[Senate Report 113-139]
[From the U.S. Government Publishing Office]
113th Congress Report
SENATE
2d Session 113-139
_______________________________________________________________________
Calendar No. 337
DIGITAL ACCOUNTABILITY AND TRANSPARENCY ACT OF 2013
__________
R E P O R T
of the
COMMITTEE ON HOMELAND SECURITY AND
GOVERNMENTAL AFFAIRS
UNITED STATES SENATE
to accompany
S. 994
TO EXPAND THE FEDERAL FUNDING ACCOUNTABILITY AND TRANSPARENCY ACT OF
2006 TO INCREASE ACCOUNTABILITY AND TRANSPARENCY IN FEDERAL SPENDING,
AND FOR OTHER PURPOSES
March 27, 2014.--Ordered to be printed
COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS
THOMAS R. CARPER, Delaware, Chairman
CARL LEVIN, Michigan TOM COBURN, Oklahoma
MARK L. PRYOR, Arkansas JOHN McCAIN, Arizona
MARY L. LANDRIEU, Louisiana RON JOHNSON, Wisconsin
CLAIRE McCASKILL, Missouri ROB PORTMAN, Ohio
JON TESTER, Montana RAND PAUL, Kentucky
MARK BEGICH, Alaska MICHAEL B. ENZI, Wyoming
TAMMY BALDWIN, Wisconsin KELLY AYOTTE, New Hampshire
HEIDI HEITKAMP, North Dakota
John P. Kilvington, Acting Staff Director
Beth M. Grossman, Chief Counsel
Jonathan M. Kraden, Senior Counsel
Keith B. Ashdown, Minority Staff Director
Christopher J. Barkley, Minority Deputy Staff Director
Andrew C. Dockham, Minority Chief Counsel
Patrick J. Bailey, Minority Counsel
Laura W. Kilbride, Chief Clerk
Calendar No. 337
113th Congress Report
SENATE
2d Session 113-139
======================================================================
DIGITAL ACCOUNTABILITY AND TRANSPARENCY ACT
OF 2013
_______
March 27, 2014.--Ordered to be printed
_______
Mr. Carper, from the Committee on Homeland Security and Governmental
Affairs, submitted the following
R E P O R T
[To accompany S. 994]
The Committee on Homeland Security and Governmental
Affairs, to which was referred the bill (S. 994) to expand the
Federal Funding Accountability and Transparency Act of 2006 to
increase accountability and transparency in Federal spending,
and for other purposes, having considered the same, reports
favorably thereon with an amendment in the nature of a
substitute and recommends that the bill, as amended, do pass.
CONTENTS
Page
I. Purpose and Summary..............................................1
II. Background and Need for the Legislation..........................2
III. Legislative History..............................................6
IV. Section-by-Section Analysis of the Bill, as Reported.............7
V. Evaluation of Regulatory Impact.................................10
VI. Congressional Budget Office Cost Estimate.......................11
VII. Changes in Existing Law.........................................14
I. Purpose and Summary
The Digital Accountability and Transparency Act (``DATA
Act'') would require the Federal government to increase the
availability, accuracy, and usefulness of on-line information
regarding Federal spending. Specifically, it would expand
current requirements to publish Federal spending information
online to cover virtually all forms of government spending,
mandate that the information appear in a form that is both
easily searchable and downloadable, make uniform the manner in
which agencies provide such data for online posting, and
require agency Inspectors General and the Comptroller General
government watchdogs to audit and report on agency compliance
with the law's mandates.
By making government spending information easily accessible
to both governmental and non-governmental users, this
legislation would facilitate increased oversight to detect and
prevent waste, fraud, and abuse, thereby improving the
effectiveness and efficiency of Federal spending programs. The
legislation also would spur greater community engagement,
because it would enable individuals and community groups to
more easily access and understand information about how Federal
tax dollars are being spent.
II. Background and Need for the Legislation
A. PAST MEASURES ON FEDERAL FINANCIAL TRANSPARENCY
Over the past several years, Congress and the
Administration have taken a number of steps to increase and
improve the public availability of information about Federal
spending. Greater transparency allows taxpayers to track how
their tax dollars are used and to understand better Federal
investments in their communities. Moreover, by making spending
information more easily available, these transparency
initiatives help to both deter and root out fraud and waste,
facilitate better decision making, and improve operational
efficiency.
Congress first tackled the need to make Federal spending
more transparent in 2006, with the passage of the Federal
Funding Accountability and Transparency Act (``Transparency
Act'').\1\ Before this legislation, there was no comprehensive,
publicly accessible source of detailed, accurate, and timely
information on Federal spending.\2\ The databases and reports
that did exist were limited in capability and usefulness and
generally not compatible with one another.\3\ The Transparency
Act addressed these deficiencies by requiring the Office of
Management and Budget (``OMB'') to establish a single
searchable website, accessible to the public at no cost, that
would contain data about the over-$1 trillion in grants, loans,
contracts and other kinds of awards that Federal agencies
dispense each year.\4\ Pursuant to the Transparency Act, OMB
launched the website--called USAspending.gov--in December 2007.
---------------------------------------------------------------------------
\1\Pub. L. No. 109-282, (31 U.S.C. Sec. 6101 Note).
\2\S. Rep. No. 109-329, at 2 (2006) (Comm. Rep).
\3\Id. at 3.
\4\Section 2(a)(2) of the Transparency Act (31 U.S.C. Sec. 6101
Note) defines Federal awards to include grants, subgrants, loans,
awards, cooperative agreements, contracts, subcontracts, purchase
orders, task orders and delivery orders above $25,000. For these
Federal awards, agencies were required to post, among other things, the
name and location of the entity receiving the award, the amount of the
award, and basic information about the award itself. Section 2(b) then
requires the creation of the website.
