Government Executive - Authors - Bernard Adelsberger

Graying Government

Bernard Adelsberger — Thu, 01 Jan 1998 00:00:00 -0500

he baby boom, long the darling of demographers, is slowly becoming a headache for federal human resources managers.

The first wave of babies born between 1946 and 1964 are now workers in their early 50s. Many of them occupy positions of great responsibility or have years of experience within their organizations. As the largest generation in the workforce, though, their gradual shift to the senior end is a cause for concern among personnel managers. Human resource professionals and analysts are anticipating a wave of retirements in the next decade.

"Throughout the workforce," says Diane Disney, deputy assistant secretary of Defense for civilian personnel policy, "you see an awful lot of workers who are now in their 40s getting into their 50s. 2001 will be the year the first boomer is eligible for normal retirement. At that point, turnover is going to accelerate, if all other things are equal."

Agencies are concerned not just about people retiring, but about the great numbers in which they'll be leaving and the experience they'll be taking with them.

"Nearly 20 percent of our employees will be eligible for regular retirement between now and 2002, with many of those being managers and more experienced employees," says Paul Barnes, the Social Security Administration's deputy commissioner for human resources.

Boom Goes Bust

The graying of America is evident in all sectors of the economy. The portion of people working who are between the ages of 45 and 54 has increased by almost 20 percent this decade, from 16.4 percent of the workforce in 1990 to 19.5 percent in 1995, according to the 1997 Handbook of U.S. Labor Statistics.

But personnel managers should not panic, many researchers say. They contend that an aging workforce is not a crisis. After all, the boomers are spread out over 18 years. And those who study aging say people into their 80s are physically and mentally able to handle office work. The jobs that make up much of government work are "well within the capabilities of the older worker," says Robert C. Atchley, director of the Scripps Gerontology Center at the University of Miami in Oxford, Ohio.

However, many companies, and many federal agencies, have climates that discourage older workers from continuing their careers into their 60s, which could cause problems as the baby boomers approach retirement age. For example, the federal government continues health coverage for workers who retire, allowing them to leave well before they are eligible for Medicare at age 65.

"Probably the only thing that will push people to stay in the labor force longer is need, not desire," says Cynthia Costello, a senior research and policy associate at the Radcliffe Public Policy Institute in Cambridge, Mass.

Downsizing programs have been another contributor to the recent exodus of older workers. Federal workers retire on average at age 61, according to the Office of Personnel Management, not much different from the national average of 62.

But an increase in early retirements can have a big effect on the average retirement age, and in recent years agencies have been actively encouraging senior workers to leave through both early-out and buyout offers.

In 1993, for example, according to OPM, 34,000 people took early retirement offers, largely due to Defense downsizing. The regular retirement total was 54,000. The high number of early retirees (whose average age is 53, OPM says) drove down the average retirement age in the federal government to 58.3 that year.

Workplace factors, such as the difficulty of serving under political appointees focused on short-term agendas, also tend to push federal workers out the door. "As soon as they hit the magic number and can get out of there, they do," Atchley says.

Changing Hiring Trends

Each agency's history has a role in determining the impact of the graying of government. Many, of course, are downsizing. Although buyouts have received the most publicity, most of the staff reductions have been accomplished simply through attrition.

In fact, human resource managers are astounded that, despite the widespread use of buyouts and attrition, the number of retirement-eligible employees continues to swell. In 1990, 340,000 federal employees were eligible for retirement. By 1996, though more than 120,000 employees had taken buyouts, nearly 400,000 retirement-eligible employees were still working. And that's in a workforce one-fourth smaller.

Not only is a large portion of the workforce eligible to retire, the pool of workers from which to replace retirees is shrinking.

Through the early 1990s, the government typically hired more than 100,000 new people each year for full-time positions. Not all of them were kids right out of school, but, as with any organization, new hires tended to be much younger than the people they replaced. Recently, though, hiring has sagged, to a low of 41,000 in 1994, representing only 2 percent of the federal workforce. Hiring has picked up slightly since then, to nearly 50,000 a year, or 2.5 percent of the workforce, but most of the increase is concentrated in a few law enforcement agencies.

The effect of changing hiring patterns can be seen by looking at two agencies, the Defense Department and NASA.

DoD has had a massive civilian workforce for decades, totaling more than 1 million when its drawdown began in 1989. The downsizing within the federal government's largest employer continues today. About 320,000 of DoD's jobs have been eliminated, and thousands more cuts are in the works.

