Avoiding a Parallel Government


 The Stimulus Bill contains an enormous number of reporting requirements. For example, Stimulus dollars have to be accounted separately, and agencies must separately report on who gets the dollars, including subcontractors or sub-grantees, and how many jobs are created.  Programs, agencies, OMB, and the new, $84 million Recovery Act Accountability and Transparency Board (see p. 175 of the bill) are all required to report on the progress of spending, often on different timetables.  In fact, according to new OMB guidance, there are eight levels of reporting that are now required, with the first report from agencies due March 3rd!


There is a risk of creating, at least on paper, a parallel government – the regular government and the Stimulus government — programs (and dollars) being funded via Stimulus dollars.  The Stimulus spending ($787 billion) is almost the size of a “regular” annual budget (about $990 billion in discretionary spending in 2009, once you back out interest on the debt and entitlement programs).


The Bill includes over $300 million in additional oversight monies to make sure the Stimulus funds are being spent appropriately.  In addition, millions more have been set aside for administrative tracking of funds by federal agencies, and even more has been set aside to support administrative tracking requirements at the state and local levels.


In many cases, Stimulus dollars are being dumped into existing, ongoing programs in order to get the dollars out quickly.  But this creates a dilemma – how do you separately account for Stimulus dollars being used to accelerate an existing construction project, including accounting for which subcontractors are being paid with which pot of dollars?


This could be seen as an enormous reporting burden, or an opportunity to completely rethink how reporting is done.  After all, Team Obama – the campaign staff – was rated as the most innovative organization in 2008 by FastCompany magazine.  Can they bring this spirit into the government?  Here are some possible directions:


A recent McKinsey Quarterly article, “Six Ways to Make Web 2.0 Work,” offers some approaches that may provide some useful strategic direction.  For example, the only way an organization can successfully employ Web 2.0 tools – which require bottom-up participation – is for leadership to become role models and lead in its use through informal channels.


Yesterday, OMB convened hundreds of agency personnel from across the government at the DOI auditorium to explain their new reporting requirements.  The statutory requirements are complicated, but they are using new approaches, such as the MAX Budget Community wiki, to share information and move quickly.


In addition, www.Recovery.gov  is an exciting new approach.  If you haven’t looked at it, it’s worth the visit.  Will agencies move toward real time reporting of contracts?  The law requires reporting within 30 days, but why not when the contract is signed?  What about the use of wikis to share best practices and to draft common administrative requirements?  What about allowing others to download the spending data and create their own mashups?  These and other ideas will likely float forward.  In fact, these kinds of ideas may be the only way the government can actually meet the requirements of both getting the money out to quickly create jobs, and ensuring the monies are not wasted.


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4 Responses to “Avoiding a Parallel Government”

  1. Norman M. Macdonald Says:

    The gate keepers of the IT Community will be a real problem. The have to learn faith and respect rather than command and control. The information must be generated at ground level.The old tool of cascading mailing lists is still in use plus tools like wikki’s, Skype and interactive web sites.This whole package should be looked upon as a large step to collaborative governance.

  2. Anne Laurent Says:

    John–So glad to see this. I have been talking about the “parallel government” since this guidance came out. It’s going to be a fascinating ride. It seems unlikley to avoid such a thing however. Already one senses a division between agencies and people involved with recovery and recovery dollars and those in the “old government.” This seems to be true within OMB and within agencies. The real interesting moment will be when the 2010 budget comes out with guidance very similar to the stimulus guidance. Then what?
    It also appears that Vivek Kundra plans to triage a huge number of legacy computer systems that now deliver program information. My bet is that most of them end up being terminated with only a few being modernized. That, or he has a massive data warehousing/business intelligence plan!

  3. John Milligan Says:

    I assume they “parallel govt” will still have to comply with the Federal Records Act and all the other records/document/IT related regs from OMB A-130 thru to e-Gov. As long as they can effectively capture the record (from whatever source) and maintain it for as long as it is needed and mandated by law, then I say fine. Go for it. But do not short-shrift those regulations and maintainin an authentic record in all this even all the Web 2.0 and 3.0 stuff. If you do not do that up front, then forget about true responsibility/accountability/transparency that is above all so vitally needed. I just hope our eyes are not bigger than our stomachs on this point.

    • John Kamensky Says:

      John — Many of the provisions in the final bill are actuallly stricter than current law, and there is more oversight involved. For example, all funds (not just funds above $25,000) have to be reported; all contracts must be competed (last year, only about half were competed) unless an exception is given and then the explanation must be posted on Recovery.gov; and all contracts must be firm-fixed price, not time-and-material — again, unless an exception is given and then the rationale must be posted on Recovery.gov.

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