---------------------------------------------------------------------------
Congress revisited the issue in February 2009, when it
sought to ensure both Federal and public oversight of the
nearly $300 billion in economic stimulus funds authorized under
the American Recovery and Reinvestment Act of 2009 (``Recovery
Act'').\5\ The Act created the Recovery Accountability and
Transparency Board (``Recovery Board''), an independent
oversight board composed of a Chairman and the Inspectors
General of major agencies.\6\ The statute also required the
Recovery Board to establish a website to give the public access
to information about the projects funded under the Act.\7\ This
website went live in the spring of 2009 under the name of
Recovery.gov.
---------------------------------------------------------------------------
\5\American Recovery and Reinvestment Act of 2009, Pub. L. No. 111-
5.
\6\Pub. L. No. 111-5, Div. A, Sec. 1521, 123 Stat. 289.
\7\Pub. L. No. 111-5, Div. A, Sec. 1526, 123 Stat. 293.
---------------------------------------------------------------------------
The Recovery Board developed a set of standard data
elements for Recovery Act funds so that funding could be
analyzed across agencies and programs. The Board also created a
central data analytics center to support fraud detection,
audits, investigations, and prosecutions. However, although the
Recovery Board laid the groundwork for future transparency
efforts, its own scope was necessarily limited, as the Board's
mandate and authority extended only to projects funded under
the Recovery Act and, as subsequently added, funds provided to
victims of Hurricane Sandy.\8\
---------------------------------------------------------------------------
\8\Although the Recovery Board was due to sunset on September 15,
2013, the Disaster Relief Appropriations Act of 2013 extended the
Recovery Board through September 2015 and tasked the Board with
detected and remediating waste, fraud, and abuse of funds related to
the impact of Hurricane Sandy. Disaster Relief Appropriations Act of
2013, Pub. L. No. 113-2, Section 904(d).
---------------------------------------------------------------------------
The Administration has also taken significant steps on its
own to improve the transparency of Federal spending data. In
2009, OMB issued guidance to agencies on how to improve the
quality of the data that agencies provide for
USAspending.gov.\9\ In June 2011, President Obama established
the Government Accountability and Transparency Board to provide
strategic direction for enhancing the transparency of Federal
spending and to advance efforts to detect waste, fraud, and
abuse.\10\ More recently, in June 2013, OMB issued a memorandum
to agency Chief Financial Officers, requiring agencies to
implement procedures to improve the quality of financial data
reported to USAspending.gov and establishing new requirements
for financial assistance awards.\11\
---------------------------------------------------------------------------
\9\Office of Management and Budget (OMB) Memorandum, Open
Government Directive, M-10-06 (December 8, 2009); OMB Memorandum,
Improving Acquisition Data Quality for Fiscal years 2009 and 2010
(October 7, 2009). http://www.whitehouse.gov/sites/default/files/omb/
assets/procurement_memo/data_quality_guidance_100709.pdf.
\10\Exec. Order No. 13576, 76 FR 35297 (June 16, 2011).
\11\OMB Memorandum, Improving Data Quality for USAspending.gov
(June 12, 2013). http://www.whitehouse.gov/sites/default/files/omb/
financial/memos/improving-data-quality-for-usaspending-gov.pdf.
---------------------------------------------------------------------------
In February 2014, OMB transferred responsibility for the
USAspending.gov website from the General Services
Administration, which had administered the website since its
inception, to the Treasury Department.\12\ Operating
USAspending.gov allows Treasury to integrate this financial
transparency resource into the Federal government's overall
financial management framework. This transition should enable
Treasury to leverage the extensive financial data that it
collects to significantly increase the transparency and
accountability of the government's financial transactions and
improve the accuracy of data on USAspending.gov.
---------------------------------------------------------------------------
\12\Section 2(b)(3) of the Transparency Act (31 U.S.C. Sec. 6101
Note) authorizes the Director of OMB to designate other Federal
agencies to operate the USAspending.gov website.
---------------------------------------------------------------------------
B. THE DIGITAL ACCOUNTABILITY AND TRANSPARENCY ACT, S. 994
The Federal government has made Federal spending more
transparent in recent years and this transparency has fostered
civil engagement by enabling citizens and communities to know
more about how their tax dollars are being spent. However, much
more remains to be done, both in expanding the scope of the
spending information provided, and in making the information
more accurate and usable.
The Digital Accountability and Transparency Act (``DATA
Act''), S. 994, takes several important steps towards ensuring
that the Federal government provides consistent, reliable, and
useful online data about how it spends taxpayer dollars. Using
the lessons learned through the Committee's own oversight in
this area, the work of the Government Accountability Office,
and the experience of the Recovery Act, the DATA Act builds
upon the foundation already laid by the Transparency Act.
Specifically, it would expand and improve upon the spending
information displayed on the USAspending.gov website,
standardize financial data, and reduce the reporting burdens of
those who do business with the Federal government.
Posting of spending for agency operations as well as
disbursements for awards. The DATA Act adds to the universe of
spending data whose disclosure is mandated under the
Transparency Act. The Transparency Act requires the posting of
spending information on Federal awards, which are, generally
speaking, grants, contracts, and loans made to third parties or
individuals. The DATA Act provides a more in-depth and
comprehensive view into Federal spending by also requiring the
posting of information about an agency's budget, amounts that
an agency has committed to spend and has actually spent,
amounts that have been reprogrammed or transferred from one
appropriations account to another, and the amounts of funds
balances that can or cannot still be used--taking into account
the expiration of any applicable appropriations authorities.
The disclosure of this information on the USAspending.gov
website, along with information about awards, will provide a
more complete and accurate display of Federal spending.
Providing data in a more accessible and usable form. The
DATA Act requires information disclosed on USAspending.gov to
be posted in a manner that allows the website's users to
aggregate and download it in bulk. The Committee expects that
the Treasury Department also will be able to improve the
quality of the data displayed on the website and strive to
provide users of USAspending.gov with the ability to download
data sets that can assist in reviewing program level spending
data, aid in the evaluation and review of how well Federal
programs are performing, and support the reduction of program
duplication.
One of the lessons learned from the work of the Recovery
Board was the importance and value of linking location data to
spending data. Data about the location where money is being
spent helps to foster improved engagement by communities and
individual citizens who can better track and understand how
Federal tax dollars are spent in their communities. Where
practicable, Treasury should also work to provide information
about the location where Federal funds are used or the service
provided in each state, city, district, or other geographical
location, and not just where the Federal funds were first
awarded.
