U.S. Department of the Treasury 

FY 2012 Budget in Brief 

Summary of FY 2012 President’s Budget 

Executive Summary ....................................................................................................................................................... 1 

Summary Tables and Charts 

FY 2012 President’s Budget by Function .............................................................................................................. 1 

FY 2012 President’s Budget by Strategic Goal .................................................................................................... 8 

Fiscal Year Comparison of Full-Time Equivalent (FTE) Staffing ........................................................................... 9 

Summary of FY 2012 Increases and Decreases ................................................................................................. 10 

Appropriated Accounts – Bureau Program Detail 

Departmental Offices .................................................................................................................................................. 11 

Department-wide Systems and Capital Investment Program ....................................................................................... 17 

Office of Inspector General .......................................................................................................................................... 19 

Special Inspector General for TARP ............................................................................................................................ 23 

Treasury Inspector General for Tax Administration ...................................................................................................... 27 

Community Development Financial Institutions Fund .................................................................................................. 33 

Financial Crimes Enforcement Network ....................................................................................................................... 39 

Alcohol and Tobacco Tax and Trade Bureau ............................................................................................................... 45 

Financial Management Service .................................................................................................................................... 51 

Bureau of the Public Debt ............................................................................................................................................ 57 

Internal Revenue Service ............................................................................................................................................ 61 

Non-Appropriated Accounts – Bureau Program Detail 

Emergency Economic Stabilization Act Programs ....................................................................................................... 77 

Housing Government Sponsored Enterprise Programs ............................................................................................... 83 

Office of Financial Research/Financial Stability Oversight Council .............................................................................. 85 

Small Business Lending Fund ...................................................................................................................................... 87 

State Small Business Credit Initiative .......................................................................................................................... 89 

Bureau of Engraving and Printing ................................................................................................................................ 91 

United States Mint ........................................................................................................................................................ 95 

Office of the Comptroller of the Treasury ..................................................................................................................... 99 

Office of Thrift Supervision ......................................................................................................................................... 103 

Treasury International Programs

Treasury International Programs ................................................................................................................................ 105 

Supplemental Information

Summary of FY 2012 Appropriations Language ........................................................................................................ 111 

Mandatory Funding Levels for the FY 2012 President’s Budget – Treasury Chapter ................................................ 120 

Detail of Other Treasury Accounts ............................................................................................................................. 121 

Consumer Financial Protection Bureau ..................................................................................................................... 131 
FY 2012 DEPARTMENTAL SUMMARY

FY 2012 President's Budget by Function

(Dollars in Thousands)

FY 2010 FY 2011 FY 2012 

Enacted Annualized 

CR Level

Request $ Change % Change

Management & Financial 890,192 903,192 369,383 (533,809) -59.1%

Departmental Offices Salaries and Expenses 304,888 304,888 324,889 20,001 6.6%

Dept-wide Systems & Capital Invest. Programs 9,544 9,544 0 (9,544) -100.0%

Office of Inspector General 29,700 29,700 29,855 155 0.5%

Treasury IG for Tax Administration 152,000 152,000 157,831 5,831 3.8%

Special IG for TARP 23,300 36,300 47,374 11,074 30.5%

Community Development Financial Institutions Fund 246,750 246,750 227,259 (19,491) -7.9%

Financial Crimes Enforcement Network 111,010 111,010 84,297 (26,713) -24.1%

Transfer from Forfeiture Fund 30,000 

Net, Financial Crimes Enforcement Network 111,010 111,010 114,297 3,287 3.0%

Alcohol & Tobacco Tax and Trade Bureau 103,000 103,000 97,878 (5,122) -5.0%

Treasury Forfeiture Fund 1/ (90,000) (90,000) (630,000) (540,000) 600.0%

Fiscal Service Operations 426,376 426,376 384,440 (41,936) -9.8%

Financial Management Service 244,132 244,132 218,805 (25,327) -10.4%

Bureau of the Public Debt 192,244 192,244 173,635 (18,609) -9.7%

 Less Offsetting Fees (10,000) (10,000) (8,000) 2,000 

Net, BPD 182,244 182,244 165,635 (16,609) -9.1%

Tax Administration 12,146,123 12,146,123 13,283,907 1,137,784 9.4%

IRS Taxpayer Services 2,278,830 2,278,830 2,345,133 66,303 2.9%

IRS Enforcement 5,504,000 5,504,000 5,966,619 462,619 8.4%

IRS Operations Support 4,083,884 4,083,884 4,620,526 536,642 13.1%

IRS Business Systems Modernization 263,897 263,897 333,600 69,703 26.4%

IRS Health Insurance Tax Credit Administration 15,512 15,512 18,029 2,517 16.2%

Total, Treasury Appropriations Committee 13,462,691 13,475,691 14,037,730 562,039 4.2%

Treasury International Programs 2,128,670 2,128,670 3,363,934 1,235,264 58.0%

Poverty Reduction and Economic Growth (MDBs) 1,552,170 1,552,170 2,072,564 520,394 33.5%

Food Security 30,000 30,000 338,000 308,000 1026.7%

Combating Climate Change and Environmental Degradation 481,500 481,500 748,750 267,250 55.5%

Debt Relief 40,000 40,000 174,500 134,500 336.3%

Technical Assistance 25,000 25,000 30,120 5,120 20.5%

Total 2/ 15,591,361 15,604,361 17,401,664 1,797,303 11.5%

1/Includes a $600 million permanent cancellation and a $30 million transfer to FinCEN. 

2/ FY 2010 Enacted excludes supplementals and transfers.

Overview

The Department of the Treasury serves the 

American people by strengthening the U.S. 

economy, supporting job creation, and

restoring confidence in the financial system.

As stewards of the economy, the Department’s 

FY 2012 Budget (the Budget) reflects

Treasury’s commitment to the significant 

challenges that face our economy while
ensuring every dollar spent addresses the 

nation’s economic challenges.

The Budget requests $14.038 billion to fund 

priority functions at the Department’s ten

appropriated bureaus. The Budget also 

proposes $3.364 billion to fund Treasury 

International Programs. The International 

Programs request includes investments for 

reducing poverty and increasing economic 

stability around the world and addressing 

critical global challenges such as climate 

change and food security. Our request affirms

the Department’s commitment to controlling 

spending with $336 million in cost savings 

and program reductions, $630 million in

proposed cancellations and transfers of 

Forfeiture Fund balances, and requests well 

below the FY 2010 enacted level in five of our 

bureaus.

The Budget has been developed in order to 

make significant progress towards the 

Department’s three high priority performance 

goals:

• Repair and Reform the Financial 

System; 

• Increase Voluntary Tax Compliance; 

and 

• Significantly Increase the Number of 

Paperless Transactions with the Public.

Goal 1: Repair and Reform the Financial 

System

Regulatory Reform Support – Treasury

played a prominent role in developing and 

promoting sweeping financial reform

legislation, culminating in the enactment of 

the Dodd-Frank Wall Street Reform and 

Consumer Protection Act (Dodd-Frank Act) in 

July 2010. Implementation of the historic 

reforms contained in the Dodd-Frank Act is an 

important area of focus for the Department. 

Treasury is working to ensure that the new 

rules provide necessary protections against the 

financial excess that contributed to the recent 

financial crisis, while preserving the benefits 

of financial innovation.

The Department is engaged in a broad array of 

programs to stabilize the financial system and 

develop long-term, comprehensive solutions 

to avoid future economic crises. The 

Department is currently spearheading the 

standup of new independent regulatory bodies 

created by the Dodd-Frank Act, including the 

Consumer Financial Protection Bureau 

(CFPB) and the Financial Stability Oversight 

Council. Under the Act, the Department is 

also creating the Office of Financial Research, 

and the Federal Insurance Office. Reform 

efforts include the closure of the Office of 

Thrift Supervision and its integration into 

Office of the Comptroller of the Currency and 

other existing government functions. Treasury 

will continue working with other government 

agencies to develop new market regulations 

and guidance to more effectively respond to 

current and future financial challenges. The

Budget provides resources to support the 

successful implementation of new offices and 

activities authorized by the Dodd-Frank Act, 

including the new Federal Insurance Office 

and Office of Minority and Women Inclusion.

Supporting America’s Small Businesses – To 

help small businesses, Treasury is 

implementing two new programs as part of the 

Small Business Jobs Act of 2010 (the Jobs 

Act): the Small Business Lending Fund 

(SBLF), and the State Small Business Credit 

Initiative (SSBCI). SBLF will increase the 

availability of credit to small businesses by 

providing up to $30 billion in capital to 

community and smaller banks with assets 

under $10 billion, the banks that provide the 

most amount of lending to small businesses.

SSBCI provides $1.5 billion to strengthen 

state programs that support lending to small 

businesses and small manufacturers. Under 

the Jobs Act, Treasury will continue to 
increase support for America’s small 

businesses, as they play a critical role in the 

U.S. economy and are central to creating jobs 

and restoring our economic prosperity.

Housing Government Sponsored Enterprise 

(GSE) Programs – Using authority granted 

under the Housing and Economic Recovery 

Act of 2008 (HERA), the Department has 

sought to stabilize the two largest GSEs, the 

Federal National Mortgage Association 

(Fannie Mae) and Federal Home Loan 

Mortgage Corporation (Freddie Mac), as well 

as the Federal Home Loan Banks (FHLB). 

Under the Preferred Stock Purchase 

Agreements (PSPAs), Treasury has helped to 

ensure the viability of the GSEs by providing 

$131 billion of investment, net of dividends 

the GSEs paid to Treasury. In addition, 

Treasury has helped stabilize the market by 

purchasing over $200 billion in GSE 

mortgage-backed securities and has helped 

state and local housing finance agencies 

obtain needed financing to aid low- and 

moderate-income Americans. 

The Obama Administration is strongly 

committed to reforming our nation’s housing 

finance system in order to protect taxpayers, 

institute tough oversight, restore the long-term 

health of our housing market, and strengthen 

our nation’s economic recovery. The 

Administration is transmitting to Congress a 

framework and principles for making the 

transition to a new housing finance system 

that will end the model of private gains and 

public losses, repair the broken housing 

finance market, and minimize taxpayer 

exposure to financial risks. The framework

will also seek to make sure that the market 

provides stable and widely available mortgage 

credit, affordable housing options for low and 

middle-income homeowners and renters, and 

has stronger protections for consumers and 

better disclosure as mandated by the financial 

regulatory reform that passed last year.

Community Development Financial 

Institutions (CDFI) Fund – The Budget 

promotes economic and community 

development through investments in and 

assistance to community development banks, 

credit unions, loan funds, and venture capital 

funds through the CDFI Fund's merit-based 

grant programs. These programs expand the 

availability of financial services and 

affordable credit to underserved populations, 

including distressed urban, rural, Native 

American, Native Hawaiian, and Alaska 

Native communities. The Healthy Food 

Financing Initiative (HFFI) provides grants to

CDFIs to expand the availability of healthy 

food options in distressed communities. Bank 

on USA promotes access to affordable and 

appropriate financial services and basic 

consumer credit products for households 

without access to such products and services.

Troubled Asset Relief Program (TARP) – As

a result of improved financial conditions and 

careful stewardship of the TARP, the ultimate 

cost to the taxpayer of TARP investments is 

significantly lower than previously estimated. 

The TARP has allowed participating 

institutions to stabilize their balance sheets 

and avoid further losses, leaving the nation’s 

financial system in a much stronger position 

than it was before the crisis. TARP included 

various consumer and business programs to 

help recapitalize the financial system, restart 

the credit markets, restore confidence, and 

lower borrowing costs for businesses and 

families. The Department’s calculations 

estimate the lifetime cost of the program to be 

$48 billion.

Goal 2: Increase Voluntary Tax 

Compliance

In 2006, the IRS estimated that the tax gap, or 

difference between the amount owed under 

tax law and the amount paid on time, was 

$345 billion in 2001. Addressing this gap 
through improved voluntary compliance is a 

top priority of the Department. The 

Department proposes to improve compliance 

through targeted changes to the tax code and 

further investment in tax enforcement, 

taxpayer services, and IRS systems 

modernization. Furthermore, the Budget 

includes funding for new initiatives critical to 

the IRS in implementing the Affordable Care 

Act (ACA).

Tax Compliance – The Budget includes a 

number of legislative proposals to improve tax 

collection and increase collections with 

minimum additional burden on taxpayers.

These proposals expand information reporting, 

improve compliance by businesses, and 

strengthen tax administration. In total, these 

proposals are expected to increase collections 

by more than $10 billion over the next ten 

years. Further information on these proposals

can be found in the Treasury 2010 Green 

Book (http://www.treasury.gov/resourcecenter/tax-policy/).

Taxpayer Service – Quality taxpayer service 

is an important complement to enforcement 

efforts. Recent legislation has increased the 

volume of calls to toll-free service lines at the 

IRS, leading to longer wait times and 

unanswered calls. The Budget provides 

funding to improve the level of service for the 

toll-free service lines to 80 percent, up from 

the FY 2011 projection of 71 percent. The

Budget also includes funding to improve 

IRS.gov to meet the growing demand for more 

electronic services. This multi-year project

will improve self-service, reduce taxpayer 

burden, increase compliance, reduce costs, 

and continue to position IRS.gov as the 

preferred choice for taxpayer service.

Tax Enforcement – The Budget includes new 

enforcement initiatives to improve 

compliance. These initiatives are expected to 

produce $1.332 billion in additional annual 

enforcement revenue once the new hires reach 

full potential in FY 2014. In FY 2012, IRS

will implement enacted legislation such as the 

Foreign Account Tax Compliance Act 

(FATCA), information reporting on merchant 

payment card and third party reimbursements, 

basis reporting on security sales; increase 

compliance by addressing offshore tax 

evasion; expand enforcement efforts on 

noncompliance among corporate and highwealth taxpayers; and enforce return preparer 

compliance.

Goal 3: Significantly Increase the Number 

of Paperless Transactions with the Public 

The Department is committed to moving to

paperless transactions, including increasing 

the number of payments and collections made 

electronically. The effort to dramatically 

increase the number of electronic transactions 

is expected to save $524 million and 12 

million pounds of paper in the first five years.

The Department has begun implementing a 

three-pronged initiative to increase electronic 

transactions. Individuals receiving Social 

Security, Supplemental Security Income, 

Veterans Administration, Railroad Retirement 

Board, Office of Personnel Management and 

Department of Labor – Black Lung benefits 

will be required to receive these payments 

electronically, either through direct deposit 

into a bank account or Treasury's Direct 

Express debit card; other non-tax payments 

are also required to be made electronically.

Second, most businesses currently permitted 

to use paper Federal Tax Deposit coupons will 

have to make those deposits electronically 

beginning in 2011. Finally, Treasury will be 

ending all issuances of paper savings bonds no 

later than December 31, 2011 and instead 

focus on electronic means to issue bonds. 

Increased use of e-Filing for tax returns is 

saving the IRS tens of millions of dollars each 

year. In FY 2012 Treasury Tax and Trade 
Bureau will realize savings gained through 

efficiencies from its Permits Online electronic 

filing system due to processing time reduction 

and the streamlining of business processes.

In addition to greatly reducing costs, 

enhancing customer service and minimizing 

Treasury's environmental impact, the move 

from paper to electronic transactions will 

increase reliability, safety and security for 

benefit recipients and taxpayers. The benefits 

of electronic transactions are well 

documented. Aside from the large cost 

savings, electronic transactions provide safety, 

convenience and control for payment 

recipients, taxpayers and savings bond 

holders. These initiatives do not require new 

legislation and can be accomplished by 

changes to Treasury's existing regulations.

International Programs

The Department’s request includes $3.364 

billion in total funding for International 

Programs to provide resources to sustain 

global economic development, aid 

impoverished countries, address climate 

change, and support our national security 

objectives by strengthening the economies of 

fragile nations. Of the total, $2.073 billion is 

requested for scheduled annual U.S. 

contributions to the multilateral development 

banks (MDBs), including two new 

replenishments to the International 

Development Association and the African 

Development Fund and General Capital 

Increases (GCIs) to the MDBs which faced 

capital depletions after their aggressive and 

necessary response to the global financial 

crisis. Another $175 million will fund the 

U.S. share of the Multilateral Debt Relief 

Initiative at the International Development 

Association (IDA) and the African 

Development Fund (AfDF).

The Department is also requesting $338 

million for multilateral food security 

initiatives, including the Global Agriculture 

and Food Security Program (GAFSP) which

will leverage U.S. resources to provide 

increased agriculture investments in poor 

countries. To combat climate change and 

environmental degradation, the request 

includes $749 million for contributions to the 

Clean Technology Fund (CTF), the Strategic 

Climate Funds (SCF), the Global Environment 

Facility (GEF) and Tropical Forest 

Conservation Act. Finally, $30.1 million is 

requested for the Office of Technical 

Assistance (OTA), to strengthen economic 

and financial governance in fragile and 

developing countries around the world

Terrorism and Financial Intelligence

The Budget includes $92.6 million in direct 

appropriations for the Office of Terrorism and 

Financial Intelligence (TFI) in FY 2012. This 

investment will implement targeted financial 

sanctions with the goal of stopping the flow of 

money to terrorist organizations, drug 

traffickers, money launderers, weapons 

proliferators, rogue regimes, and their support 

networks that constitute a threat to the United 

States to keep the world’s financial systems 

accessible to legitimate users, while excluding 

those who wish to exploit the systems for 

illegal purposes.

Fiscal Prudence 

In recognition of the current fiscal outlook and 

in order to partially offset the cost of high 

priority investments, the Budget includes 

savings of $336 million in Department 

discretionary funding and additional savings 

in mandatory programs. The request also 

focuses on improving tax administration and 

debt collection. The Department is using the 

many employee ideas submitted through the 
Administration’s SAVE initiative to explore 

means to reduce costs.

Administrative and other Efficiency Savings

– The Budget proposes efficiency savings and 

program reductions at all Treasury bureaus, 

including nearly $200 million of 

administrative savings as part of the 

President’s Accountable Government 

Initiative, and savings from a variety of 

program reforms. Examples include $190

million in process improvement savings for 

the IRS, $10.1 million in administrative and 

data center consolidation savings for the 

Financial Management Service (FMS) and 

$6.6 million in savings for BPD. The Budget 

also identifies $2.6 million in savings from 

certification and accreditation consolidation, 

data center consolidation and managing FTE 

lapses for the Treasury Inspector General for 

Tax Administration and $2.1 million in 

Financial Crimes Enforcement Network

(FinCEN) staffing efficiency reductions and 

information technology savings. Finally, $15.4

million in efficiency savings is included for 

the Departmental Offices (DO). Through these 

efforts, the Department will achieve savings, 

while creating a more agile and innovative 

Treasury.

Paperless Treasury – As discussed above, the

Department will significantly increase the 

number of paperless transactions with the 

public and anticipates saving of $524 million 

through this effort over the next five years.

Freedom of Information Act – The

Department’s current process for responding 

to Freedom of Information Act (FOIA)

requests is inefficient and outdated and has 

resulted in a significant backlog in request 

fulfillment at the agency. To address this 

issue, Treasury is creating a new FOIA tool 

using existing funding. With this tool, 

Treasury will process FOIA requests rapidly

and accurately with less cost by leveraging 

modern electronic storage and web based 

application technology to prevent redundant 

work and automate process steps where 

possible. In addition to improvements to how 

FOIA requests are handled internally, the tool 

will feature a public facing component that 

allows citizens to initiate FOIA requests 

online.

IT Consolidation – The Department proposes 

to consolidate information technology 

resources at the Bureau of Public Debt (BPD) 

and Financial Management Service (FMS). As 

part of Treasury’s broader IT strategy to 

achieve efficiencies, BPD and FMS will 

partner to consolidate certain IT resources. 

During 2011, the bureaus are consolidating

five data centers into two shared data centers.

This will result in a more sustainable approach 

to IT services and further savings may be 

demonstrated by considering reductions in 

carbon emissions. Further IT consolidation 

efforts include moving from 42 data centers in 

FY 2010 to 29 in FY 2015. 

Debt Collection Legislation – Treasury and 

OMB are improving the management of the 

Federal debt portfolio, which could increase 

collection of delinquent tax and non-tax debt 

by more than $5 billion over the next ten 

years. The Budget incorporates a number of 

these improvements, including debt collection 

legislative proposals to increase levy authority 

to 100 percent for Medicare payments and 

vendor payments, offset tax refunds to collect 

delinquent state income taxes from out-ofstate residents, and other administrative 

improvements, such as expanding the use of 

Administrative Wage Garnishment and 

improving the Treasury Offset Program match 

process.

Do Not Pay Portal – In June 2010, a 

Presidential Memorandum (Enhancing 

Payment Accuracy Through a “Do Not Pay 

List”) established the creation of a 

comprehensive Do Not Pay List against which 
agency payments could be cross-checked to 

prevent ineligible recipients from receiving 

payments from the federal government. To 

make this list more beneficial, the 

Administration created VerifyPayment.Gov to 

serve as a one-stop-shop for agencies. The 

Bureau of the Public Debt will expand and 

maintain this portal. Additionally, Public Debt 

will work with the Recovery Accountability 

and Transparency Board, to support an 

operations center to analyze fraud patterns and 

refer potential issues to agency management.

