U.S. GOVERNMENT PUBLISHING OFFICE

32–987 PDF WASHINGTON : 2019

S. Hrg. 115–451 

THE CHALLENGES AND OPPORTUNITIES OF 

THE PROPOSED GOVERNMENT REORGANIZATION 

ON OPM AND GSA 

HEARING 

BEFORE THE

SUBCOMMITTEE ON 

REGULATORY AFFAIRS AND FEDERAL 

MANAGEMENT 

OF THE

COMMITTEE ON 

HOMELAND SECURITY AND 

GOVERNMENTAL AFFAIRS 

UNITED STATES SENATE 

ONE HUNDRED FIFTEENTH CONGRESS 

SECOND SESSION 

JULY 26, 2018 

Available via http://www.govinfo.gov 

Printed for the use of the Committee on Homeland Security 

and Governmental Affairs 

( 
(II) 

COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS 

RON JOHNSON, Wisconsin, Chairman 

JOHN MCCAIN, Arizona 

ROB PORTMAN, Ohio 

RAND PAUL, Kentucky 

JAMES LANKFORD, Oklahoma 

MICHAEL B. ENZI, Wyoming 

JOHN HOEVEN, North Dakota 

STEVE DAINES, Montana 

CLAIRE MCCASKILL, Missouri 

THOMAS R. CARPER, Delaware 

HEIDI HEITKAMP, North Dakota 

GARY C. PETERS, Michigan 

MAGGIE HASSAN, New Hampshire 

KAMALA D. HARRIS, California 

DOUG JONES, Alabama 

CHRISTOPHER R. HIXON, Staff Director 

MARGARET E. DAUM, Minority Staff Director 

LAURA W. KILBRIDE, Chief Clerk 

SUBCOMMITTEE ON REGULATORY AFFAIRS AND FEDERAL 

MANAGEMENT 

JAMES LANKFORD, Oklahoma, Chairman 

JOHN MCCAIN, Arizona 

ROB PORTMAN, Ohio 

MICHAEL B. ENZI, Wyoming 

STEVE DAINES, Montana 

HEIDI HEITKAMP, North Dakota 

THOMAS R. CARPER, Delaware 

MAGGIE HASSAN, New Hampshire 

KAMALA D. HARRIS, California 

JOHN D. CUADERES, Staff Director 

JAKE M. WINDHAUS, Counsel 

ERIC A. BURSCH, Minority Staff Director 

ASHLEY E. POLING, Minority Counsel 

MALLORY B. NERSESIAN, Subcommittee and Document Clerk 
(III) 

C O N T E N T S 

Opening statement: Page 

Senator Lankford .............................................................................................. 1 

Senator Heitkamp ............................................................................................ 2 

Senator Hassan ................................................................................................. 7 

Senator Johnson ............................................................................................... 9 

Senator Harris .................................................................................................. 12 

Senator Carper ................................................................................................. 14 

Prepared statement: 

Senator Lankford .............................................................................................. 31 

Senator Heitkamp ............................................................................................ 33 

WITNESSES 

THURSDAY, JULY 26, 2018 

Hon. Emily W. Murphy, Administrator, General Services Administration ........ 4 

Hon. Jeff T.H. Pon, Ph.D., Director, Office of Personnel Management ............... 6 

ALPHABETICAL LIST OF WITNESSES

Murphy, Hon. Emily W.: 

Testimony .......................................................................................................... 4 

Prepared statement .......................................................................................... 34 

Pon, Hon. Jeff T.H., Ph.D.: 

Testimony .......................................................................................................... 6 

Prepared statement .......................................................................................... 39 

APPENDIX 

Statement submitted for the Record from National Treasury Employees 

Union ..................................................................................................................... 42 

Responses to post-hearing questions for the Record: 

Ms. Murphy ....................................................................................................... 45 

Mr. Pon .............................................................................................................. 66 

(1) 

1The prepared statement of Senator Lankford appears in the Appendix on page 31. 

THE CHALLENGES AND OPPORTUNITIES OF 

THE PROPOSED GOVERNMENT 

REORGANIZATION ON OPM AND GSA 

THURSDAY, JULY 26, 2018 

U.S. SENATE, SUBCOMMITTEE ON REGULATORY, AFFAIRS AND FEDERAL MANAGEMENT, OF THE COMMITTEE ON HOMELAND SECURITY

AND GOVERNMENTAL AFFAIRS, Washington, DC. 

The Subcommittee met, pursuant to notice, at 10:02 a.m., in 

room 342, Dirksen Senate Office Building, Hon. James Lankford, 

Chairman of the Subcommittee, presiding. 

Present: Senators Lankford, Johnson, Heitkamp, Carper, Hassan, and Harris. 

OPENING STATEMENT OF SENATOR LANKFORD1

Senator LANKFORD. Good morning, everyone. Welcome to today’s 

Subcommittee hearing titled The Challenges and Opportunities of 

the Proposed Government Reorganization on Office of Personnel 

Management (OPM) and General Services Administration (GSA). 

Thank you for being here and being part of this conversation. 

This hearing provides an opportunity to discuss the Administration’s proposal to transfer certain functions being handled by the 

Office of Personnel Management to the General Services Administration. This particular proposal is one of many that make up the 

Office of Management and Budget’s (OMBs) governmentwide reorganization plan, released on June 21, 2018. 

The current Administration has echoed the sentiment of previous 

Administrations that our Federal Government was designed and 

structured for the last century. Updating our government to meet 

the demands and challenges of the 21st Century is vital and is a 

necessary undertaking. The American taxpayers deserve an efficient and effective government, capable of meeting their 21st Century needs, and it is imperative that these conversations on reform 

take into account the dedicated men and women who comprise our 

Federal workforce. 

The Administration’s proposals are bold. They seek to consolidate 

government offices, merge executive agencies, and create new initiatives. OMB has stressed that some of these proposals can be implemented without statutory change while others will need Con-
2 

1The prepared statement of Senator Heitkamp appears in the Appendix on page 33. 

gress to act. In fact, the vast majority of them will need congressional action. 

Today we will be examining one particular reorganization proposal, titled ‘‘Reorganizing the United States Office of Personnel 

Management.’’ It identifies seven major organizational units within 

OPM that could be transferred to other agencies. The proposal calls 

for transferring five of these units outside of OPM and notes the 

placement of the remaining two units will be determined at a later 

date. Of the five units to be transferred to other specific offices, the 

plan proposes realigning three of them with GSA and then renaming the General Services Administration to the Government Services Administration. 

The three functions that are candidates for transfer from OPM 

to GSA are Human Resource (HR) Management, Federal Retiree 

Services, and Management of the Federal Health Benefits Program 

(FHBP). OPM functions as the personnel policy manager and chief 

human resources agency for the Federal Government. Congress 

charged OPM with many important responsibilities pertaining to 

the Federal workforce, including administering retirement and 

health care services for retirees and their beneficiaries. GSA manages Federal real estate and aims to provide efficient and effective 

acquisition solutions across agencies and supplies Federal purchasers with products and services from commercial vendors. 

If these three OPM services can be transferred into GSA it must 

be done to improve services to our Federal workforce and to provide 

efficiencies from what many would equate as a merger. 

In beginning this conversation, we will need more details how 

these proposals can achieve these goals, and I hope today we can 

begin to hear some of these details, which will be necessary for 

Congress’s consideration and implementation. 

With that I would recognize the Ranking Member Heitkamp for 

her opening remarks. 

OPENING STATEMENT OF SENATOR HEITKAMP1

Senator HEITKAMP. Thank you, Chairman Lankford, for holding 

this hearing, and thank you to Ms. Murphy and Dr. Pon for joining 

us today. 

I think everyone in this room, as well as every Member of Congress, from either party, would agree that we want a more efficient, 

better Federal Government system. Federal Government, honestly, 

must do better. It must be more efficient. It must be more effective 

and do a better job of connecting with its citizens. That is why I 

am looking forward to improving Federal agencies, and I know that 

that is always a great idea. Congress, the Administration, and the 

public should always be exploring ways, working together to come 

up with new ideas and structures to execute on those new ideas. 

With that in mind, I really look forward to today’s conversation. 

The Administration has proposed some bold and actually interesting ideas and its governmentwide reorganization proposal. One 

of the key proposals is the focus of today’s hearing, merging most 

of OPM’s functions with GSA and creating a whole new agency. 
3 

Last week, the full Committee got a chance to explore the full 

scope of the Administration’s reorganization proposals. Today we 

are going to get down in the weeds and learn more about one specific proposal, what it will mean and how it will be executed. 

I am not afraid of big ideas and Congress cannot be reflexively 

dismissive of a proposal simply because it changes the status quo. 

With that said, Congress also needs more information and more 

analysis about these reorganization plans. 

I am sure the witnesses today are aware of the conversation we 

had last week, and I think I am not exaggerating to say I was 

somewhat disappointed in the lack of detail that was provided to 

us regarding the overall Administration proposals, particularly as 

it relates to postal and some of the U.S. Department of Agriculture 

(USDA) proposals. So I am hoping that we will not see the same 

kind of reluctance or inability to provide background or analysis 

today, because this is a really important function. I think Senator 

Lankford and I know that there has been increasing frustration, 

not only with the public toward this agency, OPM, but also internally, with other agencies who have to work with OPM, who expect 

that they are going to get a more rapid response. 

I think that the OPM–GSA proposal is interesting, I think that 

is something that needs to be explored, and I think we have to 

work together to see how that would be carried out and analyzed 

to see if we are actually going to see efficiency. 

So we need information so that we can fulfill our oversight duties 

and also protect Federal workers. Federal employees are absolutely 

critical to the proper and efficient functioning of Federal Government, and we cannot have government, our Nation, or our citizens 

without a strong Federal workforce. 

I want to thank you and I look forward to your testimony, and 

thank you for coming in. 

Senator LANKFORD. At this time we will proceed with testimony 

from our witnesses. The Honorable Emily Murphy is the Administrator for the U.S. General Services Administration. Administrator 

Murphy previously served at GSA from 2005 to 2007, where she 

was appointed inaugural chief acquisition officer and led the transformation of the agency’s assisted acquisition centers and the consolidation of the Federal Supply Service and the Federal Technology Service. Her previous public service includes an appointment to the U.S. Small Business Administration (SBA) and 9 years 

working at the U.S. House of Representatives on the House Committee on Small Business and House Armed Services Committee. 

Dr. Jeff Pon is the Director of the Office of Personnel Management, a position he has held since March. He has had over 25 

years of experience in leading organizations and transforming talent management in the private and public sectors. Dr. Pon previously served as the Society for Human Resource Management’s 

Chief Human Resources and Strategy Officer. 

I really thank both of you for not only stepping up and taking 

these responsibilities. Going through the nomination process is not 

fun—to go through that process but also to be able to step in and 

take the challenge of the reorganization, which is a significant 

event. Status quo is much easier than just trying to be able to do 
4 

1The prepared statement of Ms. Murphy appears in the Appendix on page 34. 

the reorganization that needs to be done, so I thank you for stepping into it. 

It is the custom of the Subcommittee to swear in all witnesses 

that appear before us. So if you do not mind, please stand and 

raise your right hand. 

Do you swear that the testimony you are about to give before 

this Subcommittee will be the truth, the whole truth, and nothing 

but the truth, so help you, God? 

Ms. MURPHY. I do. 

Mr. PON. I do. 

Senator LANKFORD. Thank you. You may be seated. Let the 

record reflect both witnesses answered in the affirmative. 

We are using a timing system today, so for your opening statement we will have a 5-minute clock there. We are not going to be 

super enforcing of that today, but we do want to make sure that 

we get to questions quickly. 

Emily, you are ladies first in this one as well, with GSA, so we 

are glad to be able to receive your testimony. 

TESTIMONY OF THE HONORABLE EMILY W. MURPHY,1

ADMINISTRATOR, GENERAL SERVICES ADMINISTRATION 

Ms. MURPHY. Good morning Chairman Lankford, Ranking Member Heitkamp, and Members of the Subcommittee. It is good to see 

you, Chairman Johnson. My name is Emily Murphy and I am the 

GSA Administrator. Thank you for the opportunity to testify today 

on GSA’s role in the Administration’s Government Reform Plan, 

specifically the reorganization of certain functions with respect to 

the Office of Personnel Management. 

GSA’s mission is to deliver value and savings in real estate, acquisition, technology, and other mission support services across 

government. In this testimony, I will lay out the case for why GSA 

is uniquely positioned to build on the work of OPM and enhance 

the delivery of human capital operation services across government. 

As detailed in the President’s reform plan, the consolidation of 

administrative support functions into a unified, customer-centric 

organization is a rational approach to the management of any large 

organization. To that end, the plan identifies an expanded role for 

GSA to provide administrative services to Federal agencies. Under 

the plan, GSA’s role will expand most substantially through the 

move of certain human resource operational functions from OPM to 

GSA. Combining these functions, which include a broad spectrum 

of human resource products and services, will create opportunities 

for operational efficiencies, IT modernization, and improved service 

delivery. 

Given the breadth of the reorganization, OMB, GSA, and OPM 

all understand that we must be thoughtful and clear as we move 

forward. Moreover, to help better ensure success, the reorganization of OPM will be phased. 

In this first phase, OPM’s Human Resources Solutions (HRS) will 

be transitioned to GSA. In support of this effort, both GSA and 

OPM have established working groups and appointed transition co-
5 

ordinators, both of whom have significant experience in agency realignments. 

Before I go any further, I believe it is important to share some 

additional background on what GSA does, to show how HRS and 

other OPM functions fit within GSA’s current mission. 

Working with the predecessors of this Committee, GSA was established by President Truman on July 1, 1949, to streamline the 

administrative work of the Federal Government, a role that remains central to GSA’s mission. The delivery of complex, governmentwide services is not new for GSA. It is what we do every day. 

In many of these cases, we are able to leverage the purchasing 

power of the full government to secure better deals for the taxpayer. 

GSA excels in providing a wide variety of mission support services to agencies, including support for acquisition, fleet management, real property, travel services, and financial management 

tools. Additionally, for small agencies, we even provide an integrated set of financial, HR, and payroll services. 

GSA also serves as an integration body, enabling the delivery of 

high-quality, high-value shared services that improve performance 

and efficiency throughout the government. This is further supported by the Administration’s Cross-Agency Priority (CAP) Goal, 

‘‘Sharing Quality Services,’’ which I co-lead. The goal exists to address the fact that 40 percent of Federal leaders report that they 

are not satisfied with the administrative support in the government. 

As the first Federal agency to have an agency-wide chief customer officer, GSA has a long-standing culture of being customeroriented, and understands how to bring modern information technology (IT) solutions to government. Centralizing the transaction 

process and IT for administrative functions in GSA, which already 

aligns with our core mission, will allow for OPM to focus on the improvement of human capital policy. 

The existing capabilities within GSA provide a fertile environment to increase efficiency, decrease costs, and improve the 

lifecycle of administrative and employee services through the natural connections and interdependencies. 

GSA already provides HR services to OPM and other agencies, 

including time and attendance and leave management services. 

GSA and OPM also have an extensive partnership on the Human 

Capital and Training Services program, with GSA and OPM each 

providing subject matter experts and contracting expertise. 

The Administration’s reform plan provides a path to remaking 

government to be more responsible, efficient, and effective in service of the American people. I look forward to working in partnership with this Committee, OPM, and the Federal agencies we serve 

to bring about this needed change. 

Thank you for the opportunity to be here today. I am happy to 

answer any questions you may have. 

Senator LANKFORD. Thank you. Dr. Pon. 
6 

1The prepared statement of Mr. Pon appears in the Appendix on page 39. 

TESTIMONY OF THE HONORABLE JEFF T.H. PON, PH.D.,1

DIRECTOR, OFFICE OF PERSONNEL MANAGEMENT 

Mr. PON. Chairman Lankford, Ranking Member Heitkamp, 

Chairman Johnson, Members of the Subcommittee, thank you for 

this opportunity to be here today and to discuss the Administration’s commitment to aligning our agencies to better meet the 

needs of the American citizen. As the Director of OPM and a seasoned human capital professional, I understand the importance of 

an effective, strategic workforce alignment and how organizations 

can utilize reorganization to realize positive results. 

There has not been comprehensive civil service reform for over 

40 years now, and the way in which certain government functions 

and programs are organized does not enable our Federal workers 

to excel at the delivery on mission in the most efficient and effective way possible. 

President Trump’s reorganization proposal is a comprehensive 

attempt to address these issues, particularly by elevating OPM’s 

strategy, policy, and governance functions and aligning transactional-based services to the new GSA. I wanted to be clear on 

this one point. This proposal is not a secretive plan to fire civil 

servants. Rather, it is an opportunity to elevate the Federal civil 

service and workforce management functions to maximize operational efficiency for human capital services. 

The Executive Office of the President (EOP) released the plan 

recommending the reorganization of OPM and the process by which 

the Federal personnel management and operations functions are 

coordinated. The main objective of this proposal is to enable OPM 

to focus on its core strategic mission, which is to serve as the chief 

human resource agency and personnel policy manager for the Federal Government. 

This proposal recommends moving OPM’s policy function into the 

EOP. The details of this piece of the transition will be further developed in a later stage of our overall reorganization process, and 

I would follow additional discussions with all the stakeholders. Discussions are focused on realignment of OPM’s HR Solutions, which 

primarily includes the reimbursable HR services. By transferring 

these services, the human capital function can remain at OPM and 

allow for a more comprehensive approach for strategic workforce 

initiatives for the Federal Government. 

With the renewed focus, OPM could better support the centralized coordination of all personnel policies across the Federal Government, which includes employee compensation, workforce supply 

and demand, identification of workforce skills, leadership and talent management, and other issues. OPM could also modernize the 

approach to human resource policy, with a core focus on strategy 

and innovation, workforce and mission achievement, senior talent 

and leadership management, and total compensation and employee 

performance. 

Reorganization is just one tool among many the Administration 

is committed to using to drive transformational change across the 

Federal Government. As with most agencies named in the overall 

reorganization plan, we are currently developing a detailed imple-
7 

mentation plan. In support of this proposal, I have been participating in ongoing discussions with GSA and OMB on the specifics 

of the implementation of this proposal. I expect to have future conversations with employee groups and Members of Congress as we 

gain more detailed insight into what is necessary to move forward. 

I understand there are a lot of questions about this proposal and 

the impact it would have on our Federal workforce. I look forward 

to having a continued conversation about it. 

Thank you for this opportunity to testify and share the vision of 

this proposal. I welcome any questions that you may have. 

Senator LANKFORD. Dr. Pon, thank you. As the Chairman and 

Ranking Member, we are deferring our questions to the end, and 

I wanted to be able to recognize Senator Hassan for questions. 

OPENING STATEMENT OF SENATOR HASSAN 

Senator HASSAN. Well, thank you to my Chair and Ranking 

Member, and thank you, Ms. Murphy and Mr. Pon, for being here 

and for your work on behalf of the American people. 

I wanted to start with a question to both of you. As I said to Ms. 

Weichert last week, we all share the priority of working toward a 

more efficient and effective Federal Government, and I know when 

we have met before we have talked about that. I think this plan 

can be a starting point for an important conversation about how to 

reorganize the Federal Government, but as we all know, the devil 

is in the details. As Governor, I proposed changes to the structure 

of our State’s government, and so I appreciate the challenges that 

come along with this kind of proposal. 

On this OPM and GSA recommendation, specifically, I am curious to hear where the idea came from. We spoke last week in our 

hearing about how some of these ideas were top-down and some 

were bottom-up. So let me start with you, Director Pon. Was this 

an idea that came from the agency or the White House or somewhere else? 

Mr. PON. Thank you, Senator, for the question. Actually, it was 

an iterative process over the last 18 months. The Executive Order 

(EO) for Reorganization happened 18 months ago, and the agencies 

actually submitted their ideas to OMB. Through synthesis of this, 

OMB prepared the overall proposal and released it to agencies in 

an iterative process. So trading information back and forth and 

then the proposal came out. 

Since then, Emily and I, have set up task forces to really understand each organization and how it actually dovetails into each organization’s synergies. There is a lot to learn about GSA and also 

OPM on our staffs, and we are making sure that they are working 

together and making the tough decisions on who goes where and 

how the synergies can actually happen. 

Senator HASSAN. OK. Thank you. Administrator Murphy, the 

plan calls for moving some retirement, health care, and processing 

services into GSA. I know that in your opening remarks you 

touched a little bit on GSA’s experience in this regard. But can you 

drill down a little bit more? What experience does your agency 

have with those kinds of policies that make this a good fit? 

Ms. MURPHY. Thank you very much, Senator. I first want to start 

by saying that the transition of either retirement or health care to 
8 

GSA has not been decided. That is a Phase 2 issue and it is one 

that we are continuing to do a lot of exploration. We would be looking at that as something that is potentially 2020 or 2021 budget. 

However, when you look at GSA’s role, we are not really a policy 

organization. We are an administrative back office. So we take the 

policy directives or the mission requirements from our customer 

agencies, whether it be OPM, where we already work with them on 

things like the Human Capital and Training Solutions contract, or 

many other programs, and we then put them into implementation. 

You know, we process the transactions, we make things happen, 

and we try and find the efficiencies to make it happen so that it 

pleases the agencies who are our customers, it makes easier for 

their employees to do their jobs, and it ultimately results in savings for the taxpayers. 

Senator HASSAN. OK. I will look forward to a little bit further 

conversation with you on that offline. But I also wanted to follow 

up, Director Pon, on something that you and I have discussed and 

that I raised with Ms. Weichert last week. You and I have spoken 

in the past about the Federal cybersecurity workforce and about 

my frustration with the difficulty we have getting clear information 

about how many Federal workers we have doing cybersecurity in 

each agency. I know you are working on that and that you share 

my frustration, but the delay and lack of information has become 

a real issue. 