Government-wide financial data standards. Executive branch
agencies currently publish information about a vast array of
programs, but in the absence of uniform definitions for various
terms and uniform formats for presenting certain information,
it is impossible to accurately compare one agency's activities
with those of another. The creation and use of government-wide
data definitions and standards for financial information will
enhance the usability, transparency, and accountability of
financial and performance information and significantly improve
the ability of the government and the public to analyze Federal
spending information.\13\
---------------------------------------------------------------------------
\13\Show Me the Money: Improving the Transparency of Federal
Spending. Hearing before the Senate Committee on Homeland Security and
Governmental Affairs, 112th Cong. 14 (July 18, 2012) (statement of Dick
Gregg, Fiscal Assistant Secretary, U.S. Department of the Treasury).
Mr. Gregg also testified that the use of data standards can reduce the
operational cost of government by facilitating the ``movement towards
greater use of shared technologies and services throughout
government[.]'' Id. at 69. (written statement of Dick Gregg, Fiscal
Assistant Secretary, U.S. Department of the Treasury).
---------------------------------------------------------------------------
The Recovery Board showed the value of developing and using
uniform data standards through its work regarding Recovery Act
funds. The application of such standards to Recovery Act funds
significantly assisted in analyzing information across
different agencies and programs.\14\ In a July 2012 hearing on
implementation of the Transparency Act, former Controller Danny
Werfel clearly summed up the need for data standards when he
stated: ``standardization provides the key to unlocking
transparency and accountability.''\15\ The DATA Act addresses
this issue by requiring the development and use of common
terms, formats, and definitions for key financial data
elements.
---------------------------------------------------------------------------
\14\Government Accountability Office, Federal Data Transparency:
Opportunities Remain to Incorporate Lessons Learned as Availability of
Spending Data Increases, GAO-13-758 at 19. See also, Government
Accountability and Transparency Board, Report and Recommendations to
the President (December 2011). http://www.whitehouse.gov/sites/default/
files/gat_board_december_2011_report_and_recommendations.pdf.
\15\Show Me the Money: Improving the Transparency of Federal
Spending. Hearing before the Senate Committee on Homeland Security and
Governmental Affairs, 112th Cong. 12 (July 18, 2012) (statement of
Danny Werfel, Controller, Office of Federal Financial Management,
Office of Management and Budget).
---------------------------------------------------------------------------
Improvements in data quality. While the Transparency Act
has provided policymakers and the public with unprecedented
access to data on Federal spending, USAspending.gov has
unfortunately been plagued by data quality issues, thereby
limiting the usefulness of the website to improve transparency
and increase accountability. For example, in 2010, the
Government Accountability Office (``GAO'') compared a sample of
data on USAspending.gov to records provided by the awarding
agencies. The results were troubling. GAO found ``widespread
inconsistencies'' between the two sets of data with each of the
100 awards that it sampled, demonstrating at least one blank
data field or otherwise inconsistent piece of information.\16\
---------------------------------------------------------------------------
\16\Government Accountability Office, Electronic Government:
Implementation of the Federal Funding Accountability and Transparency
Act of 2006, GAO-10-365 at 2. In June 2012, several members of this
Committee requested that GAO conduct another review of the completeness
and consistency of the data on USAspending.gov. Although that audit had
not yet been completed at the time this report was released,
preliminary data that GAO provided to Committee staff indicates that
USAspending.gov is still plagued by inconsistent and incomplete data.
---------------------------------------------------------------------------
In addition, the Sunlight Foundation (``Sunlight''), which
conducts an annual assessment of the direct-assistance\17\
spending data posted to the USAspending.gov website for
consistency, completeness, and timeliness,\18\ has found
widespread problems in all three areas. For example, Sunlight
reported that a comparison between the data on USAspending.gov
and the data on a Federal database of domestic assistance
awards\19\ shows substantial inconsistency, which did not
improve from 2008 to 2010.\20\
---------------------------------------------------------------------------
\17\See http://sunlightfoundation.com/clearspending/. The
USAspending.gov website contains information about two types of
spending: contracts and direct assistance (which consists of grants,
direct payments, loans, and loan guarantees). These two types of
spending are tracked using two very different reporting systems, the
Federal Awards and Assistance Data System PLUS (which tracks direct
assistance) and the Federal Procurement Data System--Next Generation
(which tracks contracts). The Clearspending analysis and report focuses
on direct assistance payments.
\18\Basically, Sunlight asks the following questions of the
information contained on USAspending.gov: How close are the reported
dollar amounts on USAspending.gov to the yearly estimates contained in
other spending reports? How many of the required fields are filled out
in each record? And how long did it take the agency to report the money
once it was allocated to a project? See http://sunlightfoundation.com/
clearspending/.
\19\The Catalog of Federal Domestic Assistance is maintained by the
General Services Administration and provides a full listing and
detailed program descriptions for all Federal assistance programs.
\20\2011 Clear Spending report at http://2011.clearspending.com/
sunlightfoundation.com/clearspending/summary/index.html.
---------------------------------------------------------------------------
The executive branch has taken some steps to improve the
site and the accuracy and quality of the underlying data.
However, to ensure sustained progress, the DATA Act includes
provisions to hold Federal agencies more accountable for the
information disclosed on USAspending.gov, by requiring the
Government Accountability Office and the agency Inspectors
General to conduct a series of reviews and audits of agency
information posted on USAspending.gov.
Streamlining the reporting requirements for recipients of
Federal awards. Under existing statutes and regulations,
recipients of Federal awards are required to report back to the
agencies that provided the awards to help the agency and others
monitor the use of the funds and other aspects of the
recipient's performance under the award. However, with better
coordination among agencies, the reporting requirements could
provide more useful data to the government and impose less
burden on the reporting entities. Those who receive Federal
awards have provided Committee staff with many examples of the
time-consuming and burdensome process of reporting to Federal
agencies about the contracts, grants, and loans these groups
had received. Although it is important for agencies to receive
information from those that they do business with or give
grants and loans to, the reporting that is required appears to
be highly inefficient and, in many cases, unnecessarily
burdensome.
