# Presentation: 349382

## Introducing FSA’s Budget and Performance Management System (BPMS) with a New Strategic Plan

**	****...****for better decision making and accountability to citizens!**

- April 14, 2005
- Karen Malkin, Director
- Strategic Performance
- and Evaluation Staff
- Dennis Taitano, Director
- Budget Division

## What is the Farm Service Agency?

- Farm Service Agency (FSA) is a major agency of the U.S. Department of Agriculture.
- FSA was created in 1994 by incorporating the commodity and conservation programs of the former Agricultural Stabilization and Conservation Service (ASCS) and the lending programs of the Farmers Home Administration (FmHA).

- The Agency’s name has changed over the years, however, its relationship with farmers and ranchers dates back to the 1930s.  Serving farmers and ranchers is a major component of USDA’s mission.

- Cleveland, 1940

**Notes:**
Farm Service Agency was created when the UDSA reorganized and the former Ag Stabilization & Conservation Service was merged with the farm credit programs of FmHA.  FmHA’s housing programs are now administered by USDA’s Rural Development agency.  

Many of the programs and services of FSA and the agency’s relationship with America’s farmers and ranchers date back to the early 1930s.

USDA and FSA are committed to serving America’s agricultural community.

## FSA Business Lines

- FSA delivers a wide variety of programs to over _**2.2 million**_ registered agricultural producers.
- Farm commodity programs
- Farm credit -- ownership, operating and emergency loans
- Conservation and environmental programs
- Emergency and disaster assistance
- Domestic and international food assistance
- International export credit programs

**Notes:**
FSA administers a wide range of programs from traditional commodity price support and market stabilization programs, to loans for new and beginning farmers and others who have found it difficult to obtain commercial credit, to emergency and disaster assistance, to programs aimed at helping farmers and other landowners to conserve natural resources and protect the environment.  

17 Billion loan portfolio 

FSA  also works in partnership with the US Agency for International Development and the Foreign Agricultural Service to expand market opportunities and provide humanitarian food assistance domestically and worldwide.

## FSA Programs

- FSA Programs are legislated by:

- Farm Bill
- Annual Appropriations
- Disaster and Emergency Acts

**Notes:**
FSA’s programs are legislated by Congress through a variety of means, including the Farm Bill (this legislation is revisted every five years), annual appropriations, and often through supplemental appropriations targeted at the delivery of emergency and disaster assistance to producers. 

## Program Delivery

- Agricultural producers apply for benefits and service from their local USDA Service Center.
- FSA has over 2,400 Service Centers nationwide, including local offices in Puerto Rico and Guam.
- FSA has 51 State Offices, including Puerto Rico.

**Notes:**
FSA’s program delivery structure is decentralized and quite unique in government.  FSA has over 2400 county offices nationwide, local offices in Puerto Rico and Guam, and 51 State Offices. 

Farmers and ranchers can apply for entitlement programs, disaster benefits, conservation programs, and loans at their local office...and now FSA is making an effort to make applications available online, as well. 

## Decentralization & Local Governance

- FSA workforce = 17,000 Federal and non-Federal employees
- State and local _**county-elected committees**_ oversee the delivery of FSA programs.
- Committee system and local governance sets FSA apart.

**Notes:**
FSA workforce = 17,000 Federal and non-Federal employees in Headquarters, State Offices, and the local USDA Service Centers

State and local county-elected committees, comprised of farmers in the local area, oversee the delivery of FSA programs and services to the local farming community.

It is FSA’s unique participatory committee system and local governance that sets FSA apart from other Federal agencies.

## Link program results to budget requests.
Dismantle existing “stove pipes.”
Streamline business processes.
Improve accountability.
Align resources effectively.
Improve employee engagement.
Improve customer service & satisfaction.
It’s good business!
“Better Performance Makes Sense!”

- Dismantle existing “stove pipes.”
- Streamline business processes.
- Improve accountability.
- Align resources effectively.
- Improve employee engagement.
- Improve customer service & satisfaction.
- It’s good business!
- “_**B**_etter _**P**_erformance _**M**_akes _**S**_ense!”

- Why is FSA Seeking to Transform?