As Chairman Lankford noted last week, the Russian attacks on 

our election infrastructure in 2016 were an attack on our democracy. If Russia is willing and able to attack our election infrastructure, they and others will absolutely also attack our Federal agencies, and we need to ensure that we have a cybersecurity workforce 

in place to prevent and mitigate those attacks. 

The broader OMB reorganization plan calls for creating a unified 

cyber workforce across the Federal Government. Could you share 

your perspective on that proposal, and how would the proposed 

changes to OPM and GSA impact OPM’s ability to support that 

kind of unified workforce? 

Mr. PON. Thank you, Senator. I share your concern in terms of 

making sure that we have a robust cyber core in our Nation so that 

we can defend against any foreign and/or domestic threat. The actors are getting worse, it is getting more complicated, and I think 

that our workforce needs to be agile and nimble, going from private 

sector and public sector experience and getting the necessary workforce that we need. It is not just the Federal workforce that we 

have. We have contractor workforces. 

Senator HASSAN. Right. 

Mr. PON. And we need to make sure that there is a total accounting of the whole entire workforce, whether it’s contractor and/or 

Federal workforce. I intend to make sure that there is data available so that we can understand how to track people that are in the 

cyber workforce, both on the contractor side and also on our Federal workforce side. 

We also need to understand the cost and the total package, the 

type of training that they have, and the type of training we want 

them to have. So we have initiated certain types of workforce plans 

for onboarding people, flexibilities in terms of hiring, training, per-
9 

formance management, and making sure that the Federal workforce is not just stagnant, that they are getting the training available for the best-in-class. With the cyber workforce, unlike most 

workforces, the technologies and techniques change every 3 to 6 

months. It is not a 2-year cycle. So we need to take a look at that 

occupation and, in every 6 months would be my recommendation, 

because these things are actually accelerating at a much faster 

pace than most of our Federal workforce occupations. 

Senator HASSAN. Well, thank you for that answer, and I also just 

want to touch a little bit on this issue with Administrator Murphy, 

because there is another cybersecurity workforce idea that my office has been working on. There are resources in the Federal Government to help address known cybersecurity vulnerabilities, but 

there are fewer people who are proactively testing for 

vulnerabilities within agency systems and highlighting them for 

the agencies. 

I have been looking into creating a roving cyber IG or so-called 

‘‘red team’’ that would do that kind of proactive testing across 

agencies, building on the work that is already happening at the individual agency level. We have been trying to determine the best 

place to house a team of people doing that kind of cross-agency 

work, and given 18F digital service in GSA, we have considered 

GSA as a potential home for the team. Do you think such a team 

could fit within GSA, either in GSA’s current form or the expanded 

form that would exist under this reorganization proposal? 

Ms. MURPHY. Thank you, Senator. I would love to explore this 

with you, because GSA is already taking a proactive role in trying 

to identify those risks. 

Senator HASSAN. OK. 

Ms. MURPHY. We run the Continuous Diagnostics and Mitigation 

contracts for Federal agencies. We have our own bug bounty program, and we are working with the centers of excellence in providing cybersecurity assurance services to small agencies. So I 

think that there would be a lot of alignment there and I would love 

to figure out how we could make that work. 

Senator HASSAN. Well, thank you, and thank you, Mr. Chair, for 

letting me go over. 

Senator LANKFORD. You bet. And I recognize the Chairman of the 

full Committee, Senator Johnson. 

OPENING STATEMENT OF SENATOR JOHNSON 

Chairman JOHNSON. Thank you, Mr. Chairman. In last week’s 

hearing with Margaret Weichert I would consider it kind of a misunderstanding of exactly what she was presenting. She was 

present more of a vision. I personally appreciate the fact that the 

Administration is thinking big, thinking outside the box, and putting forward what I almost hate to call a proposal, because these 

things are not fleshed out yet. They are ideas. They are concepts. 

And so the only question I have for both of you—and, by the 

way, thank you for your service and your willingness to work on 

this—where are you in this process, of this integration, of this reorganization? I mean, are we at the infancy? Are you a quarter of the 

way through? And what is your process, moving forward, and when 

do you think you might have it all fleshed out where you actually 
10 

could provide this Committee and the Administration the details of 

what you are actually going to do? 

Ms. MURPHY. Senator, I think we are pretty far along with the 

HRS portion of the work. Both Jeff and I have created task forces 

that have been working together. We understand the missions and 

how there is a lot of synergy that already exists between the work 

that is existing within HRS at the Office of Personnel Management 

and the work that is already existing within GSA. 

Right now we are trying to sort of dive into the work that is 

being done in the support offices, so the CFO Office, the CIO Office, or the General Counsel’s Office, to support that work to make 

sure that we have a comprehensive solution. 

When it comes, though, to transitioning either retirement or 

health care, we are much earlier in the process for those items. 

Chairman JOHNSON. So there is not a single answer here. There 

are different components where you are further along. Director 

Pon? 

Mr. PON. Yes, I would agree with Administrator Murphy. We are 

taking these things in phases. We cannot do it all at once, and for 

the authorities that we have we are taking a look at what authorities we have administratively and what we need to work with Congress in order to approve. 

The HR Solutions organization is our fee-for-service business. It 

is the transactional fee-for-service business that has training, has 

USA Learning, USA Jobs. A lot of the agencies come to this part 

of OPM for services. GSA has a lot of synergies in terms of delivering services for the organization and agency. I think of this as 

a really good step toward the right thing, being a human capital 

and IT professional. We have a distributed system of HR, as well 

as our IT infrastructure. Could you imagine an agency that has integrated financial management, HR, IT, and acquisition, with systems that support it in one agency? That would actually increase 

our transparency and accountability across all of the things that we 

do. Our systems do not talk to one another. They are distributed. 

I have always said, in my career in the Federal service, that simplification, unification, and standardization is a good back office infrastructure, and that is what we are trying to achieve together 

with GSA. 

Chairman JOHNSON. Senator Lankford and I both have sponsored a bill that would give the Administration the authority to 

make these changes. It is almost identical. It has been obviously 

tweaked to the current circumstances, but it is modeled on Senator 

Lieberman’s and Senator Warner’s authorization that really did not 

get out of the starting gate, quite honestly. But it is that authority. 

And just listening to you, would you anticipate, if you are given 

that authority, are you going to wait until the very end point where 

all these things are decided, or would you prioritize the integration, 

the reorganization into different component parts and maybe start 

implementing them one after the other? 

Mr. PON. Thank you, Senator, and thank you for your and Senator Lankford’s bill. I think it is 3137. I have read a bit of it, and 

I believe it was since the 1980s we have discontinued that. But it 

is an authority that we can either take as an omnibus or separate 

parts. I think there is room for big things to happen all at once, 
11 

but a lot of things have to happen separately too. So it gives the 

Administration potentially some flexibility working with speed with 

Congress, and making some decisions that we would like to both 

move forward on. 

In any change effort, you need to judge what are the easy things 

and high value, what are the hard things and hard value, what are 

the hard things that have very little value, and that is what we are 

doing across our reorganization plans. Administrator Murphy and 

I are trying to prioritize the things that are essential to move over 

to GSA, as we do it administratively, that are important to us. We 

are looking at contracting vehicles that are, in my opinion, nobrainers. OPM does not have—it has an acquisition organization 

but GSA has a significant organization. 

Chairman JOHNSON. So again, you would need the authority 

from our piece of legislation to even do the low-hanging fruit, the 

no-brainers. Correct? 

Mr. PON. Some of the things I think we could do administratively, but many of the other things we need to take a look at, and 

that is what we are sifting through. 

Chairman JOHNSON. So I will go to you, Administrator. Again, 

the question I am asking, would you do this step by step, bit by 

bit? So you take a look at, well, this is a no-brainer, this is common 

sense, this is low-hanging fruit, whether you need the authority or 

not, would you do this in pieces, based on priorities, or are you 

going to kind of wait for the whole, big old reorganization plan? 

Mr. PON. We are taking a phased approach. 

Chairman JOHNSON. OK. 

Mr. PON. HRS is one consideration. In future financial budgets 

we will take a look at the other transactional services that OPM 

provides, such as health care and retirement. 

Ms. MURPHY. I agree with Dr. Pon. We are looking at this as an 

iterative process. We are trying to be agile, and hopefully make 

this part of a conversation, also, so we can be coming up and talking to you on a regular basis about what the next steps are going 

to be, asking for your input, and having that dialogue. 

Some of the work is already actually even happening, not in the 

OPM proposal but, for example, the work on fleet consolidation. 

GSA already has contracts in place where we are studying 50,000 

vehicles. We have done a demonstration with the Navy. They have 

been so happy with the way GSA managed their fleet, they have 

actually asked us to take on an additional 6,000 vehicles for them, 

and we are usually able to achieve about a 26 percent savings. So 

we are going full steam ahead there. 

We are working through HRS with all deliberate speed, and then 

we are taking a much more phased approach when it looks at the 

additional services within OPM. 

Chairman JOHNSON. Again, first of all, I think that is the exact 

right approach. It should hopefully calm everybody’s concerns that 

we are not going to be just one great big old package that has to 

be approved. It is really going to be a step-by-step approach, and 

hopefully some of this stuff will be so common sense, so obvious, 

that we can just start making those improvements. Whether you 

get the whole reorganization plan or not, at least we will be mak-
12 

ing continuous improvement. That is my manufacturing background. That is the right approach, so I appreciate that. 

Senator LANKFORD. Senator Harris. 

OPENING STATEMENT OF SENATOR HARRIS 

Senator HARRIS. Thank you. Mr. Pon, by statute, the OPM is an 

independent entity, as you know, in the Executive Branch, and 

among other things sets standards for holding managers and 

human resources offices accountable in accordance with merit system and principles around making personnel decisions based on 

merit. 

So my question is that in the reorganization plan there is a proposal that essentially will eliminate OPM, and my concern is if 

OPM is eliminated, who will take on this independent role in the 

Executive Branch to ensure that HR decisions will be in compliance 

with and adhere to merit-based principles as opposed to politics? 

Mr. PON. Thank you, Senator Harris. That is a very important 

question because OPM needs to play the independent role if we are 

leading the civil service, defending the merit system principles that 

we have. OPM is going to be, in the proposed state, elevated to the 

Executive Office of the President, and when you have an organization where the head of the organization wants HR at the table to 

make decisions, to be an influencer, I think that is a very good sign 

in any organization. The independence, whether it is in the EOP 

or not, I think we need to make sure that the OPM director has 

that directive and continues to have that directive and legislation 

that supports that role. 

Senator HARRIS. So I agree that it is important that we ensure 

that. My question is how are you going to do that under the description of this reorganization? Because, frankly, my concern is 

that this reorganization would put—and actually make HR policy 

for career staff be a function of politics and not merit. That is truly 

my concern. How would that be addressed? I think we agree on the 

goal, but how are you going to address that? 

Mr. PON. Yes, I think the current laws—none of the responsibilities or rules right now are proposed to change. It is the service 

functions and transactional systems that are the focus of our current planning. All of the policies and the rights of the OPM director, and the role of the OPM director still stays in this organization 

and entity. 

Senator HARRIS. And how does the OPM director retain independence in this new organizational structure? 

Mr. PON. Sure. I am still a direct report to our President, whether I am across the street or not. Our Merit System Accountability 

group reports in to me, and that organization actually enforces the 

Merit System Accountability approach. I think there is enough separation between the politics and also that function that it will continue to do what it is supposed to do. 

Senator HARRIS. How will you deal with any pressure that is 

placed on you to make HR decisions based on politics and not 

based on merit? 

Mr. PON. That is the role that OPM has. I swore an oath to defend the Constitution and also to uphold the office. That office is 

to be the leader of the civil service and defender of the merit sys-
13 

tem principles, and making sure that our civil service is a robust, 

free-from-politics organization. 

Senator HARRIS. And that is a noble oath. Are you aware of any 

concerns among career staff that HR decisions are being made not 

based on merit but based on politics? 

Mr. PON. I have not had any conversations with any career staff 

about threats, about the political people exerting any undue influence in personnel actions or merit system principles. 

Senator HARRIS. And then, as you know, the Administration released three Executive Orders on May 25, which appear to be 

aimed at weakening the unions that represent Federal workers. 

And one of these orders, in particular, restricts the use of official 

time by Federal employees who are part of a union to represent 

their coworkers as provided by law. 

Among other things, official time, as you know, is used in such 

as a way that it can establish flexible work hours, enforce protections against unlawful discrimination, sexual harassment being an 

example, and provide employees with a voice on their working condition. 

So due to the severe restrictions on the amount of official time 

that employee representatives can use, will agency officials then be 

required to stay after work hours and on weekends to address 

these grievances? 

Mr. PON. This proposal actually limits the official time use, taxpayer-funded union time, at 25 percent. We are not saying do not 

do it. We are saying only 25 percent. We do have cases, such as 

in the Department of Veterans Affairs (VA)—there are approximately 472 employees that are on 100 percent time. Some of these 

are nurses and doctors. What we are saying is we hired you to be 

doctors and nurses for our veterans but you can still use 25 percent 

of your time to represent your union. We think that that was a reasonable amount of time for any organization, and each employee, 

out of 100, gets an hour of representation, so the whole entire VA 

has a whole bank of hours that they can spread across each individual at 25 percent of the time. 

Senator HARRIS. So in the event that 25 percent of the time is 

insufficient to meet the concerns about working conditions, about 

allegations of discrimination or sexual harassment, in the event 

that the 25 percent of the time is insufficient to address those 

grievances, what allocation are you making and what have you set 

up in this system to allow those grievances to be met, if it exceeds 

the 25 percent? My question specifically is, are you requiring, then, 

that folks will stay on weekends and after work to address it if you 

are not allowing them to do it during work hours? 

Mr. PON. So it is 25 percent of the time and the bank. So it is 

exhaustive in terms of if you exhaust the whole entire bank. But 

for an individual they can only represent the union 25 percent of 

the time. That does not preclude another union member 25 percent 

of the time to use that bank of hours. So it is more making sure 

that we have allotted a certain amount of hours and also limited 

the amount of time to 25 percent of a person’s work role—— 

Senator HARRIS. I just have a few seconds left—— 

Mr. PON. Yes. 
14 

Senator HARRIS [continuing]. And I appreciate your point, in theory. But have you ever had the responsibility of actually working 

with an employee on a grievance? Because if you have you would 

appreciate that it takes time to establish a relationship of trust, to 

then understand the experience they have had and be familiar with 

the facts in a way that you can sufficiently represent them in their 

grievance. And the idea, then, that if you have hit that 25 percent 

mark and so it is going to have to go to a bank and another person 

will represent that employee, you can imagine how things will fall 

through the cracks and that employee will not be appropriately 

represented in the case of a sexual harassment grievance. So how 

are you going to deal with that? 

Mr. PON. I think that is a very valid concern, making sure that 

there are people that understand the case on both sides, making 

sure that you can work with your union representative to fairly 

and adequately represent you. Twenty-five percent of the time I 

think is 10 hours a work week. Each and every union member actually has that, and the bank, we think, is sufficient enough to do 

that. 

Usually within these things it is not one person representing 

you. It is two or three people. And in the case of real experience 

and working at agencies, there are usually teams of people that are 

working with the person that is grieving. 

Senator HARRIS. Thank you. 

Mr. PON. Thank you, Senator Harris. 

Senator LANKFORD. Senator Carper. 

OPENING STATEMENT OF SENATOR CARPER 

Senator CARPER. Thanks, Mr. Chairman, Senator Heitkamp, 

Governor Senator. Welcome, Administrator Murphy and Director 

Pon. I am glad you are here. Is this your whole family? Are your 

families with you today? No, that was for your confirmation hearing. Glad to see you. Thanks for your work. 

I am initially going to start with a couple of questions. I could 

use a hanging curve ball, and basically say hanging curve balls, 

Administrator Murphy. But as you think this Committee, in fact, 

some of the folks who are sitting here today with you have worked 

on real property reform, and a couple of years ago I worked with 

a number of Members of our Committee. In fact, this goes back to 

when Senator Lankford’s predecessor, Tom Coburn, was with us, 

and we worked then, and we work now on real property reform to 

try to make sure that—we spend a lot on where we put our employees to work and we want to make sure that they are in places 

where they feel appreciated but also productive. 

And I just wanted to ask you, given the work that has been 

done—who was it, Rob Portman. He is not here today, but he has 

done a lot of work on this, with us, as well. But could you just take 

a minute or two and give us an update on the status of the real 

property reform under this Administration please? 

Ms. MURPHY. I can talk for a lot more than a minute or two on 

it because I am so excited about the work we are doing on real 

property reform. First of all, I want to thank—— 

Senator CARPER. I am really excited too. People think I am 

strange—— 
15 

Ms. MURPHY. No. 

Senator CARPER [continuing]. But I get really excited about real 

property. 

Ms. MURPHY. It is really exciting work. 

Senator CARPER. I get really excited about postal reform too. My 

wife says, ‘‘Get a life.’’ 

Ms. MURPHY. Lots of people say that to me. Sorry. 

So, first of all, I want to thank you for the work that you did in 

perfecting the FASTA legislation. We got three of the board members named earlier this week. GSA has already reached out to all 

of them. We have been pulling the data together to help them. 

Since I was confirmed we have published the 2016 and 2017 Federal real property profiles. We actually, this month, then put it into 

an interactive map so people can see where all that property is. 

We have been reforming leasing and trying to focus on the leases 

where we get the best return on results, because I think I mentioned, in my confirmation hearing, that our average tenancy in a 

building is over 20 years. Our average lease is about 6 years. And 

we are at a spot where about 50 percent of our leases are not being 

renewed in a timely fashion. By focusing on those that are at the 

highest dollar value we have been able to save $400 million in anticipated lease payments between January and June of this year. 

Just yesterday I announced that, within GSA, we are actually 

taking our national capital region and we are taking them out of 

the building at L’Enfant Plaza, we are going to move 1,000 additional people into the central office building, because we think we 

can accommodate them while still giving them a quality work space 

to work in. 

So we are doing a lot to expedite the disposal of unneeded property. We were able to transfer the Department of Interior South 

Building to the Federal Reserve Board. They paid us $40 million 

for it, on a property that needs over $100 million in repairs. And 

I want to thank Senator Lankford in his role as the Chairman of 

my Appropriations Subcommittee. The Senate mark-up of this 

year’s bill gives us a lot of money to invest in doing repairs to those 

buildings so we can continue to protect our Federal property. 

Senator CARPER. Good. One of the appropriations bills also actually includes some money for GSA, I want to say about $100 million, to do some more work at St. Elizabeth’s, as we try to move 

our friends from the Department of Homeland Security (DHS) into 

this campus. How are we doing on that front? 

Ms. MURPHY. So the center building—— 

Senator CARPER. With a special focus on consolidating the Federal Emergency Management Agency (FEMA) and bringing those 

employees to the campus, please. 

Ms. MURPHY. So the $100 million that you are referring to in this 

year’s bill, and the Senate version of the bill, is for the FEMA consolidation. We think it will take about $229 million to build the 

new FEMA building on campus. We anticipate that the center office building will be ready for the Secretary of Homeland Security 

to occupy starting April 1 of next year. We have been working also 

on the Munro Building. 

Senator CARPER. That is April Fools’ Day. 
16 

Ms. MURPHY. Yes, and I hate the fact that it is April Fools’ Day 

because I feel like people think that we are trying to pull something over on them. 

Senator CARPER. That is when we do our best work here. 

Ms. MURPHY. I do not know if you have had a chance to see it. 

The work they did with that building, it is amazing. When you 

think that the original center building was built by patients at St. 

Elizabeth’s unskilled, and they were able to maintain it, keep a lot 

of the historical character while still giving us an open concept 

space that meets the Secretary and Deputy Secretary’s needs. You 

can go and see Ezra Pound, who was incarcerated there, was a patient there. You can see where he was. They have done a beautiful 

job with that building. 

And then if you look at the Munro Building, that we built for the 

Coast Guard, we are working to further consolidate, get more individuals into that building. Later this month or it is early next 

month we are going to actually do a ribbon-cutting for the Martin 

Luther King 295 Extension, so it will be easier for employees to get 

into and off of the campus. That will help with congestion around 

the area. 

So we have been putting a lot of work into that property, and I 

would invite you to come out and see it with me, because it is—— 

Senator CARPER. I have asked my staff to arrange for us to come 

out. 

Ms. MURPHY. I would love that. 

Senator CARPER. Probably not April Fools’ Day. Well, maybe not. 

Ms. MURPHY. If you want to come—— 

Senator CARPER. Hopefully before that. 

Ms. MURPHY [continuing]. I seem to get out there about every 

other month or so, and so it is amazing to see the progress. 

Senator CARPER. I look forward to joining you. 

Dr. Pon, do you ever use the Postal Service? 

Mr. PON. Sir, periodically. 

Senator CARPER. OK. Well, I want you to use it more. They need 

the business. 

Mr. PON. I use Amazon. 

Senator CARPER. OK. Well, actually, if you use Amazon you are 

using the Postal Service. 

Mr. PON. Correct, sir. 

Senator CARPER. And the Postal Service makes money on packages and parcels. What do they make, Senator Heitkamp, about $6 

or $7 billion a year, and Amazon is one of their best customers. So 

was UPS a big customer, and FedEx, because the Postal Service 

delivers the last mile and these other companies, they do not want 

to do that. So it is actually quite a good partnership. 

I used to be a State treasurer. I used to oversee most of the benefit programs for State employees, educators in our State, and have 

a great interest in pensions and health care and all the fringe benefits and so forth. 

I just wanted to mention this and then I will stop. You do not 

even have to respond. But for the record, on postal reform, when 

I was Governor, we got AAA credit ratings, until the end of my second term. We used to have the worst credit rating in the country. 

We got AAA credit ratings. 
17 

And the same week we got AAA credit ratings from all the rating 

agencies they said to us, ‘‘You still have a big liability to address 

in Delaware. You have done a great job in a lot of ways.’’ Governor 

du Pont, Governor Castle—I try to add some value as Governor. 

