Calls for Congress to Loosen LSC Restrictions

 

On June 25, the Senate Appropriations Committee approved the FY 2010 appropriations bill of the Commerce, Justice, Science and Related Agencies (CJS) subcommittee. This includes funding for the Legal Services Corporation (LSC), the nonprofit organization that provides grants to legal-aid charities around the country. The bill appropriates $400 million for LSC. Notably, it removes restrictions on LSC grantees' state, local, and private funds. This provision has been referenced as a poison pill because as soon as a legal services program accepts any federal funds, the restrictions expand to cover all activities carried out by the nonprofit, even those paid for with private funds. We have argued that limiting the ability to spend private funds, unconstitutionally infringes on the freedom of charitable donors and nonprofits. The bill does leave two of the restrictions on non-LSC funds intact, a ban on the use of funds in abortion cases and cases involving prison inmates.

The full House passed its appropriations bill, removing the restriction prohibiting LSC grantees from seeking attorneys' fees, but left in all other restrictions on LSC and non-LSC funds. Once the full Senate passes its bill, the differences between the two will have to be reconciled in a Conference Committee.

A Baltimore Sun editorial from June 26, 2009 praises the work of Senator Barbara Mikulski (D-MD) and wrote that the "poison pill" restriction, "effectively tied up hundreds of millions of dollars in private and non-federal funds that legal aid groups otherwise could have used to litigate cases ranging from voting rights and medical insurance benefits to public housing complaints and labor union disputes."

Previously, both The Washington Post and the New York Times called on the Senate to consider lifting the restrictions. The Brennan Center for Justice has also recently released a report, "A call to End Federal Restrictions on Legal Aid for the Poor." The report asserts: "The time has come to eliminate the most severe of the LSC funding restrictions."

(Amanda Adams 07/02/09; 0 comments)

HHS Reinstates Medicaid Benefits Removed under Bush

 

This week, the Department of Health and Human Services (HHS) rolled back three Bush administration regulations designed to limit Medicaid services. In a statement, HHS Secretary Kathleen Sebelius said, “These regulations, if left in place would have potentially adverse consequences for Medicaid beneficiaries, some of our nation’s most vulnerable people.”

One of those regulations narrowed the definition of outpatient hospital services to reduce Medicaid beneficiaries' access to those services, such as dental and vision care. The rule, finalized Nov. 7, 2008, was one of many in the Bush administration’s midnight regulations campaign.

During the last few months of President Bush’s term, agencies finalized dozens of controversial regulations, most of which reduced the role of government and/or limited oversight of businesses. Health care, environmental, and labor advocates, among others, criticized the administration’s efforts. The rescission of the outpatient services rule is the latest example of actions the Obama administration has taken to mitigate the impact of those rule changes.

HHS rescinded two other regulations, both published in 2007. One regulation “would have eliminated reimbursement for school-based administrative costs and costs of transportation to and from schools.” The other “would have restricted beneficiary access to case management services.”

(Matthew Madia 07/02/09; 0 comments)

IT Dashboard Provides Detailed Look at Tech Spending

 

On Tuesday, June 30, Vivek Kundra, the new federal Chief Information Officer, unveiled the IT dashboard, part of the newly redesigned USAspending.gov. The dashboard is actually pretty amazing, as it lets users examine every federal IT project, by agency, and shows whether each project is on schedule and on budget, along with a link to a detailed list of performance metrics for the project. It also has a tab for analysis of the data, which right now is limited to a graph of spending by agency over time and a chart showing a breakdown of the current year's budget. The site also allows third-parties to download XML versions of the data, a feature which I hope will now be standard on all government sites.

The dashboard, which is modeled on a similar project Kundra implemented during his tenure as CIO of Washington, DC, is a gigantic step forward in the administration's movement towards being more transparent and accountable. Indeed, the only real limitation of the dashboard (other than its somewhat confusing layout) is that it only applies to IT projects. Kundra is reportedly working with the newly-confirmed Chief Performance Officer, Jeff Zients, on expanding the idea to include other federal projects, which is something we here at OMB Watch are eagerly looking forward to.