**Notes:**
As I mentioned, despite its name change, the Agency has been around since the 1930s, but for many reasons, we have been working diligently to improve the Agency and to become more result-oriented and more focused on performance.  We also want to measure customer satisfaction and continue to demonstrate program results while streamlining our business processes.  We also need to modernize our systems and migrate to a Web-based platform as much as possible. 

FSA is a fairly hierarchical organization and in past Strategic Plans, the performance measures were very “stove piped” and did not cross traditional program lines.  In our new Strategic Plan, we worked to address this issue. 

## Organizational Issues Facing Agencies Striving to Transform

**Delivering and Monitoring Results**
**Horizontal (i.e., flatter)**
**Employee Empowerment**
**Working in Matrixed Teams**
**Forming Partnerships**
**Sharing Knowledge**
**Managing Risk **
**Constructive Labor/Management Relations**
**Embracing and Leveraging New Technology**

**FROM**
**Delivering and Monitoring Outputs**
**Hierarchical**
**Micro-management**
**Working in Stovepipes**
**Protecting Turf**
**Hoarding Knowledge**
**Avoiding Risk**
**Adversarial Labor/Management Relations**
**Avoiding New Technology**

**Notes:**
Key Organizational Issues at FSA:

The Agency is:
	Focused on outputs
                      Working in “stove pipes” – little collaboration across program 	area lines
We have:
	 “Turf” issues – and a very hierarchical organizational structure
 	Outdated IT systems – We have a major contract with IBM                 	to  modernize our program delivery systems and our financial 	systems

	A need for increased outreach – There is a perceived disparity 	in customer service and program delivery to minority agricultural 	producers, beginning farmers and ranchers, and women

	Customer service and employee relations issues
	A need to assess effectiveness of our partnerships
	A great need to streamline our business process, and a
	Need to coordinate contracts and projects – no organizational 	“change leader” currently at FSA! 

## What is BPMS?

-  Links and integrates FSA's budget, cost, and 	performance management information.
-  Begins with **new** Fiscal Years 2005 – 2011            	Strategic Plan.
-   “What gets measured gets done _AND_ 		  funded!”

**Notes:**
BPMS at FSA is our Budget and Performance Management System.

In the summer of 2003, working through the budget process, managers became aware that FSA needed an approach for Budget and Performance Integration (BPI) and began to design a “whole system approach to integrating FSA’s budget, performance management, and cost accounting information. 

## Key Elements

**BPMS **
**Strategic Plan Framework**

**People – Processes - Systems**

**Notes:**
Once we identified key organizational issues and began our Strategic Plan development journey, we used a logic model approach to develop a the Framework for our new Strategic Plan.  Included in this Framework are the Agency’s Strategic Goals, Outcome-oriented Objectives, and our Performance Measures.

## Budget and Performance Management System  

**Budget and Performance Management System **** **

## BPMS Management Structure

**Strategic Performance & Evaluation Staff Director, Co-Chair**
**Budget Director, Co-Chair**
**Senior Managers:**
**Farm Programs**
**Farm Loan Programs**
**Commodity Operations**
**Field Operations**
**External Affairs**
**Civil Rights**

_**Key Advisors**_
**Information Technology Division**
**Economic and Policy Analysis Staff**
**Financial Management Division**
**Human Resources Division**
**State and County Offices**

**FSA Administrator**

**Associate Administrator for Operations and Management**

**Associate Administrator ****for Programs**

**Director, Office of Business and Program Integration**
**Director, Strategic Performance and Evaluation Staff**

**Notes:**
In order to accomplish this Agency-wide initiative, we assembled a Core Team of managers representing major functions within FSA.  We also enlisted the help of Senior Managers as Advisors to this Core Team.  

## Engaging External Stakeholders

- Input from 250 External Stakeholders:
- Farmers and ranchers
- Conservation and environmental groups
- State and Federal agencies
- Commodity groups and trade associations
- Community-based and civil rights organizations

**Notes:**
As we set out to develop FSA’s new Strategic Plan, we sought input from external and internal stakeholders.  

We held Six full-day external stakeholder meetings in Omaha, Sacramento, and Washington, D.C.
SUBSTANTIAL Input from 450 Internal and External Stakeholders
At our various internal and external stakeholder sessions, we asked those who participated what FSA does well, what they saw as the mission of the agency, and in which areas did we need to improve.