But they said, ‘‘You have not set aside any money for the health 

care costs, the liability for health care costs for your pensioners.’’ 

OK. And so we started doing that. 

But we looked around and we looked at other States to see what 

they were doing to address the liability for health care costs for 

their pensioners and they were not doing anything. And even 

today, if you look to see what States are doing, even big cities, almost nothing in terms of setting money aside. You look at big companies, Fortune 100, very little; Fortune 500, very little; Fortune 

1000, very little. And yet we have a law that says the Postal Service has to fully fund the liability for the pensioners for health care 

within 10 years of 2007. And it is just not realistic, and it is, I 

think, grossly unfair. 

The other thing I would say, my wife retired from DuPont a few 

years ago. She had a great career there. When she turned 65—let 

me say, for the record, if she is listening, she looks about half that 

age. 

Mr. PON. You are a lucky man, sir. 

Senator CARPER. Yes. We have a saying in our family, ‘‘Happy 

wife, happy life.’’ Anyway, when she turned 65 she got a letter from 

DuPont, and it said, ‘‘Dear Martha, we love you, but you have to 

sign up with Medicare Part A, Part B, and Part D, and we will provide some wraparound coverage for you.’’ And most every major 

company, employer in the country does the same thing. And with 

the Postal Service, most of their retirees, most of them use Part A, 

and the majority of them use Part B. Nobody uses Part D. But the 

Postal Service pays into the trust fund, the Medicare trust fund, 

as if everybody was going to get covered. But they do not. They actually overpay so that other companies can pay less. And I just 

want to say there is an equity problem there. At some point in time 

you are going to be drawn into this discussion on postal reform, 

particularly as it applies to fringe benefits and health care. So I 

just wanted to set that as a marker. All right? Thank you. 

Mr. PON. Sure. 

Senator CARPER. Great to see you both. Thank you. 

Senator LANKFORD. Senator Heitkamp. 

Senator HEITKAMP. Thank you, Mr. Chairman. I think you both 

know how much respect I have for both of you, and I really want 

to say that I am always excited when I see you on the agenda because I know we are going to have a substantive discussion and it 

is going to be very helpful to us. So I just want to tell you how 

much I appreciate your government service and your enthusiasm 

for the task ahead of you. 

One of the, I think, critical questions in any kind of reorganization plan is what is the problem you are seeking to solve and how 

will this reorganization actually further solve that problem? Now 

we have had many oversight hearings on this Committee regarding 

challenges of OPM. There is no doubt about it whether we need to 

take a look at the overall system, whether Jobs USA is just not 

functioning the way it needs to function. I get all that. But some-
18 

how just rearranging the chairs or who sits where in my opinion 

does not solve some of the problems that I see that need to be 

solved within OPM. 

So what is the problem that you think will be solved by the relocation of OPM? And I really see it more as a merger as opposed 

to an accusation—not an accusation, but instead of being acquired—thank you. But the way you described it to Senator Harris, 

clearly it is not integrating all the authorities of the Director of 

OPM within the head of GSA. So this is kind of an umbrella. 

So how is that going to solve the problems that we have recognized over a long period, Dr. Pon, that need to be solved over at 

OPM? 

Mr. PON. Thank you, Senator. Throughout my career in the Federal Government we wanted to make sure that transactional and 

administrative things were minimized and mission delivery and 

performance enhancements were maximized at agencies. This is an 

effort to continue that effort. I did mention the systems that we 

have. Initially, 15 years ago, we consolidated 22 payroll systems 

into 4. We got a lot of efficiency and cost avoidance for the taxpayers. Administrator Murphy actually owns part of that program 

to consolidate those shared service centers now, that we call them. 

They are adding time and attendance as well as other Human Resources Information Technology (HRIT) functions. With HR Solutions potentially going over there to GSA it actually envelops a lot 

of the HRIT infrastructure—USA Jobs, USA Learning, USA Staffing—which 80 or 90 percent of the agencies use some form or fashion of those types of IT solutions. 

Senator HEITKAMP. And you are saying they are already over at 

GSA. 

Mr. PON. No. USA Learning, USA Jobs, USA Staffing are in HR 

Solutions at OPM. 

Senator HEITKAMP. Right. 

Mr. PON. Those are potentially going over there to add synergy 

to the overall offering that GSA would have, in a consolidated fashion, for HRIT solutions for agencies. 

Senator HEITKAMP. OK. 

Mr. PON. The problem that we are solving is making sure that 

we are standardizing, simplifying, and unifying a lot of these tools 

so that it is not 1,000 flowers that bloom. The data is everywhere 

and the information does not really interact at the systems level. 

There is no interoperability or standardization across different 

types of tools. 

So I will give you a concrete example. 

Senator HEITKAMP. Yes. That would be good. 

Mr. PON. Performance management systems. We do not have one 

or two. We have hundreds and hundreds of them, and they have 

different—— 

Senator HEITKAMP. So why does it have to go over there in order 

for you to solve this problem? 

Mr. PON. I think it is operational efficiency. One part of OPM 

does the policy end of things. The other part of the spectrum we 

provide services to agencies. General Services Organization does 

services for IT, acquisition, and I think finance and HR are the 
19 

next steps to consolidating that back office infrastructure. That, to 

me, as an executive—— 

Senator HEITKAMP. So it is kind of a one-stop shop for the backbone. 

Mr. PON. It is the one-stop shop for administrative services for 

the Federal Government. 

Senator HEITKAMP. And you would see retention within your operation to be that public policymaking, that innovation, whatever 

it is. 

Mr. PON. Government-wide policy, the management of personnel 

management, but staying out of the fee-for-service type of business 

that HR Solutions is currently engaging in and the National Background Investigations Bureau (NBIB), as well. 

Senator HEITKAMP. Yes. Losing control over the implementation 

of your policies is not something you worry about. 

Mr. PON. I think we have been, actually customers. 

Senator HEITKAMP. Yes, I know you two can get along. 

Mr. PON. No, but even before I got here. 

Senator HEITKAMP. I am just thinking future administrative 

structures. I mean, I think both of you could make this work. I 

have no doubt about that. And you could make it work for the retirees. You could make it work for the employee that you both represent. I have utmost faith. I am just looking into the future, saying when you do not have this relationship, when you do not have 

this kind of collaboration, where is the tension points going to be 

as you are looking at creating policy for Federal employees that 

then has to be implemented and embedded within General Service. 

Mr. PON. Even before I got here, OPM has been a customer of 

GSA in HR, and I welcome Emily’s comments on that type of relationship, even before I got here. 

Ms. MURPHY GSA actually already does the performance management system for OPM. So OPM sets the policy for it, we implement it, and then we actually provide it back to them. We provide 

their payroll services. We provide their time and attendance. 

Senator HEITKAMP. So, Emily, I get that. 

Ms. MURPHY. Yes. 

Senator HEITKAMP. So then explain to me why the two agencies 

need to be umbrellaed. Why cannot we just make OPM the policymaking branch for public employees and just give you the implementation back behind-the-counter operation for management? 

Ms. MURPHY. I think that that is the intention of this plan. It 

is a step in that direction. GSA was set up to be a mission support 

agency, and if we can do a better job in serving OPM and other 

customers, as they already come to us with their mission requirements and it is our job to figure out how to most effectively and 

efficiently implement those. 

Senator HEITKAMP. So, I will turn this over to Senator 

Lankford—I understand what you guys are saying but I am trying 

to understand what you are saying in the context of what we are 

reading, in terms of reorganization, and I think some of the issues 

that Senator Harris raised could be—if you said, ‘‘Look, we are 

going to have a revised OPM that looks at overall policymaking, recruitment, does the studies,’’ that it becomes the employment agency, kind of the arching, and we are going to tell you, GSA, how we 
20 

are going to manage this. I mean, I get that. But why do you need 

to co-locate OPM within GSA? 

Mr. PON. This part of OPM is the services part of it. It is only 

that part that we are talking about right now. In future budget 

years we are considering Federal Health Benefits and also Retirement. Other than that, the enforcement, the policies still stay within this organization, whether you call it OPM or OPM, Inc. It still 

has all of those responsibilities that Congress has given them. 

Ms. MURPHY. If I could probably give an example of how we 

think this is going to add some efficiency, within OPM right now, 

within HRS, which we are contemplating bringing to GSA, there is 

a group that does telework policy. Within GSA, we actually provide 

the space and we can help consolidate the space to help with 

telework, and then we also provide the IT and the systems that 

allow for telework. So by having those groups work really closely 

aligned with each other, working together, we think we are going 

to deliver a better solution. 

Senator HEITKAMP. Emily, do you think you can do this piece 

without legislative—without congressional approval? 

Ms. MURPHY. It is my understanding that we can do the HRS 

transfer without legislative approval, but that I do not know 

that—I know our lawyers are still looking at it, and I do not want 

to speak definitively, 100 percent, because I will get in trouble with 

my lawyers. But it is my understanding, from our task forces, we 

think we can make this happen. 

Mr. PON. Large part, I think we can do this administratively. 

There are some things that our lawyers are taking a look at. There 

are certain authorities, such as USA Jobs, assessment authority. It 

is not a fee-for-service business. It is actually OPM’s responsibility 

to post all the jobs across the Federal Government. Before there 

was USA Jobs, people came to the basement of OPM and went 

through the reams and reams of paper. 

Senator HEITKAMP. Yes. I just want to make this point. This is 

what I do not want to have happen. I get mad at USA Jobs. I already am so that is a short trip. So I call you, Emily, and say, 

‘‘This has to get fixed. We cannot be waiting. You cannot do it this 

way.’’ And you go, ‘‘Well, it is Jeff’s fault.’’ And I call Jeff and Jeff 

goes, ‘‘Well, Emily is not doing her job.’’ 

I mean, right now I am going to call you and blame you, right? 

Mr. PON. Yes. 

Senator HEITKAMP. So I just want to make sure that we do not 

eliminate accountability in this kind of bifurcated responsibility. 

Ms. MURPHY. Maybe a good example is GSA already runs something called the Federal Business Opportunities website. It is sort 

of the contracting equivalent of USA Jobs. 

Senator HEITKAMP. No, I know you can do it, Emily. 

Ms. MURPHY. So when there is a problem with it, I am the one 

who gets the calls even though it is a governmentwide policy—— 

Senator HEITKAMP. You are going to regret saying that. [Laughter.] 

Ms. MURPHY. I am a Missourian. I believe, Harry Truman, the 

buck stops here. I am there. I love that. 

Mr. PON. USA Jobs is a tool. Hiring has to be taken a look at, 

and whether it is USA Jobs or the agencies pass-back, we are tak-
21 

ing a look at the whole entire system and the delivery of it. USA 

Jobs is the front door, and we need to make sure that the back office, the hiring, the agencies, the managers are doing their jobs and 

not trading the classifications back and forth. 

This is like basic HR. We need to get back to the basics and read 

resumes versus doing these keyword searches and getting all these 

things racked and stacked. We need to go back to the basics of how 

we recruit people, source people. That is very important to the mission of our organization, and USA Jobs is sometimes—I have heard 

the names. 

Senator HEITKAMP. Yes. This is a Committee that could not 

agree more with you. 

Mr. PON. That is right. 

Senator LANKFORD. And we will allow you to be able to say it is 

Jeff’s fault, and Jeff can say it is Margaret Weichert’s fault, and 

they can go to Mick Mulvaney’s fault, and then we will just keep 

going up from there. But we do appreciate this because USA Jobs 

just has to get fixed. 

Mr. PON. Hiring has to get fixed. That is all of our jobs but that 

is my responsibility. 

Senator LANKFORD. And we will talk about that in just a moment. 

Senator Hassan wanted to be able to ask an additional question 

as well. 

Senator HASSAN. Thank you very much, Chairman Lankford. Dr. 

Pon, I wanted to follow up with you on the official time proposal 

that you were discussing with Senator Harris. This official time 

proposal would limit workers to spending 25 percent of their time 

on official time, but the same amount of official time needs to be 

done regardless of how many people are doing it. That means you 

might end up with four people working 25 percent of their time instead of one person at 100 percent, to get the work done. Why is 

four people doing this work part-time more efficient and effective 

than one person full-time? 

Mr. PON. I think there is a balance, Senator, between what you 

do for the union and what you do for your government, what we 

hire people to do. 

Senator HASSAN. Excuse me just a second. I would say that 

many of us believe that representing employees and making sure 

their voices are heard serves the government and the people of the 

United States of America, so I would not distinguish or divide service to make sure employees are being heard from service to government. 

Mr. PON. Yes. 

Senator HASSAN. Does that make sense to you? 

Mr. PON. I understand what you are saying, Senator. I think our 

proposal is to make sure that we have representation 25 percent 

of the time and we have a bank of hours that helps the union manage their time allotted to them, that the taxpayers pay. But we also 

want to make sure that they do the jobs that the American public 

has hired them to do. 

Senator HASSAN. I will make this observation. I practiced labor 

unemployment law for over two decades. I represented a hospital 

in the course of doing so. 
22 

My son went through 20 hours of surgery about 15 years ago, 2 

days of surgery, 20 hours. I would not want multiple surgeons coming in and doing that 20 hours of surgery. My time is up. Next person. I counted on the doctors and nurses coming together and deploying their time, and all the other professionals who were there, 

in a way that got the job done. 

And I think it is concerning that the Administration is acting as 

if employee representation is somehow rote work that anybody just 

does and comes in with their 25 percent. To Senator Harris’s point, 

this takes professional effort, and nobody but doctors and nurses, 

for instance, know how important nurse-patient ratio is on the floor 

of a VA hospital. That is why we have nurses and doctors engaging 

in employee representation, because they know what it is to be a 

doctor or a nurse in the VA system. 

And so I just am concerned that the way the Administration is 

speaking about this proposal really reflects a lack of respect for the 

importance of representing employees, especially health care employees who take care of our veterans, and I think one might think 

that the Administration is simply trying to dilute the effectiveness 

of employee representatives, and that concerns me greatly. 

Thank you, Mr. Chair. 

Senator LANKFORD. Do you want to respond to that either way? 

Mr. PON. I understand your concern. I do believe that the employee representatives need to adequately represent their organizations and employees. It is concerning to me that we have had a tip 

through 100 percent of the time having representation. This is 25 

percent of the time. I understand your concern about the limitation 

that that 25 percent of the time takes and may have potential impacts on a case-by-case basis. 

Senator HASSAN. And thank you, and I will not prolong it other 

than to say it could seem pretty arbitrary, and that concerns me. 

But I would look forward to discussing this further. And thank you 

for your indulgence, Mr. Chair. 

Mr. PON. Thank you, Senator. 

Senator LANKFORD. So let me ask you a question, and coming 

back to what Senator Heitkamp was talking about as well, on the 

purpose of what we are trying to accomplish. How does the moving 

HR services over improve customer service? 

Ms. MURPHY. May I? 

Mr. PON. Go ahead. 

Ms. MURPHY. I think that if you look at the alignment of HR 

services with the work GSA is already doing, for example, if you 

are coming to either GSA or OPM right now and trying to use the 

Human Capital Training and Services contract, it is unclear where 

you are supposed to go. By bringing these two groups together, it 

is going to be much easier for customers to work on it. It also 

means we can use those assisted acquisition professionals to provide greater service across the government. 

Likewise, when we are doing consulting or customer experience 

work, there is a group within GSA that does this work already and 

there is a group within HRS that does this work already. Bringing 

them together we are going to be able to leverage that and provide 

a better solution. By having the work we do on telework, having 

the individuals who do the telework consulting aligned with the in-
23 

dividuals who do the telework space management, and those who 

do the telework IT management, you are going to get a better solution just by having everyone work together. 

At the end of the day, this should add—my goal, under the CAP 

goal on sharing quality services is that I am supposed to deliver 

$2 billion in savings over the next 10 years, as well as improving 

customer satisfaction. So my goal is to thrill my customers and 

save taxpayer dollars. 

Senator LANKFORD. OK. Good goals, by the way. And taking it 

from there, you both called that the low-hanging fruit of the proposals, and then Administrator Murphy, you gave us a little bit of 

a news flash there, saying Phase 2 is still in conversation about 

what happens to retirement and health benefits. 

So tell us a little bit about that. Would we have the same type 

of gain in moving that over, as you are examining it now? Will customer service still improve? And because if there is any one area 

that I get casework on dealing with OPM it is the retirement system. That area, more calls than anything else. When it takes 6 

months to actually move into the retirement system, and you have 

vulnerable retirees, it is a big issue. So does that improve customer 

service to combine that or is that still being studied? 

Mr. PON. We are taking a look at it right now, but I think moving HRS versus moving Health Benefits, its policies and its Administration is a much bigger project. I think there needs to be a lot 

of due diligence in talking about what gets to move. But the nature 

of Federal Employee Health Benefits is still a very transactional 

thing. Unfortunately, it is very much paper-based and retirement 

is paper-based too. We have a whole cave full of paper in Pennsylvania right now. 

I want to make sure that we have digital records for both. The 

employee digital record will help agencies move people from agency 

to agency and move them to retirement systems without the paper. 

I want to make sure that we deliver that in good order to GSA so 

that the digital infrastructure can be worked on together, but I am 

not having her and the GSA organization inherit some of the problems that OPM has been dealing with for decades. I want to make 

sure, on my watch, that we move to a digital environment, and 

that will take at least a year or two. 

Senator LANKFORD. OK. So let me try to clarify that. So the goal 

on, let us say, retirement—just take that piece of it—is to try to 

fix the system and then transfer it—— 

Mr. PON. Correct. 

Senator LANKFORD [continuing]. Rather than transfer it and 

have someone else clean it up. 

Mr. PON. Correct. 

Senator LANKFORD. Why is that better? 

Mr. PON. I am familiar with HRIT transformation—22 payroll 

systems, USA Jobs. I know that is a sore point for Senator 

Heitkamp. But I do think that before that we did not have any of 

those systems. We did not have digital systems. You want to make 

sure that you charge people that have the experience in doing that. 

We have a track record of doing that on my watch and I want to 

make sure that that happens on my watch. 
24 

Senator LANKFORD. All right. So set some timelines for me, both 

for retirement, let us say. Let us just take that piece of it. At what 

point will we move to current, up-to-date retirees, so that you retire 

and you actually get to retire when you retire, as shocking as that 

may seem. So walk me through that. And then talk me through 

timelines of transition for that to be able to move. 

Mr. PON. So the first step is the electronic data record. That is 

going to pull in the Enterprise Human Resources Integration of 

eOPF, which is the official personnel file, as well as other data that 

resides in Enterprise Human Resources Integration. That data will 

represent the whole entire digital representation of the employee. 

That will feed all of the systems that we are talking about, whether 

it is health benefits, whether it is retirement, whether it is transfers, promotions. The records that we keep still are very paperbased. 

So we are starting with that. In about a year, year and a half, 

we will have an organization, demonstrate that capability, and 

then from there we will be testing out the capabilities, in parallel, 

building out those test cases for transferring an employee from an 

active employee to a retired employee, in about a year and a half 

or two. 

Senator LANKFORD. OK. And that is all done by a single office, 

or would that be distributed agency to agency with instructions on 

how to do it? In other words, going through the cave, does this become a team of folks there scanning in information, trying to type 

it in, or to be able to merge it, or does each agency have the responsibility to say this is the system we are going into; get your 

data into this system? 

Mr. PON. Yes. So currently there are multiple forms of, for instance, payroll information, and the retirement system itself requires 188 data elements to process retirement. We are going toward standardization of those data requirements so that each agency can feed, in a standard way, that information and not have 

forms that are varying, that people have to type and put into the 

system. So we are digitizing things going in and also processing it. 

Senator LANKFORD. But you are establishing the structure. The 

agencies will be responsible for populating that with information. 

Mr. PON. The agencies, with their payroll providers, which Emily 

has. 

Ms. MURPHY. While Jeff is taking the lead on this right now it 

is definitely going to be something we do in partnership, because 

GSA, in our work with Shared Services through the Unified Shared 

Services Management group, and by putting out new solutions in 

that area, may be able to expedite and help those customer agencies with that part of the process. 

Senator LANKFORD. But I am still back to the same issue. They 

are establishing the system and structure. Is GSA inputting that 

data for every agency, or does each agency have the responsibility 

to be able to input their own data so that we have a much larger 

group handling this? Because this will be an enormous task, that 

if you have a small team, that that is what they do, that is going 

to take forever, versus it is distributed nationwide toward the different agencies. 
25 

Mr. PON. The current systems that we are talking about are primarily payroll, time, and attendance and HRIS. There are consolidated organizations that provide those, and I am working with 

Emily’s organization to make sure that they have standards so that 

they are going toward common standards in feeding these data systems, wherever they may reside. And we are consolidating that activity and making sure that there are economies of scale, and we 

are working together on the shared services side. 

Ms. MURPHY. So as I try to work on getting us from over 100 

time-and-attendance systems in the government down to, hopefully, 

a manageable number of time-and-attendance systems, that will 

actually make it easier for Jeff’s systems to capture that data and 

come up with a better solution. The same thing with payroll. If we 

can get from, I think, five payroll providers to a ‘‘software as a solution’’ service, we will be able to better capture that data, make 

it easier, less low-value, data entry work and more system transformation work. 

There is going to be more than enough work to go around, but 

it is going to be an opportunity for us to actually use it as a chance 

to modernize on both sides of the equation. 

Mr. PON. So the good news story about this is that we are moving away from forms. We are moving toward data, and the data 

can actually be sucked up into what they call the cloud, and then 

it can be repurposed into these systems for transactional systems. 

We have outdated systems right now that are sometimes at endof-life mainframes, and we are moving away from that type of technology across government so that the data actually can be data and 

can be repurposed for many different reasons. That is why an enterprise employee data record is so important to us. So we can pull 

the data from wherever it is and pull those 188 data elements for 

retirement systems, whether they are at the agency or the service 

provider. But we require each and every one of the entities to provide us that 188 standardized data elements. 