There are plenty of articles about the IT dashboard for you to choose from on this, so take your pick. My favorite is the ZDNet article, but they're all good.

New York Times

Washington Post

NextGov

CongressDaily

TechPresident

ZDNet

Federal Computing Week

New York Observer

And, of course, the official OMBlog.

Image by Flickr user sarosenamy. Used under a Creative Commons license.

(Sam Rosen-Amy 07/02/09; 0 comments)

A Not-so-Free Pass to Pollute

 

With the passage of the Waxman-Markey bill (HR 2454) in the House, the U.S. is one step closer towards the implementation of a major effort to reduce greenhouse gas emissions (GSGs).  Despite its inclusion of a cap-and-trade system, famed Harvard economist, Greg Mankiw, recently called the bill a "missed opportunity" because it gives away a significant number of very valuable pollution permits instead of using an auction system.

After the creation of the Kyoto Protocol, an international treaty that the Bush Administration notoriously refused to sign, most developed countries around the world introduced a cap-and-trade system.  These systems were touted as a way to take advantage of market mechanisms to reduce emissions - a "cap" would be placed on total emissions.  Participants could buy and sell their permits in order to comply with the limits.Factorys' pollution rising into the sky

Giving away these permits doesn't mean that they're without cost.  Instead, the government decided, and perhaps rightly so, that in order for the bill to pass, it needed to make some concessions to the business community.  The value of these giveaways are in the eye of the beholder (after all, is investment in alternative energy research simply a disguised subsidy?).  See CBO numbers here. In general, the permit giveaways creates problems - by giving away the permits, businesses gain a big bonus and the government loses a big chunk of revenue.  The Average Joe loses because: 

  • If businesses need to change their practices or purchase more permits to comply with the set emissions limits, they will pass along at least some of that cost on to the average customer;  
  • The government loses revenue that they could use for other environmental efforts or even other programs that could benefit communities historically adversely affected by pollution; and
  • It becomes harder for citizens to really understand how much the right to pollute is really worth in the open market. 

The obvious upside is that if the bill passes the Senate vote, the U.S. will finally regain some international creditability on environmental issues.  If the bill is successful in reducing emission costs, the U.S. will benefit from better health outcomes and other outcomes that have yet to be quantified.  As currently written, the bill could spur some creative innovation in alternative energy sources and also includes some provisions for low-income households that could be adversely affected  by the cost of the program.

Make no mistake, reducing our energy consumption will take some genuine effort.  The U.S. is the largest per capita polluter in the world.  Households and businesses alike are stakeholders in this challenge.  However, by giving away the permits, it leads everyone to believe that change will be easy and inexpensive when in fact, the lost revenue is simply another type of green that the government could use more of right about now.
 

Click here for more OMB Watch analysis on its potential regulatory implications.

Image by Flickr user pfala. Used under a Creative Commons license.

(Jocelyn Yin 07/02/09; 0 comments)

Counting Chickens Before They Hatch: A Quick Lesson on Recovery Act Spending

 

One of the trickiest aspects of tracking Recovery Act spending is a very basic one: figuring out how much money has been spent so far. Theoretically, it should be pretty easy. Find out how much the federal government has spent because of the Recovery Act, and, well, that's how much has been spent on it. By that estimate, according to Recovery.gov, we've already spent almost $53 billion on the recovery, which isn't particularly impressive.

Unfortunately, though, it's not that easy.

The direct spending figure doesn't take into account obligated funds, or the funds the government, through the federal agencies which are theoretically supervising the Recovery Act projects, has promised to pay out. A great deal of the Recovery Act spending is through the use of these promises. Essentially, the states (or other prime recipients) will be the entities directly spending money on projects, with the federal agencies promising to reimburse the states once the work is done.

Deputy Secretary of Transportation John D. Porcari recently had a great post about this issue on the White House blog, which should be mandatory reading for anyone interested in Recovery Act spending.