To address this problem, the DATA Act instructs the
Director of OMB to review the current reporting requirements
for recipients of Federal awards to identify common reporting
elements across the government, unnecessary duplication, and
unnecessarily burdensome reporting requirements. This
information can be used to make the reporting requirements less
costly and burdensome to the recipients and more useful to the
government. In addition, the DATA Act requires OMB to create a
pilot program in order to help develop recommendations for
common reporting elements across the Federal government, to
eliminate unnecessary duplication in financial reporting, and
to reduce compliance costs for recipients.
III. Legislative History
Senator Warner first introduced the DATA Act last Congress,
on June 16, 2011. The bill, S. 1222, which was referred to this
Committee, would have improved transparency of Federal spending
by creating a new independent Commission (patterned after the
Recovery Board) to act as the central hub to collect spending
data, set data standards, and analyze the information.
This Committee held a hearing in July 2012 to examine
Federal efforts to increase and improve the transparency of
Federal spending information. The hearing focused on the
current state of transparency of Federal spending,
implementation of the Transparency Act, lessonslearned from the
Recovery Act, and what opportunities exist to improve transparency and
accountability of Federal spending. Witnesses at the hearing included:
Senator Warner; Eugene Dodaro, Comptroller General of the United
States, U.S. Government Accountability Office; Daniel Werfel,
Controller, Office of Federal Financial Management at OMB; and Richard
Gregg, Fiscal Assistant Secretary, U.S. Department of the Treasury.
Senator Warner testified at the hearing in support of his bill. Mr.
Werfel from OMB discussed the executive branch's progress toward
improved spending transparency and efforts then underway to continue
that progress. Mr. Gregg from the Treasury Department testified about
Treasury's efforts to modernize their payment processing systems.
In September 2012, Senators Warner and Portman introduced a
revised version of the DATA Act (S. 3600, 112th Congress),
which incorporated a number of revisions suggested by the
Administration and outside groups.
Senators Warner and Portman again introduced the DATA Act
this Congress, on May 21, 2013, and it was given the number S.
994 and referred to this Committee. The Committee considered
the bill at a November 6, 2013 business meeting. The Committee
adopted by voice vote a substitute amendment to the bill
offered by Senator Carper and then by voice vote ordered the
bill, as amended, favorably reported. Members present for both
votes were Senators Carper, Levin, McCaskill, Tester, Begich,
Baldwin, Johnson, Portman, and Ayotte.
IV. Section-by-Section Analysis
Section 1. Short title
Section 1 gives the bill the short title of the ``Digital
Accountability and Transparency Act of 2013'' or the ``DATA
Act.''
Section 2. Purposes
Section 2 of the bill states the purposes of the DATA Act:
(1) to expand the Transparency Act by disclosing direct Federal
agency expenditures and linking information about Federal
awards with spending information about Federal agency programs
for use by taxpayers and policy makers; (2) to provide
consistent, reliable and searchable government-wide spending
data that is displayed accurately on USAspending.gov; (3) to
simplify reporting requirements for entities receiving Federal
funds while improving transparency; and (4) to improve the
quality of the data submitted to USAspending.gov by holding
Federal agencies accountable for the data submitted.
Section 3. Amendments to the Federal Funding Accountability and
Transparency Act of 2006 (Transparency Act)
Definitions. Section 3(1)(A) of the bill adds four new
definitions to the list of definitions in section 2(a) of the
Transparancy Act: A ``Federal agency'' has the same meaning as
an ``Executive agency'' under 5 U.S.C. Sec. 105, thereby making
the Act's provisions applicable to every executive department,
government corporation, and independent establishment.
``Federal funds'' means any funds made available to or spent by
a Federal agency. An ``object class'' is the category assigned
for purposes of the President's budget to a type of property or
services purchased by the government. A ``program activity''
has the meaning given under 31 U.S.C. Sec. 1115(h), which is a
specific activity or project as listed in the schedules of the
annual Federal budget.
Website. Section 3(1)(B) of the bill amends section 2(c) of
the Transparency Act to require that USAspending.gov must
enable users to aggregate any data published under the
Transparency Act and to download the data in bulk.
Section 3(2) of the bill strikes existing sections 3 and 4
of the Transparency Act and adds new sections 3 through 7 to
the Act:
New section 3 of the Transparency Act--Full disclosure of
Federal funds
New section 3 of the Transparency Act, as added by section
3(2) of the bill, would expand upon the information displayed
on the USAspending.gov website to account for all Federal funds
and accurately display all kinds of spending, not only spending
on Federal awards.
The Treasury Department is currently responsible for
operating the USAspending.gov website, on which is posted
information about Federal awards. Under new section 3, the
Secretary of the Treasury is given the additional
responsibility to post on the USAspending.gov website
information about Federal spending generally. On a monthly
basis, the Secretary of the Treasury, in consultation with the
Director of OMB, must ensure that financial information is
published on the website for each Federal agency, component,
appropriations account, program activity, and object class. For
each of these, the published spending data must include:
amounts of budget authority authorized, amounts obligated,
amounts of outlays, amounts reprogrammed or transferred, and
amounts of expired or unexpired unobligated balances.
New section 4 of the Transparency Act--Data standards
New section 4(a) of the Transparency Act, as added by
section 3(2) of the bill, requires the Secretary of the
Treasury, in consultation with the OMB Director, the GSA
Administrator and agency heads, to establish government-wide
financial data standards for Federal funds.
New section 4(b) states criteria that these data standards
must meet. These include that the standards must incorporate
widely accepted existing standards, be computer-readable,
include government-wide universal award identifiers for awards
and for entities receiving awards that can track individual
awards through the full cycle of spending, and allow for
comparisons across program activities and agencies.