Senator HEITKAMP. Let us stay on IT here, because obviously one 

of the concerns that we have—and you recognized in your reorganization plan—talked about the challenges that OPM has experienced with data breaches, background investigations, backlogs, and 

really IT problems. 

So if we talk about this—number one, let us all agree it is not 

like in the cloud. It is in a server bank somewhere. Right? I mean, 

you can pull it—— 

Mr. PON. Probably in Ashburn, Virginia. 

Senator HEITKAMP. Right. Emily, do you have data storage? Who 

does this for the Federal Government? 

Ms. MURPHY. We do. GSA actually has a center of excellence on 

data storage. We have been working—if you look at our FITARA 

scorecard we have been working really hard to make sure that all 

of our servers are consolidated and that we are using cloud optimization. We actually have a cloud center of excellence that is working with USDA right now to help them make that transition themselves, so they can provide better expertise to farmers. I think we 

are actually heading to North Dakota next month to meet with 

some farmers, actually—— 

Senator HEITKAMP. Great. 
26 

Ms. MURPHY [continuing]. To make sure we are designing the 

right system for them. 

But GSA has a lot of expertise when it comes to—— 

Senator HEITKAMP. Data storage and data retrieval. 

Ms. MURPHY. And we also run a lot of the contracts for data storage, data retrieval. So if the way we are doing things is not the 

right one, we help agencies find a solution that works for them and 

their requirements. So we do not assume that there is a one-sizefits-all for every type of data that you want the same answer. 

Senator HEITKAMP. So there are some synergies, there are some 

economies of scale by migrating data storage and data analysis to 

that place. Then you become more like USDA as opposed to the 

person who is responsible for maintenance of all these records. 

Mr. PON. We will still, from a policy standpoint, be responsible 

for maintaining the records, but GSA, the new GSA, or the Government Services Agency—not new—the Government Services Agency 

will be our service provider for data IT systems. 

Senator HEITKAMP. How do you see cybersecurity improved with 

this system? 

Obviously, we are all concerned, still, about the hack of OPM. 

Mr. PON. Yes. 

Senator HEITKAMP. We do not know. I mean, I think we are 

going to be suffering consequences from that hack in years to come. 

I sit on that data for a while, assuming that only so many people 

are going to take steps to protect whatever number they have. 

And so this is a ticking time bomb. Let us not assume that, oh, 

the sky did not fall on some public employee’s head right after it 

happened. Let us just assume that people are sitting on some of 

this data, ready to utilize it at their leisure. 

So how will this system improve cybersecurity? 

Mr. PON. Well, in particular to that data, the investigative data, 

that is planned to be going to the Department of Defense (DOD), 

DOD through NBIB, National Background Investigations Bureau. 

We have, and are working with DISA to be the provider for the 

back-office infrastructure for background investigations, and working with DOD on the smooth transfer of NBIB to DOD. 

Senator HEITKAMP. Well, OK. So how do we prevent a hack in 

the future? You are saying, you are going to migrate background 

checks to DOD, right? 

Mr. PON. Yes. 

Senator HEITKAMP. Is not that what you just told me? 

Mr. PON. The infrastructure. 

Senator HEITKAMP. Right. The infrastructure. So assuming they 

are more secure than what you have had in the past. 

Mr. PON. I would not say that. We actually doubled down on 

much of our security since the hack. Government reports have actually said that OPM is on the top three of protecting their systems. 

Despite that, I want to make sure that we have the best and 

brightest working on defending some of these sensitive systems. I 

come from a background of OPM and also Department of Energy. 

That is one of the most attacked organizations in the whole entire 

government. We need help in terms of making sure that we have 

the right people to defend our cybersecurity infrastructure, and I 
27 

believe that we have placed a lot of our resources in that part of 

our organization, to get the right people and the technology, and 

the right contractors to help test, penetration test our systems. We 

do penetration tests with the security agencies as well as DHS and 

DOD, so they are active partners in making sure that our infrastructure is secure. 

Senator HEITKAMP. Yes. I am trying to figure out—now you are 

telling me you are sending a piece of this to DOD. I am trying to 

figure out why you are not responsible for—if you have the center 

of excellence for data storage, and you are responsible for contracting with many of these agencies, why are not we looking to 

you to be the center of excellence for cybersecurity, for Federal 

data? 

Ms. MURPHY. I want to distinguish between the National Background Investigation piece that Jeff is talking about. 

Senator HEITKAMP. Why? 

Ms. MURPHY. Because the National Defense Authorization Act 

(NDAA) a few years ago actually directed the transfer of 70 percent 

of that to the Department of Defense. 

Senator HEITKAMP. OK. So it is a statutory—— 

Ms. MURPHY. Yes. 

Mr. PON. Yes. 

Ms. MURPHY. But the Department of Defense is actually GSA’s 

largest customer, so we do help them. We do partner with them on 

IT and on cybersecurity. We partner with almost every agency and 

providing them assistance. 

Senator HEITKAMP. OK. I think this is fascinating. I think this 

will be one of these introductory meetings. And I just, again, do not 

want to be in that spot where I have to, and it just gets passed— 

the responsibility gets passed along. And, where I would be completely comfortable that you two are collaborating and there is not 

going to be finger-pointing. 

I do not know what that is going to look like in 5 years. I do not 

know what it is going to look like in 8 years. And so we have to 

design these systems not based on the personalities of the people 

in front of us but based on clear lines of delineation and responsibility so that we better understand. 

This is an area that I think needs reform. I mean, I think anyone 

who has examined this—and we have talked about this, Jeff, in my 

office, and in this hearing room. I look forward to continuing to 

work with you all to understand better what it is that you want 

to do, and helping you advance some of these economies of scale so 

that we can, in fact, get a better backbone for our personnel system 

and for our hiring system. 

And so thank you so much for your appearance today and thank 

you for this great discussion. 

Mr. PON. Thank you, Senator. 

Senator LANKFORD. Yes. I just have one final question. When do 

we get a timeline? I am sure your task forces are working together 

in setting some targets and goals, and say by this month we need 

to have this done, by this month we need to have this done. And, 

oh, by the way, by this month we need Congress to pass legislation 

that we may need to have enacted so we will be on time to do this. 
28 

When do we get that timeline that your task forces are working together to be able to create? 

Mr. PON. So for each phase we will make sure that we set out 

a timeline for each and every one of the phases that we are talking 

about. So, at least notionally, we have, for each section, a timeframe in which to produce deliverables on project plans, business 

cases, cost benefit analysis. That is where our team, our task forces 

are actually mapping out that project plan so that there will be 

smooth transition on it. 

What I think you will see after the task force has tackled this 

part of the HRS, you will see a timeline of implementation that we 

would be sharing with this body as well as other key stakeholders. 

But we need to make sure that our task force is giving us the information. We are learning about each other’s organizations right 

now. We are doing our due diligence on what contracting vehicles 

would be more efficient and effective in running many of these 

things? What support organizations need to support these different 

types of activities? 

But I think a reasonable timeframe would be probably in 3 or 4 

months, to work with your staffs and briefing you up on where our 

status would be on that whole entire plan. 

Senator LANKFORD. That is what I needed to hear. 

Ms. MURPHY. Our goal is really the end of the summer, early this 

fall, to make this happen. 

Senator LANKFORD. OK. Can we set a date on that now? Can we 

set an October 1 date? Do we need to set a November 1 date? When 

do we get a timeline so we can target that? 

Ms. MURPHY. I hate making commitments that I cannot guarantee. 

Senator LANKFORD. I know. It is so fun, is it not? 

Ms. MURPHY. No, well, because I do not want to come up and explain to you why we missed—why it was October 2 rather than October 1. Could we set up a set of regular briefings so you know 

where we are, when we are there? 

Senator HEITKAMP. That is OK. 

Senator LANKFORD. Sure. That is fine. 

Ms. MURPHY. OK. 

Senator LANKFORD. That is fine. What I want to know is a couple 

of things. One is I do not have a doubt you all are planning on 

working together. This is a hard process that is actually the practice round for harder things that may be coming in Phase 2, so we 

get that. But we want to be able to be engaged so we can do our 

oversight to be able to ask questions, have you thought about, 

where does this go, what happens next. 

The second part of this is there will be some date sitting out 

there that a piece of legislation might be needed. It is to your advantage to not ask us about that a week before. You might have 

noticed it takes longer than a week to be able to move a piece of 

legislation. So if there is a discovery and the lawyers come back 

and say, ‘‘We need legislation about this issue at this point to be 

able to accomplish that,’’ we need that as early as possible so we 

do not get to the last day and say we are ready to flip the switch, 

except. So we just need to know what our connection point is. Does 

that make sense? 
29 

Mr. PON. Very good. Yes, sir. 

Ms. MURPHY. Absolutely. Yes. 

Senator LANKFORD. That is great. Any other comments you all 

need to make? 

Mr. PON. We really appreciate both Senators working together 

and making sure that this is an issue that we address. It is refreshing to see that the eyes of your Committee are on us and making sure that we can actually do some things to affect the operations of the Federal Government in a much more deliberative 

fashion, and move out with those things. 

Senator LANKFORD. Great. 

Ms. MURPHY. I just want to say thank you. I am really excited 

about this opportunity for us to see if, by working together, we can 

deliver a better service for Federal employees. 

Senator LANKFORD. Yes. Absolutely. Let us fix it. I thank both 

of you for being here and what you are doing. 

The hearing record will remain open for 15 days, until the close 

of business on August 10, for submission of statements and questions for the record. 

Thank you both again. This hearing is adjourned. 

Senator HEITKAMP. Thanks, you guys. 

Mr. PON. Thank you. 

Senator HEITKAMP. Good job. 

[Whereupon, at 11:26 a.m., the Subcommittee was adjourned.] 

(31) 

A P P E N D I X 
32 

The three functions that are candidates for transfer from OPM to GSA arc, human resource 

management, federal retiree services and management of the federal health benefits program. 

OPM functions as the personnel policy manager and chief human resources agency fOr the 

federal government 

Congress charged OPM with many important responsibilities pertaining to the federal workforce 

including administering Retirement and Healthcare Services for retirees and their beneficiaries. 

GSA manages federal real estate and aims to provide efficient and effective acquisition solutions 

across agencies, and supplies fCderal purchasers with products and services from commercial 

vendors. 

If these three OPM services can be transferred into GSA, it must be done to improve services to 

our federal workforce and to provide efficiencies from what many would equate as a merger. 

In beginning this conversation, we will need more details of how these proposals can achieve 

these goats. I hope that today we can begin to hear some of those details which will be necessary 

for Congress's consideration and implementation. 

With that, I recognize Ranking Member Heitkamp for her opening remarks. 
33 

RAFM Hearing- The Challenges and Opportunities <~f the Proposed Government 

Reorganization on OPM and GSA 

Thursday, July 26, 2018 

Opening Statement of Ranking Member Heidi Heitkamp 

As Prepared for Delivery 

Thank you, Chairman Lankford for holding this hearing. And thank you to Ms. Murphy and Dr. 

Pon for joining us today. 

I think everyone in this room today, as well as every member of Congress from both parties, 

could agree that we want a better federal government. The federal government can always do 

better. It can be more efficient, more effective, and do a better job of connecting with its citizens. 

That's why looking at ways to improve federal agencies is always a good idea. Congress, the 

Administration and the public should always be exploring ways to work together, come up with 

ideas and execute on them. 

With that in mind, I look forward to today's conversation. 

The Administration has proposed some bold and interesting ideas in its government-wide 

reorganization proposal. One of the key proposals is the focus of today' s hearing- merging most 

ofOPM's functions with GSA and creating a new agency. 

Last week, the full committee got a chance to explore the full scope of the Administration's 

rf'0rge.niz&lion proposal. Today, we get down in the weeds and learn more about one specific 

proposal -what it will mean and how it could be executed. 

I am not afraid of big ideas, and Congress shouldn't be reflexively dismissive of a proposal 

simply because it changes the status quo. However, Congress needs more information and more 

analysis about this reorganization. 

I am sure the witnesses are aware of the discussion from last week's hearing. I was disappointed 

in some of the answers I got and the Administration's reluctance and inability to provide analysis 

of its reorganization proposals or information about what it has the ability to execute on right 

now. I hope that today's witnesses will be forthcoming when we ask them to convince us that 

this OPM-GSA proposal would work and that it is a good idea. I hope they will share their 

analysis proving their assertions and details about how this proposal would actually work. 

Congress needs that information so that we can fulfil our oversight duties, and also protect 

federal workers. Federal employees are an absolutely critical part of the federal government. We 

can't have the government our nation and citizens need without a strong, focused, and vibrant 

federal workforce. Congress needs to know how this proposal will ensure that strong workforce. 

Thank you and I look forward to the testimony and discussion. 
34 

Statement of Emily W. Murphy 

Administrator of the U.S. General Services Administration 

Before The United States Senate Committee on Homeland Security 

and Governmental Affairs 

Subcommittee on Regulatory Affairs and Federal Management 

July 26, 2018 

Introduction 

Good Morning Chairman Lankford, Ranking Member Heitkamp, and Members of the 

Subcommittee. My name is Emily Murphy and I am the Administrator of the U.S. 

General Services Administration (GSA). Thank you for the opportunity to testify today 

on GSA's role in the Administration's Government Reform Plan and Reorganization 

Recommendations; specifically, the reorganization of certain functions with respect to 

the Office of Personnel Management (OPM). 

GSA's mission is to deliver value and savings in real estate, acquisition, technology, 

and other mission-support services across government. In this testimony, I will layout 

the case for why GSA is uniquely positioned to build on the work of OPM and enhance 

the delivery of human capital operational services across government. 

The Administration's Reform Plan and GSA 

In Apri12017, Office of Management and Budget (OMB) Memo M-17-22 directed all 

agencies to draft reform plans to consider a number of factors including if "some or all of 

the mission functions or administrative capabilities of an agency, component, or 

program are needlessly redundant with those of another agency, component, or 

program." These agency reform plan submissions helped inform the Administration's 
35 

comprehensive Reform Plan and Reorganization Recommendations, 1 which was 

released on June 21, 2018. 

As detailed in the plan's section on the proposed reorganization of several OPM 

programs, the consolidation of administrative support functions into a unified, customercentric organization is a rational approach to the management of any large operation. 

To that end, the plan identifies an expanded role for GSA to provide administrative 

services to Federal agencies through: motor vehicle fleet assessments, real estate 

property disposal; real estate leasing improvements; customer experience digital design 

consulting, and support to establish the Government Effectiveness Advanced Research 

(GEAR) Center. 

Under the plan, GSA's role will expand most substantially through the move of certain 

human resource operational functions from OPM to GSA Merging these functions, 

which include a broad spectrum of HR products and services, will create opportunities 

for operational efficiencies, IT modernization, and improved service delivery. 

Given the breadth of the reorganization, OMB, GSA, and OPM all understand that we 

must be thoughtful and clear as we move forward. To that end, all three agencies are 

working together to lay out the best path toward success, particularly with regard to 

functions that may ultimately be merged with GSA 

Moreover, to help better ensure success, and as discussed by OPM Director, Dr. Jeff 

T.H. Pon, the reorganization of OPM will be phased. In this first phase, OPM's Human 

Resources Solutions (HRS) will be transitioned to GSA In support of this effort, both 

GSA and OPM have established working groups and appointed transition coordinators, 

both of whom have significant experience in agency realignments. 

The Work of GSA 

Before I go any further, I believe it is important to share some additional background on 

what GSA does, to show how HRS, and other OPM functions fit with GSA's current 

mission. 

GSA was established by President Harry S. Truman on July 1, 1949, to streamline the 

administrative work of the Federal government, a role that remains central to GSA's 

mission. The delivery of complex governmentwide services is not new for GSA It's 

what we do every day. 

1 https://www.whitehouse.gov/wp-content/uploads/2018/06/Government-Reform-and-Reorg-Plan.pdf 
36 

GSA already excels at providing space, fleet, acquisition, travel, card services, and IT 

support to agencies. For small agencies, we even provide an integrated set of financial, 

HR, and payroll services. 

As part of this work, GSA's Public Buildings Service is the largest landlord in the 

country. GSA owns or leases 9,624 assets and maintains an inventory of more than 

375 million square feef of workspace serving 1.1 million federal employees. 

GSA's Federal Acquisition Service (FAS) manages over 205,000 fleet vehicles and has 

more than 19,000 vendors on schedules available to provide products and services to 

agencies across government. GSA's SmartPay Program, also managed by FAS, is the 

world's largest commercial payment solution program, providing services to more than 

560 Federal organizations and Native American tribal governments, handling $55 billion 

in spend annually. 

GSA's Office of Shared Solutions and Performance Improvement (formerly the Office of 

Unified Shared Services Management) serves as an integration body that enables the 

delivery of high quality, high value shared services that improve performance and 

efficiency throughout the government. This is further supported by the Administration's 

Cross-Agency Priority (CAP) Goai"Sharing Quality Services," which I co-lead. The goal 

fits well with GSA's mission to provide competitive and high-performing mission-support 

services to other Federal agencies and was established to address the challenges the 

Federal government has faced in executing administrative support functions. These 

include: 

• Outdated processes, old technology, and a culture of compliance, which have 

created a complicated and inflexible administrative environment. 

• Duplication of common administrative services such as processing hiring 

transactions, managing Federal finances, contracts, and payroll. Rather than 

economizing by sharing across the Federal government, we duplicate contracts, 

people, and technology across hundreds of locations, costing taxpayers billions 

of dollars annually. 

• Slow adoption of innovative solutions provided by industry, which has led the 

private sector to outpace our Federal capabilities. 

• A past focus on short-term, rather than a strategic vision that creates an 

architecture for an innovative, flexible, and competitive environment. 

• All of this has contributed to low satisfaction with administrative support, with 40 

percent of Federal leaders reporting they aren't satisfied with administration 

support in the govern menta 

2 (190 million owned; 183 million leased) 3 2018 OMB Customer Satisfaction Survey. 
37 

Fostering an Environment for Innovative Solutions 

GSA has a long history of deploying systems and services that are secure, 

transformative, cost-efficient and innovative. We have a number of technology initiatives 

that have resulted in increased business value, optimized business operations and 

savings for the American taxpayer, including moving to a cloud based email and 

collaboration system, as well as consolidating existing applications to - and developing 

new applications in - a centralized development platform. 

As the first Federal agency to have an agency-wide chief customer officer, GSA has a 

long-standing culture of being customer-oriented, understanding how to bring modern IT 

to government, and being believers in going first and sharing things that are common. 

The pairing of HRS' human capital expertise with GSA's IT innovation and culture 

presents the opportunity to optimize the services currently provided by OPM, offer an 

integrated IT solution for employee lifecycle management, and drive standardization 

around many current hiring and performance issues. Centralizing the transaction 

processing and IT for administrative functions in GSA, where it is our mission to provide 

excellent mission-support services, will allow for OPM to focus on their core strategic 

mission. 

The existing capabilities within GSA provide a fertile environment to increase efficiency, 

decrease costs, and improve the lifecycle of administrative and employee services 

through natural connections and interdependencies. GSA already provides HR services 

to OPM and other agencies through our HR Links implementation, supporting employee 

performance management, time and attendance, and leave management services. 

GSA and OPM also have an existing partnership on the Human Capital and Training 

Services program with OPM providing subject matter experts and GSA providing 

contracting expertise. 

Finally, to support our vision of expanding services GSA provides to other agencies, we 

are working to create a new Services Management Office (SMO) to house the additional 

services that GSA would offer under the CAP goal. The SMO will help create a new 

payroll service for civilian agencies that leverages commercial technology, and will 

continue the transition planning for moving HRS to GSA. 

Closing 

GSA is committed to delivering value and savings in real estate, acquisition, technology, 

and other mission-support services across Government. The Administration's reform 

plan provides a path to re-making government to be more responsive, efficient and 
38 

effective in service to the American people. I look forward to working in partnership with 

this Committee, OPM, and the Federal agencies we serve to bring about that needed 

change. Thank you for the opportunity to appear before you today. I am happy to 

answer any questions you may have. 
39 

UNITED STATES OFFICE OF PERSONNEL MANAGEMENT 

STATEMENT OF 

DR. JEFF T. H. PON, DIRECTOR 

U.S. OFFICE OF PERSONNEL MANAGEMENT 

before the 

SUBCOMMITTEE ON REGULATORY AFFAIRS AND FEDERAL MANAGEMENT 

COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS 

UNITED STATES SENATE 

on 

"The Challenges and Opportunities of the Proposed Government Reorganization on OPM 

and GSA" 

July 26, 2018 

Chainnan Lankford, Ranking Member Heitkamp, and members of the Subcommittee, thank you 

for the opportunity to be here today to discuss the Administration's commitment to refonning the 

United States Government, and aligning our agencies and Departments to better meet the needs 

of American citizens. As the Director of the U.S. Office of Personnel Management (OPM), and 

a seasoned human capital professional, I understand the importance of an effective strategy for 

workforce alignment and how organizations can utilize reorganization to realize positive results. 

The 2.1 million-person civilian workforce represents one of the government's largest and most 

impactful investments. Like any large organization, the Federal Government is only as effective 

as its people. Forty years ago, OPM was established in statute by the Civil Service Reform Act 

of 1978, and was tasked with aiding and advising the President on actions to promote an efficient 

civil service. This was the last time the Federal Government implemented broad civil service 

reform. 

Today, many observers believe that the manner in which Federal agencies are required to hire, 

pursuant to existing law, may not be the most efficient way to pursue candidates with the best 

competencies for vacant positions, and may place the Federal Government at a competitive 

disadvantage with the private sector, which has fewer constraints on how private entities go 

about their hiring processes. There has not been comprehensive civil service reform in 40 years, 

and the last significant modifications to the hiring rules occurred 74 years ago. Over time, the 

hiring process has become a complex and difficult to navigate system of statutes and associated 

rules and regulations. On top of that, the way certain government functions and programs are 

organized does not enable our Federal employees to excel at delivering on mission in the most 

efficient and effective way possible. The current system hinders innovation by America's 

incredible civil servants. 

