Bush seeks $1 billion in cuts for subpar programs

President Bush will recommended axing $1 billion worth of poorly performing federal programs in his fiscal 2005 budget proposal.

The White House would like to scale back roughly 20 programs that are duplicative or lack the potential to produce meaningful results, said Clay Johnson, the Office of Management and Budget's deputy director for management. Administration officials selected these programs based on OMB evaluations and discussions with agency managers, Johnson said.

Bush will release his budget proposal Monday, revealing the list of programs slated for elimination. Congress will decide during the fiscal 2005 appropriations process whether to grant the Bush administration's requests.

The administration will not ask lawmakers to cut every program deemed ineffective in OMB's program assessments, Johnson emphasized. In fact, the president will suggest funding increases for several poor performers. OMB assessments simply point out problem areas, Johnson said.

Before drawing up the fiscal 2005 budget request, the administration reviewed 40 percent of all federal programs using a 25-part questionnaire called the Program Assessment Rating Tool (PART). Based on agencies' answers, OMB evaluators graded programs as "effective," "moderately effective," "adequate," "ineffective," or "results not demonstrated."

Half of the programs OMB assessed for the 2005 budget also received evaluations in 2004, making comparisons across years possible. The administration will release the latest PART scores on Monday, along with the budget proposal.

OMB officials looked carefully at programs receiving poor PART scores and, in several instances, met with program managers to discuss management challenges, Johnson said. The administration decided that some underperforming programs suffered from funding shortfalls and asked Congress to grant them more money in 2005.

Other programs failed to meet expectations, but serve important social needs, making the White House reluctant to eliminate them, Johnson said. In those cases, OMB will work with the program managers to find ways to improve performance.

But some programs that received poor ratings in the latest set of PART evaluations showed no potential for improving, Johnson said, and others were duplicative. Bush will suggest "zeroing out" these programs in his 2005 budget.

OMB eventually plans to use the PART to evaluate all federal programs. But lawmakers remain skeptical of the rating tool and the general concept of performance-based budgeting. In committee reports on several fiscal 2004 spending bills, congressional appropriators said they were not prepared to see agencies submit performance-based budget documents in place of traditional budget projections.

"There are inherent challenges in assigning a single rating to programs having multiple purposes and goals," the General Accounting Office concluded in a report released Friday (GAO-04-174). OMB will need to ensure that PART assessments are "credible" and consistent, GAO said.

In addition, OMB should do more to integrate PART assessments with information in agencies' annual reports required by the 1993 Government Performance and Results Act, GAO said. The administration also should discuss PART results with Congress, the report suggested.

Regardless of remaining challenges, PART evaluations have already come in handy. "The PART has helped to structure OMB's use of performance information for its internal program analysis and budget review, made the use of this information more transparent and stimulated agency interest in budget and performance integration," the GAO report said.

GAO's research focused on 2004 program assessments. In that year, roughly half of the 234 programs evaluated could not demonstrate results. OMB rated 30 percent of programs as "effective" or "moderately effective" and 14 percent as "adequate." On average, the president's 2004 budget proposal rewarded programs deemed "effective" with a 6 percent funding increase, and held those programs "not showing results" to less than a 1 percent increase, according to Carl DeMaio, president of the Performance Institute, an Arlington, Va. based think tank.