OPM and the Revolving Fund...
June 28, 2011 at 3:22 pm #134069
It’s fair to say that I have serious misgivings about the way OPM conducts its state run business practices of setting policy, performing oversight and providing fee based services. Its central command and control mentality as well as inherent conflict of interest are truly misguided and have held back innovation in Federal HR for years.
The question never answered is why? Why does OPM feel it necessary to provide products and services? In who’s interest is it that OPM do so?
OPM constantly says that it’s authorized under the “Revolving Fund”. It says so on OPM’s Form 1616, and in its woefully inaccurate budget submissions, etc.
OPM says that it’s authorized by 5 U.S.C. 1304(e).
You can find this statute at several sites on the Internet. I chose http://codes.lp.findlaw.com/uscode/5/II/13/1304 because its format is easy to read.
5 U.S.C. 1304(e) is one of seven clauses (14.3%). The text of clause (e) alone is 2795 of 4447 characters (62.8%). Pretty disproportionate, don’t you think?
Sections (a), (b), (c), (d), (f) and (g) all pertain to investigations. While Section (e) has the word “investigations” in it and was probably the intent of the law, OPM morphed it for its own revenue generating benefit.
(e)(1) A revolving fund is available, to the Office without fiscal year limitation, for financing investigations, training, and such other functions as the Office is authorized or required to perform on a reimbursable basis, including personnel management services performed at the request of individual agencies (which would otherwise be the responsibility of such agencies), or at the request of nonappropriated fund instrumentalities.
I guess it’s subject to interpretation, but OPM is taking language like “and such other functions as the Office is authorized or required to perform on a reimbursable basis” way out of context. I’m sure the authors didn’t intend for OPM to create a $2Billion/year state run enterprise. OPM sees it like a loophole you can drive a truck through.
Even the term “reimbursement” is mischaracterized by OPM. OPM doesn’t reimburse monster for USAJOBS. OPM pays monster. If you license software from a vendor it’s not on a reimbursable basis, yet that’s how OPM wants to redefine its business practice.
But if you read 5 U.S.C. 1304(e) carefully, there are some limitations on OPM like: “However, the functions which may be financed in any fiscal year by the fund are restricted to those functions which are covered by the budget estimates”. If you read my post on OPM and the FY2012 budget on the Revolving Fund you’d realize that OPM’s budget estimates understate actual costs by over 30% year over year. If OPM is limited to its “budget estimates” then OPM violates the very law they use to justify their state run operation.
Further, Subsection (4): “Any unobligated and unexpended balances in the fund which the Office determines to be in excess of amounts needed for activities financed by the fund shall be deposited in the Treasury of the United States as miscellaneous receipts.”
I have learned since my “OPM and the 2012 Budget” post that OPM and GAO negotiated that the revolving fund carryover cannot exceed $26mil/year. Unfortunately, OPMs “Cumulative Results in Operations” show a $353 million in Net Proceeds for FY 2010. Essentially OPM is playing the very shell game with funds that this Administration accuses Wall Street of. Bernie Madoff would be proud.
I love Section (5): “The Office shall prepare a business-type budget providing full disclosure of the results of operations for each of the functions performed by the Office and financed by the fund, and such budget shall be transmitted to the Congress…”When 78% of your Budget is categorized as “Other” you have a problem.
And did you know that the Comptroller General at the GAO can only be a male? Yep, it’s in the law in Section (6): “The Comptroller General of the United States shall, as a result of his periodic reviews of the activities financed by the fund…” (Operative word “his”). Sorry ladies, the law is the law. But, when was the last time the GAO reviewed the Revolving Fund or OPM’s finances in general?
OPM is always glad to use the Revolving Fund to justify all of its state run business actions, but where is the authorization to create and operate USA Staffing? And is it really “reimbursable” if OPM actively markets and sells/licenses the software?
“Reimburse” means to pay back, but I guess it’s all subject to interpretation when you flout the very law you use to justify your actions.
Have a Happy Fourth of July.
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