New section 4(c) lays out the deadlines for implementing
the data standards across the Federal government. First, the
Secretary of the Treasury, in consultation with the Director of
the Office of Management and Budget, has one year to issue
guidance on the data standards. Second, after Treasury issues
the guidance on the data standards, agencies have one year to
start applying the data standards to their financial and
payment information. Finally, within two years after Treasury
issues guidance on the data standards, the Director of OMB and
the Secretary of the Treasury must ensure that the
USAspending.gov website is populated with financial information
that meets these new data standards.
Finally, new section 4(d) specifically requires that the
Secretary of the Treasury consult with public and private
stakeholders, including state and local governments,
universities and contractors in establishing the data
standards.
New section 5 of the Transparency Act--Simplifying Federal
award reporting
Under existing statutes and regulations, recipients of
Federal awards are required to report back to the agencies that
provide the awards in order to help the government and others
monitor the use of the funds and other aspects of the
recipient's performance. The purpose of new section 5 of the
Transparency Act, as added by section 3(c) of the bill, is to
reduce the reporting costs and burdens for the recipients of
Federal awards. New section 5(a) instructs the Director of OMB
to review the current reporting requirements for recipients of
Federal awards to identify common reporting elements across the
government, unnecessary duplication, and unnecessarily
burdensome reporting requirements. As part of that review, the
OMB Director is required to consult with Federal agencies and
with recipients of Federal awards.
New section 5(b) requires the Director of OMB, or a
designee, to establish a pilot program in order to develop
recommendations for common reporting elements across the
Federal government, for the elimination of unnecessary
duplication in financial reporting, and for the reduction of
compliance costs for recipients. The pilot program, to be
established within one year of the DATA Act's enactment, must
cover contracts, grants, and sub-awards that have an aggregate
value of not less than $1 billion. The program must also
include diverse recipients of awards, including, to the extent
feasible, recipients that receive awards from multipile
programs across multiple agencies. The pilot program also must
collect data over a 12-month period.
After the pilot program is completed, OMB has 90 days to
provide guidance to agencies designed to simplify reporting
requirements for award recipients, reduce unnecessary
duplication, and reduce compliance costs. OMB also has 90 days
after completion of the pilot program to submit to Congress a
report on the program with recommendations for improving
financial reporting and transparency and including
recommendations for legislation to simplify reporting
requirements for Federal award recipients.
New section 6 of the Transparency Act--Accountability for
Federal funding
New section 6 of the Transparency Act, as added by section
3(b) of the bill, requires a series of reviews and audits by
GAO and agency Inspectors General intended to hold Federal
agencies more accountable for the information that they
disclose on USAspending.gov. New Section (6)(a) requires the
Inspector General of each agency, in consulation with GAO, to
review and report on the completeness, timeliness, quality and
accuracy of the data the agency submits to USAspending.gov. The
Inspectors General are required to report on the first audit no
later than 18 months after the Treasury Department issues its
guidance on the data standards. Subsequent Inspectors General
reports are then required approximately two and four years
after the first report was issued. For the second and third
report, Inspectors General may include the findings of their
data quality audits as part of the annual financial audit
reports they are required to submit.
New Section 6(b) requires GAO to review and report on the
completeness, timeliness, quality, and accuracy of the data
each agency submits to USAspending.gov and to compare the
quality of the data submitted by each agency across the Federal
government. GAO is required to report on its findings in the
second, fourth, and sixth year after the date of enactment of
the DATA Act.
New section 7 of the Transparency Act--Classified and
protected information
New section 7 clarifies that nothing in the Transparency
Act, as amended by the DATA Act, would require the disclosure
of information that is classified or otherwise protected from
disclosure under the Freedom of Information Act or the Privacy
Act.
Section 4. Executive agency accounting and other financial management
reports and plans
31 U.S.C. Sec. 3512(a) requires the Office of Management
and Budget to annually submit a financial management status
report and a revised government-wide five-year financial
management plan to the appropriate committees of Congress.
Section 4 of the bill amends these provisions to add
requirements for OMB to--(1) publish these annual status
reports and revised financial management plans on
Performance.gov, and (2) also publish within one year after
enactment of the DATA Act, and every five years thereafter, a
report regarding implementation of the Transparency Act.
Section 5. Funding
Section 5 of the bill allows the Treasury Secretary to use
funds from the Treasury Franchise Fund to implement this Act.
The Treasury Franchise Fund is a revolving fund through which
certain offices at the Treasury Department provide financial
management, procurement, and other administrative services to
Treasury bureaus and to other Federal agencies on a
reimbursable, fee-for-service basis.
V. Evaluation of Regulatory Impact
Pursuant to the requirements of paragraph 11(b) of rule
XXVI of the Standing Rules of the Senate, the Committee has
considered the regulatory impact of this bill. The Committee
agrees with the Congressional Budget Office that S. 994
contains no intergovernmental or private-sector mandates as
defined in the Unfunded Mandates Reform Act (``UMRA'').
VI. Congressional Budget Office Cost Estimate
December 5, 2013.
Hon. Tom Carper,
Chairman, Committee on Homeland Security and Governmental Affairs, U.S.
Senate, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed revised cost estimate for S. 994, the
DATA Act. This version supersedes the cost estimate transmitted
on December 4, 2013. It corrects an error in referring to the
bill number: we mistakenly referred to the Data Act as S. 944
in the previous estimate. There is no change, however, in the
estimated costs of the legislation.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Matthew
Pickford.
Sincerely,
Douglas W. Elmendorf.
Enclosure.
S. 994--DATA Act
Summary: S. 994 aims to make information on federal
expenditures more easily accessible and transparent. The bill
would require the U.S. Department of the Treasury to establish
common standards for financial data provided by all government
agencies and to expand the amount of data that agencies must
provide to the government website, USASpending. In addition,
the Office of Management and Budget (OMB) would be required to
conduct a two-year pilot program to make it easier for federal
contractors and grant recipients to comply with federal
reporting requirements. S. 994 also would require OMB, the
Government Accountability Office (GAO), and the agencies'
Inspectors General (IGs) to submit additional reports to the
Congress. Finally, the legislation would designate the Treasury
Franchise Fund as the source of funding for the bill's
implementation.