Other actions taken:

Regular meetings with BPMS Core Team
Briefings with Senior Management
Input from and Consultations with USDA
Consultations with OMB

##  FSA FY 2005-2011 Strategic Plan

-  FSA FY 2005-2011 Strategic Plan

## Strategic Goal 3 

**Improving Conservation Practices**
- ______________________________
- PERFORMANCE MEASURES
- M1 Maintain or increase % of acres in compliance with highly erodible land and wetland provisions.
- M2 Increase % of conservation acres with invasive species controls.

- OBJECTIVE 3.2
**Targeting Lands to Maximize Conservation Benefits**
- _______________________________
- PERFORMANCE MEASURES
- M1 Increase acres managed under Continuous Conservation Reserve Program (CRP) sign-up.
- M2 Increase general sign up acres in priority areas.
- M3 Reduce average processing time of conservation offers through partnerships and technology:
- 		-	FSA time*
- 		-  partner time*.

- OBJECTIVE 3.3
**Mitigating Adverse Impacts**
**From Agricultural Production**
- _______________________________
- PERFORMANCE MEASURES
- M1 Increase CRP acres of riparian and grass buffers.
- M2 Increase % of  CCC sites where remediation is implemented.
- M3 Increase CRP restored wetlands acres.

******** *Asterisk denotes efficiency measure.

**END**
**OUTCOMES**

**Strategic Goal 3**** **
- Conserving Natural Resources and Enhancing the Environment

- END OUTCOME 1
**Quality Soil**_ _____________________
- INDICATOR
- Reduced erosion rates.

- END OUTCOME 2
**Quality Water**
- _____________________
- INDICATOR
- Reduced ground and surface water contamination.

- END OUTCOME 4
**Quality Air**
- _____________________
- INDICATOR
- Increased tons of carbon dioxide sequestered.

- END OUTCOME 3
**Quality Wildlife Habitat**
- _____________________
- INDICATOR
- Increased populations of targeted species.

**INTERMEDIATE**
** ****OUTCOMES**

**PRODUCTS and SERVICES**

- 26

## End Outcomes and Indicators

- FSA ***plays a role*** in achievement of these societal goals, but Agency is not solely responsible for end outcomes.
- Strategic goals are relevant ***beyond*** FSA – USDA and many other agencies and private entities play roles.

**Notes:**
 What is it (BPI)?
 Goal of the BPI Initiative:  To best allocate limited federal resources to those programs that deliver results.

## Interagency Responsibilities

**Example Showing**

- 28

**Notes:**
 What is it (BPI)?
 Goal of the BPI Initiative:  To best allocate limited federal resources to those programs that deliver results.

## End Outcomes and Indicators

- Indicators with End Outcomes are measured every 3 years by reviewing relevant statistics to see trends.
- Indicators are **not** reported with FSA’s Performance Budget.
- Indicators are** not**** **directly linked to individual employee performance.

## Objectives and Performance Measures

- FSA ***can influence*** the achievement of these Objectives, which can ultimately lead to the accomplishment of end outcomes and strategic goals.
- Measures with Objectives are reviewed annually or more frequently, when appropriate, by monitoring target levels.
- Measures are reported with FSA’s Performance Budget.
- Measures are directly linked to senior managers’ performance.

**Notes:**
 What is it (BPI)?
 Goal of the BPI Initiative:  To best allocate limited federal resources to those programs that deliver results.

## Outputs and Employee Performance Measures

- Products and services of the Agency.
- Activities performed by employee that lead to outputs or products and services.
- Measures set by employee’s manager specifically for employee.
- Measures linked to employee’s performance.
- Employee measure falls under Agency’s performance measure.

**Notes:**
 What is it (BPI)?
 Goal of the BPI Initiative:  To best allocate limited federal resources to those programs that deliver results.