Offsetting Cancellations and Transfers – The

Budget includes a $600 million proposed 

permanent cancellation and a $30 million 

transfer to FinCEN from the unobligated 

balances of the Treasury Forfeiture Fund. 
FY 2012 President’s Budget by

Goal/Objective

(Dollars in Thousands)

Effectively Managed 

US Government 

Finances

U.S. and World Economies

Perform at Full 

Economic Potential

Prevented Terrorism & 

Promoted Nation's 

Security

Management and 

Organizational Excellence Total

Disc $

Reimb./

Mand $ Disc $

Reimb./

Mand $ Disc $

Reimb./

Mand $ Disc $

Reimb./

Mand $ Disc $

Reimb./

Mand $

Management & Financial $115,092 $23,884 $382,456 $24,763 $210,214 $13,894 $291,651 $46,457 $999,413 $108,998 

Departmental Offices Salaries and Expenses 66,153 23,884 106,258 24,763 95,917 10,894 56,561 31,957 324,889 91,498 

Dept-wide Systems & Capital Invest. Program 0 0 

Office of Inspector General 29,885 13,200 29,885 13,200 

Treasury IG for Tax Administration 157,831 1,300 157,831 1,300 

Special Inspector General for TARP 47,374 47,374 0 

CDFI Fund 227,259 227,259 0 

Financial Crimes Enforcement Network 114,297 3,000 114,297 3,000 

Alcohol & Tobacco Tax and Trade Bureau 48,939 48,939 97,878 0 

Fiscal Service Operations $384,440 $255,623 $0 $0 $0 $0 $0 $0 $384,440 $255,623 

Financial Management Service 218,805 231,223 218,805 231,223 

Bureau of the Public Debt 165,635 24,400 165,635 24,400 

Tax Administration $13,025,396 $118,169 $0 $0 $258,511 $20,103 $0 $0 $13,283,907 $138,272 

IRS Taxpayer Services 2,345,133 22,924 2,345,133 22,924 

IRS Enforcement 5,769,388 55,799 197,231 20,103 5,966,619 75,902 

IRS Operations Support 4,559,246 39,446 61,280 4,620,526 39,446 

Business Systems Modernization 333,600 333,600 0 

Health Insurance Tax Credit Administration 18,029 18,029 0 

Total, Treasury Appropriations Committee 1/ $13,524,928 $397,676 $382,456 $24,763 $468,725 $33,997 $291,651 $46,457 $14,667,760 $502,893 

Treasury International Programs 3,363,934 3,363,934 0 

Total, Appropriated Level $13,524,928 $397,676 $3,746,390 $24,763 $468,725 $33,997 $291,651 $46,457 $18,031,694 $502,893 

Non Appropriated Bureaus $0 $0 $0 $4,642,375 $0 $0 $0 $0 $0 $4,642,375 

Office of Financial Stability 311,240 0 311,240 

Bureau of Engraving and Printing 582,050 0 582,050 

U.S. Mint 2,545,885 0 2,545,885 

Office of the Comptroller of the Currency 1,040,756 0 1,040,756 

Small Business Lending Fund Administration 72,603 0 72,603 

OFR and Financial Services Oversight Council 82,353 0 82,353 

SSBCI Administration 7,488 0 7,488 

Subtotal, Direct $ $13,524,928 $3,746,390 $468,725 $291,651 $18,031,694 

Subtotal, Reimbursable $ $397,676 $4,667,138 $33,997 $46,457 $5,145,268 

Total, Treasury Level $13,922,604 $8,413,528 $502,722 $338,108 $23,176,962 1/ Total does not include the proposed $600 million Forfeiture Fund permanent cancellation and the reduction in the Fund's spending resulting from the proposed $30 million transfer to FinCEN. 
Fiscal Year Comparison of Full-Time Equivalent (FTE) Staffing

(Direct and Reimbursable)

Appropriation FY 2010 Actual

FY 2011 Annualized CR 

Level FY 2012 President's Budget

Direct Reimb. Total Direct Reimb. Total Direct Reimb. Total

Departmental Offices Salaries and Expenses 1,166 150 1,316 1,266 137 1,403 1,341 137 1,478

Administrative Expenses, Recovery Act 1,200 0 1,200 65 0 65 0 0 0

Office of Inspector General 172 0 172 172 0 172 172 0 172

Treasury IG for Tax Administration 817 3 820 835 3 838 864 3 867

Special Inspector General for the TARP 112 0 112 192 0 192 192 0 192

Community Development Financial Institutions Fund 71 0 71 84 0 84 90 0 90

Financial Crimes Enforcement Network 328 1 329 327 1 328 304 1 305

Alcohol & Tobacco Tax and Trade Bureau 502 10 512 535 15 550 502 15 517

Financial Management Service 1,583 248 1,831 1,566 269 1,835 1,492 269 1,761

Bureau of the Public Debt 956 0 956 1,042 0 1,042 987 0 987

Internal Revenue Service 94,766 752 95,518 94,766 659 95,425 99,878 659 100,537

Subtotal, Treasury Appropriated Level 101,640 1,164 102,804 100,832 1,084 101,916 105,822 1,084 106,906

Office of Financial Stability 210 0 210 251 0 251 270 0 270

Small Business Lending Fund Administration 0 0 0 41 0 41 55 0 55

State Small Business Credit Initiative Administration 0 0 0 9 0 9 12 0 12

Financial Stability Oversight Council and Office of Financial 

Research

0 0 0 50 0 50 192 0 192

Working Capital Fund 0 195 195 0 200 200 0 222 222

Treasury Franchise Fund 0 973 973 0 1,012 1,012 0 1,190 1,190

Bureau of Engraving and Printing 0 1,889 1,889 0 1,950 1,950 0 1,925 1,925

U.S. Mint 0 1,778 1,778 0 1,873 1,873 0 1,873 1,873

Office of the Comptroller of the Currency 0 3,101 3,101 0 3,140 3,140 0 3,976 3,976

Office of Thrift Supervision 1/ 0 1,016 1,016 0 1,021 1,021 0 0 0

Terrorism Insurance Program 11 0 11 10 0 10 10 0 10

Total 101,861 10,116 111,977 101,193 10,280 111,473 106,361 10,270 116,631

1/ The Dodd-Frank Wall Street Reform and Consumer Protection Act, Public Law 111-203 (Dodd-Frank Act), abolishes and transfers the 

functions of the Office of Thrift Supervision in Fiscal Year 2011.
Summary of FY 2012 Increases and 

Decreases

(Dollars in Thousands)

DO DSCIP OIG TIGTA SIGTARP CDFI FINCEN TTB TEOAF FMS BPD IRS Total

FY 2011 Annualized CR Level $304,888 $9,544 $29,700 $152,000 $36,300 $246,750 $111,010 $103,000 ($90,000) $244,132 $182,244 $12,146,123 $13,475,691 

 Adjustment to Meet FY 2011 President's Policy Level 39,707 12,456 351 2,266 13,068 3,144 (11,038) 2,571 0 (10,537) (7,458) 401,665 446,195 

FY 2011 President's Policy Level $344,595 $22,000 $30,051 $154,266 $49,368 $249,894 $99,972 $105,571 ($90,000) $233,595 $174,786 $12,547,788 $13,921,886 

Maintaining Current Levels $3,215 $0 $183 $1,391 $454 $201 $897 $832 $0 $2,000 $1,234 $85,754 $96,161 

 Cancellation/Transfer of Balances 0 0 0 0 0 0 30,000 0 (540,000) 0 0 0 (510,000)

 Above Base Savings (28,946) (22,000) (392) (3,474) (2,448) (1,830) (13,570) (8,525) 0 (11,690) (20,385) (189,957) (303,217)

Adjustments to Base $10,761 ($9,544) ($41) ($1,208) $10,620 $1,314 $5,392 ($5,954) ($540,000) ($22,227) ($27,843) $211,708 ($367,022)

FY 2012 Base $318,864 $0 $29,842 $152,183 $47,374 $248,265 $117,299 $97,878 ($630,000) $223,905 $155,635 $12,443,585 $13,204,830 

 Program Decreases 0 0 0 0 0 (22,706) (3,002) 0 0 (5,100) (2,000) 0 (32,808)

 Program Reinvestments 0 0 0 0 0 1,700 0 0 0 0 0 1,486 3,186 

 Program Increases 6,025 0 13 5,648 0 0 0 0 0 10,000 838,836 860,522 

 Changes to Offsetting Fees 0 0 0 0 0 0 0 0 0 0 2,000 0 2,000 

FY 2012 President's Budget $324,889 $0 $29,855 $157,831 $47,374 $227,259 $114,297 $97,878 ($630,000) $218,805 $165,635 $13,283,907 $14,037,730 
Departmental Offices - S & E 

Program Summary by Budget Activity 

Dollars in thousands 

Appropriation FY 2010 

Enacted* 

FY 2011 

Annualized 

CR Level** 

FY 2012 

Request** 

Change FY10 to FY12 

$ Change** % Change** 

 Executive Direction $21,983 $33,465 $38,098 $16,115 73.3% 

 International Affairs and Economic Policy $47,249 $70,037 $68,349 $21,100 44.7% 

 Domestic Finance and Tax Policy $48,580 $71,738 $84,562 $35,982 74.1% 

 Terrorism and Financial Intelligence $64,611 $96,386 $92,605 $27,994 43.3% 

 Treasury-wide Management and Programs $22,679 $33,262 $41,275 $18,596 82.0% 

 Administration Programs $99,786 $0 $0 ($99,786) (100%) 

Subtotal, Departmental Offices - S & E $304,888 $304,888 $324,889 $20,001 6.6% 

 Offsetting Collections - Reimbursables $66,045 $91,498 $91,498 $25,453 38.5% 

Total Program Operating Level $370,933 $396,386 $416,387 $45,454 12.3% 

 Direct FTE 1,266 1,266 1,341 75 5.9% 

 Reimbursable FTE 150 137 137 (13) (8.7%) 

Total FTE 1,416 1,403 1,478 62 4.4% 

 *This does not include funding provided by Public Law 111-212 nor transfers. 

**FY 2011/2012, numbers and percentage changes reflect the reallocation of the Administration Programs dollars 

 to their respective budget activities, resulting in across-the-board increases to other budget activities. 

Summary 

 

Departmental Offices, as the headquarters 

bureau for the Department of the Treasury, 

provides leadership to the Department through 

the promotion of policies geared toward 

developing a strong and stable economy. The 

Secretary of the Treasury plays a primary role 

in the formulation and management of 

domestic and international economic policies 

of the United States, specifically in the areas 

of finance, tax, terrorism and financial 

intelligence policies. Through effective 

management and leadership, the Department 

of the Treasury develops and implements 

strategies to promote the stability of the 

nation's financial markets, ensure the integrity 

of the financial system, and enhance the 

government's ability to collect revenue, and 

serves as a world leader for best practices in 

the area of counterterrorist financing and antimoney laundering. 

Departmental Offices (DO) top priorities and 

proposed initiatives support each of the 

Department’s strategic goals: Effectively 

Manage U.S. Government Finances; Ensure 

U.S. and World Economies Perform at Full 

Potential; Prevent Terrorism and Promote the 

Nation’s Security Through Strengthened 

International Financial Systems; and Promote 

Management and Organizational Excellence. 

Total resources requested to support DO 

activities for FY 2012 are $416,387,000 

including $324,889,000 from direct 

appropriations and $91,498,000 from 

offsetting collections and reimbursable 

programs. 

 
DO FY 2012 Budget Highlights

Dollars in thousands 

Appropriation Amount

FY 2010 Enacted $304,888

FY 2011 Annualized CR Level $304,888

Changes to Base: 

Adjustment to Reach Policy Level: $39,707

Adjustment to Reach FY 2011 President's 

Policy 

$39,707

Maintaining Current Levels (MCLs): $3,215

Non-Pay, Pay & Benefits, and Pay 

Annualizations 

$3,215

Transfers Out: $0

Procurement Transfer to IRS $0

Efficiencies, Savings & Base Reductions: ($28,946)

Streamlining Management ($6,400)

Administrative Efficiency Savings ($2,635)

Non-recur of Alpha Computers ($2,750)

Non-recur of Domestic Finance Contracts ($1,596)

Federalizing the IT Workforce ($1,000)

Multilateral Meeting Support Savings ($1,974)

Summit Support Representation Funds ($200)

Non-Recur of ODM Information Technology ($1,550)

Non-recur of Program Evaluation ($5,292)

Terrorism and Financial Institutions (TFI) 

Office Efficiency Savings 

($4,349)

TFIN Savings ($1,200)

Subtotal FY 2012 Changes to Base $13,976

Total FY 2012 Base $318,864

Program Changes: 

Program Increases: $6,025

Dodd-Frank Wall Street Reform Act $5,525

Domestic Finance (DF) Recovery Act $500

Subtotal FY 2012 Program Changes $6,025

Total FY 2012 Request $324,889

FY 2012 Budget Adjustments 

 

FY 2011 Annualized CR Level 

The FY 2011 annualized Continuing 

Resolution (CR) level for DO is $304,888,000. 

Adjustment to Reach FY 2011 President’s 

Policy Level 

Adjustments to Reach FY 2011 President’s 

Policy Level +$39,707,000 / +76 FTE 

Adjustment from the FY 2011 Annualized 

Continuing Resolution (CR) Rate to reach the FY 

2011 President’s Policy Level. The President’s 

Policy Level is equal to the FY 2011 President’s 

Budget as adjusted for the proposed pay freeze.

Maintaining Current Levels (MCLs) 

Adjustments Necessary to Maintain Current 

Levels +$3,215,000 / +0 FTE 

Funds are requested for inflation adjustments 

in non-labor expenses such as GSA rent 

adjustments, postage, supplies and equipment 

and health benefits and the increase in Federal 

Employee Retirement System participation. 

No inflation adjustment is requested for pay in 

FY 2012.

Transfers 

Procurement Transfer to IRS +$0 / -9 FTE 

Transfer the functions of the Departmental 

Offices Procurement Services Division to the 

Internal Revenue Service. 

Non-Recurs and Efficiencies Savings 

Streamlining Management -$6,400,000 / -23 

FTE 

Savings will be achieved through a number of 

management initiatives, including the nonrecur of FY 2011 one-time initiative support 

costs, consolidation of IT contractor services, 

reduction of overtime, and other services. 

Administrative Efficiency Savings -$2,635,000 

/ +0 FTE 

Savings will be achieved through a more 

efficient use of administrative activities and 

through non-recur of one-time FY 2010 costs. 

Non-recur of Alpha Computers -$2,750,000 / 

+0 FTE 

Non-recur of one-time FY 2011 funds to 

upgrade the Department’s Alpha computers.

Non-Recur of Domestic Finance Contracts 

-$1,596,000 / +0 FTE 

Non-recur $1.596 million of a $3.5 million FY 

2011 increase to support research activities to 

allow Domestic Finance to obtain high-quality, 

time-sensitive research, data, and analysis to 

inform policy development. 
Federalizing the IT Workforce -$1,000,000 / 

+20 FTE 

Net contract savings from converting IT 

contractors into federal employees while 

improving accountability, efficiency, and 

customer service within the department. 

Multilateral Meeting Support Savings 

-$1,974,000 / +0 FTE 

Non-recur of FY 2011 funds to host 

international meetings, including G-8 

meetings, a G-20 Ministerial and an AsiaPacific Economic Cooperation (APEC) 

meeting, plus numerous other related meetings 

and workshops leading up to these events. 

Summit Support Representation Funds 

 -$200,000 / +0 FTE 

Reduction in the increased FY 2011 financial 

support for attending annual economic 

summits with the G-7 and G-20 nations.

Non-Recur of Office of Debt Management 

(ODM) Information Technology -$1,550,000 / 

+0 FTE 

Non-recur $1.550 million of program funds 

used to develop and modernize ODM’s 

information technology system. The remaining 

$1.450 million in the base will cover 

operations and maintenance. 

Non-recur of Program Evaluations 

 -$5,292,000 / +0 FTE 

Non-recur of FY 2011 requested in a 

government-wide competition to measure 

program effectiveness. Funding was one-time 

for specifically chosen studies. 

Office of Terrorism and Financial Intelligence 

(TFI) Efficiency Savings -$4,349,000 / +0 FTE

TFI will realize savings through the 

prioritization of staff travel; elimination of 

overseas support for its Brussels liaison; 

targeted procurement spending to save on 

contracts, IT licenses, subscriptions, and 

supplies; and by eliminating funding for its 

now completed responsibilities under United 

Nations Security Council Resolution 1822 

which required agencies to address 

discrepancies in the terrorist financing 

designation list. 

Treasury Foreign Intelligence Network 

-$1,200,000 / +0 FTE 

Remaining base funding will be used to support 

operations and maintenance expenses in FY 

2012 and beyond.

Program Increases 

Dodd-Frank Wall Street Reform Act 

+$5,525,000 / +11 FTE 

Departmental Offices (DO) requests funds in 

FY 2012 to support Dodd–Frank Wall Street 

Reform and Consumer Protection Act 

activities. The FY 2012 request is focused on 

building the expertise necessary to fulfill 

Treasury’s ongoing responsibilities under the 

Act and to monitor and develop policy in the 

areas where regulation was greatly expanded 

under the Act. 

DF Recovery Act +$500,000 / +0 FTE

Resources are requested to support Domestic 

Finance’s implementation of the American 

Recovery and Reinvestment Act (ARRA) 

Cash Payments for Specified Energy Property 

in Lieu of Tax Credits. Payments under this 

program continue through 2017. 

Explanation of Budget Activities 

 

Salaries and Expenses 

 

Executive Direction ($38,098,000 from direct 

appropriations and $3,134,000 from 

reimbursable programs) 

Provides direction and policy formulation to 

the Department, and interacts with Congress 

and the public on Departmental policy matters. 
International Affairs and Economic Policy 

($68,349,000 from direct appropriations and 

$10,883,000 from reimbursable programs) 

Monitors domestic and international economic 

conditions and collects and analyzes financial 

data, including foreign credits and credit 

guarantees. 

Domestic Finance and Tax Policy 

($84,562,000 from direct appropriations and 

$36,160,000 from reimbursable programs) 

Monitors and provides economic and financial 

policy expertise in the areas of domestic 

finance and tax policy. 

Terrorism and Financial Intelligence (TFI) 

($92,605,000 from direct appropriations and 

$10,621,000 from reimbursable programs) 

Develops and implements strategies to counter 

terrorist financing and money laundering. 

Treasury-wide Management and Programs 

($41,275,000 from direct appropriations and 

$30,700,000 from reimbursable programs) 

Provides strategic plans, and policy direction 

in the fields of human resources, information 

technology security, and financial 

administration that include the formulation and 

management of the budget. 

Administration Programs (Direct 

appropriations and reimbursable program 

funding have been allocated to operational 

budget activities.) 

Treasury has allocated administrative expenses 

for Departmental Offices by operational 

budget activity, instead of maintaining a 

separate budget activity for administrative 

expenses. This will give oversight officials a 

better understanding of the full cost of each 

program within Departmental Offices. 

Legislative Proposals 

 

Departmental Offices has no legislative 

proposals. 

DO Performance by Budget Activity 

Budget Activity Performance Measure FY 2008 FY 2009 FY 2010 FY 2011 FY 2012

Actual Actual Actual Target Target

Terrorism and Financial 

Intelligence

Impact of TFI programs 

and Activities (Oe) (Oe)

N/A 7.8 8.1 7.4 7.6

International Affairs and 

Economic Policy 

Number of new trade and 

investments negotiations 

underway or completed 

(Oe) 

14 15 13 6 6 

International Affairs and 

Economic Policy 

Scope and intensity of 

engagement (traction) 

3.6 3.7 3.5 3.6 3.6 

Domestic Finance and Tax 

Policy 

Variance between 

estimated and actual 

receipts (annual forecast) 

(%) (Oe)

4.6 5.5 5.8 5.0 5.0

Treasury-wide Management 

Policies and Programs

Percent of timely 

completed Planned 

Corrective Actions (%) (Oe)

82.5 85.6 88.4 85.0 85.0

Key: Oe - Outcome Measure, E - Efficiency Measure, Ot - Output/Workload Measure, M - Management/Cust. Satisfaction, and DISC - Discontinued, and B – Baseline 
Description of Performance 

 

DO is continuing to work to develop more 

meaningful performance measures for policy 

offices. 

In FY 2010, the Department continued using a 

composite performance measure which 

assesses of its impact of the organization. The 

composite measure resulted in a score of 8.1 

out of 10 equaling its target for FY 2010. The 

targets for the composite performance measure 

have been set to 7.4 for FY 2011 and 7.6 for 

FY 2012. 

In FY 2010, Treasury’s Office of International 

Affairs (IA) exceeded its performance 

measures related to the number for new trade 

and investments negotiations trade and 

investment. For FY 2010, the Office 

completed or was in progress on 13 new trade 

and investment negotiations, far in excess of 

the 2 that were targeted in FY 2010. The 

performance targets are 6 new negotiations for 

FY 2011 and FY 2012. The Office of 

Technical Assistance continues to assess the 

effectiveness of assistance programs for client 

countries. The average rating in FY 2010 was 

3.6 for traction out of a possible score of 5.0, 

exceeding its target of 3.5. Performance targets 

for FY 2011 and FY 2012 for IA measures 

have been set to reflect current economic 

conditions. 

Given economic uncertainties and legislative 

changes, the forecasts for FY 2010 were not as 

good as those for FY 2009. The variance for 

FY 2010 was 5.8 percent, higher than the 5.5 

percent variance in FY 2009 and the 5.0 

percent target for FY 2010. FY 2010 proved 

very challenging to forecast due to the heavy 

influence of 2009 tax liabilities on FY 2010 

receipts and lingering uncertainty concerning 

the pace of the economic recovery. To reduce 

error rates, the office completed a review of 

the statistical techniques used to forecast major 

federal financial activities, and will deploy a 

new updated fiscal projections system. 

Targets for FY 2011 and FY 2012 have been 

set at 5 percent. 

The offices comprising the Treasury Wide 

Management (TWM) budget activity are 

committed to ensuring accountability and a 

well understood strategic direction in order to 

build a world-class organization. In FY 2010, 

offices have continued to work to objectively 

monitor their progress toward program 

outcomes and Treasury’s strategic objectives. 

For FY 2011, Treasury has made the decision 

to allocate administrative expenses for 

Departmental Offices by operational budget 

activity, instead of maintaining a separate 

budget activity just for administrative 

expenses. As a result, Treasury Wide 

Management Goals are under development. 

Also, the Department continues to be engaged 

in rigorous efforts to redevelop metrics for its 

International Affairs programs that better 

reflect the mission and goals of the office. 
Department-wide Systems and Capital Investments Program

Program Summary by Budget Activity

(Dollars in thousands)

Appropriation FY 2010 FY 2011 FY 2012 FY 2010 to FY 2012

Enacted Annualized

CR Level

Request $ Change % Change

 Department-wide Systems and Capital Investments Program $9,544 $9,544 $0 ($9,544) (100.0%)

Total Appropriated Resources $9,544 $9,544 $0 ($9,544) (100.0%)

Summary

The Department-wide Systems and Capital 

Investments Program (DSCIP) is authorized to 

be used by or on behalf of the Department of 

the Treasury’s bureaus, at the Secretary’s 

discretion, to improve infrastructure, 

modernize business processes and increase 

efficiency through technology investments.

No FY 2012 DSCIP funding is requested in 

order to direct resources to other priorities of 

the Secretary. The following initiatives will 

continue to be implemented using existing 

DSCIP funding:

Enterprise Content Management (ECM):

Treasury will continue to eliminate paperbased and non-optimal processes and 

transactions. The ECM program is an essential 

element of this initiative as it will provide a 

common approach across Treasury to 

modernizing business processes. Existing 

funding will allow the program to continue, 

with a focus on enhancing mission 

effectiveness, reducing total cost of ownership 

by promoting economies of scale, and 

enabling all Treasury bureaus to progress 

toward a paperless environment.

