```

[Senate Report 115-331]
[From the U.S. Government Publishing Office]

                                                       Calendar No. 563
115th Congress          }                     {                Report
                                 SENATE
 2d Session             }                     {                115-331
_______________________________________________________________________

                                     

              GOOD ACCOUNTING OBLIGATION IN GOVERNMENT ACT

                               __________

                              R E P O R T

                                 of the

                   COMMITTEE ON HOMELAND SECURITY AND

                          GOVERNMENTAL AFFAIRS

                          UNITED STATES SENATE

                              to accompany

                                S. 2276

          TO REQUIRE AGENCIES TO SUBMIT REPORTS ON OUTSTANDING
    RECOMMENDATIONS IN THE ANNUAL BUDGET JUSTIFICATION SUBMITTED TO 
                                CONGRESS
                                
                                
                                
                                
                                

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

               September 4, 2018.--Ordered to be printed
               
                                ______

                   U.S. GOVERNMENT PUBLISHING OFFICE 

79-010                     WASHINGTON : 2018

               
               
               
               
               
               
        COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS

                    RON JOHNSON, Wisconsin, Chairman
JOHN McCAIN, Arizona                 CLAIRE McCASKILL, Missouri
ROB PORTMAN, Ohio                    THOMAS R. CARPER, Delaware
RAND PAUL, Kentucky                  HEIDI HEITKAMP, North Dakota
JAMES LANKFORD, Oklahoma             GARY C. PETERS, Michigan
MICHAEL B. ENZI, Wyoming             MAGGIE HASSAN, New Hampshire
JOHN HOEVEN, North Dakota            KAMALA D. HARRIS, California
STEVE DAINES, Montana                DOUG JONES, Alabama

                  Christopher R. Hixon, Staff Director
                Gabrielle D'Adamo Singer, Chief Counsel
                  Daniel J. Spino, Research Assistant
               Margaret E. Daum, Minority Staff Director
       Charles A. Moskowitz, Minority Senior Legislative Counsel
                 Katherine C. Sybenga, Minority Counsel
                     Laura W. Kilbride, Chief Clerk

                                                       Calendar No. 563
115th Congress          }                     {                Report
                                 SENATE
 2d Session             }                     {                115-331
======================================================================

 
              GOOD ACCOUNTING OBLIGATION IN GOVERNMENT ACT

                                _______
                                

               September 4, 2018.--Ordered to be printed

                                _______
                                

 Mr. Johnson, from the Committee on Homeland Security and Governmental 
                    Affairs, submitted the following

                              R E P O R T

                         [To accompany S. 2276]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Homeland Security and Governmental 
Affairs, to which was referred the bill (S. 2276), to require 
agencies to submit reports on outstanding recommendations in 
the annual budget justification submitted to Congress, having 
considered the same, reports favorably thereon with an 
amendment in the nature of a substitute and recommends that the 
bill, as amended, do pass.

                                CONTENTS

                                                                   Page
  I. Purpose and Summary..............................................1
 II. Background and Need for the Legislation..........................1
III. Legislative History..............................................3
 IV. Section-by-Section Analysis......................................3
  V. Evaluation of Regulatory Impact..................................4
 VI. Congressional Budget Office Cost Estimate........................4
VII. Changes in Existing Law Made by the Bill, as Reported............5

                         I. Purpose and Summary

    S. 2276, the Good Accounting Obligation in Government (GAO-
IG) Act requires Federal agencies to submit reports on 
outstanding recommendations from the Government Accountability 
Office (GAO) and agency's Office of Inspector General (OIG) in 
the annual budget justification submitted to Congress.

              II. Background and the Need for Legislation

    GAO and OIGs serve as important partners to Congress and 
Federal agencies. The GAO IG Act looks to strengthen those 
relationships by requiring Federal agencies to report what 
actions they have taken to address open and unimplemented GAO 
and OIG recommendations.
    GAO is an independent agency that works for Congress with 
the statutory requirement of securing greater economy and 
efficiency in the business of public service.\1\ GAO conducts 
financial audits, program reviews, and other services to help 
Federal agencies ensure efficiency in public expenditures.\2\ 
GAO's recommendations, when implemented, often save taxpayer 
dollars by eliminating areas of mismanagement, duplication, and 
waste.\3\
---------------------------------------------------------------------------
    \1\Pub. L. No. 67-13 title III.
    \2\Id.
    \3\U.S. Gov't Accountability Office, Presidential and Congressional 
Transition, Priority Recommendations (July 17, 2018), available at 
https://www.gao.gov/resources/presidential-transition/priority-
recommendations.
---------------------------------------------------------------------------
    The first OIGs were established by Congress by the 
Inspector General Act of 1978.\4\ OIGs promote efficiency and 
prevent, detect, and report fraud and abuse.\5\ OIGs are the 
watchdogs of their respective agencies that review programs, 
while providing recommendations for improvement.\6\ OIGs report 
to Congress on a semi-annual basis on the number of 
recommendations they have made to their respective agency that 
have not been implemented, including the impact they may have 
on an agency's operations.\7\
---------------------------------------------------------------------------
    \4\Pub. L. No. 95-452.