In November, Defense Secretary William Cohen announced that staffing in the Office of the Secretary of Defense would be cut by 33 percent over the next 18 months. Personnel in Defense agencies will be reduced by 21 percent over the next five years, Cohen said, and DoD field activities personnel will be reduced by 36 percent in the next two years.

If all the envisioned cuts are completed, the department's civilian workforce will stand at 43 percent of its 1989 strength, says DoD's Disney.

Nearly a decade of downsizing has left the Pentagon's workforce top-heavy, Disney says. The average age of DoD civilians is 45.3, up 1.4 years since 1993. The number of DoD employees in their 30s is down 40 percent since 1989, a reduction far exceeding overall staff cuts, Disney says. "That cuts across all kinds of occupations across the organization."

"The concern is having enough skilled workers in the pipeline to meet the department's mission as the current employees retire," she says.

At NASA, on the other hand, the effects of a downsizing that has eliminated nearly one in four jobs haven't been as severe. That's because NASA started its workforce reduction on the heels of a growth spurt.

NASA's workforce had hovered at about 21,000 through the 1980s. However, the January 1986 Challenger explosion raised concerns among agency leaders that "staffing in the core engineering disciplines was inadequate," says Stan Kask, director of management systems for NASA's human resources office.

So the agency boosted its corps of scientists and engineers. With hiring peaking at about 2,000 in 1992, the workforce expanded to 25,000 workers. But the growth was followed immediately in 1993 by downsizing. The agency is to scale down to 19,600 people by 1998, on its way to 18,000 by 2000.

Although the downsizing has been difficult, the fact that it came right behind an increase has mitigated some of the potential damage, Kask says. Even though the average employee age has increased by a year, to 43.7, since 1993, the agency has been able to feed off its earlier growth spurt during the current fast.

The hiring slowdown is "creating a void at the bottom end of the employee pipeline," Kask acknowledges. "But we assumed that we could work with that for a year or two or three and not cause irreversible damage to the agency."

Future Force

Just as an organization's history can determine the impact of an aging workforce, its future plays a role, too. Consider the case of the Army Materiel Command.

AMC, like the rest of the Defense Department, has steadily downsized through the 1990s. As the command's mission of developing land warfare weapons and equipment has shrunk with the end of the Cold War, so has its workforce. Civilian staffing has declined from 102,000 in 1989 to 61,000 today. About 20,000 of the reductions have come through buyouts. And there are more reductions to come, says George Jones, AMC's deputy chief of staff for personnel. AMC expects to shrink to 50,000 civilians, but the number could go as low as 30,000.

AMC, like many federal organizations, is undergoing a laborious review of how it goes about its business and what its central focus should be. As command leaders look into the next century, they see an acquisition environment greatly changed from previous eras. As technologies bloom and wilt seemingly overnight, turnaround time on projects will shorten. The pace of work will ebb and flow depending on needs, potential threats, emerging technologies and other external factors.

Like many other agencies, AMC is casting the mold for its future workforce by deciding which functions are inherently governmental and which can be done by outside contractors. In the next century, Jones says, the command will rely on a mix of government employees-career workers hired for the long term and temporary hires for specific projects.

The AMC civilian workforce of 10 or 15 years from now will primarily consist of full-timers with multiple skills rather than one specialty. They will contract for, organize and supervise projects rather than perform functional tasks themselves. "The doers probably [will be] mostly contractors with a mix of temps and [term hires] to accommodate the rise and fall in workload and the uncertainty of what Congress is going to do with [the acquisition] budget," Jones says.

Facing those kinds of changes, downsizing and the coming wave of retirements are a "mixed blessing," Jones says. Not only does the command need to reduce its civilian workforce, but it needs to bring on an entirely new inventory of skills. The pending flood of retirements "is going to help us get there faster," he says.

Other DoD agencies also face the prospect of mixing long- and short-term workers. Disney described such a mix in an August information paper on possible changes to the department's civilian personnel policy. Among the "workforce challenges" Disney described in the paper are "an older, more senior workforce caused by limited accessions, multiple reductions-in-force and demographic forces; pipeline [succession] problems in certain occupations; [and] continued reductions to DoD civilian personnel staff."

Disney's paper proposed a personnel management system consisting of three layers: the first a "cadre of permanent, career employees," the second consisting of full-timers with full benefits but hired for short terms of up to five years, and the third made up of contractors. The second layer would be employed for certain projects that occur cyclically or arise suddenly and require extra hands.