President Trump's reorganization proposal is a comprehensive attempt to address these issues, 

particularly by elevating OPM's strategy, policy and governance functions and aligning 

Page 1 of3 
40 

Statement ofDr. JeffT. H. Pon 

Director 

li.S. Office of Personnel Management 

July 26, 2018 

transaction based services in a new service-centered organization. I want to be clear on one 

particular point - this proposal is not a secret plan to fire civil servants, within OPM or across the 

government. Rather, it is an opportunity to elevate the Federal workforce management function 

and maximize the operational efficiency of human capital services. 

Executive Order (EO) 13781, entitled "Comprehensive Plan for Reorganizing the Executive 

Branch," highlights the need to evaluate the organizational constructs that support today's 

mission delivery objectives. Building on a history of bipartisan government reform initiatives, 

the EO focuses specifically on the role of organizational alignment in reducing duplication and 

redundancy, and improving the efficiency, effectiveness, and accountability of the executive 

branch. To that end, the Executive Office ofthc President (EOP) released a plan entitled 

"Delivering Government Solutions in the 21st Century: Reform Plan and Reorganization 

Recommendations." One of the recommendations is to reorganize OPM and the process by 

which Federal personnel management and operations functions are coordinated. The main 

objective of the proposal is to enable OPM to focus on its core strategic mission, which is to 

serve as the chief human resources agency and personnel policy manager for the Federal 

Government. To accomplish this objective, we plan to blend the HR expertise ofOPM with the 

customer delivery capability of GSA to meet the 21'' Century needs for our government. 

To drive real reform, the government needs to elevate Federal workforce policy, and utilize 

existing authority while seeking any necessary new legal authorities so that leading practices can 

play a larger role in driving strategic management for the entire Federal workforce. The proposal 

recommends moving OPM's policy function into EOP. The details of this piece of the transition 

would be developed in a later stage of the overall reorganization process, and would follow 

additional discussions with all stakeholders. Discussions are focusing on the realignment of 

OPM's HR Solutions, which primarily includes reimbursable HR services. By transferring these 

services, the human capital function can remain at OPM, allowing for a more comprehensive 

approach to strategic workforce initiatives for the Federal Government. With its renewed focus, 

OPM could better support the centralized coordination of all personnel policies for Federal 

employees, eliminating the confusing matrix of who does what under the current balkanized 

system, as well as several key gaps in policy that are inhibiting the streamlining of mission 

support services. OPM can concentrate on centralized policy development in areas such as 

employee compensation, workforce supply and demand, identification of future workforce skill 

needs, leadership and talent management, and other important issues. OPM would also 

modernize the approach to human resources policy, with a core focus on: strategy and 

innovation, workforce and mission achievement, senior talent and leadership management, and, 

total compensation and employee performance. 

Merging certain OPM provided services with GSA functions will provide increased economies 

of scale and creates opportunity for significant cost-avoidance based on reductions in contract 

and IT duplication, as well as increased data sharing and availability. This merger will allow 

critical functions to be housed in a government-wide agency without the administrative burden 

and cost of operating duplicative support functions within multiple agencies. 

Page2 of3 
41 

Statement of Dr. JeffT. H. Pon 

Director 

U.S. Office of Personnel Management 

July 26, 2018 

The thinking behind this proposed reorganization is not unprecedented. Congress has already 

required, pursuant to the FY 2018 National Defense Authorization Act ("NDAA"), that the 

majority of background investigations be transferred from OPM to Department of Defense 

(DoD). As you know, OPM has long held the mission of conducting background investigations 

for most of the rest of Government to support the imperative need that individuals applying for 

Federal employment meet necessary standards of personal conduct and character, and, for many 

years, has also performed background investigations related to national security determinations. 

In October 2016, the National Background Investigations Bureau (NBIB) was formally 

established, absorbing OPM's predecessor investigative component and serving as the primary 

provider of background investigations for the Federal Government. However, the 2018 NDAA 

authorized the Secretary of Defense to conduct such background investigations for DoD 

personnel and directed the Secretary of Defense to carry out the transfer of associated personnel 

and resources from NBIB to DoD. In response to the government-wide impacts related to 

splitting the background investigative mission, the Administration has now considered realigning 

the entirety ofNBIB functions, personnel, and resources under DoD, keeping the program intact 

to promote efficiency and effectiveness. This NBIB proposal would also enhance efficiency and 

effectiveness as it relates to other human capital operational services by creating a greater focus 

on OPM's core mission. 

Reorganization is one tool among many that this Administration is committed to using to drive 

transformational change in government. The proposal would help the needs of the American 

people, as well as advancing the President's mandate for greater efficiency, effectiveness, and 

accountability in government. The proposal is focused on better aligning agencies to allow civil 

servants to thrive and to serve the American taxpayer more effectively and efficiently. 

As with most other agencies named in the overall reorganization proposal, we are currently 

developing a detailed implementation plan. In support of this proposal, I am having ongoing 

discussions with the GSA and the Office of Management and Budget on the specifics of 

implementing this proposal, and how Administrator Murphy and I can best partner in carrying 

out this proposal. I expect to have future conversations with employee groups and Members of 

Congress as we gain more detailed insight into what is necessary to move forward. I understand 

there are a lot of questions about this proposal and the impact it would have. I look forward to 

having a continued conversation about it. 

Thank you for the opportunity to testifY and share the vision of this proposal. I welcome any 

questions you may have. 

Page3 of3 
42 

NTEU 

The National Treasury Employees Union 

Statement for the Record 

By 

Anthony M. Reardon 

National President, National Treasury Employees Union 

Before 

The Subcommittee on Regulatory Affairs and Federal Management 

Senate Committee on Homeland Security and Governmental Affairs 

On 

"The Challenges and Opportunities of the Proposed Government 

Reorganization on OPM and GSA" 

July 26, 2018 
43 

Chairman Lankford, Ranking Member Heitkamp and members of the Subcommittee, thank 

you for allowing NTEU to share its thoughts on the Administration's plans to reorganize the 

Office of Personnel Management (OPM) and the General Services Administration (GSA). As 

National President ofNTEU, I represent over 150,000 federal employees in 33 agencies and I 

appreciate the opportunity to discuss this important issue. 

As the subcommittee is aware, on June 21st, the White House released a report detailing 

its plans to reorganize the executive branch entitled, "Delivering Government Solutions in the 

21" Century: Reform Plan and Reorganization Recommendations." The report is in response to 

the President's March 2017 Executive Order directing the Office of Management and Budget 

(OMB) to propose a comprehensive plan to reorganize federal agencies. The report highlights 

32 proposals, which impact several agencies with employees represented by NTEU. In addition, 

the report proposes to break apart OPM, moving core employee policy divisions to the White 

Hm!~e. ,\dditionally, retirement policy and the processing of annuities, as well as the 

administration of the Federal Employees Health Benefits Program (FEHBP), would move to a 

renamed GSA, the Government Services Agency, and federal employee background 

investigations would be transferred to the Department of Defense. While NTEU does not 

represent OPM employees, we are concerned about the break-up of retirement and health care 

policy and operations, and the loss of needed independence from all White Houses for federal 

employee and workforce management policy-making and decisions. The White House's Office 

of Presidential Personnel has rightly been responsible for the selection and hiring of presidential 

appointees; however, OPM's independent authority over the career civil service-and employing 

agency human resources' actions and decisions-must be maintained for our government not to 

revert to the spoils system. 

As you know, the Civil Service Reform Act of 1978 made clear that the employment 

system for federal employees is based on merit system principles, including that federal 

employees should be ''protected against arbitrary action, personal favoritism, or coercion for 

partisan political purposes ... " (5 USC 230l(b)(8)(A)) OPM was established as an independent 

agency in the executive branch to enforce the civil service rules and regulations. (5 USC 

II 03(a)(5) However, the President's reorganization proposal does not acknowledge these or any 

meritsy~\em principles upon which the law is based. Instead, it proposes to tear apart OPM and 

send its Employee Services office, the office that sets policy and ensures that the merit systems 

principles are followed, to the Executive Office of the President. That action would remove the 

agency's nonpartisan, independent status at a time when federal employees already fear reprisals 

from agency heads for not showing enough support for this administration's policies. 

Regarding the plan to move Retirement Services and the administration of the FEHBP to 

GSA, we are concerned due to GSA's lack of experience with retirement policy and processing, 

or with health care policy and administration. Furthermore, as the federal government looks to 

recruit and retain employees in the future, it will be difficult for OPM to have a clear picture of 

the government's benefits package and whether its offerings arc competitive if the responsibility 
44 

and expertise is divided amongst different agencies. Moreover, it is unclear how this change will 

improve government efficiency if federal employees and retirees are faced with navigating a 

bureaucratic maze of various agencies to gather information about their service history, benefits, 

etc E~·;;;1 the administration's plan to develop an employee digital record will be difficult to 

achieve if key components like retirement or health care processing are moved to agencies other 

than OPM. 

We believe that an independent, central personnel agency outside ofthc Executive Office 

of the President is important for a non-partisan civilian workforce of two million. Breaking up 

OPM is not the best way to ensure mission performance. Rather, we believe properly funding 

the agency is the best solution. OPM has been underfunded for years, contributing in part to its 

massive data breach and retirement processing backlogs. 

NTEU is not against reforming some aspects of the government. However, previous 

large-scale reform and reorganization efforts failed to accomplish their stated goals. Instead, 

we've experienced overly ambitious efforts to reform the civil service that eroded employee 

rights and employee morale or haphazard efforts to reduce the number of federal workers by 

cutting an arbitrary number of personnel, implementing a hiring freeze, or failing to replace 

employees who had retired resulting in gutted agencies and largely contributing to the looming 

retirem~.n,t. <:risis facing the federal government today. In fact, one of the biggest lessons and 

failures of the Clinton-Gore Administration's so-called "Reinventing Government" initiative was 

the hollowing out of positions and focus on out-sourcing, leaving agencies unable to conduct 

proper workforce planning, and without a skilled workforce in place---which devastated 

agency's abilities to effectively perform their responsibilities, opening up federal agencies and 

workers to criticism. Under this Administration, it is unfortunate that there has already been a 

lost opportunity to improve government by not engaging with, and including, frontline 

employees in ways to improve agency functions and operations from the very beginning. So far, 

our ideas have been routinely ignored, and we have not been invited to join in discussions on 

improving efficiency and effectiveness in government programs. Moreover, the administration 

has not released key details about these proposals-including the impact on employees, the costbenefit analysis, and whether the proposals can be implemented without legislation. 

I ask this subcommittee to continue to push for additional information, to continue 

exercising congressional scrutiny and oversight over these proposals, and to work with federal 

employee organizations to obtain input from frontline workers. If this administration really 

wants to reform the government, dismantling the agency that can help them do that makes no 

sense. Nor does it make sense to freeze out those who know how government is supposed to 

work. 

Thank you for allowing me the opportunity to share NTEU's views. 
45 

Post-Hearing Questions for the Record 

Submitted to the Honorable Emily Murphy 

From Senator Claire McCaskill 

"The Challenges and Opportunities of the Proposed Government Reorganization on OPM 

and GSA" 

July 26, 2018 

1. How many public comments did GSA receive pursuant to the May 15, 2017, 

Federal Register notice? 

A: GSA received 24 comments specific to GSA; however 129 additional comments related to 

broader government reform were shared by OMB with GSA: 

a. Is GSA able to identify how many comments were submitted by individuals 

and how many were submitted on behalf of organizations? If so, please 

provide a breakdown of those submissions. 

A: It is not clear which comments were submitted by individuals or on behalf of 

organizations. The information forwarded to us consisted of spreadsheets of 

comments that included an "organization" column, but it is not clear whether the 

individuals who entered information in that section were acting on behalf of that 

organization or merely entering the organization where they work. 

b. Did GSA establish any policies regarding the intake of comments? 

A. The intake of comments on behalf of Federal agencies was managed by OMB via 

the portal at https://www.whitehouse.gov/reorganizing-the-executive-branch. OMB 

provided GSA with the public comments in cases where the commenter selected 

"GSA" as an agency for reform or elimination. These comments were reviewed and 

used in the development of the GSA agency reform plan. 

c. What process did GSA use to analyze these comments? What methods, in 

particular, were employed to identify and support the proposals that were 

included in the Administration's plan? 

A. OMB received public comments and organized, tallied. and sorted the comments by 

agency. Public comment files were then made available to GSA and other agencies 

!hfcuyh an internal website in three !ranches: May 8. June 2, and June 19, 2017. 

In developing the Agency Reform Plan submission to OMB, a wide range of inputs 

were considered, including public comments collected, as well as inputs and 

feedback gathered from interviews and focus groups with external stakeholders, 
46 

which included customers of GSA, Federal agencies, executive councils, advisory 

groups, affinity groups, and industry thought leaders. Inputs were also collected from 

GSA employees via an all-employee survey questionnaire, as well as from GSA 

program owners/executives who reviewed the overall functions of GSA and the core 

mission/functions of each specific program office. Data from all these sources were 

reviewed by the GSA senior leadership team. These senior leaders worked through 

a process to reach consensus and select the most promising proposals to pursue. 

d. Did GSA retain the comments that it received pursuant to the Federal Register 

notice? 

A .YG3c· GSA followed the appropriate records management and retention policies. 

e. Please provide copies of the comments that were received by GSA. 

A. See attached file. Please note that PII information has been deleted. 

2. How did GSA solicit input and comments from its employees? 

A: In May of 2017, GSA's Acting Deputy Administrator issued a survey to all GSA employees 

asking for ideas to improve mission delivery and inform the development of the GSA Agency 

Reform Plan. The survey closed in June of 2017. The Acting Deputy Administrator also sought 

ideas directly from Heads of Staff and Service Offices across the Agency. 

a. How was that input used? 

The input was shared with the senior leadership team and used to shape the development of 

GSA's Agency Reform Plan (ARP), which was submitted to OMB in September 2017. With the 

focus on improving mission delivery, the Acting Deputy Administrator also convened bi-weekly 

meetings with Federal Acquisition Service (FAS) and Public Building Service (PBS) leadership 

to review the ideas and shape the final ARP. 

b. How many comments were received? 

586 comments were received. Employees from all GSA organizations and regions contributed 

ideas and comments. 

3. Where did the idea to transfer Human Resources Solutions (HRS), retirement 

services, and healthcare and insurance from the Office of Personnel Management (OPM) 

to GSA originate from? 

A: The President's Reform and Reorganization Plan entitled "Delivering Government Solutions 

in the 21st Century," published on June 21, 2018, outlines the idea and the proposed reform 

initiative. When agencies were asked to submit their government reform proposals, GSA 
47 

acknowledged that it had imperfect insight into where it could best support other agencies. In 

::!oi;·,;; :;o, we expressed our willingness to adopt shared services offered by other agencies if 

there was better mission alignment or value add at GSA. GSA broadly proposed several reform 

initiatives that would help improve efficiency, reduce redundancy and reduce costs across 

government in back office and administrative functions such as fleet, procurement, and real 

estate services. 

a. Who are the members of the GSA Task Force charged with implementation of this 

transfer and what are their roles and responsibilities? 

A: The GSA Task Force is led by Mary Davie, a senior executive in GSA and the Task Force 

has representation from PBS, FAS and all GSA staff offices. The task force members are 

charged with developing the transition and implementation plan to move OPM functions and 

technology to GSA GSA staff offices have been coordinating with their OPM counterparts to 

better understand how the various C-Suite Office (CxO) offices support OPM functions and what 

actions need to be completed to ensure the successful transfer to GSA: 

b. What authorities does GSA have to assume HRS? 

A GSA ha:: existing statutory authorities to perform human resources services for Federal 

agencies and small boards and commissions on a full cost recovery basis through the Working 

Capital Fund found at 40 U.S.C. § 3173 and the Acquisition Services Fund found at 40 US C. § 

321. In fact, many statutes creating small boards and commissions direct GSA to provide the 

administrative support such as human resources management, budget, accounting, and payroll 

services on a reimbursable basis. 

One example of the HR services GSA currently provides is HR Links. HR Links is a major 

application that provides personnel action and benefits processing for GSA employees and 

other Federal agencies including the Office of Personnel Management GSA's Federal 

Acquisition Service also provides a wide variety of human resources services and solutions for 

Federal customers through Schedule 738 X and Schedule 736. This includes HR program 

development, executive searches, planning services such as modeling and forecasting, 

recruitment and placement services from web-based global recruiting firms, surveys and 

assessments in support of workforce improvements, temporary administrative support services, 

and HR specific workshop training in support of staff development The Human Capital and 

Training Solutions Program is a partnership between GSA and OPM comprised of two IDIQ 

governmentwide contract vehicles to provide reliable, flexible, fast and efficient ways to obtain 

the best value customized solutions for human capital management and training requirements. 

GSA possesses the necessary statutory authority to transfer all HRS functions under 40 U.S.C. 

§ 121 
48 

c. How will the HRS offerings differ from similar contract vehicles and services 

currently offered by GSA? 

A: As part of the transition planning, reviews of both GSA's and OPM's HRS offerings are 

underway to ensure similar and complementary offerings can be brought together and we 

reduce or eliminate redundant offerings and to expand the capabilities offered by both 

organizations providing further value to the federal government in human resource solutions. 

GSA believes HRS' human capital subject matter depth combined with the broad reach of GSA 

r::an ''";s~IGr ale Improvements in workforce and organizational performance and lead to better 

government. Working together, we have already identified a number of similarities and 

differences. 

GSA and HRS currently partner to provide the Human Capital and Training Services (HCaTS) 

contracts to federal agencies. GSA also offers some administrative and staffing services 

through the GSA Schedules. HRS delivers products and services through government 

employees with expertise in human capital policy and operating environments that include HR 

specialists, industrial/organizational psychologists, educators, IT specialists and program 

managers. 

Like GSA, HRS offers assisted acquisition services. HRS also offers organizational design, 

leadership development and training, and strategy and evaluation services and GSA manages 

the Federal Acquisition Institute. 

HRS provides an array of consultative, developmental, and programmatic human capital 

solutions and service across the federal space and receives high ratings for its services. This 

transition will allow HRS and GSA to accelerate and implement the next generation of human 

capital solutions as the Federal government's provider of choice. These solutions will rely on 

solid IT enterprise infrastructure, implementation of digital solutions. and leverage GSA's 

strengths in acquisition, evidence-based decision making. evaluation sciences, and customer 

engagement strategies. 

4. Has GSA conducted a business case analysis for the assumption of HRS? If so 

please provide that analysis. If not, how does GSA support its contention that it is more 

effective and efficient to transfer HRS and that GSA has the necessary resources and 

infrastructure to assume these functions? 

A: GSA and OPM have developed a qualitative business case. GSA and OPM expect to brief 

staff on the analysis. Our analysis incorporates a review of both GSA and OPM HRS offerings, 

GSA and HRS customers. GSA and HRS business models, GSA and OPM Strategic Plans, 

alignment with Cross Agency Priority Goal initiatives, and includes a benefits assessment. 

GSA and OPM leaders are exchanging information to build out a transition and implementation 

timeline and plan to ensure that GSA will be prepared to assume the functions with the 
49 

necessary resources and infrastructure. As a government-wide provider of a number of 

services to other agencies, such as fleet, payroll and other human resources related functions, 

GSA has the necessary infrastructure in place to support the HRS functions, although we 

anticipate we will make some additional investments to support HRS business operations. 

a. Has GSA prepared cost estimates for implementation? If so please provide these 

estimates. 

A: GSA is working with OMB and OPM to develop cost estimates for implementation and is 

currently working on the 2020 Budget submission. GSA will be happy to brief on those costs 

once the estimates are finalized. 

b. What are the expected costs and savings associated with the transfer? 

A: GSA, OPM and OMB are working to determine estimates and any potential savings 

associated with the transfer. GSA anticipates making upfront investments 

that also provide opportunities for longer term efficiencies and savings which include: phasing 

out IF>()'?Cy iT ,;ystems at OPM and starting anew with more modern systems at GSA: rebadging and transition of OPM employees to GSA; reviewing OPM facility leases to determine 

any impacts; and reducing overhead and duplication of administrative support. Over the longterm, however, we anticipate that hosting a true end-to-end scheme for the government's 

employee-centered activities under one roof will result in cost savings. GSA and OPM have 

recently lowered the Human Capital and Training Services' (HCaTS) Contract Access Fee to 

make the program more competitive, which is a great example of the efficiencies gained, and 

value created. by transferring the Human Resources Solutions portfolio to GSA. 

c. Has GSA conducted a workforce impact analysis for the transfer? Please provide 

that analysis. If GSA has not conducted this analysis, how will it assess workforce 

impact? 

A: GSA and OPM will conduct a workforce impact analysis as part of the transition planning 

activity. 

d. How does this transfer of services to GSA serve the taxpayers and improve 

customer service? 

A: By centralizing operational human resources services in one agency. unique business value 

is created through the synergy of OPM's human capital subject matter depth with the broad 

reach of IT, acquisition expertise and customer engagement capabilities at GSA. Together, this 

merger can accelerate improvements in federal talent management by expanding services and 

making investments in technology to improve offerings and operational efficiency. The two 

entities. merged, have the potential to deliver new offerings as well as more robust offerings 

than each could do separately. These accelerated enhancements to OPM programs align with 
50 

both OPM and GSA Strategic Plans as well as the President's Management Agenda (PMA) and 

designation of GSA as a shared services provider for human resources solutions. 

The existing capabilities within GSA provide a fertile environment to increase efficiency, 

decrease costs, and improve the lifecycle of administrative and employee services through the 

natural connections and interdependencies. GSA already provides HR services to OPM and 

other agencies, including time and attendance and leave management services. GSA and OPM 

::!:::c :·,ave an extensive partnership on the Human Capital and Training Services program. with 

GSA and OPM each providing subject matter experts and contracting expertise. 

e. When will GSA share the information its task force develops on this proposal? 