    \5\Id.
    \6\ Project on Government Oversight, Where Are All the Watchdogs? 
(2012), available at http://www.pogo.org/tools-and-data/ig-watchdogs/
go-igi-20120208-where-are-all-the-watchdogs-inspector-general-
vacancies1.html.
    \7\Pub. L. No. 95-452.
---------------------------------------------------------------------------
    As of July 16, 2018, GAO has 4,832 open recommendations to 
agencies.\8\ According to a 2016 report issued by majority 
staffs for the Committee and the Senate Committee on the 
Judiciary, in 2016 there were 15,222 open and unimplemented OIG 
recommendations which totaled over $87 billion in potential 
cost savings.\9\
---------------------------------------------------------------------------
    \8\U.S. Gov't Accountability Office, Reports & Testimonies, 
Recommendations Database (July 16, 2018), available at https://
www.gao.gov/recommendations.
    \9\Staff of S. Comm. On Homeland Sec. & Governmental Affairs, and 
S. Comm. on the Judiciary, 114th Cong., Empowering Inspectors General: 
Supporting the IG Community Could Save Billions for American Taxpayers 
(Oct. 17, 2016), available at https://www.hsgac.senate.gov/imo/media/
doc/IG%20Open%20Recs%20Staff%20Report_FINAL%20(2).pdf.
---------------------------------------------------------------------------
    While both GAO and the OIGs' report on open and 
unimplemented recommendations, agencies are not required to do 
so. To shine a light on agencies' failures to act on GAO and 
OIG recommendations, S. 2276 requires agencies to include a 
listing of open, unimplemented GAO and OIG recommendations in 
each agency's annual budget justification submitted to 
Congress. Agencies must also provide explanations for not 
implementing each recommendation. By disclosing open 
recommendations and being required to explain the lack of 
implementation in an agency's budget request, agencies will be 
held more accountable for unimplemented recommendations and 
Congress and the public can more readily scrutinize an agency's 
funding request in light of unfulfilled efficiency improvements 
that may yield cost savings. Private watchdog the Project on 
Government Oversight supports the GAO-IG Act, stating that the 
legislation ``could inspire agencies to incorporate important 
recommendations that have languished on the sidelines.''\10\
---------------------------------------------------------------------------
    \10\Letter from Danielle Brian, Executive Director, Project on 
Gov't Oversight, to Representatives Walker, Bishop, Duncan, 
Fitzpatrick, and Palmer (June 12, 2018), available at http://
www.pogo.org/our-work/letters/2018/pogo-supports-house-bill-stressing-
inspector-general-and-gao-recommendations.html.
---------------------------------------------------------------------------
    S. 2276 also extends the timeline from 60 days to 180 days 
for agencies to provide statements to Congress on a GAO report 
pertaining to the agency. This allows agencies more time to 
plan substantive action in response to GAO's recommendations 
and will result in responses that are more useful to 
congressional committees and GAO in following up on agencies' 
implementation of the recommendations.\11\
---------------------------------------------------------------------------
    \11\U.S. Gov't Accountability Office, Findings and Recommendations 
for 60 day Letters (Feb. 2, 2017) on file with S. Comm. On Homeland 
Sec. and Governmental Affairs.
---------------------------------------------------------------------------

                        III. Legislative History

    Senator Todd Young (R-IN) introduced S. 2276, the Good 
Accounting Obligation in Government (GAO-IG) Act, on January 4, 
2018, with Senator Elizabeth Warren (D-MA). The bill was 
referred to the Committee on Homeland Security and Governmental 
Affairs.
    The Committee considered S. 2276 at a business meeting on 
June 13, 2018. During the business meeting, an amendment in the 
nature of a substitute was offered by Chairman Ron Johnson to 
strike the 60-day requirement for agency statements concerning 
GAO's work and increase it to 180 days. Both the Johnson 
substitute amendment and the bill, as amended, were ordered 
reported favorably en bloc by voice vote with Senators Johnson, 
Portman, Lankford, Enzi, McCaskill, Carper, Peters, Hassan, 
Harris, and Jones present.

        IV. Section-by-Section Analysis of the Bill, as Reported

Section 1. Short title

    This section establishes the bill's short title as the 
``Good Accounting Obligation in Government Act'' or the ``GAO-
IG Act.''

Section 2. Reports on outstanding Government Accountability Office and 
        Inspector General recommendations

    Subsection (a) establishes that the term ``agency'' refers 
to a designated Federal entity defined in section 8G(a)(2) of 
the Inspector General (IG) Act of 1978, as well as an 
establishment defined in section 12(2) of the IG Act of 1978.
    Subsection (b) explains how agencies have to report 
unimplemented GAO recommendations, and OIG recommendations with 
no final actions. It also requires agencies to present a 
contingency plan for unfulfilled GAO and OIG recommendations 
that includes a timeline for completion or a justification for 
not implementing the recommendation.