In a recent interview, Disney distanced herself from the information paper, saying it was a draft and not yet an active plan. However, one source familiar with federal personnel programs doubts the paper is insignificant. "I'm sure they did a fair amount of staff work before they wrote the concept paper," the source says. "It stands to reason that they would want to explore all options."

Replacing Senior Leaders

Whether or not agencies are contemplating the kind of dramatic personnel changes DoD is considering, they are all concerned about replacing senior leaders as the baby boomers inch their way toward retirement age.

Some agencies face a greater degree of urgency than others. The Social Security Administration, for example, had an expansion in the early 1970s, and many of the employees brought on then are now managers nearing retirement eligibility.

Barnes says 80 percent of SSA's Senior Executive Service members will be eligible for early or regular retirement in the next five years. Barnes doesn't expect them to all leave the first year they are able; typically, he says, about 18 percent of the agency's retirement-eligible workers actually retire. But in an organization where 57 percent of the workforce is 45 or older, succession planning is important.

Many other departments and agencies face similar situations. However, succession planning, even in the best of situations, is not something the federal government does particularly well, says Ray Blunt, an analyst with the National Academy of Public Administration. Blunt recently wrote a report called Managing Succession and Developing Leadership: Growing the Next Generation of Public Service Leaders, that NAPA published in October.

Part of the problem with leadership development in the federal government, Blunt says, is the political layers atop all organizations. In both the public and private sectors, he says, effective succession planning requires the attention of the organization's leaders, but most federal department heads don't get involved in their organization's leadership development plans. The current environment of downsizing, technology changes, globalization and competitiveness, calls for more than incremental change, he says. "Leadership and change are very much tied together," Blunt says. "The conditions that we're facing are ones the government hasn't faced."

The one federal organization that Blunt rates highly is the Defense Department. He says the military culture makes leadership development a critical task, even for political appointees. For instance, secretaries of the individual services are responsible for panels that select officers for promotion.

Another concern, especially among highly technical agencies, is maintaining a steady influx of fresh brainpower. "That is probably the one unifying theme we hear from our managers out in the field," says NASA's Kask. "They really feel that it's time to get on with it and that we can't afford to go too much further in this without bringing some fresh blood in."

Battle Plans

Many agencies facing a glut of retirements among key workers are adopting programs to prepare the next tier of workers for greater responsibility. The Social Security Administration is planning to expand its leadership development efforts for senior executives, middle managers and management interns. Each program will run about two years and provide a range of job experience and training for those enrolled.

The idea, says Barnes, is to provide workers with the skills and experience they'll need for the next step of their careers, which might come several years sooner than it has in the past. A management intern himself in 1970, Barnes says, "In the two years I was in that program, I had the opportunity for a lot of developmental assignments that normally could take a person five or 10 years."

Human resource managers across government agree training will be critical as their workforce ages. As functions shift, missions change and technology reshapes jobs, workers will need to be more flexible. Blunt warns that preparing the next generation of leaders is a long-term process that needs to be embedded in organizations. "Typically, the [organization's] culture doesn't reinforce what people are learning," he says. "The top management is not involved in it."

Federal personnel managers think it will be three to five years before they notice a sharp increase in retirements due to the aging baby boomers. In the meantime, they are trying to define broad approaches to the succession problem.

"This is not a problem you can solve in a day or a week," Disney says. "It has to be a process. We have to take a look at ways of increasing [hiring], of developing the people who are here, and of investing in their training and education so they have the capacity to do a greater variety of things than perhaps was required of their predecessors at the same point of their careers."

Bernard Adelsberger is a Washington freelance writer who has been covering the federal government for more than 10 years.

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Wheeler Dealers

Bernard Adelsberger — Tue, 01 Jul 1997 00:00:00 -0400

irtually every federal operation is threatened these days by the prospect of budget cuts, downsizing and privatization. The vehicle fleet management division of the General Services Administration, which manages 149,000 cars, trucks and vans for agencies, is more vulnerable than most. That's because this big, highly centralized government operation has direct competitors in the private sector.

But the leaders of the Interagency Fleet Management System (IFMS), as the division of GSA is officially known, are trying to turn the federal budget situation to their advantage. They say that they leverage the purchasing power of the dozens of agencies they serve to save the government money.