## How Do Employees Link to the Strategic Plan? 

**Conserving Natural Resources and Enhancing the Environment**

**Example:**
- How Do Employees Link to the Strategic Plan?

**END**
**OUTCOMES**

**AGENCY ****	****	****	****	****	****	****	****	****	****	****	****	****	****	****END OUTCOME 1: **Quality Soil
- 																				**INDICATOR 1: **Reduced erosion rates.

**INTERMEDIATE**
** ****OUTCOMES**

**SENIOR MANAGER PLAN ****	****	****	****	****	****	****OBJECTIVE 1: **Improving Conservation Practices
**MEASURE 1: **Maintain or increase % of acres in compliance with highly erodible land and wetland provisions.

**PRODUCTS and SERVICES**

**EMPLOYEE PLAN                    ****	****	****	****	****	****OUTPUT:** Spot-checks for Conservation Compliance

## From Annual Performance to Strategic Plan 

| Strategic Plan |  |  |  |  |
| --- | --- | --- | --- | --- |
| 

What results to accomplish by when (short-term).

Example:
Goal 1, Objective 1: Improving Access to Capital. | 

What results to accomplish by when (long-term).
Includes measures, which are  directional indicators that will be assessed every 3 years.

Example:
End Outcomes for Goal 1:
Successful Farms and Ranches
A Market-Based Agriculture Sector
Thriving Agricultural Communities. | 

Societal results FSA wants to accomplish.

Example:
Goal 1: Supporting Productive Farms and Ranches. | 

Description of what FSA is capable of becoming.

Vision:
A customer-driven agency with diverse and multi-talented work force, dedicated to achieving an economically and environmentally sound future for American Agriculture.

Example of outcome:
Timely processing of farm loans enables beginning farmers to stay in business. | 

Reason for FSA’s existence.

Mission:
Equitably servicing all farmers, ranchers, and agriculture partners by delivering effective, efficient agricultural programs for all Americans. |

| Annual Performance |  |  |  |  |
| --- | --- | --- | --- | --- |
| 

Business processes performed by the employee.

Example:
Processing racial and ethnic minorities direct loans.
 | 

Form AD-2000, Performance Plan Agreement and Appraisal.

Example: 
Mission Results: Goal 1, Objective 1, Measure 3: By 9/30/05, Reduce average processing time for racial and ethnic minorities direct loans to 34 days from FY 04 baseline (3 year average) of 37 days - set for employee.

 | 

Form AD-2000, Performance Plan Agreement and Appraisal.

Example:
Mission Results: Goal 1, Objective 1, Measure 3: By 9/30/05, Direct Loans and Funds Mgmt. Branch will reduce average processing time for direct loans to 35 days from FY 04 baseline (3 year average) of 37 days - set for office. | 

Monitoring progress and achievement based on outputs, products, and services.

Example:
Program measures such as: 
Decrease in average processing time for all direct loans to 36 days from FY 04 baseline of 38 days - Agency-wide.

Note:  These measures would be included in an Operational Plan for major program areas.  | 

An annual detailed plan for the acquisition and use of financial and other resources  wherein expenditures are based primarily upon measurable performance.

Example:
Goal 1, Objective 1, Measure 3: By 9/30/05, Reduce average processing time for all direct and guaranteed loans to 39 days from FY 04 baseline (3 year average) of 40 days - Agency-wide.
Note: This measurement is for senior mgmt. accountability. |

**FSA OBJECTIVES**

**MID-LEVEL**
**MANAGER PLAN**

**EMPLOYEE PLAN**

**FSA**
**END OUTCOMES**

**EMPLOYEE ACTIVITIES**

**FSA**
**MISSION**

**FSA**
**VISION**

**FSA - PERFORMANCE BUDGET/ APP SES/GS 15,14 PLAN**

**From Annual Performance to Strategic Plan**

**FSA**
**STRATEGIC GOALS**

**PROGRAM OR OPERATING MEASURES**

## Strategic Goal Linkage - FSA to USDA to FSA

- Provide farm income support to eligible producers, cooperatives, and associations to help improve the economic stability and viability of the agricultural sector and to ensure the production of an adequate and reasonably priced supply of food and fiber.
_**Strategic Goal 3**_
- Assist eligible individuals and families in becoming successful farmers and ranchers.
_**Strategic Goal 4**_
- Improve the effectiveness and efficiency of commodity acquisition, procurement, storage, and distribution activities, and administer the U.S. Warehouse Act (USWA).

