Credit Reform: Improving Rural Development's Credit Program Cost Estimates

USDA's Rural Development (RD) mission area have taken several steps to ensure that the necessary staffing and funding resources are available to promptly implement the procedures in the detailed implementation plan. Specifically, RD created and authorized a new Budget Division Credit Reform Staff, which includes four permanent full time positions, which are currently filled. RD's Office of the Chief Financial Officer (OCFO) has also committed staff in order to complete several of the procedures from the implementation plan. The OCFO anticipated the need for two additional staff resources to assist with the preparation of reestimates. However, since these positions were not authorized or funded, procedures were implemented to minimize workloads of existing staff. These procedures include the automation of data collection for reestimates and procedures to analyze the need for reestimates. Furthermore, resources were made available to hire outside contractors to implement more complicated procedures from the implementation plan, including the development of a new cash flow model to estimate the costs of the direct housing loan programs. The actions above demonstrate that RD has made considerable efforts to commit staff and resources needed to implement procedures from the detailed implementation plan.

USDA formed a CFO-led working group to resolve the agency's credit reform implementation issues. The working group, which includes members from the Rural Development mission area, established milestone due dates for the procedures remaining to be completed from the detailed implementation plan.

With the new administration taking over at USDA, a new process was implemented to notify agency executives, including the Secretary and all Under-Secretaries, of the status of corrective actions to resolves all of USDA's outstanding weaknesses, including credit reform implementation issues. On a regular basis, executives receive updates related to the status of the consolidated action plan. For credit reform implementation issues, these updates indicate due dates and estimated completion dates for procedures remaining to be completed. The estimated completion date is provided to ensure that scheduled due dates are not changed. In order to ensure that corrective actions are taken a list of outstanding tasks is prepared that highlight scheduled completion date and the responsible mission area. This list has been highly effective in bringing past due items to managements attention and resulting in prompt corrective actions.