[Congressional Record Volume 143, Number 12 (Tuesday, February 4, 1997)]
[Senate]
[Pages S925-S926]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




 IMPLEMENTATION OF MANAGEMENT REFORMS AT THE DEPARTMENT OF HOUSING AND 
                           URBAN DEVELOPMENT

  Mr. THOMPSON. Mr. President, I would like to use the opportunity, 
following Senate confirmation of Andrew Cuomo as the next Secretary of 
Housing and Urban Development, to address some vital management issues 
at the Department. The Department of Housing and Urban Development 
[HUD], like many other federal agencies, is confronted by serious 
management problems that impede its ability to carry out its mission.
  HUD, which Secretary-designate Cuomo will head, has a diverse group 
of activities under its purview. HUD manages an $885 billion loan 
portfolio and provides $25 billion in rental subsidies and over $5 
billion annually in community development grants. As the principal 
agency concerned with the Nation's housing needs and redeveloping our 
decaying cities, HUD has a monumental task on its hands and should be 
run as efficiently and effectively as a Fortune 500 company. 
Unfortunately, this has not been the case in the past.
  Historically, HUD has had a rocky track record. Departmentwide 
management deficiencies were a major factor leading to the 1989 HUD 
scandals. In 1994, the General Accounting Office placed the entire 
department on its high risk list, designating HUD as ``especially 
vulnerable to waste, fraud, abuse, and mismanagement.'' I understand 
that this year GAO will continue to keep HUD on its high risk list, 
believing that the deficiencies hampering HUD's leadership in 
effectively managing the agency have yet to be resolved.
  Congress has given agencies like HUD the tools to improve their 
management operations, most notably by passing legislation developed by 
the Governmental Affairs Committee such as the Chief Financial Officers 
[CFO] Act of 1990, the Government Performance and Results Act [GPRA] of 
1993, and the procurement and information technology reforms of last 
Congress. These laws are designed to get the Federal Government to 
operate in a sound, businesslike manner and implementing these 
management reforms is a major responsibility for each department head. 
I urge Mr. Cuomo to devote as much of his time as necessary to use 
these laws to focus on getting results for the taxpayers who fund HUD 
and the many who depend on its programs.
  The Government Performance and Results Act, for example, can be an 
effective tool to make government work better by measuring the success 
or failure of government programs and using this information to support 
budget decisions. I am encouraged by Secretary-designate Cuomo's 
enthusiastic support of GPRA in his responses to my questions submitted 
during his confirmation process. This is because effective GPRA 
implementation is especially needed at HUD. HUD's programs and missions 
often overlap or are linked only tangentially to HUD's primary 
missions. The National Academy of Public Administration and HUD's 
inspector general [IG] have recommended eliminating, consolidating, or 
restructuring many of HUD's 240 programs and activities, 91 of which, 
the IG said, were questionably related to the department's primary 
mission. GPRA, by focusing on agency missions and results, will 
give HUD, the Office of Management and Budget and the Congress

[[Page S926]]

the information necessary to consolidate and eliminate these wasteful 
and redundant programs.

  Unfortunately, HUD has a long way to go toward effectively 
implementing GPRA. The HUD IG recently found that the department is 
just beginning to develop an agencywide strategic plan, the key 
underpinning and starting point for the process of goal-setting and 
performance measurements under GPRA. The IG report also indicated that 
HUD staff felt that the initial plans were developed only by a few of 
the Department's staff and did not involve input from a broad range of 
HUD offices. Given the need for broad acceptance of performance 
measures and established deadlines for implementing GPRA, I hope the 
new Secretary will take steps to ensure the integrity and successful 
implementation of GPRA at HUD.
  GPRA is dependent on sound financial management--something that HUD 
is lacking. One of the reasons for GAO's designation of HUD as a high-
risk area is its poorly integrated, ineffective, and generally 
unreliable information and financial management systems. These systems 
do not meet program managers' needs and provide inadequate control over 
HUD's housing and community development programs. HUD must get better 
control over its finances and prepare timely financial statements as 
required by the CFO Act.
  Good financial data relies upon the development of effective computer 
systems and these systems are crucial to HUD's ability to meet its 
housing mission and business needs. In recent years, the Department has 
obligated over $170 million annually to activities related to 
information management. Yet HUD has had a poor history of managing its 
information resources, and as a result, is struggling with aging 
systems that do not adequately meet the agency's needs and are 
contributing causes of managerial inadequacies.
  In response to its problems, HUD has undergone dramatic structural 
changes. In September 1995, HUD completed a major field reorganization 
which was intended to eliminate previously confused lines of authority, 
enhance communications, reduce levels of review and approval, and 
improve customer service. In January 1996, HUD announced additional 
plans to reduce headquarters staff and further streamline its field 
organization by, among other things, closing up to 10 of HUD's 81 field 
offices by the end of fiscal year 1997. However, it is questionable 
whether these changes have turned the tide as GAO has found that the 
Department still has an ineffective organizational structure.
  The situation is not hopeless. HUD has made some progress in recent 
years addressing these Departmentwide management deficiencies, but 
success will require top-down management support. I hope Secretary-
designate Cuomo will articulate a management vision that can improve 
operations at HUD and take measures required to take the agency off 
GAO's and Congress' high-risk list. I look forward to working with him 
to achieve those objectives in this Congress and to effectively 
implement the bipartisan management reforms passed by Congress in 
recent years.

                          ____________________