A: OMB, GSA and OPM provided a briefing for OGR and HSGAC staff July 19, 2018 on the 

transition, and we held bicameral follow up briefings for Congressional authorizing and 

appropriations staff on September 21, 2018. Our aim is to provide regular updates throughout 

the transition process. 

f. Does GSA possess the statutory authority to use its existing revolving funds to 

finance OPM's Human Resources Solutions (HRS)? If not, what statutory changes are 

required to provide that authority? 

A: Yes, GSA has at least two funding sources available to finance the activities of OPM's 

Human Resources Solutions. As previously mentioned, GSA already performs human 

resources services for federal agencies and small boards and commissions on a full cost 

recovery basis through the Working Capital Fund and Acquisition Services Fund. In fact, many 

d:::l.:.;tc<> c1eating small boards and commissions direct GSA to provide the administrative 

support such as human resources management, budget, accounting, and payroll services. 

As stated above, one example of the HR services GSA currently provides is HR Links, which is 

a major application that provides personnel action and benefits processing for GSA employees 

and other Federal agencies including OPM. GSA's Federal Acquisition Service through the 

Acquisition Services Fund also provides a wide variety of human resources services for federal 

customers through Schedule 738 X and Schedule 736. This includes HR program development, 

executive searches, planning services such as modeling and forecasting, recruitments and 

placement services from web-based global recruiting firms, surveys and assessments in support 

of workforce improvements, temporary administrative staffing services. and HR specific 

workshop training in support of staff development The Human Capital and Training Solutions 

Program is a partnership between GSA and OPM comprised of two IDIQ governmentwide 

contract vehicles to provide reliable, flexible, fast and efficient ways to obtain the best value 

customized solutions for human capital management and training requirements. 

g. Will OPM's revolving fund be transferred to GSA to finance HRS functions? How 

much will be transferred? 
51 

A GSA, OPM and OMB are examining the funding authorities for OPM and GSA and will 

make a determination as to what fund or funds are most appropriate to perform OPM's functions 

as part of GSA. 

h. What additional appropriations are needed to finance HRS staffing and activities 

upon transfer to GSA? 

A: GSA, OPM and OMB are reviewing requirements to transition HRS staffing and activities to 

GSA Upon transfer, these activities would be funded primarily through revenue collections, as 

they are today. We anticipate that any additional cost estimates to implement the OPM 

transition will be reflected in the President's FY 2020 Budget 

5. What is the process for the transfer of retirement and healthcare benefits to GSA? 

A: As part of the FY 2020 Budget process, OMB, GSA, and OPM are analyzing the move of 

r<"tirP""!e::t a, 1d healthcare benefits and believe there is significant value in transferring these 

functions to GSA, including support functions such as OPM's IT infrastructure. We are 

committed to engaging with Congress and all relevant stakeholders. including unions, federal 

employees, retirees and others. 

a. What stakeholders have been contacted or will be contacted? 

A: (see answer to Q5) 

b. When will GSA began to share data on the cost of this transfer? 

A: (see answer to Q5) 

c. What authorities will be used when authorizing this transfer? 

A: (see answer to Q5). GSA has the authority to transfer OPM's HRS and IT functions 

administratively, and is exploring whether additional authority will be required to effectuate the 

move of retirement and health care benefits to GSA 

a. What analyses has GSA conducted regarding its ability to address the retirement 

backlog and proceed with process and system modernization? 

A: (see answer to Q5) 

6. What is the composition of GSA's current cybersecurity workforce? 

A: The GSA IT organization has 34 cybersecurity federal staff, although there are another 46 

cyber FTE in other parts of the agency, largely focused on external federal agency customers. 

GSA's experience with securing systems, networks and data both internally and externally, will 
52 

provide a model that should make the work of integrating two SecOps organizations slightly less 

complex. 

The cybersecurity workforce at GSA uses the roles as defined in the NICE (National Initiative for 

Cybersecurity Education) framework. Cyber workforce roles at GSA include but are not limited 

!::: Cybt:r Policy & Strategy Planning, Security Control Assessors, Systems Security Analysts, 

Cyber Defense Incident Responders, Vulnerability Assessment Analysts, Secure Software 

Assessors, Security Architects, Information Systems, Security Managers (ISSMs), IT Program 

Auditors, Privacy Compliance Managers, and Executive Cyber Leadership. 

a. How will the transfer of HRS to GSA further enhance the broader goal of creating a 

unified cybersecurity workforce? 

The transfer of HRS to GSA will enhance the goal of a unified cybersecurity workforce by 

allowing us to recruit, retain, retrain, and recognize a highly-qualified workforce. By blending 

cyber workforces, this effort also reduces the amount of interagency competition for 

cybersecurity roles across government As part of our assessment phase, GSA also plans to 

conduct a skillset assessment of OPM's cybersecurity workforce. 

b. How will the transfer of HRS address chronic underinvestment in OPM's 

cybersecurity workforce and how will GSA's cybersecurity workforce investment 

strategy change after the transfer? 

GSA t1<Js R robust security program and a skilled cyber workforce, and we believe we can help 

bolster the underlying cybersecurity challenges that OPM has encountered. GSA expects that 

we can take advantage of economies of scale within our existing cyber program to help ensure 

the foundation of any cyber workforce transferred, but believes that additional cyber investment 

will likely be necessary with the transfer of the HRS program. 

As part of our existing strategy, in FY18, GSA performed a cyber workforce assessment survey 

to fill any gaps with existing cyber skills within GSA cyber staff. As a result of the survey, GSA 

procured and offered multiple security certification training courses to existing cyber staff. GSA 

plans to continue to offer role based technical training on emerging cybersecurity tools and 

technologies to its cyber workforce that can be leveraged to perform daily job duties. GSA also 

plans to hire additional cyber security professionals to fill work roles of critical needs. GSA 

believes that this type of investment strategy will also be beneficial to OPM cyber professionals 

that may transfer to GSA. 

7. What analyses has GSA's Office of the Chief Information Office (CIO) conducted 

regarding assumption of OPM legacy IT systems and modernization efforts? 

GSA IT has initiated an analysis to determine OPM's current technology footprint (including both 

;c:yacy and modern IT systems). GSA IT's goal is to create a checklist that will allow us to 

determine the health of OPM's IT systems and determine any additional investments required to 
53 

modernize their legacy IT systems. GSA IT is assuming that systems transitioning to GSA may 

require modernization, and our implementation plan will reflect that assumption. 

8. What is the strategy and implementation plan for assumption of OPM's legacy IT 

systems? 

GSA will create an implementation plan that covers four key technology tracks: (1) Budget & 

Contracting, (2) Resource Management, (3) Security & Policy and (4) Enterprise Applications, 

Infrastructure and Strategy. Our strategy is to complete in-depth reviews and analysis of current 

OPM infrastructure and IT services by Q1 FY 2019. 

9. How will this transfer of services to GSA from OPM better protect system data from 

a cyberattack? 

GSA will assess the risk posture of the IT systems in OPM and their security impact levels. GSA 

has a robust security environment and multi level security tools and technologies at the endpoint 

and network layers to protect against today's advanced cyber attacks. The IT systems, 

infrastructure and personnel transitioning to GSA will be better protected by the "defense in 

depth" and risk management-based approach to cybersecurity. The IT systems transitioning to 

GSA will be integrated with GSA's enterprise security tools and processes of secure 

configuration management, vulnerability management, patch management, security information 

and event management (SIEM), application whitelisting and perimeter security. 
54 

Post-Hearing Questions for the Record 

Submitted to Emily Murphy, Administrator of General Service Administration 

"The Challenges and Opportunities of the Proposed Government Reorganization 

on OPM and GSA" 

From Senator Heidi Heitkamp 

1) This hearing focused on just one piece of the larger reorganization proposal. But even this 

one piece is pretty large. We are talking about eliminating one agency and greatly expanding 

the responsibilities of another. This proposal will not only greatly impact all the employees who 

work at OPM and GSA, but also the entire 2.1 million-person civilian federal workforce, and all 

federal retirees. 

What problems at OPM does this proposal solve? 

A: With regard to transactional work, by removing repetitive operational functions from OPM and 

moving them to GSA, it will allow GSA to focus on shared service delivery while allowing the 

policy functions to focus on the government-wide HR policy challenges highlighted by GAO and 

others. This operational focus is in direct line with GSA's core mission since its establishment 

by President Truman in 1949 to streamline the administrative work of the Federal government. 

Further. both GSA and OPM believe this is an opportunity to elevate the Federal workforce 

manaaement function and maximize the operational efficiency of human capital services. 

How will implementing this proposal make our federal government more effective or 

efficient? 

A: GSA, as the administrative backbone of the federal government, is well positioned to provide 

human resources services to the federal workforce. Ultimately, GSA is striving to provide 

quality services to the federal workforce with an overarching goal to also provide the very best 

stewardship of the American taxpayers' money. 

The consolidation of human resources functions and systems will aid in standardizing, 

simplifying, and unifying to keep administrative costs down and to enable the government to run 

more efficiently. By centralizing transactional, consultative, and educational human resources 

services in one agency, unique business value is created through the synergy of OPM's human 

capital subject matter depth and GSA's IT, acquisition expertise and customer engagement 

capabilities. This merger can accelerate improvements in federal talent management by 

expanding services and making investments in technology to irnprove offerings and operational 

efficiency The two entities, rnerged, have the potential to deliver new and more robust offerings 

than "'?-Ch could do separately. These accelerated enhancements to OPM programs align with 

both OPM and GSA Strategic Plans as well as the President's Management Agenda (PMA) and 

designation of GSA as a shared services provider for human resources solutions. 

As an example, the federal government consolidated 22 payroll systems into four fifteen years 
55 

ago, which resulted in increased efficiency and cost avoidance for federal agencies. GSA is now 

standing up shared services for Payroll and other functions outlined in the PMA. GSA is 

supporting time and attendance as well as other HRIT functions. With HR Solutions moving to 

GSA, that also means much of the HR IT infrastructure such as the USA Suite of applications 

will move to GSA. These systems are heavily used across government today to advertise 

positions and fill vacancies, and to manage staffing and performance. 

What data can you provide this subcommittee to prove your point? 

A: GSA already excels at providing Space, Fleet, Assisted Acquisition, Travel, Card Services 

and IT support to agencies. For small agencies, GSA provides an integrated set of financial, 

riK., and payroll services. GSA provides end-to-end service for Commissions and Boards 

including a full array of administrative and real estate support services, including but not limited 

to. human resources, payroll, office space, furniture, phones, IT, legal, and contracting. 

Specific examples include: 

GSA's SmartPay Program is the world's largest commercial payment solution program, 

providing services to more than 560 Federal agencies. organizations and Native American tribal 

governments. 3.5M Account holders (purchase, travel, fleet). Total spend through the program 

in 2017 was 28.6B (increase over 2017) and net refunds of $217M provided. 

GSA's Fleet program is another example of shared services resulting in efficiencies and 

savings. GSA Fleet provides over 214,000 quality vehicles and efficient and economical fleet 

management services to over 75 participating federal agencies costing agencies 26% less than 

those agencies who maintain independent Fleet programs. The GSA Fleet is one of the largest 

non-tactical fleets in the United States. 

Since 2003, the HR Line of Business shared services strategy has produced improved human 

capital outcomes and quantifiable cost savings. To date, over 99 percent of agencies have 

'"'grated to a payroll provider and over 88 percent of agencies have migrated to an HR SSC. 

This consolidation resulted in over $1 billion in cost savings and cost avoidance through the end 

of FY 2013, and is anticipated to result in over $1.6 billion through FY 2015, and an additional 

$194 million a year thereafter. 

GSA has proven experience achieving cost savings and efficiencies through 

consolidating/merging administrative functions. GSA consolidated its CxO functions into a 

Working Capital Fund (WCF)-driven, internal shared service in FY14. A 2018 independent 

study conducted by Price Waterhouse-Coopers to assess the results of this consolidation over 

time found that GSA's WCF organizations achieved operational efficiencies of 14 percent from 

FY14 to FY19. Specifically, the study found that total WCF obligations decreased 8 percent 

when adjusted for subsequent consolidations of functions into the fund, despite the fact GSA's 

total obligations as an agency grew 14 percent over the same time period. 
56 

In addition, the January 2017 report from Technology CEO Council estimated $478 in savings 

::'"t::;o:iai irom increased use of shared services across the Federal space. 

Annual increases in customer and employee satisfaction scores also demonstrate federal 

agencies find value in GSA's offerings and our employees feel GSA is one of the best places to 

work in government. For example: 

• Customer satisfaction with the Federal Acquisition Service (FAS) overall increased by 

0.2 from 7.4 in FY17 to 7.6 in FY18 (on a 10-point scale). 

• FAS customers also noted an increased satisfaction in "value" -scores increased by 0.3 

from 7.4 in FY17 to 7.7 in FY18 (on a 10-point scale). 

• Customer satisfaction and Value with the GSA/OPM Human Capital and Training 

Solutions (HCaTS) contract is 8.0 (on a 10-point scale). 

• GSA is a great place to work, based on our Federal Employee Viewpoint Survey results 

" GSA's FEVS scores have improved consistently each year from 2013 to 2017. 

Generally GSA rates second-highest among "large agencies" (10,000-24,999 

employees) behind NASA in most categories including: 

• Employee Engagement -- GSA's score has risen from 76 to 83 compared 

to average score of 81 among large agencies (OPM is a small agency 

and scores 81) 

• HCAAF Job Satisfaction --GSA's score has risen from 67 to 73 (average 

is 69, OPM score is 69) 

• General Satisfaction-- GSA's score has risen from 65 to 75 (average is 

69, OPM score is 69) 

'" The Partnership for Public Service (PPS) notes in its annual Best Places to Work 

survey that among 25 "mid-size agencies," GSA ranks 1Oth and GSA's score 

rose from 68.4 in 2016 to 73.7 in 2017, the 4th largest jump in the index. (OPM is 

ranked 17th and their score went down year-over-year from 66.2 to 65.7.) 

• GSA's infrastructure and internal service providers I CxOs 

o GSA satisfaction with Human Capital services internally ranked 5th among all 

agencies with a score of 5.04, compared to the government-wide median of 4.60 

(OPM score was 4.67) 

GSA satisfaction with IT function ranked 4th among all agencies with a score of 

5.41, compared to a government-wide median of 5.26 (OPM's score of 3.99 

ranked last among all agencies) 

c. GSA satisfaction with Financial Management function ranked 12th with a score of 

5.14, compared to the government-wide median of 5.11 (OPM's score of 4.70 

was ranked third to last) 

How will this proposal impact the core missions that currently GSA focuses on? 
57 

A: This proposal is very much in line with the core mission of GSA. As mentioned in my 

testimony, GSA was established by President Truman on July 1, 1949, to streamline the 

administrative work of the Federal Government, a role that remains central to GSA's mission. 

GSA excels in providing a wide variety of mission support services to agencies, including 

support for acquisition, fleet management, real property, travel services, and financial 

management tools. Additionally, for small agencies, GSA provides an integrated set of financial, 

HR, and payroll services. 

GSA also serves as an integration body, enabling the delivery of high-quality, high-value shared 

::;:;r;;i..:.c::; tnat improve performance and efficiency throughout the government This is further 

supported by the administration's Cross-Agency Priority goal, "Sharing Quality Services," which 

I co-lead. The goal exists to address the fact that 40 percent of federal leaders report that they 

are not satisfied with the administrative support in the government 

The existing capabilities within GSA provide a fertile environment to increase efficiency, 

decrease costs, and improve the lifecycle of administrative and employee services through the 

natural connections and interdependencies. GSA already provides HR services to OPM and 

other agencies. including time and attendance and leave management services. GSA and OPM 

also have an extensive partnership on the Human Capital and Training Services program. with 

GSA and OPM each providing subject matter experts and contracting expertise. 

2) At the HSAGC hearing on July 18 where Margaret Weichert testified, we heard a lot of 

answers along the lines of- 'We still need to figure this out' or 'We need to work through 

that.' One of my takeaways from that hearing was that more study and development is 

needed on these proposals. 

·~ yc;,;i .ninds, has enough analysis been done to determine that this is a good idea? 

The consolidation of back office operations into a single entity that specializes in the delivery of 

these services is a solution which many large organizations have successfully implemented. As 

stated in the response to the previous question, the delivery of complex, government-wide 

services is not new for GSA and is our primary mission. In many of these cases, we are able to 

leverage the purchasing power of the Federal Government to secure better deals for the 

taxpayer. GSA excels in providing a wide variety of mission support services to agencies, 

including support for acquisition, fleet management, real property, travel services, and financial 

management tools. Additionally, for small agencies, GSA provides an integrated set of financial, 

HR, and payroll services. 

The HRS Business Case has been developed and GSA and OPM will continue to do additional 

analysis on how to integrate OPM functions into GSA in an efficient manner that takes into 

account the Federal employees who use the services. 
58 

HaS enough research been done to determine that this is feasible? 

From a mission delivery perspective, we believe the merger will bring value and efficiencies to 

federal agencies. GSA is actively working with OMB and OPM to determine the best approach 

to integrate the transactional, consultative and educational human resources solutions with 

GSA 

Will you commit to sharing with Congress all the analysis developed in the 

implementation of this proposal? 

GSA is committed to working with Congress and their staff in providing information on the 

transition. OMB, GSA and OPM provided joint briefings for HOGR and HSGAC staff in July and 

September. 

3) OPM and GSA submitted reorganization proposals to OMB as part of this overall 

reorganization effort that was set in motion by the President's Executive Order last year. 

What were the key recommendations in the proposals your agencies sent OMB that 

would have improved agency effectiveness and efficiency? 

A: In GSA's Agency Reform Plan (ARP) submitted to OMB, there were 14 specific actions 

recommended. The actions aligned to the enhancement or improvement of GSA's traditional 

lines of business--acquisition. real estate. and technology. It also focused on expanding GSA's 

role in designing and delivering expanded and shared services within GSA and across the 

Federal government. The plan discussed expansion of shared services in relation to its 

traditional service offerings, such as acquisition, real estate, travel, and fleet. 

Did you have further conversations with OMB about those proposals? 

A: Yes, we have had discussions with OMB post proposal submissions. 

Did either of your agencies propose anything along the lines of the OPM-GSA merger 

that was included in the final administration proposal? 

A: GSA broadly proposed several reform initiatives that would help improve efficiency, reduce 

redundancy and reduce costs across government in back office and administrative functions 

5' ,,..,., :::; fle:ei, procurement, and real estate services. 

Why or Why not? 

A: While GSA did not unilaterally propose moving the human capital services from OPM to 

GSA. GSA has been a leading advocate for consolidating administrative functions and 

advancing government-wide shared services. Moving HRS into GSA is in keeping with that 

view. 
59 

When agencies were asked to submit their government reform proposals, GSA acknowledged 

that it had imperfect insight into where it could best support other agencies. In doing so, we 

expressed our willingness to adopt shared services offered by other agencies if there was better 

mission alignment or value add at GSA 

To the best of your knowledge, who came up with the idea to break apart OPM and move 

it to different agencies? 

A: GSA supports the proposal outlined in the President's Reform and Reorganization Plan that 

reorganizes OPM by elevating its core strategic mission and moving certain fee for service 

operational functions to GSA This proposal is aligned to our core mission and the President's 

Management Agenda. The reorganization ideas were developed through a series of iterative 

conversations following the issuance of OMB M-17-22. In this connection, Congress itself 

mandated a major restructuring of OPM. Specifically, the NOAA for FY18 requires that 

responsibility for most background investigations be transferred from OPM to DoD; this transfer 

will result in a major revenue loss for OPM and put a strain on central support functions that are 

currently funded in part from background investigation revenue. The legislative transfer of 

background investigations necessitated a reexamination of OPM's structure and functions. 

Will you provide the plan that your agency submitted to OMB so that Congress can better 

understand the development of the final proposals? 

A: GSA's proposals were either internally facing or relied upon OMB to examine cross agency 

opportunities. As this proposal was developed as part of a suite of cross-agency proposals, 

GSA does not believe that we have anything substantive to provide in response to this question. 

4) When the President released his reorganization plan last month, it talked about some 

of the challenges that OPM has experienced in recent years such as data breaches, 

background investigations backlogs, and IT problems. 

Do you agree that the best way to improve and overcome those types of challenges is to 

dismantle OPM and move its functions to other agencies? 

A: As outlined in the Government-wide Reform Plan, by realigning certain functions currently 

performed by OPM to GSA, there is an opportunity elevate the Federal workforce management 

function and to maximize the operational efficiency of human capital services. 

GSA serves as an integration body, enabling the delivery of high-quality, high-value shared 

services that improve performance and efficiency throughout the government This is further 

supported by the administration's cross-agency priority goal, "Sharing Quality Services," which I 

co-lead. The goal exists to address the fact 40 percent of federal leaders report they are not 

satisfied with the administrative support in the government 
60 

The existing capabilities within GSA provide a fertile environment to increase efficiency, 

decrease costs, and improve the lifecycle of administrative and employee services through the 

natural connections and interdependencies. GSA already provides HR services to OPM and 

other agencies, including time and attendance and leave management services. GSA and OPM 

also have an extensive partnership on the Human Capital and Training Services program, with 

GSA and OPM each providing subject matter experts and contracting expertise. 

What shows us that moving these functions is going to improve their outcomes? 

Will DOD automatically be better than OPM at background investigations? 

A: GSA defers to DOD and OPM to answer this question. GSA notes the transfer of background 

investigations to DOD from OPM was directed by Congress. 

Does GSA have better cybersecurity than OPM? 

