Lawmakers' concerns halt HR LOB

A little-known provision tucked into the Financial Services and General Government sections of the 2008 Omnibus Appropriations Act has temporarily stopped all contract competitions under a federal consolidation initiative known as the Human Resources Line of Business (HR LOB). The earliest those competitions might resume is March. The bill became law Dec. 26, 2007. The Office of Management and Budget, which initiated the HR LOB, must now submit a report to Congress’ appropriations committees. The Government Accountability Office also must review the report and brief committee members within 45 days of receiving it before agencies can resume contracting activity under the initiative. Karen Evans, OMB’s administrator for e-government and information technology, said her office is working on the report and hopes to minimize the effect of the new requirement. “This provision asks a number of good questions,” Evans said. “We’ll need to demonstrate how the HR LOB provides the necessary tools for agencies to improve their administrative systems and processes in order to [ensure that we have] the right workforce to achieve their program goals.” Rep. José Serrano (D-N.Y.), chairman of the Appropriations Committee’s Financial Services and General Government Subcommittee, said he inserted the language because he had concerns about the effect the initiative could have on federal workers. “Along with many others, I had many concerns about the efficacy and wisdom of OMB’s HR LOB initiative,” Serrano said. “Federal workers were at risk of unfair treatment to the express benefit of outside contractors. Our federal workers do an outstanding job, and the rush to privatize often harms them by forcing them to compete on unfair terms or even denying them an opportunity to compete.” Lawmakers want OMB to report back with answers to five questions, including an explanation of how the initiative could affect federal employees and the cost of switching to a new human resource services provider. Serrano was one of 10 House and Senate members who sent a letter last year to Clay Johnson, OMB’s deputy director for management, expressing his concerns about the HR LOB program. The lawmakers said the program “treats federal employees unfairly, allows for abuse in the privatization process and risks the healthy functioning of the federal government.” A former Capitol Hill staff member said the lawmakers’ concerns are similar to those expressed about the Bush administration’s competitive sourcing and e-government initiatives. “OMB makes a lot of claims about how much can be saved over five to 10 years, and this report the committee wants is trying to [put] some details to that,” the former staff member said. HR LOB “is a pretty big deal to do because it is applied governmentwide.” The former staff member said members of Congress have a growing concern that the administration’s consolidation and outsourcing projects are not delivering the innovation and savings officials promised.