Questions persist on finance LOB guidance

Even after a third hearing this year on the topic, Rep. Todd Platts (R-Pa.) still has several questions about the Office of Management and Budget’s Financial Management Line of Business consolidation initiative.

Platts, chairman of the House Government Reform Subcommittee on Government Management, Finance and Accountability, said OMB’s draft migration memorandum issued in May raised as many questions as it answered and urged the administration to clarify its policies before more agencies migrate to shared-services providers or the private sector.

“It seems like we’ve come back to where we were in March,” Platts said yesterday in questioning OMB controller Linda Combs and General Services Administration deputy associate administrator Mary Mitchell. “We’re doing migrations, and we haven’t finalized the terms.”

In particular, Platts focused on the Labor Department’s decision in March to give Mythics Inc. of Virginia Beach, Va., a five-year, $5.3 million contract to provide financial-management hosting, operation and maintenance services.

This, despite the fact that OMB has only issued draft guidelines for how an agency should migrate its financial management services to either a federal shared-services provider or the private sector.

“They may have put the cart before the horse,” subcommittee staff director Mike Hettinger said after the hearing.

Platts held the hearing after OMB released its draft migration guidance in May. The guidance stated that, with limited exceptions, an agency can only rely on its in-house FM system if officials can demonstrate that it represents the best value and lowest risk.

The draft also requires agencies to release a single request for proposals for both public and private shared-services providers to respond to, publish it on and follow the Federal Acquisition Regulations as much as possible. If the task is performed by 10 or more agency employees, the competitions must comply with OMB Circular A-76, which directs agencies to use commercial products and services wherever possible.

But Platts said the guidance changed considerably from earlier discussions and a previous hearing on the topic in March, and he expressed concern that agencies and vendors are unsure just how the process works.

“It seems like we still don’t have an answer to the basic premise that, if I’m an agency, I have to migrate to an SSP if I’m not one myself,” Platts said.

OMB controller Linda Combs said at the hearing that OMB is still reading the voluminous comments on the draft, and the final version should be available this fall.

In the meantime, Combs said, she will continue meeting with Platts and his subcommittee to explain the FMLOB concept.

“We are always happy to have an opportunity to have dialogue with Congress,” she said after her speech. “We always learn a lot from their perspective and the perspective of other stakeholders in such discussions.”

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