_**Strategic Goal 2**_
- Assist agricultural producers and landowners in achieving a high level of stewardship of soil, air, and wildlife resources on America’s farms and ranches while protecting the  human and natural environment.

_**Strategic Goal 1**_
- Promoting Productive Farms and Ranches
_**Strategic Goal 2**_
- Supporting Secure and Affordable Food and Fiber Supply

_**Strategic Goal 3**_
- Conserving Natural Resources and Enhancing the Environment

**Strategic Goal Linkage - FSA to USDA to FSA**

_**Strategic Goal 1**_
- Enhance Economic Opportunities for
- Agricultural Producers

_**Strategic Goal 5**_
- Protect and Enhance the
- Nation’s Natural Resource Base and Environment

_**OLD**_
**FSA FY 01-05 Strategic Plan**

_**NEW**_
**FSA FY 05-11 Strategic Plan**

**USDA FY 02-07 Strategic Plan**

- 9

##       FY 2006 President’s Budget

| USDA Strategic
Goal/Objective | FSA 
Strategic Goal | 
FSA Strategy | Major Program Areas
that Contribute | 
FSA End Outcome |
| --- | --- | --- | --- | --- |
| USDA Goal 1:
Enhance Economic
Opportunities for
Agricultural Producers

Objective Strategic 1.2:
Support International Economic Development and Trade Capacity Building | Agency Goal 2:
Supporting Secure and
Affordable Food and
Fiber Supply
 | Objective 2.2:
Providing Adequate, Secure Storage Capacity that Maintains Quality | Income Support Programs

Commodity Operations | End Outcome 2:
Secure Supply of Quality Food and Fiber

End Outcome 3:
Effective Food Aid |
| USDA Goal 1:
Enhance Economic
Opportunities for
Agricultural Producers

USDA Strategic
Objective 1.3:

Expand Alternative
Markets for
Agricultural Products
and Activities | Agency Goal 1:
Supporting
Productive Farms and
Ranches | Objective 1.4:
Expanding Market
Opportunities | Commodity Operations | End Outcome 1:
Successful Farms and
Ranches

End Outcome 3:
Thriving Agricultural
Communities  |

**      ****FY 2006 President’s Budget**
**Strategic Goal Linkage – FSA to USDA**

##     FY 2006 President’s Budget

| USDA Strategic
Goal/Objective | FSA 
Strategic Goal | 
FSA Strategies | Major Program Areas
that Contribute | 
FSA End Outcome |
| --- | --- | --- | --- | --- |
| USDA Goal 1:
Enhance Economic
Opportunities for
Agricultural Producers

USDA Strategic
Objective 1.4:
Provide Risk Management
and Financial Tools to
Farmers and Ranchers | Agency Goal 1:
Supporting Productive
Farms and Ranches |  Objective 1.1: 
 Improving Access to
 Capital

 Objective 1.2:
 Mitigating Market Losses

 Objective 1.3:
 Mitigating Losses from
 Natural Disasters |  Farm Loan Programs

 Income Support Programs

 Disaster Assistance
 Programs

 Conservation Programs

 Commodity Operations |  End Outcome 1:
 Successful Farms and
 Ranches

 End Outcome 2:
 A Market-Based
 Agricultural Sector

 End Outcome 3: 
 Thriving Agricultural
 Communities |
|  | Agency Goal 2:
Supporting Secure and Affordable Food and Fiber |  Objective 2.1: 
 Supporting Domestic
 Agriculture |  Farm Loan Programs

 Income Support
 Programs

 Disaster Assistance
 Programs

 Conservation Programs

 Commodity Operations |  End Outcome 1:
 Affordable Food and
 Fiber |
| USDA Strategic 
Goal 5:
Protect and Enhance
the Nation’s Natural
Resource Base and
Environment