Financial Innovation and Transformation 

(FIT):

Existing funding will be used to develop and 

expand efforts to support shared governmentwide financial solutions associated with 

agency financial management services (e.g., 

invoice processing, cash collections, 

interagency agreement management), an effort 

coordinated through the Office of Financial 

Innovation and Transformation (FIT). This 

program will continue developing options for 

streamlining the processing of financial 

transactions and information.

Treasury Annex Repair and Renovation –

Treasury is fixing life safety issues, upgrading 

a number of outdated systems, and replacing 

inefficient, single paned windows, which will 

make the building more energy efficient.

DSCIP FY 2012 Budget Highlights

(Dollars in thousands)

Appropriation Amount

FY 2010 Enacted $9,544

FY 2011 Annualized CR Level $9,544

Changes to Base:

Adjustment to Reach Policy Level: $12,456

Adjustment to Reach FY 2011 President's 

Policy

$12,456

Non-Recurring Costs: ($22,000)

Zero Base DSCIP ($22,000)

Subtotal FY 2012 Changes to Base ($9,544)

Total FY 2012 Base $0

Total FY 2012 Request $0

FY 2012 Budget Adjustments

FY 2011 Annualized CR Level

The FY 2011 Annualized CR Level for DSCIP 

is $22,000,000.
Adjustment to Reach Policy Level 

Adjustment to Reach FY 2011 President's 

Policy +$12,456,000 / +0 FTE 

Adjustment from the FY 2011 Annualized 

Continuing Resolution (CR) Rate to reach the 

FY 2011 President’s Policy Level. The 

President’s Policy Level is equal to the FY 

2011 President’s Budget as adjusted for the 

proposed pay freeze.

Non-Recurring Costs 

Zero Base DSCIP -$22,000,000 / +0 FTE 

DSCIP appropriations are one-time funding 

and do not recur.

Explanation of Budget Activities

Salaries and Expenses

Department-wide Systems and Capital 

Investments Program (No funding)

While no additional DSCIP funding is 

requested, existing funding will be used to 

implement the Enterprise Content 

Management (ECM) and Financial Innovation 

and Transformation (FIT) programs and to 

repair and upgrade the historic Treasury 

Annex Building.

Legislative Proposals

DSCIP has no legislative proposals.

Description of Performance

The Department of the Treasury uses DSCIP 

funds to make investments necessary to 

facilitate its strategic goals as laid out in its 

Strategic Plan.

Results to be achieved include reduced cost of 

maintaining paper, standardized shared 

services, increased efficiency and productivity 

of staff through automated workflow, reduced 

time required to share information and reduced 

management reporting burden.
Office of Inspector General

Program Summary by Budget Activity

(Dollars in thousands)

Appropriation FY 2010 FY 2011 FY 2012 FY 2010 to FY 2012

Enacted Annualized

CR Level

Request $ Change % Change

 Audit $22,869 $22,869 $22,897 $28 0.1%

 Investigations $6,831 $6,831 $6,958 $127 1.9%

Subtotal, Office of Inspector General $29,700 $29,700 $29,855 $155 0.5%

Offsetting Collections - Reimbursables $8,000 $10,000 $13,200 $5,200 65.0%

Total Program Operating Level $37,700 $39,700 $43,055 $5,355 14.2%

Direct FTE 172 172 172 - -

*Does not include the FY 2010 Supplemental (P.L. 111-212) $1.8 million rescission

Summary

The Treasury Office of Inspector General 

(OIG) supports Treasury’s goal to ensure 

accountability and transparency, to protect the 

integrity of the Department, and to improve 

overall efficiency and effectiveness in 

Treasury programs and operations. The OIG 

conducts audits and investigations of all 

Treasury programs and operations except 

those under jurisdictional oversight of the 

Treasury Inspector General for Tax 

Administration and the Special Inspector 

General for the Troubled Asset Relief 

Program. In accordance with the Inspector 

General Act, the OIG through its activities (a) 

promotes economy, efficiency, and 

effectiveness in the administration of Treasury 

programs and operations; (b) prevents and 

detects fraud, waste, and abuse in Treasury 

programs and operations; and (c) keeps the 

Secretary and the Congress fully and currently 

informed about problems, abuses, and 

deficiencies in Treasury programs and 

operations.

The Fiscal Year (FY) 2012 President’s Budget 

request for the OIG will be used for critical 

audit and investigative resources. 

The OIG will continue to address its 

traditional audit mandates related to (1) the 

Department’s financial statements, (2) the 

Department’s implementation of the Federal 

Information Security Management Act 

(FISMA), and (3) failed Treasury-regulated 

financial institutions. In addition to these 

traditional mandates, the OIG is also 

responsible for mandates related to the DoddFrank Wall Street Reform and Consumer 

Protection Act and the Small Business Jobs 

Act of 2010. The Dodd-Frank Wall Street 

Reform and Consumer Protection Act requires 

the Inspector General to (1) function as the 

Chair of the Council of Inspectors General on 

Financial Oversight which includes periodic 

reporting on the Council’s audits and 

investigations along with views on regulatory 

matters, (2) monitor the transfer of functions 

of the Office of Thrift Supervision with 

periodic reporting to the Congress, and (3) 

perform reviews of systemically significant 

failed financial institutions that had been 

regulated by Treasury. The Small Business 

Jobs Act charges the OIG with providing 

oversight over two new Treasury programs, 

the $30 billion Small Business Lending Fund 

(SBLF) and the $1.5 billion State Small 

Business Credit Initiative (SSBCI). To comply 

with these mandates, the OIG will assess 

Treasury’s implementation of the two 

programs, continually monitor recipient 
compliance with program requirements and 

use of funds, and evaluate the impact of these 

programs on small business lending. 

Furthermore, the July 2010 U.S.-European 

Union agreement on the processing and 

transfer of financial messaging data for the 

purposes of the Treasury Department's 

Terrorist Finance Tracking Program 

specifically provides for the OIG’s oversight 

to ensure safeguards over sensitive 

information are followed. 

Once mandated requirements are met, the OIG 

will conduct audits of the Department’s 

highest risk programs and operations, to the 

extent that resources are available.

Investigative priorities include: Investigating 

complaints of alleged criminal and serious 

misconduct by Department employees and 

contract employees; Investigating allegations 

of fraud and other crimes involving Treasury 

contracts, procurements, grants, guarantees 

(fictitious instruments), and federal funds with 

an emphasis on Treasury Recovery Act funds; 

Investigating allegations of criminal conduct 

stemming from the OIG’s mandated failed 

bank reviews; and conducting proactive efforts 

to detect, deter and investigate, electronic 

crimes and other threats to the Department’s 

physical and cyber critical infrastructure.

Total resources required to support OIG 

operations for FY 2012 are $43,055,000, 

consisting of (1) $29,855,000 from direct 

appropriations and (2) $13,200,000 from 

reimbursable funding agreements to support 

the financial statement audit requirements of 

the Department and for OIG oversight of the 

SBLF and the SSBCI.

OIG FY 2012 Budget Highlights

(Dollars in thousands)

Appropriation Amount

FY 2010 Enacted $29,700

FY 2011 Annualized CR Level $29,700

Changes to Base:

Adjustment to Reach Policy Level: $351

Adjustment to Reach FY 2011 President's 

Policy

$351

Maintaining Current Levels (MCLs): $183

Maintaining Current Levels $183

Efficiencies, Savings & Base Reductions: ($392)

MLRs ($392)

Subtotal FY 2012 Changes to Base $142

Total FY 2012 Base $29,842

Program Changes:

Program Increases: $13

CIGIE Contribution $13

Subtotal FY 2012 Program Changes $13

Total FY 2012 Request $29,855

FY 2012 Budget Adjustments

FY 2011 Annualized CR Level

The FY 2011 Annualized CR Level for OIG is 

$29,700,000.

Adjustment to Reach Policy Level 

Adjustment to Reach FY 2011 President's

Policy +$351,000 / +0 FTE 

Adjustment from the FY 2011 Annualized 

Continuing Resolution (CR) Rate to reach the 

FY 2011 President's Policy Level. The 

President's Policy Level is equal to the FY 

2011 President's Budget as adjusted for the 

proposed pay freeze.

Maintaining Current Levels (MCLs) 

Maintaining Current Levels +$183,000 / +0 

FTE 

Funds are requested for inflation adjustments 

in non-labor expenses such as GSA rent 

adjustments, postage, supplies and equipment 

and health benefits and the increase in Federal 

Employee Retirement System participation. 

No inflation adjustment is requested for pay in 

FY 2012.
Efficiencies, Savings & Base Reductions 

MLRs -$392,000 / +0 FTE 

Savings from anticipated reductions in 

Material Loss Review work. The savings are 

anticipated due to regulatory reform and 

economic recovery.

Program Increases 

CIGIE Contribution +$13,000 / +0 FTE 

Contribution to the Council of Inspectors 

General on Integrity and Efficiency

Explanation of Budget Activities

Salaries and Expenses

Audit ($22,897,000 from direct appropriations

and $13,200,000 from reimbursable 

programs)

In FY 2010, the Office of Audit completed a 

total of 68 audit products. As the result of the 

unprecedented number of bank failures 

requiring a material loss review, the OIG 

completed some of the reviews after the 6-

month timeframe prescribed in statute, but the 

missed dates were not considered significant. 

The appropriate Congressional oversight 

committees were informed of this situation. 

The Office of Audit plans to complete 70 audit 

products in FY 2012.

In FY 2010 the Office of Investigations met 

or exceeded both Investigative Performance 

Measure targets. OIG received investigative 

referrals regarding potential criminal 

misconduct that occurred prior to or during 

bank failures, and has worked criminal 

investigations with the FDIC OIG and the 

OIG Office of Audit regarding potential 

prosecution of acts which may have 

contributed to the bank failures. As 

additional financial institutions fail over the 

next several years, OIG expects an associated 

increase in investigative work. Treasury’s 

Recovery Act grants in lieu of tax credit 

programs—for specified energy property and 

to states for low-income housing projects—

are estimated to cost almost $20 billion over 

their lives. OIG anticipates a significant 

increase of related criminal investigations as 

Treasury continues to disburse these funds. 

It is expected that the performance measures 

will be met or exceeded in FYs 2011 and 

2012 as well.

Investigations ($6,958,000 from direct 

appropriations)

The Office of Investigations prevents, detects 

and investigates complaints of fraud, waste 

and abuse at all Treasury non-IRS bureaus and 

offices. This includes the detection and 

prevention or deterrence of employee 

misconduct and fraud, or related financial 

crimes within or directed against Treasury. 

The Office refers its cases to the Department 

of Justice, state or local prosecutors for 

criminal prosecution or civil litigation, or to 

agency officials for corrective administrative 

action. 

The Office of Inspector General (OIG) is 

actively investigating numerous referrals of 

potential bank fraud received from the OIG’s 

Office of Audit related to their reviews of 

failed financial institutions that were regulated 

by OCC or the Office of Thrift Supervision.

Legislative Proposals

The OIG has no legislative proposals.
OIG Performance by Budget Activity

Budget Activity Performance Measure FY 2008 FY 2009 FY 2010 FY 2011 FY 2012

Actual Actual Actual Target Target

Exceptional accountability and 

transparency

Number of Completed Audit 

Products (Ot)

64 68 68 62 70

Exceptional accountability and 

transparency

Percent of Statutory Audits 

Completed by the Required Date 

(E)

100.0 100.0 50.0 100.0 100.0

Exceptional accountability and 

transparency

Percentage (%) of Investigations 

that were referred for Criminal, 

Civil or Treasury administrative 

action

N/A N/A N/A B 80.0

Key: Oe - Outcome Measure, E - Efficiency Measure, Ot - Output/Workload Measure, M - Management/Cust. Satisfaction, DISC -

Discontinued, and B - Baseline

Description of Performance

In FY 2010, the Office of Audit completed a 

total of 68 audit products. As the result of the 

unprecedented number of bank failures

requiring a material loss review, the OIG 

completed some of the reviews after the 6-

month timeframe prescribed in statute, but the 

missed dates were not considered significant. 

The appropriate Congressional oversight 

committees were informed of this situation. 

The Office of Audit plans to complete 70 audit 

products in FY 2012.

In FY 2010 the Office of Investigations met or 

exceeded both Investigative Performance 

Measure targets. OIG received investigative 

referrals regarding potential criminal 

misconduct that occurred prior to or during 

bank failures, and has worked criminal 

investigations with the FDIC OIG and the OIG 

Office of Audit regarding potential 

prosecution of acts which may have 

contributed to the bank failures. As additional 

financial institutions fail over the next several 

years, OIG expects an associated increase in 

investigative work. Treasury’s Recovery Act 

grants in lieu of tax credit programs—for 

specified energy property and to states for lowincome housing projects—are estimated to cost 

almost $20 billion over their lives. OIG

anticipates a significant increase of related 

criminal investigations as Treasury continues 

to disburse these funds. It is expected that the 

performance measures will be met or exceeded 

in FYs 2011 and 2012 as well.
Special IG for TARP 

Program Summary by Budget Activity 

(Dollars in thousands) 

SIGTARP carried over $36.2 million into FY 2011 in unobligated mandatory authority, of which $22.5 million is for general 

operations and $13.7 is for PPIF/TALF funds. 

Summary 

 

The 2012 President’s Budget request for the 

Special Inspector General for Troubled Asset 

Relief Program (SIGTARP) includes funding 

to support the Department of the Treasury’s 

strategic outcome of effectively managing the 

U.S. Government’s finances as they relate to 

the Troubled Asset Relief Program (TARP). 

SIGTARP’s top priority is to promote 

transparency in the management and operation 

of TARP, ensuring the satisfaction of the 

public’s right to know how Treasury decides 

to invest the public’s money, how it manages 

the assets it obtains, and how TARP recipients 

use these funds. 

SIGTARP’s mission is to advance economic 

stability by promoting the efficiency and 

effectiveness of TARP management, through 

transparency, through coordinated oversight, 

and through robust enforcement against those, 

whether inside or outside of Government, who 

waste, steal or abuse TARP funds. 

SIGTARP views its oversight role 

prospectively, retrospectively, internally, and 

externally. Prospectively, SIGTARP, among 

other things, advises Treasury on issues 

relating to compliance, internal controls and 

fraud prevention. Retrospectively, SIGTARP 

assesses the effectiveness of TARP activities 

over time and suggests improvements. 

Internally, SIGTARP’s oversight role reaches 

to Treasury officials and to other government 

employees who manage TARP-related 

programs. Externally, it reaches to the 

recipients of TARP funds, the other private 

participants in TARP-related programs and to 

vendors that have been retained to assist 

Treasury in implementing TARP. SIGTARP 

also plays a significant external coordinating 

Appropriation FY 2010 FY 2011 FY 2012

Annualize

CR Level

 Audit $9,900 $15,609 $20,371 $10,471 106%

 Investigations $13,400 $20,691 $27,003 $13,603 102%

Total Appropriated Resources $23,300 $36,300 $47,374 $24,074 103%

Available no-year funds - S&E $20,100 $13,068 ($20,100) -100%

Available PPIP funds $5,000 $1,671 $1,708 ($3,292) -66%

Total Program Operating Levels $48,400 $51,039 $49,082 $682 1%

Activity FY 2010 FY 2011 FY 2012

Annualize

CR Level

Audit $20,700 $22,732 $20,371 ($329) -2%

Investigations $27,700 $28,307 $28,711 $1,011 4%

Total SIGTARP by Budget Activity $48,400 $51,039 $49,082 $682 1%

Direct FTE 133 192 192 59 44%

Total FTE 133 192 192 59 44%

Change FY10 to FY12

Enacted Request $ Change % Change

 FY 2010 to FY 2012

Enacted Request $ Change % Change
role among TARP oversight bodies both to 

ensure maximum oversight coverage and to 

avoid redundant and unduly burdensome 

requests on Treasury personnel who manage 

the programs. 

SIGTARP FY 2012 Budget Highlights

(Dollars in thousands)

Appropriation Amount

FY 2010 Enacted $23,300

FY 2011 Annualized CR Level $36,300

Changes to Base: 

Adjustment to Reach Policy Level: $13,068 

Adjustment to Reach FY 2011 President's

Policy 

$13,068 

Maintaining Current Levels (MCLs): $454 

Maintaining Current Levels $454 

Efficiencies, Savings & Base Reductions: ($2,448) 

Efficiencies, Savings and Reductions ($2,448) 

Subtotal FY 2012 Changes to Base $11,074 

Total FY 2012 Base $47,374

Total FY 2012 Request $47,374

FY 2012 Budget Adjustments 

 

FY 2011 Annualized CR Level 

The FY 2011 annualized CR level for SIGTARP is 

$36,300,000. 

Adjustment to Reach Policy Level 

Adjustment to Reach FY 2011 President's 

Policy +$13,068,000 / +0 FTE 

Adjustment to Reach FY 2011 President's 

Policy 

Maintaining Current Levels (MCLs) 

Maintaining Current Levels +$454,000 / +0 

FTE 

Funds are required for inflation adjustments in 

non-labor expenses such as GSA rent 

adjustments, postage, supplies and equipment 

and health benefits and the increase in Federal 

Employee Retirement System participation. 

No inflation adjustment is requested for pay in 

FY 2012. 

Efficiencies, Savings & Base Reductions 

Efficiencies, Savings and Reductions 

-$2,448,000 / +0 FTE 

A reduction from the base level will be 

absorbed through general operating costs. 

Explanation of Budget Activities 

 

Salaries and Expenses 

Audit ($20,371,000 from direct appropriations)

Conducts, supervises, and coordinates 

programmatic audits with respect to 

Treasury’s operation of TARP and the 

recipients’ compliance with their obligations 

under relevant law and contracts; evaluates 

TARP policies and procedures; and provides 

technical assistance to Treasury.

Investigations ($27,003,000 from direct 

appropriations)

Supervises and conducts criminal and civil 

investigations into those persons and entities, 

whether inside or outside of government, who 

waste, steal, or abuse TARP funds.

Legislative Proposals 

 

SIGTARP has no legislative proposals for 

FY 2012. 

 
SIGTARP Performance by Budget Activity

Budget Activity Performance Measure FY 2008 FY 2009 FY 2010 FY 2011 FY 2012

Actual Actual Actual Target Target

Audit Percent of Recommendations

Implemented (Oe)(%)

N/A 100.0 43.0 70.0 70.0

Investigations Percentage of Investigations

Accepted by Prosecutors (Oe)(%)

N/A 95.0 100.0 55.0 55.0

Key: Oe - Outcome Measure, E - Efficiency Measure, Ot - Output/Workload Measure, M - Management/Cust. Satisfaction, 

DISC - Discontinued, and B – Baseline

Description of Performance 

 

SIGTARP is continuing to set challenging 

performance goals with positive results. The 

Audit Division (AD) continues to review 

TARP policies and procedures including 

TARP agreements. A particular focus of the 

AD is ensuring that internal controls are in 

place and are complied with, both by Treasury 

in its management of TARP and by the 

recipients of TARP funds. Where controls or 

compliance are found to be lacking, or where 

particular aspects or policies are found 

ineffective at reaching TARP’s goals, AD 

assists the Special Inspector General in 

preparing recommendations to resolve issues. 

In the interests of maximizing criminal and 

civil enforcement, the Investigation Division 

(ID) coordinates closely with other law 

enforcement agencies with the goal of forming 

law enforcement partnerships, including task 

force relationships, across the Federal 

government to leverage SIGTARP’s expertise 

and unique position. ID also implements 

SIGTARP’s Hotline which accepts and 

processes telephone, e-mail, website, and inperson complaints. One of SIGTARP’s 

primary investigative priorities is to operate 

the SIGTARP Hotline to provide a simple, 

accessible way for the American public to 

report concerns of violations of criminal and 

civil laws in connection with TARP.
Inspector General for Tax Administration

Program Summary by Budget Activity

(Dollars in thousands)

Appropriation FY 2010 FY 2011 FY 2012 Change FY10 to FY12

Enacted Annualized

CR Level

Request $ Change % Change

 Audit $57,421 $57,421 $62,357 $4,936 8.6%

 Investigations $94,579 $94,579 $95,474 $895 0.9%

Subtotal, Inspector General for Tax Administration $152,000 $152,000 $157,831 $5,831 3.8%

Offsetting Collections - Reimbursables $1,300 $1,300 $1,300 $0 -

Total Program Operating Level $153,300 $153,300 $159,131 $5,831 3.8%

Direct FTE 835 835 864 29 3.5%

Reimbursable FTE 3 3 3 - -

Total FTE 838 838 867 29 3.5%

Summary

The FY 2012 President’s Budget request for 

Treasury Inspector General for Tax 

Administration (TIGTA) will be used to 

continue to provide critical audit, 

investigative, and inspection and evaluation 

services, ensuring the integrity of tax 

administration on behalf of the nation’s 

taxpayers. While there are a number of critical 

areas where TIGTA will provide oversight, 

highlights of TIGTA’s investigative and audit 

priorities include: 

• Adapting to the Internal Revenue Service’s 

(IRS) continuously evolving operations 

and mitigating intensified risks associated 

with modernization, security, addressing 

the tax gap, and human capital challenges 

facing the IRS;

• Responding to threats and attacks against 

IRS employees, property, and sensitive 

information;

• Improving the integrity of IRS operations 

by detecting and deterring fraud, waste, 

abuse or misconduct by IRS employees; 

• Conducting comprehensive audits, 

inspections, and evaluations that include 

recommendations for monetary benefits 

and enhancing IRS’s service to taxpayers;

• Informing the American people, Congress, 

and the Secretary of the Treasury of 

problems and progress made to resolve 

them; and. 

• Overseeing IRS efforts to administer tax 

provisions of the American Recovery and 

Reinvestment Act of 2009 (Recovery Act), 

the Patient Protection and Affordable Care 

Act, and the Health Care and Education 

Reconciliation Act of 2010 (ACA).

TIGTA was created by Congress as a part of 

the Internal Revenue Service Restructuring 

and Reform Act of 1998 (RRA 98). TIGTA’s 

audits, investigations, inspections and 

evaluations protect and promote the fair 

administration of the American tax system. 

TIGTA conducts audits that advise the 

American people, Congress, the Secretary of 

the Treasury, and IRS management of highrisk issues, problems, and deficiencies related 

to the administration of IRS programs and 

operations. TIGTA’s audit recommendations 

improve IRS systems and operations, while 

maintaining fair and equitable treatment of 

taxpayers. TIGTA’s investigations ensure the 

integrity of IRS employees, contractors, and 
other tax professionals; provide for 

infrastructure security; and protect the IRS 

from external attempts to threaten or corrupt 

the administration of the tax laws. TIGTA’s 

Office of Inspections and Evaluations (I&E) 

provides responsive, timely, and cost-effective 

inspections and evaluations of IRS challenge 

areas. TIGTA’s oversight is essential to the 

efficiency and equity of the IRS’s tax 

administration system. TIGTA ensures that 

taxpayers can have confidence that the IRS 

collects more than $2 trillion in tax revenue in 

an effective and efficient manner.