    Subsection (c) states that each agency shall submit a copy 
of this information to GAO and its OIG.

Section 3. Timeline for agency statements

    This section increases the amount of time agencies have to 
provide statements to GAO reports from 60 days to 180 days.

                   V. Evaluation of Regulatory Impact

    Pursuant to the requirements of paragraph 11(b) of rule 
XXVI of the Standing Rules of the Senate, the Committee has 
considered the regulatory impact of this bill and determined 
that the bill will have no regulatory impact within the meaning 
of the rules. The Committee agrees with the Congressional 
Budget Office's statement that the bill contains no 
intergovernmental or private-sector mandates as defined in the 
Unfunded Mandates Reform Act (UMRA) and would impose no costs 
on state, local, or tribal governments.

             VI. Congressional Budget Office Cost Estimate

                                                     June 21, 2018.
Hon. Ron Johnson,
Chairman, Committee on Homeland Security and Governmental Affairs, U.S. 
        Senate, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for S. 2276, the GAO-IG 
Act.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Matthew 
Pickford.
            Sincerely,
                                                Keith Hall,
                                                          Director.
    Enclosure.

S. 2276--GAO-IG Act

    S. 2276 would amend federal law to require all agencies to 
report on the status of any Government Accountability Office 
(GAO) and Office of Inspector General (IG) recommendations 
concerning their agencies in annual budget justification 
documents. That report would include information on the status 
of implementing each recommendation and an explanation of why 
any recommendations have not been implemented.
    GAO spent approximately $600 million dollars in 2017 to 
investigate how the federal government spends its funds and 
produced more than 1,400 recommendations to improve government 
operations. In addition, more than 70 federal IGs spend about 
$2.5 billion a year to detect and deter fraud, waste, and 
abuse. In fiscal year 2016, IGs produced over 5,000 audit, 
investigation, and evaluation reports. CBO is not aware of any 
comprehensive information on the status of the recommendations 
those offices issue. However, information from GAO and IGs 
indicates that some agencies track which of their 
recommendations have not been implemented. CBO expects, 
however, that additional administrative work would be necessary 
to report on all open recommendations.
    Based on the type and scope of the necessary work, CBO 
estimates that implementing the bill would require 15 percent 
of the time of one employee and cost around $20,000 per agency 
each year. That spending would be subject to the availability 
of appropriated funds and would amount to $5 million over the 
2019-2023 period.
    Enacting S. 2276 could affect direct spending by agencies 
that are not funded through annual appropriations; therefore, 
pay-as-you-go procedures apply. CBO estimates, however, that 
any net increase in spending by those agencies would be 
negligible. Enacting the bill would not affect revenues.
    CBO estimates that enacting S. 2276 would not increase net 
direct spending or on-budget deficits in any of the four 
consecutive 10-year periods beginning in 2029.
    On June 15, 2018, CBO transmitted a cost estimate for H.R. 
5415, the GAO-IG Act as ordered reported by the House Committee 
on Oversight and Government Reform on May 23, 2018. On March 
28, 2018, CBO transmitted a cost estimate for S. 2178, the 
Inspector General Recommendation Transparency Act of 2018 as 
ordered reported by the Senate Committee on Homeland Security 
and Governmental Affairs on February 14, 2018. The three pieces 
of legislation are similar and CBO's estimate of their costs 
are the same.
    S. 2276 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act.
    The CBO staff contact for this estimate is Matthew 
Pickford. The estimate was reviewed by H. Samuel Papenfuss, 
Deputy Assistant Director for Budget Analysis.

       VII. Changes in Existing Law Made by the Bill, as Reported

    In compliance with paragraph 12 of rule XXVI of the 
Standing Rules of the Senate, changes in existing law made by 
the bill, as reported, are shown as follows: (existing law 
proposed to be omitted is enclosed in brackets, new matter is 
printed in italic, and existing law in which no change is 
proposed is shown in roman:

UNITED STATES CODE

           *       *       *       *       *       *       *

TITLE 31--MONEY AND FINANCE

           *       *       *       *       *       *       *

CHAPTER 7--GOVERNMENT ACCOUNTABILITY OFFICE

           *       *       *       *       *       *       *

Subchapter II--General Duties and Powers

           *       *       *       *       *       *       *

SEC. 720. AGENCY REPORTS.

    (a) * * *
    (b) When the Comptroller General makes a report that 
includes a recommendation to the head of an agency, the head of 
the agency shall submit a written statement on action taken or 
planned on the recommendation by the head of the agency. The 
statement shall be submitted to--
          (1) the Committee on Homeland Security and 
        Governmental Affairs of the Senate, the Committee on 
        Oversight and Government Reform of the House of 
        Representatives, the congressional committees with 
        jurisdiction over the agency program or activity that 
        is the subject of the recommendation, and the 
        Government Accountability Office before the [61st] 
        181st day after the date of the report; and
          (2) the Committees on Appropriations of both Houses 
        of Congress in the first request for appropriations 
        submitted more than [60] 180 days after the date of the 
        report.

           *       *       *       *       *       *       *

                                  [all]
```