USDA Strategic
Objective 5.2: 
Improve Management
of Private Lands
 | Agency Goal 3:
Conserving Natural
Resources and
Enhancing the
Environment
 |  Objective 3.1:
 Improving Conservation
 Practices

 Objective 3.2:
 Targeting Lands to
 Maximize
 Conservation Benefits

 Objective 3.3: 
 Mitigating Adverse
 Impacts from
 Agricultural Production | 
 Conservation
 Programs

 Farm Loan Programs
 |  End Outcome 1:
 Quality Soil

 End Outcome 2:
 Quality Water

 End Outcome 3:
 Quality Wildlife Habitat

 End Outcome 4:
 Quality Air
 |

**    ****FY 2006 President’s Budget**
**Strategic Goal Linkage – FSA to USDA, Continued**

## Performance Measure Crosswalk

**Goal 3:** Guaranteed loan loss rate (%).
**Goal 3:** Processing time for direct loans (%).
**Goal 3:** Processing time for guaranteed loans (%).
**Goal 3:** Loans to beginning and socially disadvantaged farmers (% of total lending).
**Goal 3:** Direct loan delinquency rate (%).
**Goal 3: **Borrowers graduated from direct loans to guaranteed loans (%).

**Goal 1: ****	**Maintain or reduce loss rates for:
-  		 -  Direct loans
-  	 	 -  Guaranteed loans
**Goal 1:  **Reduce average processing time
-               for:
- 			-  Direct loans
- 	  -  Guaranteed Loans
**Goal 1:  ****	**Increase % of:
- 		- beginning farmers
- 		- racial and ethnic minorities, and 		  women farmers financed by 		  FSA.

*SAMPLE*

- FY 05 BPI

-  FY 06 BPI

## Performance Measure Crosswalk

- Reduce % of skills gaps in mission critical occupations.
- Reduce average processing time to fill vacancies.
- Increase % of employees that meet the homeland security training standards.
- Reduce average time to certify and disburse payments.
- Reduce % of erroneous payments.
- Increase % of material weaknesses that are corrected on schedule.
- Increase % of transactions completed through a web environment.
- Increase % of program results and budget requirements that are linked to the FSA Strategic Plan and fully costed.

- FY06 BPI

- USDA FY02-07 Strategic Plan

**Management Initiative 1:**
- Improve human capital management.
**Management Initiative 2:**
- Improve financial management.
**Management Initiative 3:**
- Expand electronic government.
**Management Initiative 4:**
- Establish budget and performance integration.

*SAMPLE*

## BPMS Milestones

- 	Department and OMB Approval of Strategic Plan Framework
- 	Incorporation of Framework into FY 2006 Performance Budget
- 	Linkage of Employee Performance to FY 2005-2011 Strategic Plan
- 	Development of BPMS Intranet (internal) and Internet (public) Websites
- 	Development of Interim Web-based Performance/Budget Reporting System
- 	Release of Draft Strategic Plan for Public Comment
- Vendor Demonstration of **INTEGRATED** Web-based Budget, Performance, and Cost Accounting Data System
- Development & Implementation of **INTEGRATED** Web-based Performance Reporting System
- Implementation of Strategic Plan
- Measure Customer Satisfaction
- Measure Effectiveness of Partnerships
- Streamline Business Processes
- Develop & Implement Tiered Employee Performance System
- Leverage Resources through Partnerships

**Notes:**
Talk about MITS (from DOI) as our interim solution

## TRANSFORMATION Challenges

- Institutes MAJOR cultural change – performance based.
- Requires integrated change management and will facilitate an integrated process for realigning resources.
- Requires continued commitment and support from all levels.

## Visit BPMS Internet Site at:
www.fsa.usda.gov/bpms

For answers to your questions or to send a question directly to the Agency, please visit : 
 www.fsa.usda.gov/performance

- _[www.fsa.usda.gov/bpms](http://www.fsa.usda.gov/bpms)_
- For answers to your questions or to send a question directly to the Agency, please visit :
-  _[www.fsa.usda.gov/performance](http://www.fsa.usda.gov/performance)_

- Questions?  Comments?

## Farm Service Agency

***Farm Service Agency***