OMB bends on outsourcing goals

By Jason Miller

Connecting state and local government leaders

| August 1, 2003

Having threatened to veto two bills that contained provisions on competitive sourcing, the White House late last month extended a peace offering to Congress.

Having threatened to veto two bills that contained provisions on competitive sourcing, the White House late last month extended a peace offering to Congress.The administration has abandoned governmentwide goals mandating that agencies compete certain percentages of federal jobs, said Angela Styles, administrator of the Office of Federal Procurement Policy. The original plans required agencies to meet a 15 percent goal by October and then 50 percent by October 2006.Styles, who testified before the Senate Governmental Affairs Subcommittee on the Oversight of Government Management, the Federal Work Force and the District of Columbia, told lawmakers that the Office of Management and Budget has moved away from 'mandated numerical goals.'Agencies still must meet goals they have negotiated with OMB, she said.'We don't want the numerical goals to be a distraction to what we are trying to do,' Styles said. 'We had negotiated so many individual goals with agencies that it made sense to get rid of the numerical goals.'Because of the change, OMB has issued new criteria that agencies must meet under the competitive sourcing requirements in the President's Management Agenda.The announcements came after the administration said senior advisers would recommend that President Bush veto the Interior Department appropriations bill and the Federal Aviation Administration reauthorization bill if the legislation included provisions prohibiting agencies from using funds for competitive-sourcing studies under OMB Circular A-76.But lawmakers last week reached an agreement on the FAA bill that would limit competitions for air traffic controller positions.Agencies, federal employee unions, the General Accounting Office and lawmakers reacted differently to the news that the administration discarded the goals.'I'm pleased to hear OMB dropped the mandatory goals for competitive sourcing,' said Sen. George Voinovich (R-Ohio), the Governmental Affairs subcommittee's chairman. 'This is a great improvement. The administration's original across-the-board goals failed to take into account the unique mission and circumstances at each agency.'Comptroller general David Walker also lauded OMB for setting individual targets that are based on research and fact.But union and agency officials' reactions ranged from skepticism to indifference.John Threlkeld, a legislative representative for the American Federation of Government Employees, said he will not believe OMB is dropping its mandated quotas until he sees it happen.'We know OMB has historically dictated how many jobs agencies should compete and micromanaged agencies to tell them what jobs should be opened for competition,' Threlkeld said. 'It is the same old policy that is dressed up differently.'Scott Holliday, the Veterans Affairs Department's director of competitive sourcing and management analysis, said it is good that OMB dropped the goals, but the quotas did not apply to VA.Like many agencies, VA negotiated plans with OMB, Holliday said.'Our goals were always based on logic and what made sense to us,' he said. 'From my understanding, the mandatory goals never came into play when VA and OMB negotiated goals.'Joe Sikes, DOD's director for competitive sourcing and privatization, said the agency already met the 15 percent goal and is negotiating long-term plans with OMB.'I've always thought that the target was a bit of a semantic discussion,' he said. 'The administration saw it as a short-term target and that it takes time to execute.'OMB outlined a few agency goals in a new competitive-sourcing report released at the hearing. The Agriculture Department, for instance, will hold competitions for 35,600 of 98,500 positions, or 36 percent of its work force. Meanwhile, the Health and Human Services Department has a goal of 17 percent, 11,200 jobs out of 64,900 employees.Styles said OMB by Sept. 26 will issue a full report detailing goals for every agency.

Having threatened to veto two bills that contained provisions on competitive sourcing, the White House late last month extended a peace offering to Congress.

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