Oversight Needs Overhaul
ould doubling the one-year budget cycle to two improve government efficiency? That question has won congressional and public attention for legislation long nurtured by Sen. Pete Domenici, R-N.M., to create a two-year cycle.
Supporters of biennial budgeting propose focusing on the budget in the first year of a cycle and on legislative oversight in the second. However, critics say the executive branch and Congress cannot accurately predict expenses and revenue three years in advance. They also say Congress isn't structured to conduct effective legislative oversight. A look at the current ways Congress conducts agency oversight shows that critics of biennial budgeting may be right.
Congress divides itself into committees that create laws and those that decide funding for federal agencies. Most agencies must deal with several committees, often leading to conflicting mandates.
Committees conduct oversight hearings to evaluate agencies on spending and compliance with congressional mandates. The committees try to determine whether the laws they created and the budgets they allocated are achieving the intended results.
Oversight hearings fall into at least four categories, which sometimes muddy the waters rather than clear them. And efforts to evaluate agency performance come from several different committees. The categories include:
Determining the need for new legislation.
Non-appropriating committees conduct oversight hearings in their jurisdiction to determine if new legislation is needed. For example, the House Ways and Means Subcommittee on Trade may hold hearings on whether to create a new tax on imported goods or use an existing tax to fund new computer hardware and software to aid the Customs Service in processing international trade. The stakeholders-the administration, brokers, importers, exporters and unions-all know which committee has jurisdiction and what to expect. The Trade Subcommittee regularly works together with stakeholders, so they know generally what direction the subcommittee will take.
Eliminating existing legislation.
Similarly, congressional oversight hearings to determine if certain laws should cease to exist originate with the committee that passed the law. Presidential hopeful Gov. George W. Bush, supporter of biennial budgets, says Congress should hold more hearings to determine which federal laws to eliminate, just as congressional committees did after the Republican "Contract With America" Congress was elected in 1994. Again, all the stakeholders know this dance. Those who support the existing law and those opposed to it swing into action using the traditional lobbying tools and tactics.
Ensuring executive branch execution.
Every congressional committee is interested in ensuring the executive branch carries out the laws or budgets it creates. Hearings about congressional intent multiply by the number of interested committees. Some oversight hearings are straightforward, such as those held by the House Education and the Workforce Subcommittee on Oversight and Investigations. For example, the Labor Department issued an opinion letter stating that the Occupational Safety and Health Administration safety rules apply to home offices. The subcommittee said the move to apply a new rule without using the formal rule-making process allowing those affected to respond was inconsistent with congressional intent. The subcommittee with jurisdiction called the Labor Secretary to testify.
In contrast, a 1997 report to Congress by the National Commission on the Restructuring of the Internal Revenue Service found Congress lacked a coordinated focus when dealing with the IRS. The seven committees most responsible for IRS oversight-Ways and Means, Appropriations, and Government Reform and Oversight in the House, and Finance, Appropriations, Government Affairs, and the Joint Committee on Taxation in the Senate-focus on different issues that change from year to year, the report found. While the issues they address are important, the committees fail to coordinate on high-level and strategic matters. This non-integrated approach to oversight further blurs the IRS' ability to set a strategic direction and focus on priorities. The IRS is not unique. Often, committees with overlapping jurisdictions give agencies conflicting directions. Giving committees more time to conduct oversight hearings with a biennial budget will not solve that problem.
Evaluating agency efficiency.
Evaluating how efficiently an agency has implemented congressional policy is one of legislative overseers' most difficult jobs. No commonly accepted definition of agency efficiency exists. The public sector has no bottom line against which to measure success. In the absence of such a definition, Congress often adopts the "I'll know it when I see it" approach, scanning the agency horizon to expose waste and inefficiency.
But one Congress member's "waste" may be another's "efficiency." For example, some members of Congress direct the IRS to be more efficient by collecting more revenue and conducting more audits. Others believe efficiency means more service to taxpayers, while still others say the IRS should do both. Some legislators would seek efficiency by directing agencies to contract out all but essential services; others want to fire poor performers, hire and retain better people, pay higher salaries, provide more training, improve morale, reorganize, provide a mission and vision, develop new technology, or do all of the above.
All 535 members of Congress believe they are experts on agency efficiency and fixing problems. And often the fixes are contradictory. Giving them more time to conduct oversight hearings with a biennial budget cycle will not change this pattern.
No Magic Elixir
Efficient agency operations require better management, better structure, trained and motivated employees, and state-of-the-art technology. Recognizing that Congress can neither define efficiency nor impose it, legislators passed and the President enacted the 1993 Government Performance and Results Act (GPRA). The law shifts the burden of defining and achieving efficiency to agencies, which must create five-year strategic plans and annual operating plans with "objective, quantifiable, and measurable" performance goals to aid "congressional policy-making, spending decisions and program oversight." But GPRA is only a first step, not a magic elixir.
Congress has discovered that performance management is messy. Goals are difficult to define and measure. Agencies do not have adequate accounting systems to measure costs. And congressional attention to agency results is inconsistent, giving agencies little incentive to make the tremendous effort required to comply with GPRA.
On March 31, 2000, every agency submitted a GPRA progress report to Congress. But committees with substantive jurisdiction or appropriations responsibility have not scheduled hearings to examine the operating results. Instead, Senate Governmental Affairs Chairman Fred Thompson, R-Tenn., announced he will grade the reports and exhorted "Congress to hold agencies accountable for those results." However, as the Commission to Restructure the IRS found, Congress cannot hold an agency accountable if many different committees are involved. Multiple committees can provide reactive, individual responses to agency actions, but not integrated, strategic oversight.
A Coordinated, Powerful Voice
To address this problem for the IRS, the 1998 IRS Restructuring and Reform Act reconfigured Congress' committee system. A joint congressional committee composed of three members (two majority and one minority) from each of the seven committees with IRS jurisdiction would conduct a joint review of the IRS strategic plan and budget. This committee would have a joint hearing at least once a year.
The oversight model Congress created to evaluate IRS efficiency is similar to a private-sector board of directors. Separate committees are combined to ensure a coordinated, strategic direction for the IRS. The combined committees have a more powerful voice, and the IRS has a greater ability to respond to congressional mandates. Such coordination offers a possible solution for the current problems that would prevent biennial budgeting from making congressional oversight more fruitful.
Without restructuring congressional oversight, biennial budgeting will not significantly improve agency efficiency. Though many in Congress see biennial budgeting as an opportunity to work more effectively with agencies on improving their operations, they can't pre- vail if Congress continues on its path of reactive investigations and short-term solutions.
Robert M. Tobias is a distinguished practitioner in residence and director of the Institute for the Study of Policy Implementation at American University. He was president of the National Treasury Employees Union from 1983 to 1999.
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