Several federal agencies announced they would forgo or postpone planned furlough days late last week. The Internal Revenue Service said Aug. 7 that it would not hold an agencywide furlough day on Aug. 30 as planned.
The incidents of tax fraud by identity thieves rose from 456,000 cases in 2009 to an estimated 1.9 million cases in 2013, a Treasury Inspector General for Tax Administration report (.pdf) that was brought up at an Aug. 2 House Oversight and Government Reform Committee hearing. There were 860,000 problematic tax returns from the 2013 filing season totaling $4.2 billion, Treasury Deputy Inspector General for Tax Administration Michael McKenney told the House committee.
The House Appropriations subcommittee on financial services and general government marked up a bill July 10 that would cut the Internal Revenue Service budget by 24 percent compared to fiscal 2013 levels. The bill (.pdf) sets IRS funding at $9 billion, which is $4 billion below President Obama's budget request for the agency.
Faris Fink, the IRS commissioner of small business and self employment who authorized spending $4.1 million on a conference in Anaheim, said he was embarrassed and that that kind of conference wouldn't happen today due to new conference spending rules, in a June 6 House Oversight and Government Reform Committee hearing.
Agencies should generally use any available flexibility to reduce operational risks and minimize impacts from sequestration on the agency's core mission, Office of Management and Budget Controller Danny Werfel said in a memo (.pdf) to agency heads Thursday.
The Office of Management and Budget says agencies should stop buying their own core financial management systems in favor of federal or commercial shared service providers, with changes in OMB policy to codify that requirement to come. "Agency-specific approaches are discouraged," the memo adds, stating approval for them will be reserved for when an agency can demonstrate "exceptional circumstance."
The Office of Management and Budget has outlined the budget cuts that must be applied to the federal government under sequestration, but there is no political consensus on their economic impact. "According to analysis by outside experts, sequestration would reduce real GDP growth for 2013 by 0.5 to 0.7 percentage points were it to continue for the rest of the calendar year," says the White House.
Efforts to reduce overall travel and increase oversight in travel and conference spending have saved the federal government roughly $2 billion from fiscal 2010 to fiscal 2012, says Daniel Werfel, controller at the Office of Management and Budget.
Personnel impacts of sequestration will not all be immediate but they do impact a wide range of federal employees, according to testimony given to the Senate Appropriations Committee. Instead, furloughs will happen along a continuum, said OMB's Danny Werfel.
The Office of Management and Budget has proposed consolidating the process that awards more than $600 billion annually in federal grants and financial assistance.The regulations combine some paperwork and application processes and propose some timeframe changes, such as allowing indirect costs awards to extend negotiated rates for up to 4 years, "subject to the approval of the indirect cost cognizant agency."