Two years ago, GSA commissioned a study of its fleet management system by Arthur Andersen, one of the country's largest accounting firms. The study showed that in all but one category, IFMS' costs were lower, sometimes substantially lower, than its private-sector competitors.

In the late 1980s, the Army struck an agreement with GSA to turn over control of tens of thousands of its noncombat vehicles to GSA. Since 1993, the agency has assumed responsibility for 10,000 additional vehicles, and has agreements to add about that many more in the coming years.

IFMS director Les Gray says during the last decade the division has averaged 6 percent annual growth in revenues, while holding cost increases to customers to 1.6 percent a year.

Nevertheless, "a fair amount of people say we should privatize the whole thing," says GSA Administrator David Barram. "And we should continue to ask ourselves whether we should do that. But as long as we can do it better than the private sector, we ought to do it."

GSA's critics and competitors in the private sector are far from convinced. They argue that IFMS is too big and unwieldy.

"I don't think the federal government even knows how many vehicles it has," says Alfred Cavalli, a fleet management consultant and former president of the National Association of Fleet Administrators.

Boom Years

Federal officials, though, say they know full well the size and scope of the fleet they have to manage. Executive branch agencies, they report, operate some 380,000 vehicles. (The Postal Service has another 205,000). Agencies aren't required to use IFMS' services, but enough do that it controls 40 percent of the non-postal fleet.

The fleet operation, including new vehicle purchases, is funded entirely through fees charged to the agencies which are its customers. It receives no annual appropriation.

IFMS' boom years started in the mid-1980s. During a GSA-wide reassessment of operations, senior executives determined that fleet management was one of the agency's central missions and something it did well, so more attention was given to managing it more efficiently.

The Army agreement kicked IFMS' growth into high gear. From 1987 to 1992, the Army turned over 48,000 non-tactical vehicles in the United States, virtually eliminating a $100 million vehicle procurement appropriation and cutting 1,000 civilian jobs.

The thinking behind the Army's decision then was similar to what many agencies are facing now. The heady spending of the Reagan defense buildup was cresting. Facilities were closing. The Army was losing civilian jobs. Army leaders were looking for functions they could eliminate to compensate for the lost jobs and to save money, says William Neal, assistant director for transportation for the Army Deputy Chief of Staff for Logistics.

"It came down to a question of core competencies," Neal says. "The Army's core competency is to fight and win the nation's wars. GSA's core competency is managing a fleet."

Many agencies have come to share the Army's desire to shed functions, such as fleet management, not at the core of their missions. Some, though, still view their fleet operations as integral to their purpose and are not willing to relinquish control to GSA. For example, the Air Force continues to manage most of its own fleet of 107,000 non-tactical vehicles at bases around the country and overseas.

The Air Force uses some private management companies at training and research sites, says Col. Carm Walgamott, chief of the vehicle and equipment division in the service's Directorate of Transportation. But the service views the vehicles it maintains on bases in the United States as essential to its capability to provide air defense around the world.

"Contrary to the Army, we use our vehicles as part of our wartime mission," Walgamott says. "The vehicles support base operations, the purpose of which is launching airplanes."

Future Tense

Other agencies, too, have apparently decided not to make a wholesale move to GSA fleet management. IFMS' annual growth rate in terms of the number of cars it manages has slipped from a peak of 11 percent in 1990 to 1.4 percent last year.

A 1997 cost increase, the first since 1991, won't help IFMS draw new customers. The increase raises monthly rental fees between 3 percent and 8 percent, depending on the type of vehicle. For example, the most popular vehicle, the compact sedan, will cost customers $146 a month, up from $136. The mileage rate of 10.5 cents stays the same.

What's more, environmental laws at the local, state and federal levels could force GSA to increase its purchases of expensive vehicles that run on fuels other than regular gasoline.

In an effort to be responsive to such changes, GSA's fleet division has undergone a host of changes in recent years that have cut its payroll, reduced costs to customers and improved service. The fleet management division's workforce has gone from about 1,000 in 1990 to 800 today. During that same time, the number of vehicles it manages has increased more than 20 percent.

The ongoing challenge for IFMS is meeting the needs of government customers with widely varying vehicle management requirements. For example, while the Air Force considers fleet management essential to its operations, the U.S. Park Service allows each park to make its own decisions on managing vehicles.

"We come to mutually agreeable arrangements with our customers," Gray says. "We haven't had to try to mandate that people use GSA."