Total resources required to support TIGTA 

activities for FY 2012 are $159,131,000, 

including $157,831,000 from direct 

appropriation and $1,300,000 from offsetting 

collections and reimbursable programs.

TIGTA FY 2012 Budget Highlights

(Dollars in thousands)

Appropriation Amount

FY 2010 Enacted $152,000

FY 2011 Annualized CR Level $152,000

Changes to Base:

Adjustment to Reach Policy Level: $2,266

Adjustment to Reach FY 2011 President's 

Policy

$2,266

Maintaining Current Levels (MCLs): $1,391

Maintaining Current Levels (MCLs) $1,391

Efficiencies, Savings & Base Reductions: ($3,474)

Program Reductions and Efficiencies ($3,474)

Subtotal FY 2012 Changes to Base $183

Total FY 2012 Base $152,183

Program Changes:

Program Increases: $5,648

Oversight of IRS Implementation of the 

Affordable Care Act

$5,600

CIGIE Payment $48

Subtotal FY 2012 Program Changes $5,648

Total FY 2012 Request $157,831

FY 2012 Budget Adjustments

FY 2011 Annualized CR Level

The FY 2011 Annualized CR Level for 

TIGTA is $152,000,000.

Adjustment to Reach Policy Level 

Adjustment to Reach FY 2011 President's 

Policy +$2,266,000 / +0 FTE 

Adjustment from the FY 2011 Annualized 

Continuing Resolution (CR) Rate to reach the 

FY 2011 President's Policy Level. The 

Presidents Policy Level is equal to the FY 

2011 President's Budget as adjusted for the 

proposed pay freeze.

Maintaining Current Levels (MCLs) 

Maintaining Current Levels (MCLs) 

+$1,391,000 / +0 FTE 

Funds are requested for inflation adjustments 

in non-labor expenses such as GSA rent 

adjustments, postage, supplies and equipment 

and health benefits and the increase in Federal 

Employee Retirement System participation. 

No inflation adjustment is requested for pay in 

FY 2012.

Efficiencies, Savings & Base Reductions 

Program Reductions and Efficiencies -

$3,474,000 / +0 FTE 

TIGTA continuously seeks to reduce programs 

that are non-critical and find efficiencies in its 

operations. Reaching a savings target of 

$3,474,000 without impacting the quality of 

TIGTA’s programs will require a combination 

of actions. TIGTA examines all vacancies to 

determine the impact of delayed back-filling 

and will strategically identify positions where 

longer lapses would have the smallest impact 

on mission. Reducing the reporting 

requirements identified in TIGTA’s charter 

document, RRA 98 will generate $840,000 in 

savings. However, these reductions would 

require statutory change and are further 

discussed in the Legislative Proposals section 

of this document. Further savings will be 

realized in data center and certification and 

accreditation consolidation.
Program Increases 

Oversight of IRS Implementation of the 

Affordable Care Act +$5,600,000 / +29 FTE 

The IRS components of the new ACA 

legislation are a cornerstone of the 

administration's plan to expand coverage for 

millions of Americans. TIGTA is in a unique 

position to ensure that IRS implements the law 

effectively, assure citizens about the integrity 

of the program, and give lawmakers the 

assurance that the program functions properly. 

TIGTA has often paved the way for new 

initiatives that are administered through the tax 

code. Funding will support 23 auditors, five 

investigators, and one inspections and 

evaluations specialist. TIGTA's work requires 

close coordination among its Audit, 

Investigations, Inspections and Evaluation

functions. Each program office brings unique 

skills and experience, but the bureau's overall 

success depends greatly upon these offices 

close collaboration. The success of the new 

ACA program will depend on the 

government's ability to assure taxpayers that 

the new changes are properly administered.

CIGIE Payment +$48,000 / +0 FTE 

Funds for Council of Inspectors General on 

Integrity and Efficiency (CIGIE) will 

specifically support coordinated governmentwide activities that identity and review areas 

of weakness and vulnerability in federal 

programs and operations with respect to fraud, 

waste and abuse. This increase raises 

TIGTAs CIGIE contribution to $380,000.

Explanation of Budget Activities

Salaries and Expenses

Audit ($62,357,000 from direct 

appropriations, and $551,000 from 

reimbursable programs)

The Office of Audit’s (OA) mission is to 

provide comprehensive coverage and oversight 

of all aspects of the IRS’s daily operations. 

Audits not only focus on the economy and 

efficiency of IRS functions but also ensure that 

taxpayers’ rights are protected and the 

taxpaying public is adequately served. In FY 

2010, audit reports produced potential 

financial benefits of approximately $11.46

billion, and potentially impacted

approximately 2.03 million taxpayer accounts

in areas such as taxpayer burden, rights and 

entitlements, taxpayer privacy and security, 

protection/use of resources, reliability of 

information, and increased revenue/revenue 

protected. Each fiscal year, OA develops an 

annual audit plan that communicates oversight 

priorities to Congress, the Department of the 

Treasury, and the IRS. This plan strikes a 

balance between statutory audit coverage and 

high risk audit work. The statutory coverage 

includes audits mandated by the IRS 

Restructuring and Reform Act of 1998, as well 

as reviews that address computer security and 

financial management. The high-risk 

workload includes issues pertaining to the 

IRS's modernization efforts, its major 

management challenges, its progress in 

achieving its strategic goals, as well as 

Congressional and other stakeholder requests 

for audit coverage.

Investigations ($95,474,000 from direct 

appropriations, and $749,000 from 

reimbursable programs)

While most Offices of Inspectors General 

focus primarily on fraud, waste, and abuse, 

TIGTA’s mission is more extensive. TIGTA 

has the statutory responsibility to protect the 

integrity of tax administration and to protect 

the ability of the IRS to collect revenue for the 

Federal government. To accomplish this, 

TIGTA investigates allegations of criminal 

violations and administrative misconduct by 

IRS employees, protects the IRS against 

external attempts to corrupt tax administration, 

and ensures IRS employee safety and IRS data 
and infrastructure security. The following 

summaries highlight TIGTA’s investigative 

efforts in these three core areas:

Employee Integrity: IRS employee 

misconduct can hinder the IRS’s ability to 

collect revenue for the Federal Government. 

Fifty percent of TIGTA’s current 

investigations involve alleged employee 

misconduct. In addition to unauthorized 

access (UNAX) investigations, employee 

misconduct investigations include allegations 

of extortion, theft, false statements, and 

financial fraud. TIGTA also administers a 

proactive integrity program to help detect IRS 

employees who might be committing fraud 

and other misconduct. During FY 2010, 

TIGTA initiated 70 proactive investigative 

initiatives.

Employee and Infrastructure Security: 

Congressional concern regarding the 

magnitude of uncollected revenue has 

prompted the IRS to intensify enforcement 

activities. Heightened enforcement is likely to 

cause a rise in external threats to IRS 

employees and infrastructure. Both TIGTA’s 

proactive and reactive investigations are 

critical to mitigating future risks. TIGTA 

maintains IRS employee and infrastructure 

security by conducting investigations into 

incidents that threaten IRS employees, 

facilities, and infrastructure. TIGTA’s highest 

priority complaints involve threats and assaults 

against IRS employees. TIGTA works 

aggressively and takes swift action to protect 

IRS employees, to include the providing of 

armed escorts. In October 2008, the Inspector 

General Reform Act of 2008 was signed into 

law, which allows TIGTA to provide physical 

security to protect IRS employees against 

external threats. TIGTA also operates a 

Criminal Intelligence Program that develops 

and facilitates pertinent information regarding 

potential threats to IRS employees and 

operations. This program includes 

participation in the FBI sponsored Joint 

Terrorism Task Forces nationwide. In 

addition, TIGTA has a System Intrusion and 

Network Attack Response Team to defend 

against hackers who attempt to compromise 

the data integrity of taxpayer information 

stored in IRS computer systems. In FY 2010, 

OI closed 1,425 investigations of assaults 

and/or threats made against IRS employees 

and facilities.

External Attempts to Corrupt Tax 

Administration: TIGTA is statutorily 

mandated to investigate external attempts to 

corrupt tax administration, which includes 

criminal misconduct by non-employees, such 

as, impersonation of IRS employees, 

interference with the administration of internal 

revenue laws, bribery, misuse of Treasury 

names, symbols, etc., contract fraud, and tax 

practitioner fraud relating to thefts of taxpayer 

remittances and refunds.

Legislative Proposals

TIGTA proposes eliminating certain reviews 

conducted to comply with reporting 

requirements in the IRS Restructuring and 

Reform Act of 1998. These statutory 

reviews yield little in the way of improving 

performance measures and are of relatively 

low value. TIGTA would prefer to redirect 

resources applied to these reviews to 

conducting high-risk audits. TIGTA 

recommends legislative changes eliminating 

reporting requirements in the following areas:

 

• The requirement to report information 

regarding any administrative or civil 

actions related to Fair Tax Collection 

Practices violations in one of TIGTA’s 

Semiannual Reports. This pertains to 

Internal Revenue Code Section 7803 

(d)(1)(G). 
• The requirement to review and certify 

annually that IRS is complying with the 

requirements of 26 U.S.C. section

6103(e)(8) regarding information on joint 

filers. 

• The requirement to annually report on the 

IRS’s compliance with Internal Revenue 

Code Sections 7521(b)(2) and (c) requiring 

IRS employees to stop a taxpayer 

interview whenever a taxpayer requests to 

consult with a representative and to obtain 

their immediate supervisor’s approval to 

contact the taxpayer instead of the 

representative if the representative has 

unreasonably delayed the completion of an 

examination or investigation.

• The annual reporting requirement for the 

remaining RRA 98 provisions should be 

revised to a biennial reporting requirement.

TIGTA Performance by Budget Activity

Budget Activity Performance Measure FY 2008 FY 2009 FY 2010 FY 2011 FY 2012

Actual Actual Actual Target Target

Exceptional accountability and

transparency

Percentage of Audit Products 

Delivered when Promised to 

Stakeholders (Oe)

65.0 81.0 76.0 65.0 70.0

Exceptional accountability and 

transparency

Percentage of Recommendations 

Made that Have Been 

Implemented (Oe)

85.0 91.0 95.0 83.0 85.0

Exceptional accountability and 

transparency

Percentage of Results from 

Investigative Activities (Oe)

78.0 83.0 86.0 79.0 80.0

Key: Oe - Outcome Measure, E - Efficiency Measure, Ot - Output/Workload Measure, M - Management/Cust. Satisfaction, 

DISC - Discontinued, and B - Baseline

Description of Performance

• Issued 135 audit, inspection, and 

evaluation reports, identifying 

approximately $11.46 billion in potential 

financial benefits (i.e., costs savings, 

increased or protected revenue, taxpayer 

rights and entitlements, and inefficient use 

of resources). 

• Closed 86 percent of the 3,743 final closed 

investigations which generated results, 

including 1,635 cases of employee 

misconduct referred to the IRS for action 

and 235 cases accepted for prosecution.

• Note that FY 2011 performance targets 

were reduced to FY 2010 levels to align 

performance targets and funding levels 

based on FY 2010.
Community Development Financial Institutions Fund

Program Summary by Budget Activity

(Dollars in thousands)

Appropriation FY 2010 FY 2011 FY 2012 Change FY2010 to FY2012

Enacted Annualized

CR Level

Request $ Change % Change

Community Development Financial Institutions Program $107,600 $107,600 $125,869 $18,269 16.98%

Bank Enterprise Award Program $25,000 $25,000 $0 ($25,000) (100.0%)

Native Initiatives $12,000 $12,000 $12,000 $0 -

Capital Magnet Fund $80,000 $80,000 $0 ($80,000) (100.0%)

Administration1, 2 $18,000 $18,000 $22,965 $4,965 27.58%

Financial Education and Counseling $1,000 $1,000 $0 ($1,000) (100.0%)

Hawaii Financial Ed and Counseling $3,150 $3,150 $0 ($3,150) (100.0%)

Bank on USA Initiative $0 $0 $41,425 $41,425 100.0%

Healthy Food Financing Initiative $0 $0 $25,000 $25,000 100.0%

Total Appropriated Resources $246,750 $246,750 $227,259 ($19,491) (7.90%)

Direct FTE 84 84 90 6 7.14%

1/ NMTC Program Administration is included in the Administration budget activity for the FY 2012 Budget request.

2/ In addition, $13.5 million is available for the administration of the Bond Guarantee Program provided in PL 111-240.

Summary

The FY 2012 request for the Community 

Development Financial Institutions Fund 

(CDFI Fund) will ensure that the CDFI Fund 

meets its mission of increasing economic 

opportunity and promoting community 

development investments for underserved 

populations and in distressed communities in 

the United States.

Through its various programs and initiatives, 

the CDFI Fund enables locally based 

organizations to further goals such as 

economic development that support the 

expansion of affordable housing, small 

businesses, community facilities, and 

community development financial services. 

Total resources required to support CDFI Fund 

activities for FY 2012 are $227,259,000 from 

direct appropriations.

The CDFI Fund expands the availability of 

credit, investment capital, and financial 

services in distressed urban and rural 

communities, and carries out the Community 

Development Banking and Financial 

Institutions Act of 1994. The CDFI Fund 

provides infusions of capital to institutions that 

serve economically distressed communities 

and low-income individuals. The CDFI 

Fund’s investments work toward building 

private markets, improving local tax revenues 

(through job creation, business development, 

commercial real estate, housing development 

and homeownership), and empowering 

residents by stimulating the creation and 

expansion of diverse Community 

Development Financial Institutions (CDFIs), 

which provide basic banking services and 

financial literacy training to underserved 

communities. The CDFI Fund’s activities 

leverage millions of private sector investment 

dollars from banks, foundations, and other 

funding sources.

The FY 2012 budget proposes funding for the 

CDFI Fund's core CDFI and Native programs, 

as well as the Healthy Food Financing 

Initiative (HFFI) and the Bank on USA 

initiative. The Bank on USA initiative 

promotes access to affordable and appropriate 
financial services and basic consumer credit 

products for the underbanked. These 

individuals face a number of problems, 

including high fees for alternative financial 

services such as check-cashing; barriers to 

saving and building credit; and increased 

exposure to risks such as fraud and theft. The 

Healthy Food Financing Initiative supports

CDFIs for the purpose of increasing the 

availability of affordable, healthy foods in 

underserved urban and rural communities, 

particularly through the development or 

equipping of grocery stores and other healthy 

food retailers.

CDFI FY 2012 Budget Highlights

(Dollars in thousands)

Appropriation Amount

FY 2010 Enacted $246,750

FY 2011 Annualized CR Level $246,750

Changes to Base:

Adjustment to Reach Policy Level: $3,144

Adjustment to Reach FY 2011 President's 

Policy

$3,144

Maintaining Current Levels (MCLs): $201

Maintaining Current Levels $201

Efficiencies, Savings & Base Reductions: ($1,830)

Office Relocation ($1,700)

Procurement Savings ($130)

Subtotal FY 2012 Changes to Base $1,515

Total FY 2012 Base $248,265

Program Changes:

Program Decreases: ($22,706)

Community Development Financial 

Institutions Program

($14,131)

Bank on USA Initiative ($8,575)

Program Reinvestment: $1,700

Adjustment to Support New Programs $1,700

Subtotal FY 2012 Program Changes ($21,006)

Total FY 2012 Request $227,259

FY 2012 Budget Adjustments

FY 2011 Annualized CR Level

The FY 2011 Annualized CR Level for CDFI 

is $246,750,000.

Adjustment to Reach Policy Level 

Adjustment to Reach FY 2011 President's 

Policy +$3,144,000 / +6 FTE

Adjustment to Reach FY 2011 President's

Policy

Maintaining Current Levels (MCLs) 

Maintaining Current Levels +$201,000 / +0 

FTE 

Funds are requested for inflation adjustments 

in non-labor expenses such as GSA rent 

adjustments, postage, supplies and equipment 

and health benefits and the increase in Federal 

Employee Retirement System participation. 

No inflation adjustment is requested for pay in 

FY 2012.

Efficiencies, Savings & Base Reductions 

Office Relocation -$1,700,000 / +0 FTE 

This is a one-time cost in the administrative 

account which is associated with the CDFI 

Fund's FY 2011 office relocation.

Procurement Savings -$130,000 / +0 FTE 

Reducing non-competitive and high risk 

contract actions and implementing the use of 

socio-economic programs such as 8(a) and 

small business set-asides can achieve 

procurement savings. Other methods to 

achieve savings include strategic sourcing, 

advanced acquisition planning, and GSA 

discount savings.

Program Decreases 

Community Development Financial 

Institutions Program -$14,131,000 / +0 FTE 

The CDFI Fund will reduce the amount and 

number of Financial Assistance and Technical 

Assistance awards and the funding level for 

the capacity building initiative, which 

complements existing funding for technical 

assistance and capacity building services to 

CDFIs. 

However, the impact of the reduction in 

funding is mitigated by additional financial 

support to CDFIs from other Treasury 

programs, including the more than $500 

million that has been made available to CDFIs 

under the Community Development Capital 

Initiative (CDCI) in FY 2010, and the up to 
$300 million that is authorized under Small 

Business Lending Fund (SBLF) in FY 2011.

Bank on USA Initiative -$8,575,000 / +0 FTE

The FY 2012 request is reduced because 

certain one-time fixed costs incurred in FY 

2011 will not be incurred in FY 2012 

(technical assistance to local Bank on USA 

programs, research contracts, and start-up and 

related administrative costs).

Program Reinvestment 

Adjustment to Support New Programs 

+$1,700,000 / +0 FTE

The CDFI funds will redirect reinvestment of 

non-recurring cost from the office relocation to 

cover the additional administrative support 

costs resulting from the implementation of two 

high-priority initiatives; the Bank on USA 

Initiative and the Healthy Food Financing 

Initiative.

Explanation of Budget Activities

Salaries and Expenses

Community Development Financial 

Institutions Program ($125,869,000 from 

direct appropriations)

The CDFI Program uses federal resources to 

invest in and build the capacity of CDFIs to 

serve low-income people and communities 

lacking adequate access to affordable financial 

products and services. The CDFI Program 

provides monetary awards for financial 

assistance to further economic development 

(job creation, business financing, and 

commercial real estate development); 

affordable housing (housing development and 

homeownership); and community 

development financial services (provision of 

basic banking services to underserved 

communities and financial literacy training). 

The CDFI Program also provides technical 

assistance awards to help start-up and existing 

CDFIs build their capacity to serve their target 

markets through the acquisition of consulting 

services, technology purchases, and staff/board 

training.

New Markets Tax Credit Program ($0 from 

direct appropriations)

The NMTC Program attracts private sector 

capital into low-income communities. 

Community Development Entities (CDEs) 

apply to the CDFI Fund for allocations of tax 

credits in annual competitive rounds. The 

CDEs, in turn, provide tax credits to private 

investors in low-income communities. In 

addition to awarding tax credits, the CDFI 

Fund monitors CDE compliance with the 

terms of their allocation agreements.

Bank Enterprise Award Program (No funding)

Through the BEA Program, the CDFI Fund 

encourages insured depository institutions to 

increase investments and services in distressed 

communities and financial assistance to 

CDFIs. The CDFI Fund does not propose to 

fund the BEA Program in FY 2012.

Native Initiatives ($12,000,000 from direct 

appropriations)

The Native Initiatives comprises two 

components: (i) the Native American CDFI 

Assistance Program (NACA Program) through 

which financial assistance (FA) and technical 

assistance (TA) awards are provided to build 

the capacity of new or existing Native CDFIs 

serving Native Communities, and (ii) 

complementary capacity-building initiatives 

that foster the development of Native CDFIs 

through training and technical assistance, 

strengthen their operational capacity, and 

guide them in the creation of important 

financial education and asset building 

programs for their communities.

Capital Magnet Fund (No funding)

Through the CMF, the CDFI Fund increases 

capital investment for the development, 
preservation, rehabilitation, and purchase of 

affordable housing for low-, very low-, and 

extremely low-income families, and related 

economic development activities. As initially 

conceived, the CMF was to be capitalized 

through proceeds from Fannie Mae and 

Freddie. The CDFI Fund does not propose to 

fund the CMF in FY 2012.

Administration ($22,965,000 from direct 

appropriations)

Administration encompasses the CDFI Fund’s 

operational support and management activities 

for each of the award and tax credit programs 

that it administers. This includes finalizing the 

terms of assistance agreements with awardees, 

making disbursements, and monitoring 

awardee compliance with the terms of their 

three-year award assistance and seven-year 

allocation agreements. In addition, resources 

will be utilized for a business application

enhancement upgrade and external program 

research evaluations.

Financial Education and Counseling (No 

funding)

Through the FEC Pilot Program, the CDFI 

Fund makes grants to eligible organizations to 

provide a range of financial education and 

counseling services to prospective 

homebuyers. The CDFI Fund does not propose 

to fund the FEC Pilot Program in FY 2012.

Hawaii Financial Ed and Counseling (No 

funding)

Through the FEC Pilot Program (Hawaii), the 

CDFI Fund makes grants to eligible 

organizations to provide a range of financial 

education and counseling services to 

prospective homebuyers in the State of 

Hawaii. The CDFI Fund does not propose to 

fund the FEC Pilot Program (Hawaii) in 

FY 2012.

Bank on USA Initiative ($41,425,000 from 

direct appropriations)

Through the Bank on USA initiative, the CDFI 

Fund will work in partnership with Treasury’s 

Office of Financial Education and Access to 

award grants to CDFIs to promote access to 

and innovations in affordable and appropriate 

financial services and basic consumer credit 

products for households without access to such 

products and services.

Healthy Food Financing Initiative 

($25,000,000 from direct appropriations)

Through the HFFI, the CDFI Fund will make 

CDFI Program awards to CDFIs and NMTC 

Program awards to CDEs that will finance

healthy food alternatives in low-income 

neighborhoods.

