Data Act:

Section 5 Pilot Design Issues Need to Be Addressed to Meet Goal of Reducing Recipient Reporting Burden

GAO-16-438: Published: Apr 19, 2016. Publicly Released: Apr 19, 2016.

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Michelle A. Sager
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What GAO Found

As required by the Digital Accountability and Transparency Act of 2014 (DATA Act), the Office of Management and Budget (OMB) is conducting a pilot program, known as the Section 5 Pilot, aimed at developing recommendations for reducing recipient reporting burden for grantees and contractors. OMB partnered with the Department of Health and Human Services (HHS) to design and implement the grants portion of the pilot, and with the General Services Administration (GSA) to implement the procurement portion. OMB launched the Section 5 Pilot in May 2015 and expects to continue pilot-related activities until at least May 2017.

If implemented according to HHS's proposed plan, the grants portion of the pilot will likely meet the requirements established under the act. In contrast, GAO has concerns with how the procurement portion of the pilot will contribute to the Section 5 Pilot's design requirements. For example, OMB has not fully described how it will select pilot participants that will result in a diverse group of contractors as required by the act. OMB staff stated that they intend to select participants for testing the procurement pilot by using a nongeneralizable sample of contractor data, but they have not provided a detailed, documented sampling plan.

The design of the grants portion of the pilot partially adhered to leading practices. Although five out of the six grants test models had clear and measurable objectives, only one had specific details about how potential findings could be scalable to be generalizable beyond the context of the pilot. HHS officials said they have updated their plan to address these concerns but that plan was not provided in time to allow GAO to analyze it for this review.

The design of the procurement portion of the pilot did not reflect leading practices. For example, the plan did not include specific information on the methodology, strategy, or types of data to be collected. Further, the plan we reviewed did not address the extent to which the proposed pilot approach would be scalable to produce recommendations that could be applied government-wide. The design also did not indicate how data will be evaluated to draw conclusions. Finally, while OMB has solicited general comments related to contractor reporting pain points, it has not released specific details on the design to stakeholders despite their repeated requests for that information.

Section 5 Pilot Activities, Requirements, and Reporting Time Frames

Section 5 Pilot Activities, Requirements, and Reporting Time Frames

Why GAO Did This Study

The DATA Act directs OMB or a designated federal agency to establish a pilot program to develop recommendations for simplifying federal award reporting for grants and contracts. The grants portion will test six ways to reduce recipient reporting burden while the procurement portion will initially focus on centralizing contractor reporting of certified payroll. The act requires GAO to review DATA Act implementation as it proceeds.

This report (1) describes OMB's approach to the DATA Act pilot requirements, (2) assesses whether current plans and activities will likely allow OMB and its partners to meet the requirements under the act, and (3) evaluates the extent to which designs for the grants and procurement portions of the pilot are consistent with leading practices. GAO reviewed available pilot documentation; assessed them against leading practices for pilot design; and interviewed staff at OMB, HHS, and GSA, as well as groups representing recipients of federal grants and contracts. GAO will conduct a follow-on review focused on OMB's implementation of its pilot designs.

What GAO Recommends

GAO recommends that OMB (1) clearly document how the procurement portion of the pilot will contribute to the design requirements under the DATA Act and (2) ensure that the design of the procurement portion of the pilot reflects leading practices. OMB, HHS, and GSA did not comment on our recommendations. GAO incorporated technical comments from OMB and HHS where appropriate.

For more information, contact Michelle A. Sager at (202) 512-6806 or sagerm@gao.gov.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Priority recommendation

    Comments: OMB, working with its partner agencies, has developed a revised pilot design that--if implemented as planned--should meet the design requirements set by the act. Specifically, the revised plans specify an approach for collecting data over a 12-month reporting cycle and include sampling plans that should provide for diversity among pilot participants as well as meet the aggregate amount of $1 to $2 billion collectively between the grants and procurement portions of the Section 5 Pilot.

    Recommendation: To help ensure and more clearly convey how the procurement portion of the pilot will contribute to meeting the Section 5 Pilot design requirements, the Director of OMB should determine and clearly document (1) how it will collect certified payroll data over a 12-month reporting cycle, (2) ensure the diversity of pilot participants, and (3) how the inclusion of federal contracts will contribute to an aggregate amount of $1 billion to $2 billion.

    Agency Affected: Executive Office of the President: Office of Management and Budget

  2. Status: Closed - Implemented

    Priority recommendation

    Comments: In June 2016, OMB updated its design of the procurement portion of the pilot to reflect leading practices for pilot design. Among the improvements contained in the revised design document are the following: a fuller description of the assessment methodology OMB intends to use, additional information on how OMB plans to ensure the scalability of the pilot to a larger population, inclusion of a data analysis plan to evaluate pilot results, and specific plans for conducting two-way stakeholder outreach. The revised design of the procurement portion of the pilot at least partly reflects all five leading practices for effective pilot design.

    Recommendation: To enable the development of effective recommendations for reducing reporting burden for contractors, the Director of OMB should ensure that the procurement portion of the pilot reflects leading practices for pilot design.

    Agency Affected: Executive Office of the President: Office of Management and Budget

 

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