A: GSA has a robust IT Security Program; mature IT and security stack with best of breed cyber 

tools and capabilities; and, skilled Federal and contractor security professionals that we believe 

will benefit OPM. GSA meets or exceeds 8 out of the 10 Cybersecurity Cross Agency Priority 

(CAP) Goals and is rated at "Managing Risk" in 4 out of the 5 areas with an Overall Rating at 

"Managing Risk" in the Quarterly RMA scorecard. GSA has efficient security audit management 

resulting in reasonably clean security audits and is one of the leading agencies among COM 

Task Order-2 Delta Agencies with full enterprise-wide deployment of COM Phase 1 tools and 

capabilities. 

5) A merger of two agencies is not just a merger of people. It is also a merger of systems 

and data. We all know the federal government's less-than-perfect track record on 

Information Technology (IT) issues. A merger such as this can't be successful unless an 

IT solution is found and developed. I know my staff has been told that there are "a lot of 

Shared platforms" but "a lot" is not everything. 

What can you share about your work to determine if the IT systems at these agencies can 

be merged? 

GSA is developing an integration framework that consists of in-depth reviews and analysis of 

current OPM infrastructure and IT services, which will be completed by Q2 FY 2019. This will 

enable GSA IT to develop a long-term road map for all the IT assets being transitioned. We 

anticipate that our findings will demonstrate considerable benefit to shifting OPM's IT to GSA in 

the near-term. 

GSA's approach will involve reviewing OPM's business capabilities and understanding how IT 

enables the delivery of services for each capability. In addition, the IT review will consist of 
61 

understanding the security, privacy, infrastructure and technology requirements for each system 

and how to best integrate them into the GSA environment. For example, determining what 

changes need to be made to the GSA systems so we know that OPM's data from its retirement 

and health care accounts can be accessed. 

6) This proposal eliminates the agency that is supposed to protect and nurture the 

federal workforce and merges its functions with a different agency. I know I have heard 

from several federal employee groups with great concerns about this proposal, and I 

imagine you are also aware of those concerns. 

What engagement have you had with your own employees and federal employee groups 

about this proposal and its impact? 

A: I sent an agency-wide message to GSA employees about the proposal and its potential 

effects the day that the administration's plan was announced (6/21 ). That message also 

included an invitation to an agency-wide town hall that we held six days after the plan was 

announced (6/27). The town hall was held in GSA's auditorium and streamed on our intranet. 

Employees were able to email questions to ensure we were able to engage with GSA 

employees regardless of their duty station or work location and the livestream included more 

than 7,000 participants. 

Additionally, the day after the town hall (6/28) Deputy Administrator Brigati sent out an agencywide message directing employees to send questions and recommendations about the reform 

plan proposals to a shared GSA email address. The message also included the video of the 

town hall. 

GSA also established an intra-agency task force led by Mary Davie that includes 

representatives from each of GSA's service areas and staff offices. The task force held its first 

meeting the day the administration's plan was announced and meets at least once each week to 

discuss how the plan may affect them and their colleagues. The task force reviews each 

message sent to the shared email address. Ms. Davie sent a follow up agency-wide message 

about a month after the administration's plan was announced (7/20) to solicit additional 

feedback from GSA employees. Each of the specific agency-wide communications were also 

featured in a GSA-wide newsletter to further ensure effective communication with GSA 

employees. We also sent out a video from the task force to all employees in September, again, 

asking for feedback, and held another townhall in October. OPM also plans to incorporate 

federal agencies and employees in the planning process during the transition. 

What is your strategy to engage with those groups if you are able to move forward with 

these proposals? 

A: In addition to the communications already made and the ongoing work of the task force, GSA 

plans to work with OPM to develop a comprehensive communications plan to ensure GSA and 
62 

OPM employees and vital stakeholders receive accurate and timely information ahead of key 

dates in the transition and implementation plan to move OPM functions and technology to GSA 

Can this proposal be successful without acceptance and understanding from federal 

employees? 

A: GSA and OPM are committed to working with all employees to provide information and 

garner input throughout the transition. This proposal can be best achieved with the support and 

understanding of the federal employees that will be charged with carrying out the transition and 

supporting the functions, as well as those employees who are and will be the recipient of the 

human resources solutions offered by GSA 

How are you going to deal with potential morale challenges that result from this merger? 

A: As outlinPd previously, GSA has opened several lines of communications for staff to 

communicate about how the administration's reform proposal may affect them, their work and 

the agency. GSA will directly include OPM and GSA employees in the transition planning efforts 

and will continue to maintain clear lines of communication with staff to identify challenges and 

address questions throughout the transition. 

7) A significant part of this proposal is presumably going to be moving personnel from 

OPM to the new GSA. I want to get your thoughts on how that would work for your 

average OPM employee. 

Is John Smith, an OPM employee, just going to leave OPM on a Friday and show up for 

work at GSA on Monday, or, when John Smith transfers from OPM to GSA, does his 

administrative footprint come with him, i.e. the OPM IT processes, OPM administration, 

OPM rules? 

A: OMB, OPM and GSA are currently working on these implementation issues and will have 

more information in the coming months. GSA and OPM employees representing each agency's 

respective Office of the Chief Information Officer, Office of General Counsel, Office of the Chief 

;;;;"'' rciai Officers and many other offices have held meetings to discuss the scope of the 

auxiliary activities that would be part of the transfer. 

Based on your initial analysis, what will be the impact of this merger on the total number 

of employees currently at OPM and GSA? Do you expect it to be less, the same, or more? 

A: As stated at the HSGAC hearing in July, the goal of this transfer is not to reduce the number 

of FTEs performing these functions. The goal is to realign the workforce of the two agencies to 

best enable each agency to fulfill its core mission functions. 

How did you develop the answer to the previous question? 
63 

A: Our transition and implementation planning process includes an in-depth look at support 

staff/functions and associated technology required so that GSA can be prepared to execute the 

transitioned functions and staff on Operations Day 1. We are looking at several alternatives that 

include mn'.Jir.g support staff and technology to GSA, or entering into a short term arrangement 

with .OPM to continue to provide support services and technology management until those 

functions could be staffed by and or transitioned to GSA For example, there are currently 425 

employees in OPM's HRS organization but this number does not include supporting staff such 

as contracting officers, attorneys, HR services, IT services, etc. 

8) Your agencies have a great resource in your Senior Executives. These are your 

frontline career leaders who are critical to a smooth-functioning federal government. 

What feedback have you received from these individuals on this plan? 

A: See answer below. 

What is the SES involvement in any planning for the merger that is going on at this time? 

A: The following answer applies to both parts of Question 8. The GSA Heads of Services and 

Staff offices all either personally participate and/or have a representative on the GSA Task 

Force to plan and implement the transfer of the OPM human resources transactional services to 

GSA. Weekly Task Force meetings are held. Each Service and Staff Office representative is 

, .~urrnrng file transition planning from their functional area of responsibility. 

In addition, the GSA leadership team is briefed on a weekly basis by the GSA Task Force Lead. 

The GSA Administrator has conducted a town hall with all employees, and has provided an 

update through email. GSA has an established email in box to receive questions from 

employees and these questions are personally answered by GSA's Task Force lead. 

9) An issue that arose at both recent HSGAC hearings on the agency reorganization 

proposal were questions about what parts of the reorganization that the Executive 

Branch presently has the legislative authority to execute. 

What parts of this overall proposal to move OPM into GSA and move other parts of OPM 

to DOD and OMB does the Administration have the authority to execute on without 

legislation to Congress? 

See answer below. 

How did you determine that answer? 

A: The following answer applies to both parts of Question 9. GSA has been focused on Phase I 

of the reorganization and ensuring a smooth transfer of Human Resources Solutions. , We have 
64 

confirmed there is authority to execute the HRS portion without new legislation. However, as we 

consider future phases of the reorganization plan, we will reach out to your office to discuss any 

potential legislation that may be necessary. 

10) In 2014, the Bureau of Indian Affairs (BIA) was stripped of its GSA delegated leasing 

authority for not following applicable policies and guidelines. While BIA has since 

regained some of its leasing authority, my understanding is that GSA's increased 

oversight and involvement in the leasing process can often be insensitive or 

inappropriate to the needs of Indian Country and has significantly slowed down the 

process overall to the detriment of Indian tribes. 

What efforts has GSA taken to accommodate the unique challenges of leasing on Indian 

reservations? For example, GSA does not traditionally rent schools, jails, and other 

similar structures used to house and operate BIA programs. 

A: In 2012, GSA suspended delegating leasing authority to the Department of the InteriorBureau of Indian Affairs (BIA) pursuant to a BIA Office of Inspector General audit. In 2014, GSA 

resumed delegating its leasing authority to BIA, following BIA's implementation of a corrective 

action plan, thereby allowing BIA to acquire leased space in those areas GSA has no market 

presence. GSA's lease delegation process for BIA is the same as for all other agencies. GSA 

seeks to accommodate agency specific program needs while ensuring compliance with all 

applicable Federal leasing laws and regulations. 

When GSA acquires leased space for BIA, GSA works with BIA to develop the lease 

requirements that will meet BIA's mission needs. GSA is interested to learn of any opportunities 

to improve how it provides services to the aforementioned communities, and would appreciate 

any help your office could provide in helping us identify areas where there are opportunities to 

improve. GSA will meet with BIA and discuss any concerns BIA may have with the GSA leasing 

process. 

Has GSA held, or plans to hold, formal consultations with tribes to determine how GSA 

«:!!11 ~tter serve.lndian Country and evaluate if there are inappropriate conditions applied 

to on-reservation lease agreements? 

A: GSA has not worked directly with Native American tribes on leasing requirements. All of 

GSA's interactions have been with BIA. GSA would welcome working with BIA to coordinate 

and host discussions with tribal representatives on the terms and conditions that could be 

included in these leases. 

Will you consider restoring BIA's ability to enter into Memorandums of Agreement to 

secure the use of certain facilities so they don't have to go through the more complicated 

GSA process, allowing them to address tribal needs faster? 
65 

A: There are standing categorical delegations of authority found at 41 CFR 102-73.155 that are 

applicable to certain types of space that BIA may need. When using GSA's delegated leasing 

authority, all agencies, including BIA, must adhere to the same lease policies that GSA follows 

when acquiring leased space. GSA continues to improve the efficiency of the lease process, 

and is prepared to discuss these improvements with the BIA. 
66 

1) 

Post-Hearing Questions for the Record 

Submitted to Dr. JeffT.H. Pon 

Director, Office of Personnel Management 

"The Challenges and Opportunities of the Proposed Government Reorganization 

011 OPM a11d GSA" 

From Senator Heidi Heitkamp 

Friday, August 10,2018 

This hearing focused on just one piece of the larger reorganization proposal. But even this one 

piece is pretty large. We are talking about eliminating one agency and greatly expanding the 

responsibilities of another. This proposal will not only greatly impact all the employees who 

work at OPM and GSA, but also the entire 2.1 million-person civilian federal workforce, and all 

federal retirees. 

• What problems at OPM does this proposal solve? 

o Response: Moving policy functions to the Executive Office of the President 

would afford an opportunity to elevate OPM's policy and oversight functions with 

respect to the Federal workforce as well as its workforce management functions. 

There is broad acknowledgment that the statutory framework for the Federal 

employment system is outdated in many significant respects, and does not reflect 

the realities of the contemporary workforce. Most of OPM' s workforce and 

budget arc currently dedicated to operational activities, and fewer resources are 

devoted to policy and oversight activities related to OPM's core missions, 

including the hiring process, performance management, the development of rules 

and guidance concerning compensation, merit system compliance, and 

government-wide advisory functions relating to labor relations. 

• How will implementing this proposal make our federal government more effective or 

efficient? 

o Response: This transition is seeking to create a more streamlined policy, 

oversight, and workforce management unit that is less expensive to operate. This 

proposal could also support centralized coordination of all personnel policies for 

Federal employees, including certain personnel policy functions currently 

performed by OMB, eliminating the confusing matrix of who does what. 

Centralizing human capital operational services might provide economies of scale 

and significant cost-avoidance based on reductions in contract and IT duplication. 

Also, several segments of the Federal workforce (such as VA medical 

professionals and Foreign Service officers) fall partially or wholly outside of 

OPM's title 5 policymaking authorities. Moving personnel policy into EOP will 

allow for a more holistic govemmentwide policy. 

• What data can you provide this subcommittee to prove your point? 

Page 1 of 8 
67 

2) 

o Response: OPM, GSA, and OMB are currently developing a qualitative business 

case as well as estimated budget impacts through the annual budget process. 

At the HSAGC hearing on July I 8 where Margaret Weichert testified, we heard a lot of answers 

along the lines of- 'We still need to figure this out' or 'We need to work through that.' One of 

my takeaways from that hearing was that more study and development is needed on these 

proposals. 

3) 

• In your minds, has enough analysis been done to determine that this is a good idea? 

Response: Yes OPM has developed a strong vision to create a more efficient Federal 

government, and we must now undertake the efforts to develop detailed implementation 

plans. 

• Has enough research been done to determine that this is feasible? 

Response: OPM is currently engaged in strong interagency discussions to fully determine 

the best approach to implement this vision and best actions to avoid disruption of services 

to the extent possible. 

• Will you commit to sharing with Congress all the analysis developed in the 

implementation of this proposal? 

Response: OPM will provide the committee with relevant and appropriate documents 

related to the implementation of this proposal. 

OPM and GSA submitted reorganization proposals to OMB as part of this overall reorganization 

effort that was set in motion by the President's Executive Order last year. 

• What were the key recommendations in the proposals your agencies sent OMB that 

would have improved agency effectiveness and efficiency? 

Response: OPM's Agency Reform Plan focused on four areas: 

o Drive Government Efficiency- Leverage OPM's human capital leadership role to 

drive Govermnent-wide efficiency, cost savings, and/or improved coordination 

across the human capital space. 

o Reduce Burden on Agencies - Eliminate/reduce unnecessary or low-value 

reporting requirements and empower agencies through simplifying rules/systems 

and providing greater discretion and decision-making authority. 

o. Improve Alignment of Existing OPM Program Functions- Improve coordination, 

efficiency, and/or customer-focused service delivery of OPM program functions 

by consolidating and realigning functions within OPM where duplication or 

inefficiency exists, or where synergies can be achieved. 

o Enhance OPM Mission Support Functions- Improve service, reduce costs, 

improve efficiency, and/or eliminate redundancy within the various missionsupport/administrative functions that enable OPM program and mission delivery 

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68 

4) 

• Did you have further conversations with OMB about those proposals? 

Response: OPM met with OMB to discuss the proposals contained in the OPM Agency 

Reform Plan, and we continue our dialogue to create a more effective and efficient 

government on behalf of the American taxpayer. 

• Did either of your agencies propose anything along the lines of the OPM-GSA merger 

that was included in the final administration proposal? Why or Why not? 

Response: These ideas were often a result of outgrowth from iterative interagency 

discussions and were not developed in silos. 

• To the best of your knowledge, who came up with the idea to break apart OPM and move 

it to different agencies? 

Response: This vision is not about breaking up any agency. These ideas were often a 

result of outgrowth from iterative interagency discussions and were not developed in 

silos. 

• Will you provide the plan that your agency submitted to OMB so that Congress can better 

understand the development of the final proposals? 

Response: This proposal is internal and pre-decisional executive branch correspondence. 

When the President released his reorganization plan last month, it talked about some of the 

challenges that OPM has experienced in recent years such as data breaches, background 

investigations backlogs, and IT problems. 

5) 

• Do you agree that the best way to improve and overcome those types of challenges is to 

dismantle OPM and move its functions to other agencies? 

Response: The mission of OPM is not being dismantled. The goal is to better align how 

the mission is delivered in a more efficient and effective way on behalf of the American 

taxpayer. 

• What shows us that moving these functions is going to improve their outcomes? Will 

DOD automatically be better than OPM at background investigations? Does GSA have 

better cybersecurity than OPM? 

Response: We look forward to continuing the dialogue with Congress to show how we 

will be able to deliver on our mission in a more effective and efficient way. 

A merger of two agencies is not just a merger of people. It is also a merger of systems and data. 

We all know the federal government's less-than-perfect track record on Information Technology 

Page 3 of 8 
69 

(IT) issues. A merger such as this can't be successful unless an IT solution is found and 

developed. I know my staff has been told that there arc "a lot of Shared platforms" but "a lot" is 

not everything. 

6) 

• What can you share about your work to determine if the IT systems at these agencies can 

be merged? 

Response: A robust and detailed analysis of the proposed merger ofOPM and GSA IT 

leadership and business functionalities is still ongoing to determine where similarities and 

differences occur. 

• For example, what changes need to be made to the GSA systems so we know that data 

from OPM on retirement and health care accounts can be accessed? 

Response: The migration of Retirement Services and the Healthcare and Insurance 

components of OPM would be in "Phase Two" of the proposed merger and that analysis 

is still ongoing. 

Thi' pr~p0sai eliminates the agency that is supposed to protect and nurture the federal workforce 

and merges its functions with a different agency. I know I have heard from several federal 

employee groups with great concerns about this proposal, and I imagine you are also aware of 

those concerns. 

• What engagement have you had with your own employees and federal employee groups 

about this proposal and its impact? 

Response: I personally met with every office in OPM to discuss the impacts of this 

proposal. I also took any questions from employees to address their concerns. 

• What is your strategy to engage with those groups if you are able to move forward with 

these proposals? 

Response: I will continue to update the OPM workforce on the proposal's impacts as we 

move forward with implementation. 

• Can this proposal be successful without acceptance and understanding from federal 

employees? 

.. R<:~pcnse: In my conversations with OPM employees, I have sought to ensure that the 

employees ofOPM have a full understanding of the proposal's impact on OPM and its 

workforce. I will keep them updated as we move forward with implementation. I have 

faith that the career Federal civil service will faithfully implement this reorganization, as 

they do with all other laws and regulations .. 

• How are you going to deal with potential morale challenges that result from this merger? 

Page 4 of 8 
70 

..,, 

'J 

Response: Employee morale is a critical aspect of mission success. That is why I 

continually emphasize this proposal is not a secret plan to fire employees, but rather an 

effort to streamline and improve government operations for employees, the entire civil 

service, and the American taxpayer. I would hope Members of Congress would join me 

in dispelling the false narrative this reorganization is an attack on the civil service, when 

it is in reality an effort to deliver a more efficient and effective government on behalf of 

the American taxpayer. 

A significant part of this proposal is presumably going to be moving personnel from OPM to the 

new GSA. I want to get your thoughts on how that would work for your average OPM employee. 

8) 

• Is John Smith, an OPM employee, just going to leave OPM on a Friday and show up for 

work at GSA on Monday, or, when John Smith transfers from OPM to GSA, does his 

administrative footprint come with him, i.e. the OPM IT processes, OPM administration, 

OPM rules? 

Response: Detailed processes for how the reorganization will be implemented are 

currently being finalized, but will seek to have the least impact on individuals as possible 

during a reorganization of this magnitude. 

• Based on your initial analysis, what will be the impact of this merger on the total number 

of employees currently at OPM and GSA? Do you expect it to be less, the same, or more? 

Response: We do not expect this merger to have any significant impact on the number of 

employees at OPM and GSA at this time. 

• How did you develop the answer to the previous question? 

Response: As we are simply moving an office from one agency to another, there should 

not be any significant impact on the number of employees. 

Your agencies have a great resource in your Senior Executives. These are your frontline career 

leaders who are critical to a smooth-functioning federal government. 

9) 

• What feedback have you received from these individuals on this plan? 

Response: Discussions with the OPM SES are ongoing regarding this reorganization, and 

they are supportive of a desire to create a more effective and efficient mission delivery. 

• What is the SES involvement in any planning for the merger that is going on at this time? 

Response: Leaders from OPM, both political and career, are engaged in interagency 

discussions to develop the detailed scope and plan around implementation of the 

reorganization. 

Page 5 ofB 
71 

A key part of this proposal is moving the policy part ofOPM into the Executive Office of the 

President, presumably OMB. 

10) 

Does such a move politicize the federal civil service, why or why not? 

Response: The Director and Deputy Director of OPM are already Presidential appointees. 

As I stated during the hearing, it is beneficial to the Federal workforce and the country 

when the head of an organization understanding human resources has a seat at the table. 

It shows the importance being placed on personnel, and I view this as a positive step for 

the Federal government. 

An issue that arose at both recent HSGAC hearings on the agency reorganization proposal were 

questions about what parts of the reorganization that the Executive Branch presently has the 

legislative authority to execute. 

II) 

• What parts of this overall proposal to move OPM into GSA and move other parts of OPM 

to DOD and OMB does the Administration have the authority to execute on without 

legislation to Congress? 

Response: OPM is currently reviewing legal authorities to make this final determination. 

• How did you determine that answer? 

Response: Attorneys from the relevant agencies and OMB are engaged in interagency 

discussions to review current authorities. 

Last Congress, I cosponsored the Program Management Improvement and Accountability Act 

(PMIAA) with Senator Ernst. Among other things, the bill, which is now law, instructs OPM to 

create a formal job series and career path for program managers in the federal government. 

Recently, OMB released guidance on implementing the law, and it has asked that OPM provide 

its implementing recommendations for the job series and career path by Q4 of FY 2018. 

o Are you committed to creating a formal job series and career path for program 

managers? 

Response: Yes, I am. In accordance with the PMIAA, OPM has 180 days from 

the issuance of the OMB guidance on June 25,2018 to complete regulations that 

identify key skills and competencies needed for a program and project manager in 

an agency; establish a new job series, or update and improve the existing job 

series, for program and project management within an agency; and establish a 

new career path for program and project managers. OPM will complete these 

requirements by Q 1 of FY 2019. OPM is also required to identify key skills and 

competencies for program and project managers, and it will do so. 

o Will the reorganization cause any delays in meeting your obligations under 

PMIAA as outlined in OMB's Guidance? 

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72 

12) 

Response: OPM docs not expect there to be any delays. 

o What benefits do you think the federal government will achieve once the job 

series and career path are implemented Will this speed up the hiring process, 

improve retention, and ensure people get proper training and career development? 