Legislative Proposals

The CDFI Fund does not recommend any 

legislative changes for FY 2012.
CDFI Performance by Budget Activity

Budget Activity Performance Measure FY 2008 FY 2009 FY 2010 FY 2011 FY 2012

Actual Actual Actual Target Target

Economic competitiveness ALL - Award Cycle Time N/A N/A B 7.5 7.5

Economic competitiveness ALL - Disbursement Cycle Time N/A N/A B 2.0 2.0

Economic competitiveness ALL - Jobs Created/Maintained N/A N/A N/A 51,312 48,991

Community Development 

Financial Institutions Program

CDFI - Number of Loans/Investments 

Originated (Annual)

N/A N/A N/A B B

Native Initiatives NACA - Number of Loans/Investments 

Originated (Annual)

N/A N/A N/A B B

New Markets Tax Credit 

Program

Community Development Entities' 

Annual Investments In Low-Income 

Communities ($ billions) (Oe)

3.3 3.6 3.1 3.0 3.0

Key: Oe - Outcome Measure, E - Efficiency Measure, Ot - Output/Workload Measure, M - Management/Cust. Satisfaction, DISC -

Discontinued, and B - Baseline

Description of Performance

In FY 2010, CDFIs reported leveraging private 

investment in the prior year of approximately

$1.9 billion (based on reporting from program 

year 2009 results), more than triple the target 

of $600 million; this success was largely due 

to increased CDFI Program funding which was 

met by private sector commitments despite the 

effects of the financial crisis. 

In FY 2010, the NMTC Program 

competitively awarded $5 billion in NMTC 

allocation authority to CDEs, including the 

$1.5 billion in Recovery Act authority, 

providing tax credit allocation authority to 

CDEs for targeted investments in low-income 

communities. As reported in FY 2010 (based 

on reporting from program year 2009 results), 

cumulative investments in low-income 

communities by CDEs rose to $15.8 billion 

(exceeding the performance target) and 

amounted to an annual increase of $3.1 billion 

over the prior year (exceeding the annual 

target by $600 million). 

In FY 2010, the BEA Program received 76 

applications requesting a total of $94 million 

compared to 58 applications requesting 

approximately $57 million in FY 2009. The 

CDFI Fund selected 69 FDIC-insured 

institutions to receive nearly $25 million in 

awards. FY 2010 applicants were 

headquartered in 20 states and the District of 

Columbia. In the FY 2010 funding round 

(based on the 2009 Assessment Period), 

awardees provided $373.9 million in qualified 

loans or investments in distressed 

communities, $53.9 million in qualified loans, 

deposits and technical assistance to CDFIs, 

and $233.3 million in qualified financial 

services in distressed communities.

In FY 2010, the Native Initiatives registered a 

26 percent increase in the total assets of Native 

CDFIs. In FY 2010, the NACA Program 

received 61 applications requesting a total of 

$23.7 million. The CDFI Fund awarded 45 

organizations a total of $10.3 million for both 

FA and TA funding in FY 2010.
In its inaugural FY 2010 Capital Magnet Fund 

(CMF) funding round, the CDFI Fund 

announced $80 million in competitively 

awarded grants to 23 CDFIs and qualified 

nonprofit housing organizations serving 38 

states. The CDFI Fund received a total of 230 

applications for the FY 2010 CMF funding 

round. 

In FY 2010, the administration implemented 

two productivity measures. These measures 

replaced the old administrative efficiency 

measure, which was intrinsically difficult to 

compute because it required allocating a share 

of organizational overhead to each program. 

The new program-level measure has two 

components: cycle time from the date when 

applications are received to the date of award 

announcement; and time from date of award 

announcement to date of disbursement. These 

two program efficiency measures (applicationaward and award-disbursement cycle times) 

were analyzed across all programs to 

formulate a composite, CDFI Fund-wide 

efficiency measure for each measure was 

based on the weighted average of the number 

of awards per program.
Financial Crimes Enforcement Network

Program Summary by Budget Activity

(Dollars in thousands)

Appropriation FY 2010 FY 2011 FY 2012 FY 2010 to FY 2012

Enacted Annualized

CR Level

Request $ Change % Change

 BSA Administration and Analysis $101,694 $101,694 $84,297 ($17,397) (17.1%)

 Regulatory Support Programs $9,316 $9,316 $0 ($9,316) (100.0%)

Subtotal, Financial Crimes Enforcement Network $111,010 $111,010 $84,297 ($26,713) (24.1%)

Offsetting Collections - Reimbursables $20,000 $20,000 $3,000 ($17,000) (85.0%)

Transfers $0 $0 $30,000 $30,000 -

Total Program Operating Level $131,010 $131,010 $117,297 ($13,713) (10.5%)

Direct FTE 331 327 304 (27) (8.2%)

Reimbursable FTE 1 1 1 - -

Total FTE 332 328 305 (27) (8.1%)

In FY 2012, the Regulatory Support Program budget activity is merged into the BSA Administration and Analysis budget activity.

Summary

The mission of FinCEN, a bureau within 

Treasury’s Office of Terrorism and Financial 

Intelligence, is to enhance U.S. national 

security, deter and detect criminal activity, and 

safeguard financial systems from abuse by 

promoting transparency in the U.S. and 

international financial systems. FinCEN 

fulfills its mission, goals and priorities by: 

administering the Bank Secrecy Act (BSA); 

supporting law enforcement, intelligence, and 

regulatory agencies through sharing and 

analysis of financial intelligence; enhancing 

international anti-money laundering and 

counter-terrorist financing efforts and 

cooperation; and networking people, entities, 

ideas, and information.

The following priorities support the Presidential 

goal of encouraging economic growth by 

safeguarding the financial systems from abuse 

and promoting transparency in the U.S. and 

international financial systems. 

• Implement the BSA IT Modernization 

Program, using funds transferred from the 

Treasury Forfeiture Fund; 

• Lead efforts to coordinate federal, state, and 

local efforts to combat fraud; 

• Enhance the BSA regulatory compliance and 

enforcement strategy based on risks 

informed by analysis and law enforcement; 

and 

• Engage with priority countries and 

international bodies to strengthen 

mechanisms for global information 

exchange. 

The total resources required to support 

FinCEN for FY 2012 are $117,297,000 

including $84,297,000 for direct appropriation, 

$3,000,000 from offsetting collections and 

$30,000,000 transferred from the Treasury 

Forfeiture Fund (see Administrative Provision 

Sec. 125) to continue the BSA IT 

modernization program. 
FinCEN FY 2012 Budget Highlights

(Dollars in thousands)

Appropriation Amount

FY 2010 Enacted $111,010

FY 2011 Annualized CR Level $111,010

Changes to Base:

Adjustment to Reach Policy Level: ($11,038)

Adjustment to Reach FY 2011 President's 

Policy Level

($11,038)

Maintaining Current Levels (MCLs): $897

Maintaining Current Levels (MCLs) $897

Efficiencies, Savings & Base Reductions: ($13,570)

Base Reduction to BSA IT Modernization ($10,250)

Regulatory Support Efficiency Savings ($1,017)

Information Technology Efficiency Savings ($1,636)

Staffing Reduction from Attrition ($667)

Subtotal FY 2012 Changes to Base ($23,711)

Total FY 2012 Base $87,299

Program Changes:

Program Decreases: ($3,002)

Reduce Field Law Enforcement Support ($683)

Reduce Intelligence Support to External 

Agencies

($968)

Consolidate State and Local Access to BSA 

Data

($1,351)

Subtotal FY 2012 Program Changes ($3,002)

Total FY 2012 Request $84,297

Transfers $30,000

Total FY 2012 Request (Net) $114,297

FY 2012 Budget Adjustments

FY 2011 Annualized CR Level

The FY 2011 Annualized CR Level for 

FinCEN is $111,010,000.

Adjustment to Reach Policy Level 

Adjustment to Reach FY 2011 President's 

Policy Level -$11,038,000 / +0 FTE 

Adjustment from the FY 2011 Annualized 

Continuing Resolution (CR) Rate to reach the 

FY 2011 President's Policy Level. The 

President's Policy Level is equal to the FY 

2011 President's Budget as adjusted for the 

proposed pay freeze.

Maintaining Current Levels (MCLs) 

Maintaining Current Levels (MCLs) 

+$897,000 / +0 FTE 

Funds are requested for inflation adjustments 

in non-labor expenses such as GSA rent 

adjustments, postage, supplies and equipment 

and health benefits and the increase in Federal 

Employee Retirement System participation. 

No inflation adjustment is requested for pay in 

FY 2012.

Efficiencies, Savings & Base Reductions 

Base Reduction to BSA IT Modernization 

-$10,250,000 / +0 FTE 

BSA IT Modernization program will be 

funded with Forfeiture Fund surplus in FY 

2012, thereby reducing the discretionary 

request by an additional $10.250 million. 

Total project funding remains the same.

Regulatory Support Efficiency Savings 

-$1,017,000 / +0 FTE 

FinCEN will achieve efficiency savings 

through targeted regulatory support efforts, 

centralization of money services business 

(MSB) outreach activities, and change in 

distribution methodology for MSB brochure 

materials. The impact of these reductions will 

be mitigated through future consolidation of 

call centers; centralization of outreach 

activities; additional outreach support by 

FinCEN staff; and greater reliance on 

FinCEN's public website to distribute MSB 

materials, supporting Treasury's paperless 

initiative.

Information Technology Efficiency Savings 

-$1,636,000 / +0 FTE 

In FY 2012, the BSA IT Modernization 

program will roll out new capabilities for BSA 

E-Filing and a new analytical tool. Therefore, 

FinCEN proposes to eliminate development 

funding for stand-alone system enhancements 

that could be rolled into the BSA IT 

Modernization umbrella during FY 2012. 

FinCEN will also achieve efficiencies through 

consolidation of information technology 

contracts, leveraging Treasury strategic 

sourcing initiatives, and other related 

efficiencies.
Staffing Reduction from Attrition -$667,000 / 

-5 FTE 

Reductions were identified from efficiencies 

achieved in administrative staffing support and 

absorption of workload associated with 

positions lost through attrition.

Program Decreases 

Reduce Field Law Enforcement Support 

-$683,000 / -3 FTE 

Reductions are identified from discontinuance 

of a liaison position at the Federal Law 

Enforcement Training Center (FLETC), and 

from decreases in field positions located in 

High Intensity Financial Crime Areas 

(HIFCAs). FinCEN will continue to support 

law enforcement from its headquarters.

Reduce Intelligence Support to External 

Agencies -$968,000 / -6 FTE 

This reduction will reduce analytical support 

to external customers in support of their 

national security, counter terrorism financing, 

and law enforcement matters. FinCEN will 

continue to carry-out limited case support and 

support to FinCEN's analytical initiatives that 

require national security information. FinCEN 

will also provide access to BSA information 

for external agencies through appropriate 

information sharing protocols.

Consolidate State and Local Access to BSA 

Data -$1,351,000 / -9 FTE 

This reduction will limit direct access to BSA 

data to only state coordinators, canceling 142 

current state and local BSA direct access 

agreements for law enforcement and 

regulators. The state coordinators and 

FinCEN analysts would then be asked to 

provide access to the BSA by fulfilling query 

requests from those customers that previously 

had direct access. These actions allow 

FinCEN to reduce training, investigative and 

administrative support to state and local users, 

and inspections and monitoring of BSA data 

for appropriate use.

Transfers 

Proposed Transfer from TFF to Support BSA 

IT Modernization Continuing Efforts 

+$30,000,000 / +0 FTE 

The BSA IT Modernization will be funded 

using a transfer from Treasury Forfeiture Fund 

(see Administrative Provisions Sec. 125) to 

support continuing development and 

maintenance. This transfer allows Treasury to 

use asset forfeiture to support the development 

of a tool that will support law enforcement's 

anti-money laundering and counter-terrorism 

financing efforts.

Explanation of Budget Activities

Salaries and Expenses

BSA Administration and Analysis 

($84,297,000 from direct appropriations, 

$30,000,000 from transfers, and $3,000,000 

from reimbursable programs)

This activity comprises FinCEN’s efforts to 

administer the BSA, including promulgating 

regulations, providing outreach and issuing 

guidance to the regulated industries, providing 

oversight of BSA compliance, initiating 

enforcement actions, and, with the Internal 

Revenue Service (IRS), managing the 

information filed by the regulated industries, 

as well as BSA compliance of non-bank 

financial institutions. Analytical programs 

include support to U.S. law enforcement and 

international Financial Intelligence Units 

(FIUs) in combating financial fraud and crime 

by facilitating the exchange of investigative 

information; identifying foreign and domestic 

financial fraud, money laundering, and 

terrorist financing trends, patterns, and 

techniques; and liaison with and support of 

intelligence initiatives within the intelligence 

community and within Treasury. This activity 

also incorporates efforts to support large-scale, 

complex law enforcement investigations 
involving financial fraud, terrorist financing, 

money laundering, and other financial crimes. 

Regulatory Support Programs (No funding)

FinCEN is proposing to eliminate the separate 

budget activity for the Regulatory Support 

Program along with the related two year fund 

availability. This program has matured and is 

now an integrated part of FinCEN’s activities, 

thus the separate identification and extended 

funding availability is no longer required.

Legislative Proposals

FinCEN is proposing five technical 

amendments to Titles 31 and 12 that would 

make improvements in four important areas. 

The first amendment provides authority to rely 

on examinations conducted by state 

supervisory agencies for nonbank financial 

institutions lacking a Federal regulator, which 

would capture most nonbank financial 

institutions currently subject to IRS 

examination as delegated through a 

memorandum of understanding. The second 

amendment increases information sharing 

between FinCEN and counterpart anti-money 

laundering/counter-terrorist financing 

regulators. Specifically, this amendment 

provides consistency between how FinCEN 

shares information in its capacity as a 

regulator and information sharing that 

currently exists between federal financial 

regulators and their foreign counterparts. The 

remaining amendments expand the universe of 

individuals covered by the prohibition on 

Suspicious Activity Report (SAR) disclosures 

and explicitly exempt all BSA data from 

disclosure under any state law or regulation 

providing public access to information. See 

sections 120-124 in the summary of 

appropriations chapter of this document for 

specific changes. 

FinCEN Performance by Budget Activity

Budget Activity Performance Measure FY 2008 FY 2009 FY 2010 FY 2011 FY 2012

Actual Actual Actual Target Target

U.S. & intl financial sys Percentage of Customers Satisfied 

with the BSA E-Filing (Oe)

93.0 94.0 96.0 90.0 92.0

U.S. & intl financial sys Percentage of Domestic Law 

Enforcement and Foreign Financial 

Intelligence Units Finding FinCEN's 

Analytical Reports Highly Valuable

83.0 81.0 80.0 80.0 80.0

U.S. & intl financial sys Percentage of FinCEN's

Regulatory Resource Center 

Customers Rating the Guidance 

Received as Understandable (Oe)

94.0 94.0 92.0 90.0 90.0

Key: Oe - Outcome Measure, E - Efficiency Measure, Ot - Output/Workload Measure, M - Management/Cust. Satisfaction, DISC -

Discontinued, and B - Baseline
Description of Performance

In the regulatory area, FinCEN’s goal to 

provide financial institutions with 

understandable guidance through the BSA 

Resource Center is critical to institutions 

establishing anti-money laundering programs

that comply with the BSA. The FY 2010 goal 

was to maintain a 90 percent satisfaction level 

for customers rating the guidance as 

“understandable,” and FinCEN surpassed its 

goal with 92 percent. 

In the analytical area, FinCEN supports 

domestic law enforcement and international 

FIU partners by providing analyses of BSA 

information, and measures the percentage of 

customers finding FinCEN’s analytic reports 

highly valuable. The measure closely ties to 

how BSA information is used by law 

enforcement and international FIUs to identify, 

investigate, and prevent abuse of the financial 

system. In FY 2010, 80 percent of the 

respondents rated the analytic products as 

highly valuable. FinCEN narrowly missed its 

target of 81 percent. FinCEN attributes this to 

a need to enhance communication with and 

understanding of law enforcement partners’ 

needs. FinCEN has developed a strategy to 

increase communication with law enforcement 

partners and will continue efforts to ensure its 

products and services meet those needs.

In the efficient management, safeguarding, and 

use of BSA information, FinCEN conducts a 

survey of the users of the BSA E-Filing system 

to determine the overall satisfaction level and 

to identify where improvements are needed. 

The FY 2010 target was to maintain at least a 

90 percent satisfaction level, and FinCEN 

exceeded its target with 96 percent.
Alcohol and Tobacco Tax and Trade Bureau

Program Summary by Budget Activity

(Dollars in thousands)

Appropriation FY 2010 FY 2011 FY 2012 FY 2010 to FY 2012

Enacted Annualized

CR Level

Request $ Change % Change

 Collect the Revenue $53,000 $53,000 $48,939 ($4,061) (7.7%)

 Protect the Public $50,000 $50,000 $48,939 ($1,061) (2.1%)

Subtotal, Alcohol and Tobacco Tax and Trade Bureau $103,000 $103,000 $97,878 ($5,122) (5.0%)

Offsetting Collections - Reimbursables $4,234 $3,050 $2,997 ($1,237) (29.2%)

Total Program Operating Level $107,234 $106,050 $100,875 ($6,359) (5.9%)

Direct FTE 535 535 502 (33) (6.2%)

Reimbursable FTE 15 15 15 - -

Total FTE 550 550 517 (33) (6.0%)

Note: In FY 2010, Congress appropriated $3 million in two-year funds for the hiring, training, and equipping of special agents 

and related support personnel. This funding expires September 30, 2011.

Summary

The Alcohol and Tobacco Tax and Trade 

Bureau (TTB) serves as the nation’s primary 

federal authority in the regulation of the 

alcohol and tobacco industries. TTB is 

responsible for the administration and 

enforcement of the Internal Revenue Code 

associated with the collection of excise taxes 

on alcohol, tobacco, firearms, and 

ammunition, and the Federal Alcohol 

Administration Act, which provides for the 

regulation of those engaged in the alcohol 

beverage industry and the protection of 

consumers of alcohol beverages. 

In FY 2012, TTB will continue to focus its 

efforts on enforcing compliance with alcohol,

tobacco, firearms and ammunition laws and 

regulations, in the interest of collecting all 

appropriate excise taxes, and promoting a 

marketplace for alcohol beverages that 

complies fully with federal production, 

labeling, advertising, and marketing standards. 

The FY 2012 President’s budget request 

enables TTB to continue its programs and 

activities necessary to meet the performance 

measures that support TTB’s strategic goals of 

collecting revenue and protecting the public. 

Total resources required to support TTB 

activities for FY 2012 are $100,875,000, 

including $97,878,000 from direct appropriations, and $2,997,000 from other offsetting 

collections and reimbursable programs.

Collect the Revenue - TTB is charged with 

collecting alcohol, tobacco, firearms, and 

ammunition excise taxes. These products 

generate nearly $24 billion in tax revenue 

annually, making TTB the third largest tax 

collection agency in the federal government. 

Alcohol and tobacco taxes collected by TTB 

are remitted to the Department of the Treasury 

General Fund. Firearms and ammunition 

excise taxes are remitted to the Fish and 

Wildlife Restoration Fund under provisions of 

the Pittman-Robertson Act of 1937.

The excise taxes collected by TTB come from 

taxes imposed and collected at the producer 

and importer level of operations. Members of 

the regulated industries paying excise taxes are 

distilleries, breweries, bonded wineries, 

bonded wine cellars, manufacturers of paper 

and tubes for tobacco products, manufacturers 

of tobacco products, and manufacturers and 

importers of firearms and ammunition. About 
200 of the largest taxpayers account for 98

percent of the annual excise tax collected. In 

FY 2010, the majority of taxes collected were 

from tobacco (67 percent) and alcohol (31

percent), with the remainder from firearms and 

ammunition (2 percent). 

Strategies used to collect the revenue rightfully 

due include identifying any gaps in tax 

payment, identifying any illegal entities or 

individuals operating outside the excise tax 

system, developing a balanced field approach 

of audits and investigations that target noncompliant industry members, and establishing 

an identifiable presence within all of industry 

that encourages voluntary compliance.

Protect the Public - TTB works to ensure the 

integrity of the alcohol and tobacco industries 

and of beverage alcohol products found in the 

marketplace, and regulates roughly 53,000 

alcohol and tobacco businesses. Under this 

activity, TTB enforces federal laws related to 

the issuance of permits to new businesses 

engaged in the alcohol and tobacco industries

and regulates the production, labeling, 

advertising, and marketing of alcohol 

products. TTB conducts these activities 

through investigations, application reviews, 

laboratory testing, and educational programs. 

TTB works with industry, foreign and state 

governments, and other interested parties to 

make it easier to comply with regulatory 

requirements and maintain the appropriate 

level of oversight to ensure public safety. 

TTB’s work with foreign governments also 

facilitates the import and export trade in its 

regulated commodities. Education, partnerships, and open communication are paramount 

strategies in facilitating compliance with 

regulatory requirements.

TTB FY 2012 Budget Highlights

(Dollars in thousands)

Appropriation Amount

FY 2010 Enacted $103,000

FY 2011 Annualized CR Level $103,000

Changes to Base:

Adjustment to Reach Policy Level: $2,571

Adjustment to Reach FY 2011 President's 

Policy

$2,571

Maintaining Current Levels (MCLs): $832

Maintaining Current Levels $832

Efficiencies, Savings & Base Reductions: ($8,525)

Audits, Investigations, Outreach & Trade 

Facilitation

($1,584)

Law Enforcement/Special Agents $0

Licensing and Registration Fees Initiative ($5,500)

New Regulations to Simplify Reporting 

Requirements

($300)

Overhead/Operating (Reduced 

Staffing/Overtime/Travel/Contracts, etc.)

($841)

Paperless Initiative (Permits Online) ($300)

Subtotal FY 2012 Changes to Base ($5,122)

Total FY 2012 Base $97,878

Total FY 2012 Request $97,878

FY 2012 Budget Adjustments

FY 2011 Annualized CR Level

The FY 2011 Annualized CR Level for TTB is 

$103,000,000.

Adjustment to Reach Policy Level 

Adjustment to Reach FY 2011 President's 

Policy +$2,571,000 / +12 FTE 

Adjustment from the FY 2011 Annualized 

Continuing Resolution (CR) Rate to reach the 

FY 2011 President's Policy Level. The 

President's Policy Level is equal to the FY 

2011 President's Budget as adjusted for the 

proposed pay freeze.

Maintaining Current Levels (MCLs) 

Maintaining Current Levels +$832,000 / +0 

FTE 

Funds are requested for inflation adjustments 

in non-labor expenses such as GSA rent 

adjustments, postage, supplies and equipment 

and health benefits and the increase in Federal 

Employee Retirement System participation. 

No inflation adjustment is requested for pay in 

FY 2012.
Efficiencies, Savings & Base Reductions 

Audits, Investigations, Outreach & Trade 

Facilitation -$1,584,000 / -15 FTE 

Savings realized from a reduction of staff, 

combined with an improved strategy for tax 

and regulatory enforcement that focuses on the 

areas that present the highest revenue risk, and 

a reinvented approach to industry outreach and 

international trade activities.