 

"We fund highway projects through a reimbursement process, meaning states send us bills for highway work as it's getting done. For example let's say Virginia obligated or dedicated $200,000 of its Recovery dollars to resurface several miles of a road. Once Virginia awards a bid and the work gets underway the contractor will send the state a bill periodically for the work as it progresses. The state pays the bill then turns to us for reimbursement (which in government speak is referred to as an outlay) - in many cases they get the funds the same day.

 

[…]

Whenever a state obligates or dedicates their Recovery dollars to a project that means it is green-lighted. States can start advertising the project and soliciting bids and once a bid is awarded contractors can buy supplies, bring workers on board and start breaking ground. It could be weeks before the reimbursement process starts so those outlays are in no way an indicator of how much money is getting to states, how much work is being done or how many people are working."

 

Granted, not all of the spending in the Recovery Act is governed in this way. Porcari was speaking about highway projects specifically, and a lot of the first round of spending is through direct grants to the states, such as Education's State Fiscal Stabilization Fund or Health and Human Services' Medicaid grants. But enough of the Recovery Act funding is spent through such obligations that it's important to remember obligation spending whenever reading articles about the pace of Recovery Act spending. Indeed, including obligations, the amount of money available so far under the Recovery Act is closer to $153 billion, a far cry from the $53 billion that has actually been spent up until now.

Image by Flickr user zolierdos. Used under a Creative Commons license.

(Sam Rosen-Amy 07/01/09; 0 comments)

McCain and Feingold Place Hold on FEC Nominee

 

Senators Russ Feingold (D-WI) and John McCain (R-AZ) have placed a hold on the nomination of John Sullivan to the Federal Election Commission (FEC). According to Politico they have indicated they would release the hold only if President Obama announces two additional nominees to fill the other expired seats. This is a particularly interesting development considering recent events at the FEC and that Sullivan was presumed to face an easy confirmation.

A joint statement from Feingold and McCain said, "The FEC is currently mired in anti-enforcement gridlock. [. . .] The president must nominate new commissioners. with a demonstrated commitment to the existence and enforcement of the campaign finance laws. "

The statement from McCain and Feingold references the current state of affairs at the FEC, where partisan 3-3 votes on enforcement matters are common. In light of news that Citizens United will be reargued, the Supreme Court may also notice the consistent inability to enforce campaign finance law. The Court will consider whether or not to overturn restrictions on corporate funding of political campaigns. For more on the Citizens United case, read this article from the latest Watcher.  

(Amanda Adams 07/01/09; 0 comments)

Climate Bill Would Prohibit Clean Air Act Regulation

 

The historic Waxman-Markey climate change bill passed by the House last Friday includes a provision that would strip the Environmental Protection Agency’s authority to regulate greenhouse gases under the Clean Air Act.

The bill has received a lot of attention, but this issue (found in Title III, Subtitle C) has flown under the radar. In an apparent attempt to avoid conflict with the cap-and-trade program lawmakers hope to put in place, the bill would not allow EPA to set and enforce greenhouse gas emissions limits in the way it does for other pollutants like smog and soot.

It’s only been about two years since EPA began considering Clean Air Act regulations. In April 2007, the Supreme Court ruled that climate-altering greenhouse gases were eligible for regulation under the Act – a position the Bush administration had denied.

Both cap-and-trade and Clean Air Act regulations would have the potential to be quite powerful, though in different ways. So, it makes sense to avoid any duplication of efforts by imposing one and foreclosing the other. Still, I’m surprised the provision has not attracted more attention considering that it effectively overturns a landmark Supreme Court decision.

Some environmental groups who oppose the bill (on the grounds it was not strict enough) are unhappy that EPA’s authority has been diminished. Friends of the Earth has a summary of its concerns here. Most of the major environmental advocacy groups support cap-and-trade and have not publicly raised concerns about the removal of EPA’s Clean Air Act authority.