Response: OPM anticipates the occupational series and career path, once 

implemented, will improve agencies' talent acquisition and management 

activities, including talent development. The consistent use of the series and 

competencies should improve agencies' ability to speed hiring -however, both the 

timeframe for hiring and retention are impacted by other factors (e.g., employee 

engagement). 

o Will you commit to following up with my staff to provide an update regarding 

your implementation efforts and what effect the reorganization effort might have 

on that implementation? 

Response: Yes, I will. 

OMB's Guidance also said OPM may create or enhance a job series or a job identifier. 

13) 

o Please explain the difference between a job series and a job identifier. What is the 

purpose of a job identifier, and what does OPM currently plan to do in this 

regard? 

Response: A job (occupational) series is a subdivision of an occupational 

group/family that describes positions in a similar line of work and outlines the 

qualification requirements for the corresponding series. A job identifier is a code 

representing the type of work performed in a variety of occupational 

series/groups. The job identifier allows us to also better track work that is being 

performed across various occupational series. 

o Will OPM establish the job identifier and the job series? 

Response: OPM will consult with agencies and review the relevant information to 

determine the appropriateness of establishing a new job series, or updating and 

improving an existing job series and/or establishing a job identifier. 

OPM recently finalized a rule generally known as the Flexibilities Rule where the stated purpose 

was to correct asymmetries in the insurance market for Federal employees and annuitants. One 

of the issues related to the rule are the impact of Service Benefit Plans on FEHB plan costs. 

• What iR OPM doing to encourage non-SBP plans to stay in the FEHB and/or new carriers 

to participate? 

Page 7 of8 
73 

Response: In the FEHB Program Call Letter, OPM encouraged FEHB carriers to 

consider a range of strategies to enhance the quality and affordability of their health 

benefits not only by making changes to existing plans but by proposing new plan options. 

We also discussed the new agency strategic objective of improving the quality of 

healthcare received by enrollees, increasing the affordability of plans, and enhancing the 

portfolio of available FEHB plans. Finally, OPM is exploring opportunities to expand 

plan choices, such as adding a new carrier for the Indemnity Benefit Plan. 

• What other flexibilities, if any, does OPM consider to be important in reducing regulatory 

burden? 

Response: OPM continually assesses ways in which the FEHB Program can innovate to 

meet the needs of Federal employees, annuitants and their families, while maintaining 

affordable and quality benefit options. OPM's FY 2018-2022 strategic plan includes 

Objective 1 .4, to improve healthcare quality and affordability in the FEHB Program with 

75 percent of the enrollees in quality, affordable plans. One strategy to reach that 

objective is to improve the portfolio of available FEHB plans to increase the proportion 

that are quality, affordable plans. OPM has determined that our current legislative 

authority under 5 USC 8903 is sufficient to promote innovation and competition in the 

FEHB Program. 

• How does this rule ensure that negative impacts such as program destabilization, 

increased premiums, and fewer consumer choices will not occur? 

Response: As detailed in the Expected Impact of Final Changes section of the final 

FEHB Program Flexibilities rule, we expect that the regulatory change will have a 

positive effect on market dynamics by potentially increasing competition among health 

care carriers. This expectation is based on the assumed impact of the introduction of 

additional options and on OPM's focus, as set forth in the agency's Strategic Plan, on 

increasing quality and affordability in the FEHB Program. 

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74 

Post-Hearing Questions for the Record 

Submitted to the Honorable JeffPon 

From Senator Claire McCaskill 

"The Challenges and Opportunities of the Proposed Government Reorganization on OPM 

and GSA" 

July 26, 2018 

1. What analyses has the Office of Personnel Management (OPM) conducted to assess the 

impact of the reorganization plan, including retraining, on the federal workforce? Please 

provide those analyses. IfOPM has not conducted those analyses, please explain how 

OPM will analyze workforce impacts. 

Response: OPM is actively working with GSA and OMB to assess implementation strategies 

f~~ the 2018 comprehensive reorganization plan that will maximize efficiencies and enhance 

service delivery and program execution. 

2. How many public comments did OPM receive pursuant to the May 15,2017, Federal 

Register notice? 

Response: OPM received 2,738 public comments from the White House/OMSadministered website portal. 

a. Is OPM able to identify how many comments were submitted by individuals and 

how many were submitted on behalf of organizations? If so, please provide a 

breakdown of those submissions. 

Response: It is not clear which comments were submitted by individuals or on 

behalf of organizations. The information forwarded to us consisted of 

spreadsheets of comments that included an "organization" column, but it is not 

clear whether the individuals who entered information in that section were acting 

on behalf of that organization or merely entering the organization where they 

work. 

b. Did OPM establish any policies regarding the intake of comments? 

Response: The intake of comments on behalf of Federal agencies was managed 

via the portal at https://www.whitehouse.gov/reorganizing-the-executivebranch. OMB provided OPM with the public comments in cases where the 

commenter selected "OPM" as an agency for reform or elimination. These 

comments were reviewed and used in the development of the OPM agency reform 

plan. 
75 

c. What process did OPM use to analyze these comments? What methods, in 

particular, were employed to identify and support the proposals that were included 

in the Administration's plan? 

Response: In developing the Agency Reform Plan submission to OMB, a wide 

range of inputs were considered, including public comments collected, as well as 

inputs and feedback gathered from interviews and focus groups with more than 50 

external stakeholders, which included customers ofOPM, Federal agencies, 

executive councils, advisory groups, affinity groups, and industry thought 

leaders. Inputs were also collected from OPM employees via an all-employee 

survey questionnaire, as well as from OPM program owners/executives who 

reviewed the overall functions of OPM and the core mission/functions of each 

specific program office. Data from all these sources were reviewed by the OPM 

senior leadership team. These senior leaders worked through a process to reach 

consensus and select the most promising proposals to pursue. 

d. Did OPM retain the comments that it received pursuant to the Federal Register 

notice? 

Response: Yes. 

e. Please provide copies of the comments that were received by OPM. 

Response: The comments are being prepared for public release. 

3. How did OPM solicit input and comments from its employees? 

Response: The OPM Acting Director sent an online questionnaire via email to the entire 

OPM workforce to solicit unfiltered feedback and ideas. 

a. How was that input used? 

Response: The majority of the responses from employees were related to process 

improvements relevant to the respondent's current local work or operational 

area. The ideas about the operational-level improvements were provided to the 

relevant program office heads for further consideration and pursuit outside the 

agency-wide reform plan process. The ideas that were relevant to the broader 

agency reform plan were considered by the OPM senior leadership where the 

OPM employee proposals were considered alongside proposals collected from 

various other sources. 

b. How many comments were received? 

Response: Approximately 300 responses were received from OPM employees. 

2 
76 

4. In your testimony, you stated that the President's reorganization proposal is "an 

opportunity to elevate the Federal workforce management functions" and that in order "to 

drive real reform, the government needs to elevate Federal workforce policy" by "moving 

OPM's policy function into EOP [Executive Office of the President]." Under current 

law, (5 USC § ll 03(a)(7)) the Director of OPM is responsible for aiding and advising the 

President on federal personnel policy, and during the Clinton Administration, the 

Director was elevated to a cabinet-level status. 

a. Where in the organizational structure of the EOP will the Director and OPM 

policy functions be moved? 

Response: This is part of the ongoing conversations with the Office of 

Management and Budget (OMB)." 

b. Who will the Director report to on a day-to-day basis? 

Response: This is part of the ongoing conversations with the Office of 

Management and Budget (OMB)." 

c. Will the move of the policy functions into the EOP come with a cabinet-level 

status designation for the Director? 

Response: This is part of the ongoing conversations with the Office of 

Management and Budget (OMB). 

d. How will the policy functions align or differ from the OMB Office of 

Performance a:nd Personnel Management, which directs personnel policies and 

practices across the Federal government and reports to the Deputy Director for 

Management? 

Response: 

The Reorganization Plan would move the policy function of OPM to the EOP, 

along with its existing policy and statutory authorities, of which OPM is solely 

responsible for many including, for example, the Suitability Executive Agent and 

oversight of hiring authorities. Where OPM and PPM share statutory 

responsibilities, we will continue to work closely together to meet those shared 

responsibilities. 

e. Has OPM prepared any directives, or has OPM received any directives, to ensure 

that the OPM Director will retain its independence during the reforms? 

Response: OPM has not prepared or received any directives, but the OPM 

Director will remain an independent voice for the civil service and merit systems 

principles during these reforms and will fulfill the oath he took upon 

confirmation. 

3 
77 

5. Has OPM conducted a business case analysis for the transfer of Human Resources 

Solutions (HRS) to the General Services Administration (GSA)? If so please provide that 

analysis. If not, how does OPM support its contention that it is more effective and 

efficient to transfer HRS? 

Response: OPM and GSA are collaborating on a qualitative business analysis and will 

share documentation as appropriate during our ongoing engagements with the 

Committee. 

a. How many federal workers will be affected by this transfer? 

Response: HRS currently employs about 425 FTEs; however the final scope of 

which HRS components will be transferred has not been finalized. 

b. What is the cost of implementation associated with this proposal and what impact 

will the transfer ofHRS have on OPM's budget and operations, including 

working capital fund contributions and support office functions? 

Response: OPM will be utilizing the budget process, in coordination with OMB 

and GSA, to identify any potential costs. 

c. What is the estimated long-term cost savings achieved by this transfer? 

Response: OPM will be finalizing this information as part of the annual budget 

process. 

d. Will OPM share the information its task force develops on this proposal prior to 

any implementation? 

Response: We look forward to keeping the committee updated on our progress 

with this merger as appropriate. 

e. How will moving HRS to the General Services Administration (GSA) improve 

customer service and its ability to meet the mission of the office? 

Response: As part of its discussions, GSA and OPM are strategizing how each 

organization's internal people management and customer service assets can 

enhance customer service. Meetings with HRS customers will be a key activity 

for the Interagency Task Force, including obtaining insights about customer 

expectations (e.g., customer service, product delivery/enhancement, cost savings, 

speed, etc.) concerning the transition ofHRS into GSA. OPM and GSA also 

anticipate signing a Memorandum of Agreement so HRS maintains a close 

working relationship with OPM's HR policy organization. In many cases, HRS 

supports the operationalization of policies and major HR initiatives. OPM and 

4 
78 

GSA see HRS maintaining this role within GSA after the transfer, as policy and 

operations, are, in many respects, closely intertwined. 

f. What are the outstanding recommendations from the Office of the Inspector 

General for HRS and how will this transfer address them? 

Response: HRS has two outstanding open recommendations from the Office of 

the Inspector General. The first is OIG Audit 4A-HR-00-13-055 "Pricing 

Methodology" Recommendation 5, and the second is OIG Audit 4A-HR-00-15-

015 "Audit of the Information Technology Security Controls of the U.S. Office of 

P<:rsonnel Management's GP Plateau Baseline 6 Learning Management System 

(LMS)," Recommendation 6. Through discussion with GSA's finance team, we 

have learned that GSA's financial systems do not have the OPM-Enhanced 

Projects Suite (EPS) capability to perform detailed project costing; therefore, the 

transfer ofHRS into an environment without a system equivalent to OPM's EPS 

Suite would maintain the vulnerability. OIG Recommendation 6 will be 

completed and the updated POAM document submitted for closure on next week. 

g. Where did the idea to transfer HRS from OPM to the GSA originate from? 

Response: The government reorganization is a collaborative and iterative 

interagency effort being coordinated through OMB. Ideas are often an outgrowth 

of conversations among the agencies, not ideas put forth from silos. 

6. During your testimony, you stated that there is enough separation between your office 

and the Merit Systems Accountability Group to prevent political decisions from 

influencing the merit based principles at OPM. 

a. What direction have you provided to the task force to ensure that merit based 

principles will be upheld during the HRS transfer? 

Response: I have consistently put forth direction to my agency that merit system 

principles must be adhered to while any personnel actions are being taken. 

Actions taken in regard to the government reorganization are no different. 

b. Please provide any documents or communications sent to those responsible for 

developing and executing the plans that provides guidance on ensuring that merit 

based principles will be upheld. 

Response: The direction to uphold merit system principles is not derived from, or 

based on, any sole communication or document, it is an ongoing conversation that 

I have made clear is a priority to the employees of OPM as the Director of the 

agency. 

7. During your testimony, you stated that the large part of this transfer can be done 

administratively, but that OPM is examining other authorities. 

5 
79 

a. Specifically, what statutory language or other executive authority is OPM looking 

to for executing the transfer of HRS to GSA? 

Response: OPM is analyzing legal options in coordination with OMB and GSA. 

Also, we are still exploring what legal authorities may be needed in the future. 

b. What GSA authorities is OPM relying on to executive the transfer? 

Response: Under existing law GSA controls three revolving funds that will allow 

it to replicate the reimbursable services model at HRS, and attorneys from both 

agencies continue to assess potential implementation plans against statutory 

authority in collaborative manner. 

c. Is there a timeline for when OPM will alert Congress to the legal analysis of the 

transfer and iflegislation is needed? 

Response: OPM looks forward to updating the committee on our progress with 

this merger as appropriate in an ongoing dialogue. 

8. OPM and OMB have told congressional staff that phase II proposals will include the 

transfer of retirement and insurance benefits to GSA 

a. What is the strategy for this transfer? 

Response: We are currently finalizing details for "stage!" ofthe overall vision 

and will be developing detailed strategies for the later stages at the appropriate 

time. 

b. Has OPM conducted a business case or other analyses regarding this transfer? If 

so please provide that analysis. If not, how does OPM support its contention that 

it is more effective and efficient to transfer these functions? 

Response: We are currently finalizing details for "stage I" of the overall vision 

and will be developing detailed strategies for the later stages at the appropriate 

time. However, we believe great efficiencies can be gained by consolidating 

operational functions of OPM in an agency whose priority is servicing agencies. 

Part of the challenge in Phase II will be identifying what aspects of the work 

performed by Retirement Services and Healthcare & Insurance can be 

characterized as oriented to policy formulation, regulation, and oversight, and 

what aspects can be characterized as operational. Similarly, we will need to make 

decisions about how to treat activities that, in essence, constitute administrative 

adjudication functions. 

6 
80 

c. What stakeholders have been contacted or will be contacted? 

Response: We have engaged a wide array of stakeholders for input on the 

government reorganization, including by receiving public comments, and look 

forward to opportunities to further engage stakeholders in stages that may directly 

affect them to develop a full view of any perceived or possible obstacles. 

d. When will OMB begin to share data on the cost of this transfer? 

Response: Since this question is to OMB, OPM defers to OMB for this question. 

e. What authorities will be utilized when authorizing this transfer? 

Response: OPM is still exploring what current legal authorities can be utilized for 

this transfer. 

f. What will happen to the regulatory and policy functions for retirement, 

healthcare, and other insurance programs? 

Response: This is part of the ongoing conversations; however OPM does not 

expect significant interruption of services to our customers during the transfer. 

9. How will you guarantee that your plan to move the Federal Employee Health Benefits 

Program (FEHBP) to GSA will not disrupt health coverage for the more than eight 

million federal government employees, retirees, and their dependents? 

Response: The transition of the FEHB Program from OPM to GSA will be 

discussed in a later stage of the reorganization; however preventing significant 

disruption in service will remain a top priority. 

a. What steps are you proactively taking to account for the difference in expertise 

required to operate the FEHBP that GSA currently does not possess? 

Response: As previously mentioned, the transition of the FEHB Program from 

OPM to GSA will be discussed in a later stage of the reorganization, and we will 

take steps to ensure components maintain the subject matter expertise necessary 

as part of the final, detailed plans. 

b. Earlier this year, OPM issued a final rule (8 FR 18399) affecting Service Benefit 

Plan carriers in an effort to "enhance the quality and affordability ofFEHB 

insurance offerings" in response to concerns about competition. What analysis 

led OPM to believe that this regulatory change was necessary given that the only 

Service Benefit Plan participating in the FEHB covers approximately 65% of the 

market? 

7 
81 

Response: OPM implemented the FEHB Program Flexibilities regulation to 

correct an asymmetry in rules of the market so that employees and retirees can 

have plan choices available to them that offer the same number of options 

wherever they reside. Under regulations issued in 2010, all FEHB health plans 

except the Service Benefit Plan (SBP) and the Indemnity Benefit Plan (IBP) were 

allowed to offer 3 options of any type, while the SBP and IBP were allowed to 

offer only 2 options and an HDHP. OPM has determined that there is no legal or 

practical reason to maintain this restriction. The FEHB Program Flexibilities 

regulation allows all FEHB Program health plans to operate under the same set of 

rules, to enable a fair competitive marketplace. 

c. Similarly, OPM noted in the final rule that it expects that this regulatory change 

will potentially increase competition between health plans and allow plans to 

"offer a greater variety of lower cost, higher quality options." Please provide the 

analysis that demonstrates why OPM believes that the final rule will have this 

effect on competition, cost, and quality contrary to the public comments raising 

concerns about the rule decreasing competition and further consolidating market 

share. 

Response: As detailed in the Expected Impact of Final Changes section of the 

final Federal Employees Health Benefits Program Flexibilities rule, OPM expects 

the regulatory change will have a positive effect on market dynamics by 

potentially increasing competition among health plans. This expectation is based 

on the assumed impact of the introduction of additional options and on OPM's 

focus, as set forth in the agency's Strategic Plan, on increasing quality and 

affordability in the FEHB Program. It is not based on predictive data analysis. 

10. What are the strategy and timeline for transfer of OPM legacy IT systems? What 

analyses has OPM conducted to assess feasibility, cost, and modernization for these 

systems if they are transferred? 

Response: OPM is currently working on a timeline to accomplish the migration ofiT 

systems from OPM to GSA and the analysis is ongoing. Centralizing human resources 

operational functions, including IT, in a single agency would integrate the transactional 

and employee-centric, service-based functions currently performed by OPM with existing 

GSA operations, including Federal employee payroll and travel. 

a. In particular, please describe in detail how will GSA provide better IT support for 

vital programs such as retirement services and the FEHBP when compared to the 

current operations supported by OPM. 

Response: Since this question relates to services GSA provides, OPM defers to 

GSA for this question. 

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b. What is the greater value offered by the reorganization that will ensure no 

disruption and improve legacy systems beyond existing plans and strategies? 

Response: With end-to-end services around the Federal employee lifecycle 

maintained in one place, considerable operational efficiencies should be attained. 

Currently, these services are stove-piped, forcing burdensome processes on 

managers and employees. It is worth noting that HR services are rated last among 

all mission support services by Federal managers. 

11. After E.O. 13843, what policy, program, and oversight role will OPM continue to play in 

the hiring of administrative law judges at federal agencies? 

Response: The EO places the position of administrative law judge (ALJ) in the excepted 

service and directs OPM to pursue any necessary revisions to its regulations swiftly. By 

the terms of the order, agencies may begin making Schedule E appointments to the 

position of ALJ immediately, without prior OPM approval. OPM will promulgate 

proposed regulations to address any provisions in the regulations that arc inconsistent 

with the Executive Order or use language that is generally inapplicable to the excepted 

service (e.g., references to the concepts of"probation" or "suitability"). Whether ALJs 

are in the competitive service or the excepted service, OPM's regulations continue to 

govern some aspects of ALJ employment, including those related to reassignments, intraagency details, interagency loans, senior ALJs, and reductions in force. Like other 

excepted service appointments, ALJ appointments are generally subject to investigation, 

a determination of fitness, a determination of eligibility for logical and physical access to 

agency systems and facilities, and, where applicable, a determination of national security 

eligibility. 

a. What policies, such as qualitication standards and veterans preference 

considerations, is OPM developing regarding the creation of"Schedule E" 

positions? 

Response: Section 3(a) of the EO places the position of ALJ in the excepted 

service beginning July 10, 2018. It further states that appointments to the position 

of ALJ are not subject to any examination or rating requirement, including the 

procedures of 5 Code of Federal Regulation (CFR) 302, Employment in the 

Excepted Service, except that an agency must follow the principle of veterans' 

preference as far as administratively feasible. Consistent with the requirement in 

Section 3(a)(ii) of the EO, the minimum qualification and licensure requirement 

for the position of ALJ is the possession of a professional license to practice law 

and being authorized to practice law under the laws of a State, the District of 

Columbia, the Commonwealth of Puerto Rico, or any territorial court established 

under the United States Constitution at the time of selection and any new 

appointment (other than of an incumbent ALJ to another ALJ position). For 

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purposes of this requirement, judicial status is acceptable in lieu of"active" status 

in States that prohibit sitting judges from maintaining "active" status to practice 

law, and being in "good standing" is also acceptable in lieu of"active" status in 

States where the licensing authority considers "good standing" as having a current 

license to practice law. An agency may prescribe additional qualification 

requirements as necessary. Any agency specific requirements must be provided 

to potential applicants. 

12. What plans does OPM have for the CFC program under the reorganization and how will 

those plans improve the CFC program? 

Response: Currently, OPM docs not have any plans to change the CFC program as part 

of the reorganization proposal. 

a. What has the impact of the revamped Combined Federal Campaign (CFC) had on 

donations and number of charities participating? 

Response: In 2016, Federal civilian, military and postal employees pledged 

$167.1 million to the CFC. In 2017, Federal civilian, military, postal employees, 

and annuitants pledged $101.4 million and 125,000 volunteer hours to the CFC. 

In 2017, there were about 8,200 charities that participated. In 2016, there were 

19,000 charities that participated. 

b. Please provide figures on participation, contributions, fees, and administrative 

costs since the CFC Commission recommendations were released. 

R esponse: 

Year Charities Contributions Fees Administrative 

Participating Costs 

2012 $258,300,000 $28,223,712 

2013 $209,700,000 $26,875,069 

2014 $193,200,000 $26,078,418 

2015 $177,800,000 $24,507,577 

2016 19,000 $167,100,000 $25,037,599 

. LU17 8,232 $101,400,000 $9,265,130 $26,037,363 

Note: CFC-50 Commzsszon Report released m June 2012. CFC regulatzons in 

effect January 2017. 

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