Law Enforcement/Special Agents +$0 / -10 

FTE 

Reduction of 10 FTE due to the expiration of 

two-year funding (FY 2010-2011) for law 

enforcement agents and related support 

personnel whose focus was on criminal 

activities surrounding the alcohol and tobacco 

commodities.

Licensing and Registration Fees Initiative -

$5,500,000 / -12 FTE 

Reduction due to the exclusion from the FY 

2012 Presidents Budget of a licensing and 

registration fee program, which would have 

required the collection of annual fees from 

alcohol and tobacco industry members to fund 

TTB operations.

New Regulations to Simplify Reporting 

Requirements -$300,000 / -3 FTE 

Savings realized from simplifying the 

reporting requirements for distilled spirits 

plants (DSP) by updating the regulations to 

consolidate the required monthly operations 

reports for non-industrial DSP.

Overhead/Operating (Reduced Staffing

/Overtime/Travel/Contracts, etc.) -$841,000 / -

2 FTE 

Savings realized from the reduction of 

operating costs such as overtime, travel, 

supplies, GSA rent, equipment, software, and 

the reduction of management staff.

Paperless Initiative (Permits Online) -

$300,000 / -3 FTE

Savings realized from staffing reduction 

enabled by efficiencies gained from the 

Permits Online electronic filing system due to 

processing time reduction and the streamlining 

of business processes.

Explanation of Budget Activities

Salaries and Expenses

Collect the Revenue ($48,939,000 from direct 

appropriations, and $1,499,000 from 

reimbursable programs)

This budget activity includes all tax 

processing, verification, enforcement, and 

outreach efforts related to tax administration 

performed by TTB. Collect the Revenue 

includes three programs: 1) Alcohol and 

Tobacco Tax Collections, 2) Firearms and 

Ammunition Excise Tax Collections, and 3) 

Outreach and Voluntary Compliance. 

Principal business activities within these 

programs include:

• Tax Collection, Claims, Refunds, and 

Classification, which involves preparing 

taxpayer notices and assessments, processing claims and settlement agreements, 

and assigning a tax classification to a 

product based on regulatory standards;

• Tax Verification, Audits, and Investigations, which includes the reconciling and 

auditing of tax returns and reports of 

business operations; on-site audits of 

alcohol, tobacco, firearms, and ammunition industry members; investigating 

criminal allegations or indications of tax 

fraud; conducting compliance investigations of permittees who have substantial 

potential for tax liability; and initiating 

adverse actions for willful violations of the 

Internal Revenue Code; and

• Voluntary Compliance, which supports 

outreach and education efforts for 

members of the regulated industries, and 
includes preparing regulatory guidance, 

Web site postings, and newsletters; 

participating in and/or hosting conferences 

and seminars; and industry and state 

liaison activities.

TTB uses an interagency approach in applying 

its enforcement strategies that involves 

cooperation with local, state, federal, and 

foreign government counterpart agencies to 

maximize the deterrent impact of enforcement 

actions.

Protect the Public ($48,939,000 from direct 

appropriations, and $1,498,000 from 

reimbursable programs)

This budget activity funds the programs that 

ensure the integrity of products and industry 

members in the marketplace, promote

compliance with laws and regulations by 

regulated industries, and provide information 

to the public as a means to prevent consumer 

deception. Protect the Public includes four 

programs: 1) Permits and Business Assurance; 

2) Advertising, Labeling, and Product Safety; 

3) Trade Facilitation; and 4) Outreach and 

Voluntary Compliance. Principal business 

activities within these programs include:

• Business Integrity, which involves enforcing compliance with federal laws 

related to the issuance of permits to those 

who wish to operate in the alcohol, 

tobacco, firearms, and ammunition 

industries; 

• Product Integrity, which includes 

reviewing alcohol beverage label applications; evaluating alcohol beverage 

product advertisements; reviewing alcohol 

beverage formula submissions; evaluating 

specially denatured alcohol and other 

nonbeverage alcohol formulas to verify the 

tax drawback claim of the applicant; 

investigating incidents of suspected unsafe 

conditions or product deficiencies related 

to the production and labeling of alcohol 

beverages; and testing samples of beverage 

alcohol sold at the retail and producer 

levels to ensure that these products meet 

formulation and labeling requirements, do 

not contain unauthorized substances or 

contaminants, and are properly classified 

for tax purposes; and

• Market Integrity, which includes 

monitoring the trade practices of the 

alcohol industry and taking enforcement 

actions on violations, monitoring and 

reviewing international trade in alcohol 

beverages to identify, prevent, and address 

trade barriers and incidents of international 

fraud and contaminated products, and 

promoting international agreements on 

product integrity.

TTB works with industry, foreign and state 

governments, and other interested parties to 

reduce the burden of compliance with 

regulatory requirements and to maintain the 

appropriate level of oversight to ensure public 

safety. Industry education, interagency 

partnerships, international cooperation, and 

open communication are paramount strategies 

in facilitating compliance with regulatory 

product and trade requirements.

Legislative Proposals

Extend Pay Demonstration Project: TTB 

proposes to continue the Pay Demonstration 

Project by amending the General Provision 

language to extend the program for one 

additional year.
TTB Performance by Budget Activity

Budget Activity Performance Measure FY 2008 FY 2009 FY 2010 FY 2011 FY 2012

Actual Actual Actual Target Target

Economic competitiveness Average Number of Days to 

Process an Original Permit 

Application at the National 

Revenue Center (E)

64.0 64.0 65.0 72.0 65.0

Economic competitiveness National Revenue Center (NRC) 

Customer Satisfaction Survey 

Results (%) (Oe)

90.0 89.0 89.0 85.0 85.0

Economic competitiveness Percent of Electronically Filed 

Certificate of Label Approval 

Applications (E)

62.0 74.0 79.0 81.0 83.0

Economic competitiveness Percentage of Importers 

Identified by TTB as Illegally 

Operating without a Federal 

Permit (%) (Oe)

22.0 15.0 15.0 19.0 14.0

Revenue collected Amount of Revenue Collected 

Per Program Dollar (E)

313.0 427.0 478.0 400.0 410.0

Revenue collected Percent of Voluntary Compliance 

from Large Taxpayers in Filing 

Tax Payments Timely and 

Accurately (In Terms of 

Revenue) (Oe)

94.0 94.0 94.0 92.0 94.0

Key: Oe - Outcome Measure, E - Efficiency Measure, Ot - Output/Workload Measure, M - Management/Cust. Satisfaction, 

DISC - Discontinued, and B - Baseline

Description of Performance

The bureau continues to collect the federal 

excise taxes due on its regulated commodities 

in a highly efficient manner, and continues to

enforce compliance with alcohol and tobacco 

laws and regulations. During FY 2010, TTB 

met all of its targeted performance goals, while 

showing continued improvements in 

performance scores. The bureau plans to 

continue to monitor its performance, and will 

use performance information to both measure 

and improve the effectiveness of its programs. 

The investments in the Collect the Revenue 

activity resulted in the following performance 

highlights and accomplishments during

FY 2010:

• TTB collected $23.8 billion in excise taxes 

and other revenues from 7,070 taxpayers in 

the alcohol, tobacco, firearms, and 

ammunition industries. The recent rise in 

excise tax collections for tobacco resulted 

in a return on investment for the Collect 

the Revenue program of $478 for every $1 

expended on collection activities. 

• TTB closed 36 criminal investigations 

involving diversion of products having an 

estimated tax liability of more than $30 

million.

• TTB identified 190 business entities who 

imported cigarettes into the U.S. without a 

Federal permit. All entities either ceased 

their illegal operations or obtained a permit 

to import tobacco products.

• TTB completed 145 targeted audits, which 

contributed to the identification of 
additional tax revenue of more than $8 

million. 

• TTB processed $387 million in cover-over 

payments to Puerto Rico and the U.S. 

Virgin Islands. Federal excise taxes 

collected on rum produced in Puerto Rico 

and the Virgin Islands that are

subsequently imported into the United 

States are “covered-over” (or paid into) the 

treasuries of Puerto Rico and the Virgin 

Islands.

• TTB processed $297 million in drawback 

claims. Under current law, persons who 

use nonbeverage alcohol in the

manufacture of medicines, food products, 

flavors, extracts, or perfume and other nonpotable products may be eligible to claim 

drawback of excise taxes paid on distilled 

spirits used in their products. 

The investments in Protect the Public activity

resulted in the following performance 

highlights and accomplishments during

FY 2010:

• TTB processed 132,600 Certificate of 

Label Approval (COLAs) applications 

through the bureau’s COLAs Online 

system for electronic filing of label 

applications. About 79 percent of the 

applications were filed electronically. The 

Federal Alcohol Administration Act 

requires importers and bottlers of alcohol 

beverages to obtain a COLA prior to 

introduction of the product into commerce.

• TTB processed 5,771 original permits and 

approved 18,230 amended permits. A 

TTB permit is required before a business 

can operate in the alcohol and tobacco 

industries. 

• TTB initiated more than 700 field investigations of industry members regarding 

permit applications, consumer complaints, 

tax fraud, trade practice violations, and 

product and labeling integrity verifications.
Financial Management Service 

Program Summary by Budget Activity 

(Dollars in thousands)

Appropriation FY 2010 FY 2011 FY 2012 FY 2010 to FY 2012

Enacted Annualized 

CR Level

Request $ Change % Change

 Payments $150,395 $142,537 $132,868 ($17,527) (11.7%)

 Collections $21,911 $24,267 $21,265 ($646) (2.9%)

 Government-wide Accounting and Reporting $71,826 $77,328 $64,672 ($7,154) (10.0%)

Subtotal, Financial Management Service $244,132 $244,132 $218,805 ($25,327) (10.4%)

Offsetting Collections - Reimbursables $234,690 $216,730 $231,223 ($3,467) (1.5%)

Total Program Operating Level $478,822 $460,862 $450,028 ($28,794) (6.0%)

Direct FTE 1,500 1,500 1,200 (300) (20.0%)

Reimbursable FTE 483 460 460 (23) (4.8%)

Total FTE 1,983 1,960 1,660 (323) (16.3%)

Summary 

 

FMS provides critical and essential payment, 

collections, debt collection and governmentwide accounting and reporting functions 

essential to the successful operation of the 

federal government. These functions are far 

reaching. This includes issuing over 70 

million benefit payments distributed monthly 

to the American public, the collection of all 

federal revenues that fund government 

operations and programs, processing and 

collecting of delinquent debts owed to the 

federal government including collection of 

past due child support, and providing financial 

reports to varied stakeholders. FMS touches 

almost every American and federal agency 

proving these very important and essential 

services. 

FMS’ budget reflects a strong commitment to 

fiscal stewardship of taxpayers funding. The 

FY 2011 and FY 2012 budget represents a 

10% reduction from FY 2010 levels. This 

will bring FMS to funding levels not seen 

since FY 2002. Even though FMS will 

operate at FY 2002 operating levels, we are 

committed to providing continued high service 

levels to our customers. We believe we can 

fulfill this objective due to FMS’ innovative 

modernization efforts which have been 

implemented and finalized over the past years. 

FMS’ FY 2012 budget directly addresses the 

Department’s high priority performance goal 

of significantly increasing the number of 

paperless transactions with the public. It also 

addresses the Administration’s priority of 

“going green” and consolidating data centers. 

FMS supports Treasury’s paperless initiative, 

which requires all new enrollees in federal 

benefit programs (e.g., Social Security 

Administration) to receive payments 

electronically by March 1, 2011. Anyone 

currently receiving checks would be required 

to switch to electronic payment by March 1, 

2013. A second important component of the 

all-electronic Treasury initiative requires all 

businesses currently required to use a Federal 

Tax Deposit (FTD) coupon to pay 

electronically beginning January 1, 2011. 

In response to a request from the Office of the 

Fiscal Assistant Secretary, the Commissioners 

of FMS and the Bureau of the Public Debt 
(BPD) determined that they could improve the 

efficiency and effectiveness of their collective 

information technology (IT) infrastructures. 

As a result, FMS, in partnership with BPD, 

initiated a project to consolidate the data 

centers across the two bureaus to help achieve 

the Secretary’s objective of increasing the 

utilization and efficiency of combined IT 

assets, while reducing technology costs. This 

effort also conforms to the Office of 

Management and Budget’s (OMB) Data 

Center Consolidation Directive which requests 

that all federal agencies review IT spending, 

placing emphasis on consolidating and sharing 

IT services to reduce expenditures. Five data 

centers will be consolidated into two shared by 

both bureaus with one acting as a back-up to 

the other. This effort also includes the 

creation of a single corporate governing body, 

in-sourcing of select contractor functions, and 

consolidation of application development 

methodologies and associated infrastructure; 

resulting in a more “green” approach to the 

delivery of IT services. 

FMS continues to work toward increasing 

operational efficiencies that streamline our 

four main activities of payments, collections, 

government-wide accounting and reporting, 

and debt collection. Given FMS’ recent 

history of cost reduction, it is clear that FMS is 

a conscientious steward of taxpayer money. 

These cost saving measures do not inhibit our 

ability to deliver the products and services that 

are vital to our nation’s economic security. 

FMS continues to work toward increasing 

operational efficiencies and by implementing 

these initiatives will greatly facilitate the 

ongoing effort to modernize the Federal 

government’s payment, collections, debt 

collection and central accounting and reporting 

systems. The end result will be greater 

efficiency, cost savings, and data quality 

improvements throughout government. 

FMS FY 2012 Budget Highlights

(Dollars in thousands)

Appropriation Amount

FY 2010 Enacted $244,132

FY 2011 Annualized CR Level $244,132

Changes to Base: 

Adjustment to Reach Policy Level: ($10,537)

Adjustment to Reach FY 2011 President's 

Policy 

($10,537)

Maintaining Current Levels (MCLs): $2,000

Maintaining Current Levels $2,000

Efficiencies, Savings & Base Reductions: ($11,690)

Elimination of Bureau of Economic 

Analysis Interagency Agreement 

($175)

Reduce Systems Development ($1,400)

Paperless Treasury / Payment Center 

Repurposing 

($6,297)

Data Center Consolidation ($685)

Migration of Human Resources Operations 

to Shared Service Provider 

($533)

Operational Efficiencies & Space 

Consolidation 

($2,600)

Subtotal FY 2012 Changes to Base ($20,227)

Total FY 2012 Base $223,905

Program Changes: 

Program Decreases: ($5,100)

FIRST and GWAMP Project Savings ($5,100)

Subtotal FY 2012 Program Changes ($5,100)

Total FY 2012 Request $218,805

FY 2012 Budget Adjustments 

 

FY 2011 Enacted 

The FY 2011 enacted direct appropriation for 

FMS is $235,253,000. 

Adjustment to Reach Policy Level 

Adjustment to Reach FY 2011 President's 

Policy -$10,537,000 / +0 FTE 

Adjustment from the FY 2011 Annualized 

Continuing Resolution (CR) Rate to reach the 

FY 2011 President's Policy Level. The 

President's Policy Level is equal to the 

FY 2011 President's Budget as adjusted for the 

proposed pay freeze. 

Maintaining Current Levels (MCLs) 

Maintaining Current Levels +$2,000,000 / +0 

FTE 

 Funds are required for inflation adjustments in 

non-labor expenses such as GSA rent 

adjustments, postage, supplies and equipment 
and health benefits and the increase in Federal 

Employee Retirement System participation. 

 

Efficiencies, Savings & Base Reductions 

Elimination of Bureau of Economic Analysis 

Interagency Agreement -$175,000 / +0 FTE 

FMS has an interagency agreement with the 

Department of Commerce’s Bureau of 

Economic Analysis for statistical analysis 

required each year for the International 

Monetary Fund. However, FMS no longer has 

programs or activities that benefit directly or 

indirectly from this expense. Elimination of 

this service would not hamper FMS efforts. 

Reduce Systems Development -$1,400,000 / 

+0 FTE 

FMS will reduce funding related to low 

priority program system development and 

maintenance. 

Paperless Treasury / Payment Center 

Repurposing -$6,297,000 / -49 FTE 

In FY 2012, the Paperless Treasury Initiative 

will not only save the government through 

consumable savings but will also allow FMS 

to move from four payment centers to three. 

The repurposing of the Austin Financial 

Center provides FMS the opportunity to 

expand its delinquent debt activity by targeting 

more of the delinquent debt referred to FMS 

for collection. 

Data Center Consolidation -$685,000 / -121 

FTE 

FMS, along with BPD, will consolidate five 

data centers to two which will produce savings 

due to reductions in energy consumption, 

equipment, software, and staff. The 

consolidation of Fiscal Service data centers 

includes the transferring of staff from FMS to 

the Treasury Franchise Fund. The salary and 

benefit costs of those FTE will be used to pay 

for the resulting new contract. 

Migration of Human Resources Operations to 

Shared Service Provider -$533,000 / -5 FTE 

FMS examined the feasibility of migrating its 

human resources program to a shared service 

provider. Based on the analysis, FMS elected 

to transition its HR operational functions to the 

Administrative Resource Center of the Bureau 

of the Public Debt. This migration is expected 

to improve the quality and cost-effectiveness 

of FMS HR operational processes. This 

reduction will offset the full cost of the shared 

services agreement with full implementation in 

2012. 

Operational Efficiencies & Space 

Consolidation -$2,600,000 / +0 FTE 

FMS will identify operational efficiencies 

gained through improved process and 

modernization efforts. Additionally, in 

coordination with GSA, FMS will work to 

consolidate space and reduce the FMS' 

footprint in the Hyattsville Center to 

accommodate changes in staffing and Data 

Center consolidation. 

Program Decreases 

FIRST and GWAMP Project Savings – 

$5,100,000 / +0 FTE FMS will reduce 

funding related to development for both the 

Government-wide Accounting and Modernization Project (GWAMP) and FIRST. 

Explanation of Budget Activities 

 

Salaries and Expenses 

Payments ($132,868,000 from direct 

appropriations and $129,561,000 from 

reimbursable programs) 

FMS is responsible for managing and 

operating federal payment systems and for 

disbursing approximately 85 percent of all 

federal payments. It is comprised of a 

headquarters staff and Regional Financial 

Centers (RFCs). Major payments include: 

social security benefits, supplemental security 

income, federal pension benefits, veterans’ 
compensation, railroad retirement pensions, 

and tax refunds. An electronic payment is an 

electronic funds transfer made by direct 

deposit via the Federal Reserve Bank’s 

Automated Clearing House system to more 

than 28,000 member financial institutions 

nationwide. In FY 2010, the centers disbursed 

over one billion payments, totaling over $2.3 

trillion dollars. 

Collections ($21,265,000 from direct 

appropriations and $198,000 from 

reimbursable programs) 

FMS collects revenues needed to operate the 

federal government through the management 

of the federal government’s collections 

infrastructure. The collections activity is also 

part of the nation’s critical infrastructure. 

FMS collected nearly $2.94 trillion in FY 2010 

through a network of more than 8,000 

financial institutions. It also manages the 

collection of federal revenues such as 

individual and corporate income tax deposits, 

customs duties, loan repayments, fines and 

proceeds from leases. FMS establishes and 

implements collection policies, regulations, 

standards and procedures for the federal 

government. The majority of dollar 

collections are made electronically. While 85 

percent of federal revenue was collected 

electronically in FY 2010, the Paperless 

Treasury Initiative will help FMS improve the 

percentage of tax revenue collected 

electronically by requiring all businesses 

currently required to use a FTD coupon to pay 

electronically effective January 1, 2011. 

Government-wide Accounting and Reporting 

($64,672,000 from direct appropriations and 

$4,412,000 from reimbursable programs) 

The Government-wide Accounting and 

Reporting (GWA) activity maintains the 

federal government’s accounts for its 

monetary assets and liabilities by operating 

and overseeing the government’s central 

accounting and reporting system. It also 

works with federal agencies to adopt uniform 

accounting and reporting standards and 

systems. It provides support, guidance, and 

training to assist agencies in improving their 

government-wide accounting and reporting 

responsibilities. FMS collects, analyzes, and 

publishes government-wide financial 

information which is used in establishing fiscal 

and debt management policies and is also used 

by the public and private sectors to monitor the 

government’s financial status. Publications 

include the Daily Treasury Statement, the 

Monthly Treasury Statement, the Treasury 

Bulletin, the Combined Statement of the 

United States Government, and the Financial 

Report of the United States Government (FR). 

It is important to note, the cash reporting 

function of GWA supports the National 

Financial Critical Infrastructure. 

Legislative Proposals 

 

Technical Correction to Allow IRS to Levy 

100 percent of all Vendor Payments, 

Including Payments for the Purchase and 

Lease of Real Estate, to Collect Delinquent 

Taxes

Section 6331(h) of the Internal Revenue Code 

was amended in 2005 to allow the IRS to levy 

up to 100 percent of federal vendor payments. 

Before this change, the maximum was 15 

percent. The current language, which was 

intended to cover all federal vendor payments, 

refers to payments for "goods and services." 

This has been interpreted to exclude payments 

for the purchase or lease of real estate. 

Therefore, a technical correction is needed to 

ensure that all federal vendor payments are 

covered. 

Allow Offset of Federal Income Tax 

Refunds to Collect Delinquent State Income 

Taxes for Debtors Who Currently Reside in 

Other States

Under current law, federal tax refunds may be 

offset to collect delinquent state income tax 
obligations only if the delinquent taxpayer 

resides in the state collecting the tax. This 

proposal will allow FMS to offset federal 

income tax refunds to collect delinquent state 

tax obligations regardless of where the debtor 

resides. 

Increase Levy Authority for Payments to 

Medicare Providers with Delinquent Tax 

Debt 

The Budget proposes a change to the 

Department of the Treasury's debt collection 

procedures that will increase the amount of 

delinquent taxes collected from Medicare 

providers. Through the Federal Payment Levy 

Program, Treasury deducts (levies) a portion 

of a Government payment to an individual or 

business in order to collect unpaid taxes. 

Pursuant to the Medicare Improvements for 

Patients and Providers Act of 2008, Treasury 

is authorized to continuously levy up to 15 

percent of a payment to a Medicare provider in 

order to collect delinquent tax debt. The 

Budget proposal will allow Treasury to levy 

up to 100 percent of a payment to a Medicare 

provider to collect unpaid taxes. 