Meanwhile, with a tough Senate battle ahead, this bill is far from becoming law. EPA should continue to move forward with Clean Air Act regulations. EPA took its first big step down this path in April when it proposed a finding saying that greenhouse gases are indeed a threat to public health and welfare.

The threat of those regulations gives advocates of cap-and-trade legislation an additional tool with which to leverage the debate. They are betting that industry lobbyists and some Republicans will throw their support behind the cap-and-trade bill, viewing it as less onerous than EPA regulations.

In related news, EPA has officially granted the state of California permission to set limits on greenhouse gas emissions from vehicles. The Bush administration had denied the request, even though the state appeared to be on solid legal footing.

The decision won’t have much practical impact. In May, President Obama announced federal standards that largely mirror the limits California was pursuing. This pleased both environmentalists, who wanted emissions reductions, and industry officials, who prefer a national standard over a state standard. Today’s Washington Post has more.

(Matthew Madia 07/01/09; 0 comments)

Chambliss Placing Hold on Sunstein Nomination

 

The Hill has identified Saxby Chambliss (R-GA) as the Senator who has placed a hold on the nomination of Cass Sunstein, President Obama’s pick to head the White House Office of Information and Regulatory Affairs (OIRA). The Hill outlines Chambliss’s concerns:

Chambliss told The Hill that he has blocked Sunstein’s nomination because the law professor “has said that animals ought to have the right to sue folks.”

Indeed, in his 2004 book, Animal Rights: Current Debates and New Directions, Sunstein wrote: “I will suggest that animals should be permitted to bring suit, with human beings as their representatives, to prevent violations of current law.”

[…]

An aide to Chambliss said the senator is also concerned by Sunstein’s suggestion during a 2007 speech that hunting should be banned. 


SunsteinSunstein was approved last month by the Homeland Security and Governmental Affairs Committee. During his nomination hearing, Ranking Member Susan Collins (R-ME) also raised the issue of animal rights. Sunstein said he thought the issue would be beyond his purview as OIRA administrator and appeared to satisfactorily allay Collins’ concerns. He also said some of his academic writings and remarks on the subject were meant to provoke.

But beyond Sunstein’s word, his position as OIRA administrator would not imbue in him the authority to give animals the right to sue. OIRA is the White House office responsible for overseeing federal agencies’ regulatory activity. The office reviews and sometimes edits the text of regulations, and it approves government forms and surveys that require the public to divulge information. The OIRA administrator holds the power to transform regulatory policy at the federal level, but he or she cannot affect judicial determinations such as who, or what, has standing to sue.

Hunting, on the other hand, could be a regulatory issue. However, I doubt the administration would expend the political capital required to limit hunting activities, regardless of Sunstein’s beliefs.

As Carter Wood at the Manhattan Institute blog points out, Chambliss and other conservatives may want to be careful about too forcefully lodging complaints over Sunstein. Sunstein has not received a lot of praise from public interest groups for a number of reasons. He supports cost-benefit analysis, a controversial tool in which difficult-to-count benefits, such as lives saved or injuries avoided, are weighed against compliance costs. He opposes the precautionary principle, a theory that basically says, when it comes to chemicals or workplace hazards for which the scientific picture is not complete, “better safe than sorry.” He also, not surprisingly, favors a strong role for OIRA. OMB Watch and many other groups have called on the Obama administration to scale back OIRA’s power, citing numerous instances in which the office has weakened or delayed public protections.

Wood goes so far as to rhetorically ask, “Who could possibly be better in this Administration from the standpoint of regulatory restraint?” While I personally don’t think Sunstein will restrain regulation – like the Bush administration did by basically turning off the regulatory spigot – he could prove to be a moderating force when reviewing regulations that seek to aggressively protect the public.

According to The Hill, “Chambliss said he would not lift his hold until he had a chance to ask Sunstein to explain his views in a meeting after the July 4 recess.” Stay tuned for updates.