CBO estimates that implementing the bill would cost $300
million over the 2014-2018 period, assuming appropriation of
the necessary amounts. The legislation also could affect direct
spending by agencies not funded through annual appropriations;
therefore, pay-as-you-go procedures apply. CBO estimates,
however, that any net increase in spending by those agencies
would not be significant. Enacting the bill would not affect
revenues.
S. 994 contains no intergovernmental or private-sector
mandates as defined in the Unfunded Mandates Reform Act (UMRA);
any costs to state, local, or tribal governments would result
from complying with conditions for receiving federal
assistance.
Estimated cost to the Federal Government: The estimated
budgetary impact of S. 994 is shown in the following table. The
costs of this legislation fall within budget function 800
(general government) and all other budget functions that use
the Treasury Franchise Fund to acquire services.
----------------------------------------------------------------------------------------------------------------
By fiscal year, in millions of dollars--
-------------------------------------------------------
2014 2015 2016 2017 2018 2014-2018
----------------------------------------------------------------------------------------------------------------
CHANGES IN SPENDING SUBJECT TO APPROPRIATION
Collection and Reporting of Federal Data:
Estimated Authorization Level....................... 35 50 75 75 50 285
Estimated Outlays................................... 32 53 75 75 50 285
Other Reporting:
Estimated Authorization Level....................... 1 3 4 3 4 15
Estimated Outlays................................... 1 3 4 3 4 15
Total Changes:
Estimated Authorization Level................... 36 53 79 78 54 300
Estimated Outlays............................... 33 56 79 78 54 300
----------------------------------------------------------------------------------------------------------------
Basis of estimate: For this estimate, CBO assumes that the
legislation will be enacted in fiscal year 2014, that the
necessary amounts will be appropriated near the start of each
subsequent fiscal year, and that spending will follow
historical patterns for similar activities.
Collection and reporting of financial data
The federal government uses many databases to monitor and
track agency spending. For example, three major databases--the
U.S. Census Bureau's Federal Assistance Award Data System, the
General Services Administration's Federal Procurement Data
System, and the U.S. Department of Health and Human Services'
website, Grants--contain information about federal grants and
contracts. That information on federal spending is also
available through OMB's website, USASpending, which displays
award amounts for all federal contracts, grants, and loans. The
Recovery Accountability and Transparency Board's website,
Recovery, also provides information on federal spending, but it
includes detailed information only on activities initiated
under the American Recovery and Reinvestment Act (ARRA).
S. 994 would expand the USASpending website to include all
federal spending. The Treasury Department would be required to
establish standards for developing and reporting data on all
federal spending, including the use of common data elements for
financial and payment information for entities receiving
federal funds across all government computer systems, so as to
allow data from multiple systems to be compared. In addition,
OMB would be required to conduct a two-year pilot program aimed
at improving the transparency of financial reports by
consolidating and eliminating certain information and reducing
compliance costs for recipients of federal funds. After two
years, OMB could expand the pilot program to cover all federal
agencies and would recommend future actions to improve
financial reporting.
Information from OMB, the recovery board, selected agency
IG offices, and other federal agencies indicates that the
federal government currently collects much of the information
that would be needed to create a comprehensive database on
federal spending as required under S. 994. In addition, the
Treasury Department and OMB have taken steps under current law
to standardize some reporting requirements and to improve the
quality of the financial information provided by all government
sources, including USASpending.
However, not all of that financial information is
standardized, accurate, or readily available as would be
required under the bill. For example, a recent GAO report
indicates that agencies expend significant time, effort, and
resources to develop financial information that they should be
able to provide on a daily or recurring basis.\1\ GAO also
notes that federal agencies use inconsistent definitions in
developing, tracking, and reporting on federal spending, so
creating a consolidated system probably would be difficult,
time consuming, and expensive. Finally, because many of the
government's computer systems for managing financial
information were designed to serve multiple purposes, changing
them while preserving their multiple purposes would be
expensive.
---------------------------------------------------------------------------
\1\Government Accountability Office, Federal Data Transparency;
Opportunities Remain to Incorporate Lessons Learned as Availability of
Spending Data Increase, GAO-13-758 (September 12, 2013) www.gao.gov/
products/GAO-13-758.
---------------------------------------------------------------------------
CBO expects that improving the government's current efforts
to collect and report on financial data would involve the
coordinated efforts of more than 20 major federal agencies. We
estimate that those new efforts would include modifying
numerous computer systems and further standardizing financial
data, training personnel, conducting the proposed pilot
program, and improving communications between agencies and
recipients of federal funds. Based on information from
agencies, OMB, and the recovery board, as well as GAO reports
on the performance and history of modifying major federal IT
systems and conducting audits of federal agencies, CBO
estimates that implementing those provisions would cost $2
million to $3 million annually per agency, totaling $285
million over the 2014-2018 period, assuming appropriation of
the necessary amounts.
S. 994 would authorize the use of the Treasury Franchise
Fund to implement the legislation. Using that fund the Treasury
Department provides accounting, procurement, travel, human
resources, and information technology services on a
reimbursable, fee-for-service basis to federal agencies. Under
S. 994, federal customers would reimburse the fund for the new
costs of programs to improve the collection and reporting of
financial information. Those estimated discretionary costs are
reflected in this cost estimate.
Other reports
S. 994 would require IGs and GAO to prepare a number of
reports. IGs would be required to review the spending data
provided by their respective agencies and report their findings
to the Congress. GAO would be required to review the IGs'
reports every two years. Based on information from selected IGs
and the costs of similar reports, CBO estimates that
implementing those provisions would cost $15 million over the
2014-2018 period, primarily for individual IGs to add this
reporting requirement to their current financial statement
audits, assuming the availability of appropriated funds.
Pay-As-You-Go considerations: The Statutory Pay-As-You-Go
Act of 2010 establishes budget-reporting and enforcement
procedures for legislation affecting direct spending or
revenues. S. 994 could affect direct spending by agencies not
funded through annual appropriations. CBO estimates, however,
that any net increase in spending by those agencies would not
be significant. Enacting the bill would not affect revenues.