FMS Performance by Budget Activity

Budget Activity Performance Measure FY 2008 FY 2009 FY 2010 FY 2011 FY 2012

Actual Actual Actual Target Target

Payments Percentage of Treasury 

Payments and Associated 

Information Made 

Electronically (Oe)

79% 81% 82% 83% 85%

Revenue collected Amount of Delinquent 

Debt Collected Through 

All Available Tools ($ 

billions) (Ot)

4.41 5.03 5.45 4.84 5.03

Revenue collected Percentage Collected 

Electronically of Total 

Dollar Amount of Federal 

Government Receipts 

(Oe)

80.0 84.0 85.0 82.0 82.0

Financial information Percentage of 

Government-Wide 

Accounting Reports 

Issued Timely (%) (Oe)

100.0 100.0 100.0 100.0 100.0

Key: Oe - Outcome Measure, E - Efficiency Measure, Ot - Output/Workload Measure, M - Management/Cust. 

Satisfaction, DISC - Discontinued, and B – Baseline

Description of Performance 

 

Payments: FMS disburses payments to a 

wide variety of recipients, such as those who 

receive Social Security Administration 

payments, Internal Revenue Service tax 

refunds, and the Department of Veterans 

Affairs benefits. In FY 2010, FMS issued 

more than one billion non-Defense payments, 

with a dollar value of over $2.34 trillion. 

More than 82 percent of these transactions 

were issued by Electronic Funds Transfer 

(EFT). In FY 2012, FMS is projecting the 

percentage of electronic payments to be 84 

percent. 

Collections: In FY 2010, FMS collected $2.94

trillion through a network of more than 9,000 

financial institutions. Slightly more than 85 

percent of the funds was collected 

electronically. While FMS continued to 

promote and convert collections from paper to 

the more efficient electronic media in FY 

2010, there are a number of factors that have 
adversely affected the unit cost metric. It is 

projected that the unit cost metric for 

collections will increase over the next three 

years due to two primary factors: 1) The 

current economic conditions; and 2) Increased 

expenses during the transition to a fully 

implemented Collections and Cash 

Management Modernization (CCMM) 

initiative. 

The economic climate has had a major 

influence on the unit cost for collections. 

Recessionary business failures and job losses 

have caused fewer employers to report 

withholding transactions to the Electronic 

Federal Tax Payment System (EFTPS). 

Similarly, small business failures and job 

losses reduced the number of tax filers using 

the IRS Lockbox Network. For example, 

during the Spring 2009 tax season, tax 

transaction receipts were down by 22 percent. 

Since some of the costs of EFTPS and the IRS 

Lockbox Network are fixed, the unit cost per 

item increased. 

Government-wide Accounting and 

Reporting: FMS issues 100 percent of its 

government-wide accounting reports 

accurately and timely. Annually, FMS 

releases the Financial Report of the United 

States Government (FR). The FR has been 

audited by the Government Accountability 

Office (GAO) since 1997, and has received a 

disclaimer of opinion each year. For fiscal 

year ended September 30, 2010, the report was 

released on December 21, 2010, with a 

disclaimer of opinion. GAO acknowledge that 

while significant progress has been made in 

improving federal financial management since 

the federal government began preparing the 

consolidated financial statements 14 years ago, 

three major impediments continued to prevent 

them from rendering an opinion on the federal 

government’s accrual-based consolidated 

financial statements over this period: (1) 

serious financial management problems at the 

Department of Defense (DoD) that prevented 

DoD’s financial statements from being 

auditable, (2) the federal government’s 

inability to adequately account for and 

reconcile intergovernmental activity and 

balances between federal agencies, and (3) the 

federal government’s ineffective process for 

preparing the consolidated financial 

statements. GAO also acknowledged that: (1) 

Treasury continues to take steps to help 

resolve differences in intragovernmental 

activity and balances; and (2) during fiscal 

year 2010, Treasury, in coordination with the 

Office of Management and Budget, continued 

implementing corrective action plans and 

made progress addressing certain internal 

control deficiencies that they have previously 

reported.

Debt Collection: In FY 2010, FMS collected 

$5.45 billion in delinquent debt including 

$12.8 million from Economic Recovery 

Payments. The amount collected includes 

$2.10 billion in past due child support, $2.30 

billion in federal nontax debt, and over $1.05 

billion in federal tax levies and state tax debt 

offsets. Debt referrals from creditor agencies 

were at 100 percent of eligible debt at the end 

of FY 2010. As a result of the continued 

program improvements, cumulative collections 

since enactment of the Debt Collection 

Improvement Act of 1996 are $48.2 billion. In 

calendar year 2010, the Internal Revenue 

Service referred an additional $54 billion of 

tax debts for continuous levy, a 15 percent 

increase over calendar year 2009. 
Bureau of the Public Debt 

Program Summary by Budget Activity 

(Dollars in thousands)

Appropriation FY 2010 FY 2011 FY 2012 FY 2010 to FY 2012

Enacted Annualized

CR Level

Request $ Change % Change

 Wholesale Securities Services $24,396 $25,049 $23,120 ($1,276) (5.23%)

 Government Agency Investment Services $18,013 $16,706 $15,419 ($2,594) (14.40%)

 Retail Securities Services $139,569 $140,915 $116,260 ($23,309) (16.70%)

 Summary Debt Accounting $10,266 $9,574 $8,836 ($1,430) (13.93%)

 Do Not Pay Implementation $10,000 $10,000 100%

Subtotal, Bureau of the Public Debt $192,244 $192,244 $173,635 ($18,609) (9.68%)

Offsetting Collections - Reimbursables $21,425 $20,815 $24,400 $2,975 13.89%

Total Program Operating Level $213,669 $213,059 $198,035 ($15,634) (7.32%)

Direct FTE 1,042 1,042 987 (55) (5.28%)

Reimbursable FTE - - - - -

Total FTE 1,042 1,042 987 (55) (5.28%)

Note: Total Appropriated Resources for FY 2010 and FY 2011 include $10,000,000 in projected user fee collections. Total 

Appropriated Resources for FY 2012 include $8,000,000 in projected user fee collections. 

Summary 

 

Bureau of the Public Debt (BPD) 

BPD’s mission is to borrow the money needed 

to operate the federal government, account for 

the resulting debt, and provide reimbursable 

support services to federal agencies. In 

carrying out its mission and vision, 

Public Debt annually auctions and issues more 

than $8 trillion in Treasury bills, notes, bonds 

and Treasury Inflation-Protected Securities 

(TIPS); administers on Treasury's behalf its 

regulatory responsibilities for the government 

securities market; ensures reliable systems and 

processes are in place for issuing, transferring, 

paying interest on and redeeming Treasury 

securities; serves more than 50 million retail 

customers each year; administers in excess of 

$4 trillion in investments for more than 230 

federal trust funds; and provides timely and 

accurate information on the public debt. 

Public Debt’s FY 2012 priorities include 

eliminating new issues of paper savings bonds 

and creating an IT portal of payment 

information that federal agencies can use to 

ensure their payments are only received by 

eligible recipients. 

Total resources to support Public Debt 

activities in FY 2012 are $198,035,000, 

including $173,635,000 from direct 

appropriations, of which $8,000,000 are user 

fees, and $24,400,000 from offsetting 

collections. 
BPD FY 2012 Budget Highlights

(Dollars in thousands)

Appropriation Amount

FY 2010 Enacted Budget $192,244

FY 2011 Continuing Resolution $192,244

Changes to Base: 

Adjustment to Reach Policy Level: ($7,458)

Adjustment to Reach FY 2011 President's 

Policy 

($7,458)

Maintaining Current Levels (MCLs): $1,234

Maintaining Current Levels $1,234

Efficiencies, Savings & Base Reductions: ($20,385)

Eliminate Paper Savings Bonds ($6,451)

Eliminate new issues of paper payroll 

savings bonds by 1/1/2011 

($5,700)

Program and Support Services Efficiencies ($5,464)

Data Center Consolidation ($470)

Decommission Legacy Treasury Direct 

System 

($1,650)

Procurement Savings ($650)

Subtotal FY 2012 Changes to Base ($26,609)

Total FY 2012 Base $165,635

Program Changes: 

Program Decreases: ($2,000)

Reduction to Systems Modernization Fund ($2,000)

Program Increases: $10,000

Do not Pay Implementation $10,000

Subtotal FY 2012 Program Changes $8,000

Total FY 2012 Budget Request $173,635

User Fees ($8,000)

Total FY 2012 Budget Request (Net) $165,635

FY 2012 Budget Adjustments 

 

FY 2011 Annualized Continuing Resolution 

The FY 2011 Annualized Continuing Resolution 

for BPD is $192,244,000. 

Adjustment to Reach Policy Level 

Adjustment to Reach FY 2011 President's 

Policy -$7,458,000 / -33 FTE 

Adjustment from the FY 2011 Annualized 

Continuing Resolution (CR) Rate to reach the 

FY 2011 President's Policy Level. The 

President's Policy Level is equal to the 

FY 2011 President's Budget as adjusted for the 

proposed pay freeze. 

Maintaining Current Levels (MCLs) 

Maintaining Current Levels +$1,234,000 / +0 

FTE 

Funds are requested for inflation adjustments 

in non-labor expenses such as GSA rent, 

postage, supplies and equipment and health 

benefits and the increase in Federal Employee 

Retirement System participation. No inflation 

adjustment is requested for pay in FY 2012. 

Efficiencies, Savings & Base Reductions 

Eliminate Paper Savings Bonds no later than 

December 31, 2011 -$6,451,000 / +0 FTE 

Eliminate new issues of paper savings bonds. 

Savings of agent fees, postage and printing by 

eliminating new issues of over-the-counter 

paper savings bonds. 

Eliminate new issues of paper payroll savings 

bonds by 1/1/2011 -$5,700,000 / -12 FTE 

Savings of agent fees, postage and printing by 

eliminating new issues of paper payroll 

savings bonds and FTE savings from a decline 

in customer service transactions after new 

issues of paper payroll bonds are eliminated. 

Program and Support Services Efficiencies -

$5,464,000 / -18 FTE 

Savings realized from reductions in funded 

positions across all Public Debt programs and 

in administrative and IT support services. In 

addition, to increase operational efficiencies 

and reduce operating expenses, Public Debt 

will centralize its printing, duplicating and 

scanning activities. 

Data Centers Consolidation -$470,000 / +0 

FTE 

Public Debt, along with the Financial 

Management Service, will consolidate five 

data centers to two, which will produce 

savings due to reductions in energy 

consumption, equipment, software, and staff. 

Decommission Legacy Treasury Direct System 

-$1,650,000 / -12 FTE 

Established in 1986, Legacy Treasury Direct 

allows marketable securities investors to do 

business by mail and, to a certain extent, 

through an automated phone system or online. 

Now that marketable securities are available in 

TreasuryDirect, an online account system, 
Public Debt can decommission the aging 

Legacy system. 

Procurement Savings -$650,000 / +0 FTE 

Cost savings by streamlining procurement 

operations and reducing procurement 

spending. 

Program Decreases 

Reduction to Systems Modernization Fund -

$2,000,000 / +0 FTE 

Savings due to elimination of BPD's Systems 

Modernization fund. 

Program Increases 

Do Not Pay Implementation +$10,000,000 / 

+20 FTE 

Expand the Do Not Pay Portal and increase 

analytical capabilities to detect fraud patterns 

and reduce improper payments. 

Adjustments to Request User Fee 

User Fees -$8,000,000 / +0 FTE 

 Public Debt projects that in FY 2012 there 

will be fewer users of the Legacy Treasury 

Direct system who are subject to the annual 

account maintenance fee. Account holders 

with balances over $100,000 (par value) are 

charged an annual account maintenance fee of 

$100. 

Explanation of Budget Activities 

 

Salaries and Expenses 

Wholesale Securities Services ($23,120,000 

from direct appropriations, and $3,179,000 

from reimbursable programs)

Public Debt announces, auctions and issues 

marketable Treasury bills, notes, bonds and 

TIPS. This program ensures that the 

government’s critical financing needs are met 

and oversees an infrastructure that provides for 

the transfer, custody and redemption of 

Treasury securities in the wholesale market. 

Public Debt also administers Treasury's 

regulations that provide investor protection 

and maintain the integrity, liquidity and 

efficiency in the government securities market. 

Government Agency Investment Services 

($15,419,000 from direct appropriations, and 

$2,121,000 from reimbursable programs)

Public Debt supports federal, state and local 

government agency investments in nonmarketable Treasury securities as well as 

federal agency borrowing from the 

Department of the Treasury. There are more 

than 230 trust and investment funds held by 

federal agencies. For 18 of the funds, the 

Secretary of the Treasury, designated by 

statute, is the managing trustee. 

 

Retail Securities Services ($116,260,000 from 

direct appropriations, including $8,000,000 

from user fee collections, and $17,884,000 

from reimbursable programs)

Public Debt serves more than 50 million retail 

customers who have invested in marketable 

and savings securities directly with Treasury. 

Investors may hold these securities in bookentry or paper form. With the elimination of 

new issues of paper savings bonds, 

Public Debt will position Treasury to provide 

other simple, safe, and affordable ways for 

Americans to save. The program will deliver a 

high-quality customer experience through 

traditional and emerging technologies, 

opportunities for self-service, and easy to use 

communication channels. 

Summary Debt Accounting ($8,836,000 from 

direct appropriations, and $1,216,000 from 

reimbursable programs)

This program is key to meeting Public Debt's 

responsibility to account for the public debt 

and related interest expense incurred to finance 

the operations of the federal government. 

Public Debt produces daily reports on the 

balance and composition of the public debt, 

provides the overarching control structure for 

dozens of subordinate securities systems and 
reconciles their related transactions and cash 

flows. 

 

Do Not Pay Implementation ($10,000,000 

from direct appropriations) 

In June 2010, a Presidential Memorandum 

(Enhancing Payment Accuracy Through a 

“Do Not Pay List”) established the creation of 

a comprehensive Do Not Pay List against 

which agency payments could be crosschecked to prevent ineligible recipients from 

receiving payments from the federal 

government. To make this list more 

beneficial, VerifyPayment.Gov has been 

created to serve as a one-stop-shop for 

agencies. 

The Bureau of the Public Debt has been given 

responsibility for maintaining and expanding 

VerifyPayment.Gov. Additionally, Public 

Debt will work with the Recovery 

Accountability and Transparency Board, to 

support an operations center to analyze fraud 

patterns and refer potential issues to agency 

management. 

Legislative Proposals 

 

Public Debt has no legislative proposals for 

FY 2012. 

BPD Performance by Budget Activity 

Budget Activity Performance Measure FY 2008 FY 2009 FY 2010 FY 2011 FY 2012

Actual Actual Actual Target Target

Government Financing Percent of Respondents 

Selecting the Highest 

Rating of Customer 

Satisfaction with 

Government Agency 

Investment Services (%) 

(Oe)

N/A N/A 55.0 56.0 57.0

Government Financing Percent of Retail Customer 

Service Transactions 

Completed within 5 

Business Days (%) (Ot) 

N/A 86.0 92.7 87.0 87.0 

Government Financing Percent of Auction Results 

Released in Two Minutes 

+/- 30 Seconds (%) (Oe)

100.0 100.0 100.0 100.0 100.0

Financial Information Cost Per Summary Debt 

Accounting Transaction ($) 

(E)

9.11 8.66 11.28 15.5 14.95

Description of Performance 

 

The Bureau of the Public Debt has continued 

to set challenging performance goals with 

positive results. To improve performance, 

Public Debt places a high priority on adopting 

new technology to increase the security, 

flexibility and efficiency of financing the 

needs of the federal government. 

In FY 2010, Public Debt released auction 

results within two minutes, plus or minus 30 

seconds, 100 percent of the time, surpassing its 

performance target of 95 percent. In addition, 

Public Debt processed over 92 percent of retail 

customer transactions within 5 business days 

and met its targeted costs for summary debt 

accounting transactions. In FY 2010 

Public Debt began measuring the percentage 

of customers rating Government Agency 

Investment Services as excellent.
Internal Revenue Service 

Program Summary by Appropriations Account and Budget Activity 

(Dollars in thousands) 

Appropriation FY 2010 FY 2011 FY 2012 FY 2010 to FY 2012

Enacted Annualized 

CR Level

Request $ Change % Change

 Taxpayer Services $2,278,830 $2,278,830 $2,345,133 $66,303 2.9%

 Pre-Filing Taxpayer Assistance and Education 679,924 679,924 701,035 21,111 3.1%

 Filing and Account Services 1,598,906 1,598,906 1,644,098 45,192 2.8%

 Enforcement $5,504,000 $5,504,000 $5,966,619 $462,619 8.4%

 Investigations 639,363 639,363 678,849 39,486 6.2%

 Exam and Collections 4,700,345 4,700,345 5,103,420 403,075 8.6%

 Regulatory 164,292 164,292 184,350 20,058 12.2%

 Operations Support $4,083,884 $4,083,884 $4,620,526 $536,642 13.1%

 Infrastructure 895,202 895,202 986,045 90,843 10.1%

 Shared Services and Support 1,311,127 1,311,127 1,313,050 1,923 0.1%

 Information Services 1,877,555 1,877,555 2,321,431 443,876 23.6%

 Business Systems Modernization $263,897 $263,897 $333,600 $69,703 26.4%

 Health Insurance Tax Credit Administration $15,512 $15,512 $18,029 $2,517 16.2%

Subtotal, Internal Revenue Service $12,146,123 $12,146,123 $13,283,907 $1,137,784 9.4%

Offsetting Collections - Reimbursable 137,758 137,279 138,272 993 0.7%

Mandatory Appropriation - User Fees 175,529 204,428 204,428 0 -

Total Program Operating Level $12,459,410 $12,487,830 $13,626,607 $1,138,777 9.1%

Direct FTE 94,766 94,766 99,878 5,112 5.4%

Reimbursable FTE 659 659 659 - -

User Fees FTE 93 - - - -

Total FTE 95,518 95,425 100,537 5,112 5.4%

FY 2010 Enacted represents the approved FY 2010 Operating Plan. 

Summary 

 

The Internal Revenue Service (IRS) collects 

the revenue that funds the government and 

administers the nation’s tax laws. The IRS 

collected $2.345 trillion in taxes (gross 

receipts before tax refunds) in FY 2010, 

93 percent of federal government receipts. To 

protect the flow of revenue to the government, 

the IRS pursues a robust service and 

enforcement agenda. The service agenda 

supports and protects the trillions in revenue 

that come into the Treasury each year 

voluntarily from taxpayers. The enforcement 

agenda vigorously pursues those who evade 

their responsibility to pay the taxes they owe. 

Total resources to support the IRS activities for 

FY 2012 are $13,626,607,000, including 

$13,283,907,000 from direct appropriations, 

an estimated $138,272,000 from reimbursable 

programs, and an estimated $204,428,000 

from user fees. The direct appropriation is 

$1,137,784,000, 9.37 percent, more than the 

FY 2010 enacted level of $12,146,123,000. 

The IRS Strategic Plan 2009-2013 guides 

program and budget decisions and supports the 

Department of the Treasury Strategic Plan and 

High Priority Performance Goals. 

Helping taxpayers understand their obligations 

under the tax law is critical to improving 
compliance and addressing the tax gap, the 

difference between taxes owed and taxes paid 

on time. Therefore, the IRS remains 

committed to a balanced program of assisting 

taxpayers to understand the tax law and remit 

the proper amount of tax. 

The IRS Strategic Plan goals and objectives 

are: 

 

Improve Service to Make Voluntary 

Compliance Easier 

Enforce the Law to Ensure Everyone 

Meets Their Obligation to Pay Taxes 

To improve service and make voluntary 

compliance easier, the IRS must: 

• Incorporate taxpayer perspectives to 

improve all service interactions; 

• Expedite and improve issue resolution 

across all interactions with taxpayers, 

making it easier to navigate the IRS; 

• Provide taxpayers with targeted, timely 

guidance and outreach; and 

• Strengthen partnerships with tax 

practitioners, tax preparers, and other 

third parties to ensure effective tax 

administration. 

To enforce the law to ensure everyone meets 

their obligations to pay taxes, the IRS must: 

• Enforce the law proactively in a timely 

manner while respecting taxpayer 

rights and minimizing taxpayer burden; 

• Expand enforcement approaches and 

tools; 

• Meet the challenges of international tax 

administration; 

• Allocate compliance resources using a 

data-driven approach to target existing 

and emerging high-risk areas; 

• Continue focused oversight of the taxexempt sector; and 

• Ensure that all tax practitioners, tax 

preparers, and other third parties in the 

tax system adhere to professional 

standards and follow the law. 

To achieve the service and enforcement goals, 

the IRS must: 

• Make the IRS the best place to work in 

government; 

• Build and deploy advanced information 

technology systems, processes, and 

tools to improve IRS efficiency and 

productivity; 

• Use data and research across the 

organization to make informed 

decisions and appropriately allocate 

resources; and 

• Ensure the privacy and security of data 

and safety and security of employees. 

The IRS Budget Request supports the 

following Department of the Treasury High 

Priority Performance Goals: 

Increase voluntary tax compliance 

Significantly increase the number of 

paperless transactions with the public 

Enforcement Program: The FY 2012 request 

provides funding to implement enacted 

legislation; handle new information reporting 

requirements; increase compliance by 

addressing offshore tax evasion; expand 

enforcement efforts on noncompliance among 

corporate and high-wealth taxpayers; and 

enforce return preparer compliance. 

Increased resources for the IRS compliance 

programs yield direct, measurable results 

through high return on investment activities. 
The new enforcement personnel will generate 

more than $1.3 billion in additional annual 

enforcement revenue once the new hires reach 

full potential in FY 2014. Vigorous 

enforcement also encourages voluntary 

compliance, further increasing revenue. The 

return on investment (ROI) estimate does not 

include the revenue effect of the deterrence 

value of these investments and other IRS 

enforcement programs, which is 

conservatively estimated to be at least three 

times the direct revenue impact. 

The tax law is complex and even sophisticated 

taxpayers can make honest mistakes on their 

tax returns. Accordingly, helping taxpayers 

understand their obligations under the tax law 

is critical to improving compliance. To this 

end, the IRS remains committed to a balanced 

program of assisting taxpayers to both 

understand the tax law and remit the proper 

amount of tax. 

Taxpayer Service Program: The FY 2012 

request, partially funded in the Operations 

Support account, provides funding to improve 

telephone level of service, increasing the level 

of service performance target to 80 percent 

from the planned target of 71 percent in 

FY 2010. 