Keys to Success

GSA officials argue that IFMS, which has more than 70 management centers across the country, is able to give agencies the benefits of the economies of scale that come with running such a huge operation. In part because of its size, Gray says, the fleet division has been able to institute several management practices that other agencies would not be able to duplicate.

First, IFMS doesn't have to rely on an annual appropriation to buy cars and trucks. It has a revolving fund from customer fees and vehicle resales, much like a private company. The fund allows GSA to buy new vehicles more often than most agencies can, reducing costs for repairs and parts for older vehicles.

For example, the Air Force, which depends on annual appropriations to replace aging vehicles, is falling behind. "We are underfunded and we have been for the last five, six, seven years," Walgamott says. The service plans to buy 3,000 vehicles this year, compared to GSA's expected purchase of 30,000.

GSA also spends less on maintenance than do most smaller operations. The fleet division keeps a master database containing the maintenance records of every vehicle in the fleet. That allows GSA to monitor upkeep of each vehicle and notify customers when a vehicle is due for service.

Many agency officials acknowledge they would have difficulty duplicating GSA's record-keeping. The Air Force has been able to do so, but runs a fleet nearly as large as GSA's.

GSA officials also are aggressive outsourcers. Vehicle maintenance has been contracted out since the early 1980s and private auctioneers sell used government vehicles. Gray says the fleet division's view is that "if it's not a strategic function, outsource it."

Staying Competitive

Outsourcing is just one example of how IFMS uses management practices that have succeeded in the private sector. But there are vast differences between the GSA fleet division and private companies. Some work to the agency's advantage, others do not. Among the differences:

n No taxes. The federal government is exempt from paying state and local taxes, which can reduce GSA's costs significantly, depending on the locale. Even the gasoline GSA customers buy is tax-free. That saves agencies an average of 13 cents a gallon.

n Price discounts. The fleet division deals directly with manufacturers in negotiating prices for new vehicles, eliminating middleman markups. Large private fleet companies do, too, but as GSA's fleet grows, so does the size of its annual purchase and therefore the amount of its discount per vehicle.

n Lower marketing costs. Because most of its customers are aware of the services it provides, IFMS does not have to budget for marketing and advertising on the scale that a private company does.

n No profit margins. The fleet division is required to cover its costs, but it doesn't have to turn a profit, unlike private companies. Under current market conditions, fleet companies seek profit margins of 10 percent to 15 percent.

n Slow growth. On the other hand, private companies can more readily borrow money to finance new initiatives. GSA needs authority from the Federal Financing Bank, which is backed by the U.S. Treasury, to borrow money. Several years ago, GSA asked the Office of Management and Budget to allow it to seek such authority to add more cars to the fleet, but the request was denied. So the fleet operation remains dependent solely on fees.

In addition, GSA can't just add staff at will, so the growth of the fleet tends to be slow and cautious. Agencies that choose IFMS' services usually are phased in over several years so staff and information systems don't get swamped.

Gradual growth is also the norm in the private fleet industry, says Mark Reagen, assistant vice president for marketing with Wheels Inc., a national fleet management firm based in Des Plaines, Ill.

Although it is difficult to measure the pluses and minuses of so many factors, overall, the fleet division has managed to keep costs below those of its private sector competitors. At least, that's the conclusion of the 1995 Arthur Andersen study.

Auditors compared GSA's fleet operation with private companies in areas most important in that business-vehicle purchase price, operating cost per mile, maintenance and repair cost per mile, fuel cost, resales and financing rates. The audit found the GSA operation came out ahead in all areas but one, resale of compact sedans, a small portion of its operation.

IFMS' cost per mile of operating compact sedans in its fleet was 20 cents, as opposed to a 25 cent private sector average, the study found. It also showed that IFMS was able to negotiate an average purchase price for compact sedans of $10,765 in 1995. The private-sector average was $11,702.

However, some in the private sector contend the public sector has a different mind-set in accounting for the cost of running fleet operations even as they attempt to adopt private sector business practices.

Too often, public agencies focus on the initial vehicle cost, not the total cost of running the vehicle during its life. Companies now look at total system cost-purchase, operating cost and resale, says Reagen.

Reagen also says public organizations tend to ignore fixed costs, such as administration, support personnel and property costs associated with a particular operation. "They say, 'well, we already have the building,'" Reagen says. "That may be true, but the building has a cost."