Intergovernmental and private-sector impact: S. 994
contains no intergovernmental or private-sector mandates as
defined in UMRA. The bill would change the way state, local,
and tribal governments report on their use of federal funds.
Some of those changes could increase, and others could decrease
the costs that such governments would incur to comply with
conditions of federal assistance. However, conditions of
assistance (and their costs) are not intergovernmental mandates
as defined in UMRA.
Previous CBO estimate: On November 13, 2013, CBO
transmitted a cost estimate for H.R. 2061, the Digital
Accountability and Transparency Act of 2013, as ordered
reported by the House Committee on Oversight and Government
Reform on May 22, 2013. Both pieces of legislation are aimed at
improving financial reporting within the government, but H.R.
2061 also would authorize the recovery board to continue its
activities for two more years beyond 2015 (when its current
authorization expires).
VII. Changes in Existing Law
In compliance with paragraph 12 of rule XXVI of the
Standing Rules of the Senate, the following changes in existing
law made by S. 994, as reported, are shown as follows (existing
law proposed to be omitted is enclosed in black brackets, new
matter is printed in italic, and existing law in which no
change is proposed is shown in roman).
FEDERAL FUNDING ACCOUNTABILITY AND TRANSPARENCY ACT OF 2006, AS AMENDED
Public Law 109-282, Sept. 26, 2006, as amended by Public Law 110-252,
title VI, 6202(a), June 30, 2008, (31 U.S.C. 6101 note)
* * * * * * *
SECTION 1. SHORT TITLE.
* * * * * * *
SECTION 2. FULL DISCLOSURE OF ENTITIES RECEIVING FEDERAL FUNDING.
(a) Definitions. In [this section] this Act:
(1) * * *
* * * * * * *
(2) Federal agency.--The term ``Federal agency'' has
the meaning given the term ``Executive agency'' under
section 105 of title 5, United States Code.
[(2)] (3) * * *
* * * * * * *
(4) Federal funds.--The term ``Federal funds'' means
any funds that are made available to or expended by a
Federal agency.
(5) Object class.--The term ``object class'' means
the category assigned for purposes of the annual budget
of the President submitted under section 1105(a) of
title 31, United States Code, to the type of property
or services purchased by the Federal Government.
(6) Program activity.--The term ``program activity''
has the meaning given that term under section 1115(h)
of title 31, United States Code.
[(3)] (7) * * *
* * * * * * *
(c) Website.--
* * * * * * *
(4) shall be updated not later than 30 days after the
award of any Federal award requiring a posting; [and]
(5) shall provide for separate searches for Federal
awards described in subsection (a) to distinguish
between the Federal awards described in subsection
(a)(2)(A)(i) and those described in subsection
(a)(2)(A)(ii)[.];
(6) shall have the ability to aggregate data for the
categories described in paragraphs (1) through (5)
without double-counting data; and
(7) shall permit all information published under this
section to be downloaded in bulk.
* * * * * * *
[SECTION 3. CLASSIFIED INFORMATION.
[Nothing in this Act shall require the disclosure of
classified information.
[SECTION 4. GOVERNMENT ACCOUNTABILITY OFFICE REPORTING REQUIREMENT.
[Not later than January 1, 2010, the Comptroller General
shall submit to Congress a report on compliance with this Act.]
SECTION 3. FULL DISCLOSURE OF FEDERAL FUNDS.
(a) In General.--Not later than 3 years after the date of
enactment of the Digital Accountability and Transparency Act of
2013, and every month thereafter, the Secretary of the
Treasury, in consultation with the Director of the Office of
Management and Budget, shall ensure that the information in
subsection (b) is posted on the website established under
section 2.
(b) Information To Be Posted.--The information to be posted
shall include, for each Federal agency, component of a Federal
agency, appropriations account, program activity, and object
class (including any subcomponent of an object class), and
other accounts or data as appropriate--
(1) the amount of budget authority authorized;
(2) the amount obligated;
(3) the amount of outlays;
(4) the amount of any Federal funds reprogrammed or
transferred; and
(5) the amount of expired and unexpired unobligated
balances.
SECTION 4. DATA STANDARDS.
(a) In General.--The Secretary of the Treasury, in
consultation with the Director of the Office of Management and
Budget, the Administrator of General Services, and the heads of
Federal agencies, shall establish Government-wide financial
data standards for Federal funds, which shall include common
data elements for financial and payment information required to
be reported by Federal agencies and entities receiving Federal
funds.
(b) Requirements.--The data standards established under
subsection (a) shall, to the extent reasonable and
practicable--
(1) incorporate widely accepted common data elements,
such as those developed and maintained by--
(A) an international voluntary consensus
standards body;
(B) Federal agencies with authority over
contracting and financial assistance; and
(C) accounting standards organizations;
(2) incorporate a widely accepted, nonproprietary,
searchable, platform-independent computer-readable
format;
(3) include Government-wide universal identifiers for
Federal awards and entities receiving Federal awards;
(4) be consistent with and implement applicable
accounting principles;
(5) be capable of being continually upgraded as
necessary;
(6) produce consistent and comparable data, including
across program activities; and
(7) establish a standard method of conveying the
reporting period, reporting entity, unit of measure,
and other associated attributes.
(c) Deadlines.--
(1) Guidance.--Not later than 1 year after the date
of enactment of the Digital Accountability and
Transparency Act of 2013, the Secretary of the
Treasury, in consultation with the Director of the
Office of Management and Budget, shall issue guidance
to Federal agencies on the data standards established
under subsection (a).
(2) Agencies.--Not later than 1 year after the date
on which the guidance under paragraph (1) is issued,
each Federal agency shall collect, report, and maintain
financial and payment information data in accordance
with the data standards established under subsection
(a).
(3) Website.--Not later than 2 years after the date
on which the guidance under paragraph (1) is issued,
the Director of the Office of Management and Budget and
the Secretary of the Treasury shall ensure that the
data standards established under subsection (a) are
applied to the data made available on the website
established under section 2.
