Staffing at federal agencies inadequate to deliver on Recovery Act funding

OMB Watch says a report from the groups charged with Recover Act oversight reveals that federal agencies are drastically overworked and under pressure to spend stimulus funds rapidly. The report does not touch on how the agencies are doing to make their work transparent, but OMB Watch says the problem of understaffing should be addressed to avoid waste and fraud and enable the agencies to fulfill transparency requirements. -db

March 15, 2010

Ever wonder about the mechanics of how to spend over $800 billion? Well, so did the authors of a new report from the Recovery Accountability and Transparency Board, the group charged with Recovery Act oversight, a report which looks at staffing levels in federal agencies in the wake of the Act’s passage. And the results aren’t good. The report warns that “Recovery Act funding has substantially increased the workload of most agencies receiving these funds,” and that as a result, many agency programs are reporting drastically inadequate staffing levels for their workloads.

The report, prepared by the Commerce Inspector General, who sits on the Recovery Board, surveyed 29 federal agencies receiving Recovery Act funding, representing hundreds of Recovery Act programs. Surprisingly, the survey found that 41 percent of the programs in large agencies (defined in this report as the Departments of Defense, Health and Human Services, and the Interior) reported inadequate staffing levels. On top of that, another 45 percent reported that while they were adequately staffed, doing so required taking staff away from non-Recovery Act duties. The other agencies reported similar numbers, with only 24 percent of programs in these agencies saying they have adequate staffing levels with minimal impact on non-Recovery Act work. And this is despite agencies detailing some 22,000 staffers to work on Recovery Act grants and contracts.

The consequence of this understaffing is fairly predictable. Crucial work will not get done, and overall work quality will suffer. The report says that because of the overload “the awarding of contracts and grants is being delayed-as is other work; employees are working overtime; and the oversight and monitoring of awards-especially non?Recovery Act contracts and grants-are expected to decline, as many agencies attempt to implement Recovery Act requirements while carrying out their ongoing programs and operations.” The report also warns that the impact on work quality may be exacerbated by a dearth of qualified contracting personnel in the agencies.

To be clear, the understaffing problem is not due to the reporting requirements of the Recovery Act which we here at OMB Watch are so fond of. The agencies are under enormous political pressure to spend the $275 billion of Recovery Act discretionary funds as fast as possible, thanks to the Obama Administration’s dedication to funding “shovel-ready” projects. But spending money quickly without creating absurd amounts of waste, fraud, and abuse requires large staffs. And thanks to the all the attention that these programs are getting, both from Congress and from the public, agency heads are far more likely to pour resources into Recovery Act projects than other programs, regardless of whether such allocations make sense policy-wise. As the report notes, “to ensure timely completion of Recovery Act work, agencies are prioritizing their Recovery Act workload, hiring additional personnel, and shifting and/or reassigning staff.”

That said, I’m sure the transparency requirements of the Act are at least contributing to the strain on the agencies. For instance, agencies are tasked with helping their grant, loan, and contract recipients understand how to report back on the use of their funds, a somewhat confusing process for those who have never reported before. Responsibilities such as these, while they are incredibly important from a transparency perspective, do take up staff time, since they involve communicating with thousands of recipients scattered across all fifty states. I’m disappointed the Recovery Board’s report does not specifically address this issue.

Unfortunately, at the end of an otherwise great report, the Board whiffs on providing solid recommendations for how to fix the staffing problem. The report simply finishes by saying “we recommend that agencies continue to closely monitor their staffing of both Recovery Act and non?[Recovery Act] work, and make adjustments as necessary to ensure that all contracts and grants are properly awarded and monitored.” Well, if they won’t say it, I will: the agencies need to begin channeling more resources to hire and train contract officers, and Congress needs to increase agency funding by the requisite amount so that the program funding levels are not adversely affected. End of story. You cannot simply dump billions of dollars on already-stretched agencies and expect them to deal with the new funding quickly and easily.

It’s reports like this that make discretionary caps such as the ones proposed in President Obama’s budget patently absurd, since they severely limit the government’s ability to react to new situations.

Copyright 2010 OMB Watch