Small Business Administration:

Review of Selected Personnel Practices

GGD-99-68: Published: Apr 23, 1999. Publicly Released: May 21, 1999.

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Pursuant to a congressional request, GAO reviewed events related to personnel reassignments, appointments, and activities at the Small Business Administration (SBA).

GAO noted that: (1) SBA made hundreds of appointments during the 1990s using competitive procedures for career appointments, special noncompetitive hiring authority for the Office of Advocacy, and political appointment procedures for other appointments; (2) for the appointments that GAO reviewed, GAO found that SBA adhered to the different procedural requirements; (3) for example, although 6 of the 42 District Director appointees were hired from outside SBA to the career positions, and 2 of them had political backgrounds, GAO found nothing procedurally amiss in the hiring process; (4) GAO determined, however, that in several cases SBA did not follow applicable federal regulations when setting the starting salary at a rate higher than the minimum rate for the grade; (5) SBA could not provide the documentation required by federal regulations to support the advanced salary settings; (6) SBA has developed draft procedures that, if properly implemented, should help prevent such situations from recurring; (7) GAO also determined that SBA poorly controlled its interagency detailing of employees, with the result that cost reimbursements were not always being collected; and (8) SBA officials advised GAO that they are developing new procedures to better control interagency details and collections of reimbursements.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: SBA finalized and issued a revised standard operating procedure effective July 21, 1999. This revised procedure addresses GAO's concerns about the proper setting of starting salaries at SBA.

    Recommendation: The Administrator, SBA, should finalize and issue standard operating procedures that include procedures for considering recruitment bonuses, setting salaries, and documenting those actions when SBA establishes starting salaries for newly appointed employees at levels above the minimum step of a pay grade.

    Agency Affected: Small Business Administration

  2. Status: Closed - Implemented

    Comments: GAO brought to SBA's attention the need to develop better procedures for controlling interagency details. SBA officials agreed and updated the SBA standard operating procedures manual section on employee details. GAO examined the updated procedures and determined that they adequately addressed its concerns and the recommendation. SBA officials also showed GAO that they had either obtained (or provided) reimbursements for those interagency details GAO identified during the review and for which cost reimbursements had not occurred.

    Recommendation: The Administrator, SBA, should identify and establish appropriate procedures for better controlling the interagency detailing of its employees. Such procedures should ensure that the specifics of each detail are appropriately documented and monitored and that in the case of cost-reimbursable details, all costs are accounted for and promptly reimbursed.

    Agency Affected: Small Business Administration


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