(d) Consultation.--The Secretary of the Treasury shall
consult with public and private stakeholders in establishing
data standards under this section.
SECTION 5. SIMPLIFYING FEDERAL AWARD REPORTING.
(a) In General.--The Director of the Office of Management
and Budget, in consultation with relevant Federal agencies,
recipients of Federal funds, including State and local
governments, and institutions of higher education (as defined
in section 102 of the Higher Education Act of 1965 (20 U.S.C.
1002)), shall review the information required to be reported by
recipients of Federal awards to identify--
(1) common reporting elements across the Federal
Government;
(2) unnecessary duplication in financial reporting;
and
(3) unnecessarily burdensome reporting requirements
for recipients of Federal awards.
(b) Pilot Program.--
(1) Establishment.--Not later than 1 year after the
date of enactment of the Digital Accountability and
Transparency Act of 2013, the Director of the Office of
Management and Budget, or a designee of the Director,
shall establish a pilot program relating to reporting
(in this section referred to as the `pilot program') to
facilitate the development of recommendations for--
(A) common reporting elements across the
Federal Government;
(B) the elimination of unnecessary
duplication in financial reporting; and
(C) the reduction of compliance costs for
recipients of Federal awards.
(2) Requirements.--The pilot program shall--
(A) include a combination of Federal
contracts, grants, and subawards, the aggregate
value of which is not less than $1,000,000,000;
(B) include a diverse group of recipients of
Federal awards; and
(C) to the extent practicable, include
recipients who receive Federal awards from
multiple programs across multiple agencies.
(3) Data collection.--The pilot program shall include
data collected during a 12-month reporting cycle.
(4) Reporting and evaluation requirements.--Each
recipient of a Federal award participating in the pilot
program shall submit to the Office of Management and
Budget any requested reports of the selected Federal
awards.
(5) Termination.--The pilot program shall terminate
on the date that is 2 years after the date on which the
Director of the Office of Management and Budget
establishes the pilot program.
(6) Agency guidance.--Not later than 90 days after
the date on which the pilot program terminates under
subsection (b)(5), the Director of the Office of
Management and Budget shall provide guidance to the
heads of Federal agencies regarding how to simplify the
reporting requirements for recipients of Federal awards
to reduce unnecessary duplicative reports and to reduce
compliance costs, as appropriate.
(7) Report to congress.--Not later than 90 days after
the date on which the pilot program terminates under
subsection (b)(5), the Director of the Office of
Management and Budget shall submit to the Committee on
Homeland Security and Governmental Affairs and the
Committee on the Budget of the Senate and the Committee
on Oversight and Government Reform and the Committee on
the Budget of the House of Representatives a report on
the pilot program, which shall include--
(A) a description of the data collected under
the pilot program, the usefulness of the data
provided, and the cost to collect the data from
recipients; and
(B) recommendations for--
(i) consolidating aspects of Federal
financial reporting to reduce the costs
to recipients of Federal awards;
(ii) automating aspects of Federal
financial reporting to increase
efficiency and reduce the costs to
recipients of Federal awards;
(iii) any legislative action required
to simplify the reporting requirements
for recipients of Federal awards; and
(iv) improving financial
transparency.
SECTION 6. ACCOUNTABILITY FOR FEDERAL FUNDING.
(a) Inspector General Reports.--
(1) In general.--In accordance with paragraph (2),
the Inspector General of each Federal agency, in
consultation with the Comptroller General of the United
States, shall--
(A) review a statistically valid sampling of
the spending data submitted under this Act by
the Federal agency; and
(B) submit to Congress and make publically
available a report assessing the completeness,
timeliness, quality, and accuracy of the data
sampled and the implementation and use of data
standards by the Federal agency.
(2) Deadlines.--
(A) First report.--Not later than 18 months
after the date on which guidance is issued
under section 4(c)(1), the Inspector General of
each Federal agency shall submit a report as
described in paragraph (1).
(B) Subsequent reports.--On the same date as
the Inspector General of each Federal agency
submits the second and fourth reports under
sections 3521(f) and 9105(a)(3) of title 31,
United States Code, that are submitted after
the report under subparagraph (A), the
Inspector General shall submit a report as
described in paragraph (1). The report
submitted under this subparagraph may be
submitted as a part of the report submitted
under section 3521(f) or 9105(a)(3) of title
31, United States Code.
(b) Comptroller General.--Not later than 2 years after the
date of enactment of the Digital Accountability and
Transparency Act of 2013, and every 2 years thereafter until
the date that is 6 years after such date of enactment, and
after review of the reports submitted under subsection (a), the
Comptroller General of the United States shall submit to
Congress and make publically available a report assessing and
comparing the data completeness, timeliness, quality, and
accuracy of the data submitted under this Act by Federal
agencies and the implementation and use of data standards by
Federal agencies.
SECTION 7. CLASSIFIED AND PROTECTED INFORMATION.
Nothing in this Act shall require the disclosure to the
public of--
(1) information protected from disclosure under
section 552 of title 5, United States Code (commonly
known as the `Freedom of Information Act'); or
(2) information protected under section 552a of title
5, United States Code (commonly known as the `Privacy
Act of 1974'), or section 6103 of the Internal Revenue
Code of 1986.
----------
TITLE 31. MONEY AND FINANCE
Subtitle III. Financial Management
CHAPTER 35. ACCOUNTING AND COLLECTION
Subchapter II. Accounting Requirements, Systems, and Information
* * * * * * *
Sec. 3512. Executive agency accounting and other financial management
reports and plans
(a)(1) The Director of the Office of Management and Budget
shall prepare and submit to the appropriate committees of the
Congress and make available on the website described under
section 1122 a financial management status report and a
governmentwide 5-year financial management plan.
* * * * * * *
(4)(A) * * *
(C) Not later than 1 year after the date of enactment of
the Digital Accountability and Transparency Act of 2013, and
every 5 years thereafter, the Director shall make available on
the website described under section 1122 a report regarding the
implementation of the Federal Funding Accountability and
Transparency Act of 2006 (31 U.S.C. 6101 note).
* * * * * * *