Decision Points

Each agency that uses the IFMS has its own rationale for doing so, but the reasons usually are related to one of the business practices described above. For instance, with a large revolving fund built up from renting the 149,000 vehicles in its care, GSA is able to guarantee much faster replacement than other agencies. Officials at several departments say quick replacement is a key reason to keep their business at GSA.

Before the Army turned over its vehicles to IFMS, its vehicle management was decentralized. The decision to buy a new passenger van or pickup truck was up to individual installation commanders. The expense of repairs and poor mileage for aging vehicles was hidden in the installation's maintenance budgets. If a commander decided to spend more money on improving rifle ranges, vehicle replacement was put aside.

At the Army's headquarters level, new vehicles were bought with the same appropriation that funded purchases of certain tactical equipment such as communications equipment, Neal says. Keeping an aging fleet of sedans, vans and trucks on the road costs more each year. The defense budget and personnel cutbacks that began in the late 1980s only worsened the situation.

"When procurement resources began drying up, we lost the ability to purchase new vehicles," Neal says.

On the heels of its agreement to turn over its U.S. vehicle fleet, the Army recently gave GSA about 1,000 vehicles in Panama and is just starting to relinquish its 7,000-vehicle fleet in Europe.

Like the Army, Amtrak is turning over its fleet of about 1,000 light-duty vehicles to GSA, because of the promise of quicker replacement of vehicles than the railroad could afford.

"Amtrak has always had a vehicle life cycle based on age, mileage and maintenance cost," says Edward Stuhl, the railroad's automotive manager. "But we couldn't afford to keep up with our replacement schedule."

GSA's massive record-keeping system led the Army Corps of Engineers to let IFMS do the driving. Like most other federal organizations, the Corps has vehicles spread across the country, many in remote locations. Developing a maintenance tracking system similar to GSA's would be difficult and time-consuming, says Bobby Hill, chief of the Corps' Transportation Division.

"Why should we be establishing our own system when they have one already in place?" he asks. "They are able to negotiate better discounts, just because of the sheer size of their fleet operation and volume of work they are responsible for."

"A Lot of Ifs"

But transportation officials in agencies are quick to note that their loyalty is to their own organizations, not to GSA. Although they are happy with GSA's service and costs, agency officials have their own pocketbooks and missions to worry about. GSA fleet division customers would not hesitate to jump ship if a better offer came along or the fleet division couldn't meet its promises.

Hill, who begins turning over his civil engineering vehicles to GSA in 1997, says the decision was based on a disputed Army Audit Agency report. Since the auditors based their recommendation on only a fraction of the corps' 60 districts, he has adopted a wait-and-see attitude before endorsing IFMS.

"The only way we're going to know is to convert [to GSA] and compare the bills," Hill says. "It depends on how everything sorts out. There are a lot of ifs."

In addition to cost, transportation officials monitor service. The drivers of Amtrak's railroad maintenance vehicles can be tough customers, Stuhl says.

"I certainly get a lot of feedback from Amtrak drivers," Stuhl says. "Our vehicles are not something to drive down the highway to get to a certain point. They are tools used get to the job and perform your job when you get there. If your tool doesn't work, that's very important to you."

Slow growth is expected to continue within IFMS in the near term. As the fleet division begins taking control of the Army's vehicles in Europe, officials are discussing the service's noncombat fleet in the Pacific region. But other agencies, either because of their mission or the way they do business, would have difficulty relinquishing their fleet operations.

Another hurdle GSA must clear is the requirement to buy costly alternative fuel vehicles. Half the vehicles agencies buy this year and 75 percent from now on must run on electricity, natural gas or ethanol. That's up from 33 percent last year and 25 percent in 1995.

The vehicles are much more expensive and are not available in large numbers, federal officials say. Keeping up with the regulation "is getting tough," says the Air Force's Walgamott. "We pride ourselves in supporting it, but as requirements get higher and higher, it gets tougher and tougher."

Barram is realistic about the fleet division's future. He would like to see additional growth, but also acknowledges that as the trend toward privatization continues, an organization has to be prepared for all options.

IFMS needs to continue looking for savings, Barram says. If difficult times arise, GSA will use its recent experience in reinventing several of its operations in deciding where to make cutbacks.

"We know what to look at," Barram says, "as we decide when and what to expand and when and what to contract."

Bernard Adelsberger is a Washington-area freelance writer who has been covering the federal government for more than 10 years.

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