(Matthew Madia 06/30/09; 2 comments)

Money for Nothing

  Dire Straits

...and Chicks for Free

A report released today by the Government Accountability Office (GAO) found that few federal agencies follow recently revised guidelines set forth by the Office of Management and Budget (OMB) for awarding contract bonus fees, wasting billions of taxpayer dollars per year.

The report, requested by Sens. Tom Carper (D-DE), Bernie Sanders (I-VT), John McCain (R-AZ) and Tom Coburn (R-OK), found that while a few agencies have improved their award fee practices, many others still lag behind. Notably, the Department of Defense (DOD) and the National Aeronautics and Space Administration (NASA) have made progress from simply shelling out bonuses with no cause as they did in the past, but the other top contracting federal agencies, such as the Departments of Energy (DOE), Health and Human Services (HHS), and Homeland Security (DHS) lag woefully behind.

The report evaluated agencies on three criteria:


  • The actions agencies have taken to revise or develop policies and guidance to reflect OMB guidance on using award fees.
  • Whether the agencies' current practices for using award fee contracts are consistent with the new guidance.
  • The extent that agencies are collecting and analyzing information on award fees to evaluate their use and sharing that information within their agencies.

The findings were unsatisfactory, to say the least:

Current agency practices for using award fee contracts often are not consistent with the new OMB guidance.

...

Agencies do not always follow OMB’s guidance on linking fees to demonstrated results.

...

Of the five agencies...reviewed, only DOD collects data on the use of award fees.

...

Agencies generally do not have an effective mechanism with which to evaluate the effectiveness of award fees as a tool for improving contractor performance and achieving desired program outcomes.

Of course, the good news, which is a no-brainer to those of us in the contracting reform racket, is that where agencies implemented strict controls over award fee contracts, the government saved millions of dollars. Now if we could just get these reforms spread throughout government, we could solve the problem and I could move on to ending world hunger.

Image by Flickr user Jacob Whittaker used under a Creative Commons license.

(Gary Therkildsen 06/29/09; 1 comment)

The Veterans Affairs Budgeting Experiment

 

Earlier this week, the House passed an unusual bill that authorizes advance appropriations for Veterans Affairs (VA) funding.  HR 1016 means that Congress will create two budgets this year, one for the current 2010 appropriations cycle, and a future budget for 2011.  Subsequent years will produce budgets that are at least a year ahead.  For the VA department, which has been plagued in recent years by reports of patient neglect and poor management, this will hopefully be the first step towards better service delivery.

Unlike Medicare and Medicaid, VA funding must be appropriated annually and in recent history, Congress rarely delivered a budget on time.  Year after year, a delayed budget Monument honoring soldiers.adversely affected the program staff’s ability to plan ahead or move forward with capital projects.  Veterans already face a complicated medical system that often exposes the lack of coordination between the military and VA.  This was particularly evident during the Walter Reed scandal and a separate and no less embarrassing loss of private electronic health data in 2006.

The Department of VA will now submit budgets at least a year ahead of time for the following categories: Medical Services, Medical Support and Compliance, Medical Facilities, Information Technology Systems, and Medical and Prosthetic Research.  Similar to multi-year budgets, the ability to submit budgets ahead of time will allow for more strategic planning and program execution.  This should allow the Department to more accurately project costs, assuming there are no major programmatic changes.

This budgeting mechanism differs from a traditional multi-year budget because the Department of VA is not required to forecast tax revenues. As a result, while program managers at VA may propose a spending budget that they feel is adequate for program needs, changing economic conditions might make the figures irrelevant by the time the fiscal year rolls around. A strong monitoring mechanism is necessary to ensure that each budget’s projected costs are appropriate. In this case, the Comptroller General will be responsible for assessing the budget each year. While this isn’t truly a multi-year budget, this is the beginning of a more thoughtful approach to appropriations.

 

 

Congressional Quarterly: House Passes Bill For Two-Year Budget Cycle for Some Veterans' Programs

Image by Flickr user wallyg, used under a Creative Commons license.

(Jocelyn Yin 06/26/09; 0 comments)