Providing quality taxpayer service is 

especially important to help taxpayers avoid 

making unintentional errors. Assisting 

taxpayers with their questions before they file 

their returns prevents inadvertent noncompliance and reduces burdensome postfiling notices and other correspondence from 

the IRS. To continue the effort to move 

taxpayer service to the internet, and to support 

the Treasury effort to increase paperless 

transactions, an additional $33 million in 

Operations Support will be invested in a multiyear effort to improve the IRS.gov website to 

meet taxpayer needs and the growing demand 

for more electronic services. The technology 

enhancements to IRS.gov and the continued 

investments in electronic filing under the 

Business Systems Modernization (BSM) 

program will allow more taxpayers to reach 

the IRS through the internet. In 2010, there 

were more than 304.8 million visits to 

www.IRS.gov, and more than 66.9 million 

taxpayers checked their refund status by 

accessing Where’s My Refund? in English or in 

Spanish on the IRS website. Taxpayers also 

can use automated features found at 1-800-

829-1040. In FY 2012, the IRS will complete 

the implementation of the electronic filing 

application for Form 1040, U.S. Individual 

Income Tax Return, and supporting forms and 

schedules, and continue adding new forms and 

schedules to the electronic business portfolio 

to further increase web use. 

Business Systems Modernization: The 

FY 2012 request provides funding to continue 

the migration of applications to the core 

taxpayer account database, CADE 2, and the 

expansion of Modernized e-File. The CADE 2 

program is the cornerstone of modernization 

and is a prerequisite to the development of the 

next generation of IRS service and 

enforcement initiatives. It will position the IRS 

to have quicker and better access to data for 

service and compliance. 

The Affordable Care Act (ACA): The 

FY 2012 request includes funding for ACA 

(Public Law 111-148) to administer a premium 

credit to subsidize the cost of health insurance 

for Americans who do not have access to 

affordable coverage; a small business tax 

credit to encourage employers to provide 

health insurance coverage for their employees; 

new information reporting and sharing 

requirements; an excise tax on tanning 

services; a new aggregate annual fee on 

businesses engaged in manufacturing and 

importing branded prescription drugs sold to 

specified government programs; new reporting 

requirements for tax-exempt hospitals; and, an 
individual coverage requirement for 

employees who can afford health insurance, 

but fail to obtain minimum essential coverage. 

These and other provisions of the ACA will 

require resources to build new IT systems; 

modify existing tax processing systems; 

provide taxpayer outreach and assistance 

services; make enhancements to notices, 

collections, and case management systems to 

address and resolve taxpayer issues timely and 

accurately; and conduct focused examinations 

to encourage compliance. While these 

activities are spread across the three primary 

IRS appropriations, the vast majority of the 

funding request is in the Operations Support 

account that funds information technology and 

infrastructure.

IRS FY 2012 Budget Highlights

(Dollars in thousands)

Appropriation Taxpayer 

Services Enforcement Operations Support

Business 

Systems 

Modernization

Health 

Insurance Tax 

Credit 

Administration

Total

FY 2010 Enacted Budget $2,278,830 $5,504,000 $4,083,884 $263,897 $15,512 $12,146,123

FY 2011 Annualized CR Level $2,278,830 $5,504,000 $4,083,884 $263,897 $15,512 $12,146,123

Changes to Base

Adjustment to Reach FY 2011 President's Policy Level $23,254 $242,275 $10,128 $122,561 $3,447 $401,665

Maintaining Current Levels (MCLs) $12,908 $30,691 $41,755 $168 $232 $85,754

Efficiencies/Savings ($41,333) ($21,996) ($124,440) ($1,026) ($1,162) ($189,957)

Non-Recur Savings (22,090) (22,090)

Increase e-File Savings (21,404) (1,040) (22,444)

Reduce IT Infrastructure (75,000) (75,000)

Reduce Contracts (4,522) (325) (15,907) (20,754)

Reduce Administrative Expenses (5,557) (8,271) (503) (14,331)

Eliminate Lockbox Fees (4,000) (4,000)

Reduce Certain Mailings (4,000) (4,000)

Reduce Training, Travel and Programs (9,850) (9,400) (5,900) (1,026) (1,162) (27,338)

Base Reinvestment 1,486 1,486

Consolidate Submission Processing Site (Atlanta) 1,486 1,486

Subtotal FY 2012 Changes to the Base ($3,685) $250,970 ($72,557) $121,703 $2,517 $298,948

FY 2012 Base $2,275,145 $5,754,970 $4,011,327 $385,600 $18,029 12,445,071

Program Changes

Program Increases:

Taxpayer Service Initiatives $44,078 $70,229 $114,307

Improve Taxpayer Service 44,078 37,229 81,307

Expand Online Options through IRS.gov Improvements 33,000 33,000

Enforcement Initiatives $25,910 $209,668 $370,093 $605,671

Increase International Service and Enforcement 48,363 24,233 72,596

Increase Collecton Coverage 2,201 30,275 19,524 52,000

Implement Merchant Card and Basis Reporting 10,475 17,495 7,760 35,730

Increase Coverage to Address Tax Law Changes and Other Compliance Issues 7,229 33,936 55,553 96,718

Ensure Accurate Delivery of Tax Credits 4,946 49,083 206,264 260,293

Administer New Statutory Reporting Requirements 1,059 5,061 52,385 58,505

Leverage Return Preparer Program to Reduce Noncompliance 14,240 2,360 16,600

Address Appeals Workload Growth 7,450 1,650 9,100

Implement Uncertain Tax Position Reporting Requirements 3,765 364 4,129

Infrastructure Initiatives $1,981 $116,877 $118,858

Enhance Security and Disaster Recovery Systems Capability 12,000 12,000

Update Integrated Financial System (IFS) 27,500 27,500

Leveraging Data to Improve Compliance 1,400 1,400

Enhance Physical Security for Federal Employees 1,981 13,500 15,481

Implement Individual Coverage Requirement and Employer Responsibility Payments 62,477 62,477

Business Systems Modernization (BSM) Initiative $52,000 ($52,000)

Continue Migration from Aging Tax Administration System 52,000 (52,000)

Subtotal FY 2012 Program Changes $69,988 $211,649 $609,199 ($52,000) $838,836

Total FY 2012 President's Budget Request $2,345,133 $5,966,619 $4,620,526 $333,600 $18,029 $13,283,907
FY 2012 Budget Adjustments 

 

FY 2011 Annualized CR Level 

The FY 2011 Annualized CR Level for IRS is 

$12, 146,123. 

Adjustment to Reach Policy Level 

Adjustment to Reach Policy Level 

+$401,665,000 / +1,653 FTE 

Adjustment from the FY 2011 Annualized 

Continuing Resolution (CR) Rate to reach the 

FY 2011 President's Policy Level. The 

President's Policy Level is equal to the FY 

2011 President's Budget as adjusted for the 

proposed pay freeze. 

Base Realignment 

Technical FTE Adjustments +$0 / +501 FTE 

This adjustment reflects permanent changes 

made to ensure FTE levels are fully funded in 

the base budget. 

Base Reinvestment 

Consolidate Submission Processing Site 

(Atlanta) +$1,486,000 / +0 FTE 

Increased use of e-File has led to consolidation 

of the individual return processing sites. A 

portion of the Increased e-File Savings will be 

reinvested to fund the one-time separation 

costs associated with the September 30, 2011 

closure of the Atlanta submission processing 

site. As the Atlanta consolidation approaches, 

the IRS will assist employees to find 

employment either in or outside the 

organization. 

Maintaining Current Levels (MCLs) 

Maintaining Current Levels (MCLs) 

+$85,754,000 / +0 FTE 

Funds are requested for inflation adjustments 

in non-labor expenses such as GSA rent 

adjustments, postage, supplies and equipment 

and health benefits and the increase in Federal 

Employee Retirement System participation. 

No inflation adjustment is requested for pay in 

FY 2012. 

Efficiencies, Savings & Base Reductions 

Non-Recur Savings -$22,090,000 / +0 FTE 

This is the net of reductions of non-recurring, 

one-time costs associated with the IRS 

FY 2011 enforcement initiatives (e.g., IT 

equipment and training). 

Increase e-File Savings -$22,444,000 / -416 

FTE 

This decrease is a result of savings from 

increased electronic filing (e-File). Savings are 

based on e-File projected growth, 

modernization, and the completion of the 

phased implementation of the Worker, 

Homeowner, and Business Assistance Act of 

2009 (Public Law 111-92), which requires 

electronic filing by tax return preparers. 

Reduce IT Infrastructure -$75,000,000 / +0 

FTE 

The IRS will reduce the unit costs of 

infrastructure through use of the Capability 

Maturity Model (i.e., a process improvement 

approach that yields efficiencies in software 

engineering); the Information Technology 

Infrastructure Library (ITIL) that will allow 

the IRS to improve the quality of IT services; 

and the further consolidation of security 

activities in the Cybersecurity organization to 

leverage security best practices. 

Reduce Contracts -$20,754,000 / +0 FTE 

In accordance with Presidential guidance on 

controlling contracting costs, the IRS will 

achieve targeted savings through reduced 

contracting expenses. 

Reduce Administrative Expenses -$14,331,000 

/ -66 FTE 

The IRS will reduce administrative expenses, 

including targeted attrition through hiring 

freezes. 
Eliminate Lockbox Fees -$4,000,000 / +0 FTE 

The IRS will eliminate lockbox fees that now 

will be paid by taxpayers in installment 

agreements. 

Reduce Certain Mailings -$4,000,000 / +0 

FTE 

The IRS will eliminate printing and mailing of 

certain forms and publications and reduce the 

number of inserts in mailings. 

Reduce Training, Travel and Programs – 

$27,338,000 / -41 FTE 

The IRS will reduce agency-wide nontechnical training, non-case related travel, and 

the taxpayer communication and education 

program. 

Program Increases 

Improve Taxpayer Service +$81,307,000 / 

+519 FTE 

Funding for this initiative and the $25.9 

million increase from the FY 2011 President's 

Policy level will provide staffing to address 

rising demand and increase the Customer 

Service Representative Level of Service (LOS) 

from the planned target of 71 percent in 

FY 2010 to 80 percent in FY 2012 while 

maintaining a 93 percent customer satisfaction 

rate for toll-free telephone services. This 

initiative also includes funding to help 

taxpayers understand the new tax law 

provisions and to make related call center and 

infrastructure changes to handle anticipated 

inquiries, including ACA-related service 

questions. 

Expand Online Options through IRS.gov 

Improvements +$33,000,000 / +15 FTE 

This initiative will continue the multi-year 

effort to replace the outdated web portal 

environment and provide additional online 

services to taxpayers. The Taxpayer 

Assistance Blueprint, Phase 2, targeted 

migration to the electronic channel and services as one of the five areas for improvement 

of IRS service delivery. IRS will achieve 

efficiencies by moving high-volume 

transactions to IRS.gov, improving taxpayer 

self-service, reducing taxpayer burden, 

increasing compliance, reducing costs, 

improving security, and these improvements 

will position IRS.gov as the preferred delivery 

channel of choice for taxpayer service. 

Increase International Service and 

Enforcement +$72,596,000 / +377 FTE 

This initiative will implement changes 

required by enactment of the Foreign Account 

Tax Compliance Act (FATCA) included in 

The Hiring Incentives to Restore Employment 

(HIRE) Act of 2010 ( Public Law 111-147). 

The IRS will implement the reporting, 

disclosure and withholding requirements and 

expand coverage of international filings, 

conduct more in-depth international 

compliance work, strengthen compliance 

efforts related to offshore activity and grow 

the Global High-Wealth compliance group. 

This initiative will increase examinations of 

employment tax specialty program audits; 

individual audits; business audits; and criminal 

investigation case closures. 

Increase Collection Coverage +$52,000,000 / 

+413 FTE 

This initiative will expand work on the 

collection inventory and improve collection 

processes to bring taxpayers who fail to pay 

their tax debt into compliance. This funding 

will expand the Automated Collection Systems 

(ACS) program, address the increased 

workload for the Offers in Compromise (OIC) 

program due to program improvements and to 

more taxpayers experiencing economic 

hardship, and improve efficiency through 

innovative approaches to inventory selection. 

The additional staff will resolve an additional 

144,300 tax delinquency accounts (TDA) (i.e., 

balance due accounts where returns were filed, 

but the taxes have not been paid) and 25,200 

tax delinquency investigations (TDI) (i.e., 
investigations of taxpayers with unfiled returns 

who have not responded to a notice). 

Implement Merchant Card and Basis 

Reporting +$35,730,000 / +415 FTE 

This initiative will staff programs to 

implement information reporting on merchant 

payment card and third party reimbursements 

enacted in the Housing and Economic 

Recovery Act of 2008 (Public Law 110-289) 

and basis reporting on security sales enacted in 

the Emergency Economic Stabilization Act of 

2008 (Public Law 110-343). 

Increase Coverage to Address Tax Law 

Changes and Other Compliance Issues 

+$96,718,000 / +497 FTE 

This initiative addresses compliance issues and 

new responsibilities arising from recent tax 

law changes included in major legislation such 

as the American Recovery and Reinvestment 

Act (Recovery Act) and the ACA. This 

initiative will fund compliance programs 

needed for new provisions such as direct-pay 

bonds, new requirements on tax-exempt 

hospitals, a new fee on manufacturers and 

importers of branded prescription drugs, the 

excise tax on indoor tanning, and will also 

increase the number of specialty program (i.e., 

employment tax, excise tax, and estate and gift 

tax) audits. 

Ensure Accurate Delivery of Tax Credits 

+$260,293,000 / +834 FTE 

This initiative recognizes the important role 

IRS plays in delivering economic incentives 

through tax credits by improving the delivery 

of existing credits through a combination of 

improved technology tools and increased 

enforcement staffing. The initiative also funds 

the information technology and other systems 

required to implement the new ACA premium 

assistance tax credit, which becomes effective 

in 2014. IRS must build new systems to 

support eligibility determination based on 

household income, and modify existing tax 

processing systems to support reconciliation of 

advance payments of the credit. The initiative 

also funds the appropriate compliance 

resources for the small employer tax credit, 

which came into effect in 2010. 

Administer New Statutory Reporting 

Requirements +$58,505,000 / +187 FTE 

Recent legislation established significant new 

information reporting and sharing 

requirements from third parties (such as 

employers, health insurance providers), and 

the exchanges to administer the ACA’s 

premium assistance tax credit, the individual 

coverage requirement, and the employer 

responsibility payment. Effective 

implementation will require significant 

enhancements to existing information returns 

systems to handle the additional volumes and 

new information reporting categories. This 

initiative also includes resources to implement 

provisions that allow the IRS to share tax data 

with state and federal entities for the purpose 

of determining eligibility for the advance 

premium credit. The ACA also amends 

Section 6041 of the Internal Revenue Code 

expanding in 2012 the 1099 information 

reporting requirement for businesses to report 

all aggregate purchases of services or property 

greater than $600. A portion of this initiative 

($23.3 million) is allocated to implement this 

provision, although it should be noted that the 

Administration has proposed to repeal this 

provision based on the burden it places on 

small businesses. Should this provision be 

repealed, the IRS would adjust its initiative 

needs accordingly. 

Leverage Return Preparer Program to Reduce 

Noncompliance +$16,600,000 / +108 FTE 

The IRS is increasing tax return preparer 

oversight to ensure that tax return preparers 

are competent and to help ensure that the IRS 

collects the right amount of taxes. This 

initiative will ensure uniform and high ethical 

standards of conduct for tax return preparers 
by enforcing preparer compliance with IRS 

rules, increasing preparer examinations, and 

pursuing preparers engaged in fraudulent 

activities. This initiative is core to the IRS’s 

tax gap strategy and will increase government 

revenue. 

Address Appeals Workload Growth 

+$9,100,000 / +66 FTE 

This initiative will allow the IRS to increase 

Appeals staffing. Despite improvements in 

cycle time and increased efficiency in working 

cases, Appeals continues to experience rising 

inventories, and because of the nature of 

Appeals work, the cases must be processed 

manually. The funding in this initiative will 

reduce the stress put on the appeals process 

because of increased caseload. In addition, 

Appeals settlements lead to revenue to the 

government, so this initiative will increase 

revenues. 

Implement Uncertain Tax Position Reporting 

Requirements +$4,129,000 / +20 FTE 

This initiative will allow the IRS to provide 

guidance and certainty on tax positions and 

meet increasing taxpayer demands for this 

service This increased workload is expected 

as a result of changes IRS has proposed for 

certain large business taxpayers to report 

information about their uncertain tax positions. 

It is a critical part of IRS’s work to gain 

greater transparency into large corporate tax 

returns. 

Enhance Security and Disaster Recovery 

Systems Capability +$12,000,000 / +5 FTE 

This initiative is part of a multi-year 

improvement strategy to support the continued 

deployment of critical disaster recovery 

capabilities. It supports two critical business 

processes: Processing Remittances and 

Processing Tax Returns by reducing the 

recovery time dramatically for the critical 

applications supporting these processes. 

Update Integrated Financial System (IFS) 

+$27,500,000 / +5 FTE 

This initiative provides funds to complete the 

first phase of an initiative to update IFS. This 

request will ensure IRS compliance with future 

federal accounting requirements and allow 

implementation of standard interfaces and 

communication with other federal systems. 

The IRS current financial system is more than 

ten years old and SAP no longer provides 

updates or changes to accommodate new 

legislative or other federal accounting 

requirements. Without a system that will 

allow implementation of new federal 

accounting requirements, the IRS compliance 

with federal financial management standards 

will be jeopardized. 

Leveraging Data to Improve Compliance 

+$1,400,000 / +5 FTE 

The IRS is focused on using a data-driven 

approach to continually innovate and improve 

its programs. This investment will capitalize 

on the significant increase in data reported to 

the IRS, with the goal of increasing 

compliance. Funding will increase compliance 

through leveraging such data and/or evaluating 

the effectiveness of tax-related programs. 

Enhance Physical Security for Federal 

Employees +$15,481,000 / +10 FTE 

The February 2010 attack against the IRS in 

Austin, Texas, killed one IRS employee and 

injured several others. This initiative will 

provide investments needed to update and/or 

upgrade the physical security of IRS facilities. 

The investments will enhance the overall 

security of IRS employees in the work place, 

while maintaining open access for the 

taxpayers that they serve. 

Implement Individual Coverage Requirement 

and Employer Responsibility Payments 

+$62,477,000 / +65 FTE 

This initiative will fund the development of 

the information technology, infrastructure, and 
systems to implement the provisions of 

Subtitle F of Title I of the ACA that establish 

shared responsibility payments for both 

individuals and employers. Beginning in 

2014, the ACA requires individuals who are 

able to afford health insurance to obtain 

minimum essential coverage or pay a penalty, 

and large employers - those with 50 or more 

full-time employees - to make a shared 

responsibility payment if they do not provide 

affordable coverage to their employees, and at 

least one of their employees benefits from the 

premium assistance tax credit. 

Return on Investment for Enforcement Initiatives

Dollars in Millions

FY 2012 Enforcement Investment Cost Revenue ROI Cost Revenue ROI

All Enforcement Initiatives $339.3 $646.2 1.9 $296.4 $1,332.1 4.5

Direct Revenue Producing Program Integrity Initiatives $243.8 $646.2 2.7 $207.8 $1,332.1 6.4

Increase International Service and Enforcement 72.6 234.0 3.2 57.1 467.1 8.2

Increase Collection Coverage 52.0 177.3 3.4 45.2 398.3 8.8

Implement Merchant Card and Basis Reporting 35.8 72.4 2.0 30.8 185.7 6.0

Implement Coverage to Address Tax Law Changes and Other Compliance Issues 29.8 42.7 1.4 27.3 80.8 3.0

Ensure Accurate Delivery of Tax Credits 51.0 110.2 2.2 45.0 183.3 4.1

Administer New Statutory Reporting Requirements 2.6 9.6 3.7 2.4 16.9 7.0

Other Enforcement Initiatives $95.5 $0.0 0.0 $88.6 $0.0 0.0

Implement Coverage to Address Tax Law Changes and Other Compliance Issues 24.5 0.0 0.0 23.2 0.0 0.0

Ensure Accurate Delivery of Tax Credits 33.6 0.0 0.0 33.5 0.0 0.0

Administer New Statutory Reporting Requirements 7.6 0.0 0.0 7.5 0.0 0.0

Leverage Return Preparer Program to Reduce Noncompliance 16.6 0.0 0.0 12.6 0.0 0.0

Address Appeals Workload Growth 9.1 0.0 0.0 7.9 0.0 0.0

Implement Uncertain Tax Position Reporting Requirements 4.1 0.0 0.0 3.9 0.0 0.0

First Year (FY 2012) Full Performance (FY 2014)

Explanation of Budget Activities 

 

Taxpayer Services 

The FY 2012 President’s Budget request is 

$2,345,133,000 in direct appropriations, an 

estimated $22,924,000 from reimbursable 

programs, and an estimated $130,962,000 

from user fees, for a total operating level of 

$2,499,019,000. This appropriation funds the 

following budget activities. 

Pre-Filing Taxpayer Assistance and Education 

($701,035,000 from direct appropriations, and 

an estimated $863,000 from reimbursable 

programs) This budget activity funds services 

to assist with tax return preparation, including 

tax law interpretation, publication, production, 

and advocate services. In addition, funding for 

these programs continues to emphasize 

taxpayer education, outreach, increased 

volunteer support time and locations, and 

enhancing pre-filing taxpayer support through 

electronic media. 

Filing and Account Services ($1,644,098,000 

from direct appropriations, an estimated 

$22,061,000 from reimbursable programs, and 

an estimated $130,962,000 from user fees) 

This budget activity funds programs that 

provide filing and account services to 

taxpayers, process paper and electronicallysubmitted tax returns, issue refunds, and 

maintain taxpayer accounts. The IRS 

continues to make progress in decreasing 

paper returns and increasing the use of 

electronic filing and payment methods. 
Enforcement 

The FY 2012 President’s Budget request is 

$5,966,619,000 in direct appropriations and an 

estimated $75,902,000 from reimbursable 

programs for a total operating level of 

$6,042,521,000. The total direct appropriations level includes an additional 

appropriation for tax enforcement and 

compliance activities funded through a 

program integrity allocation adjustment 

totaling $1,257,000,000, of which 

$936,000,000 will be funded from the 

Enforcement account. This appropriation 

funds the following budget activities. 

Investigations ($678,849,000 from direct 

appropriations, and an estimated $66,567,000 

from reimbursable programs) This budget 

activity funds the criminal investigations 

programs that uncover criminal violations of 

the internal revenue tax laws and other 

financial crimes, enforce criminal statutes 

relating to these violations, and recommend 

prosecution as warranted. These programs 

identify and document the movement of both 

legal and illegal sources of income to identify 

and document cases of suspected intent to 

defraud. It provides resources for international 

investigations involving U.S. citizens residing 

abroad, non-resident aliens and expatriates and 

includes investigation and prosecution of tax 

and money-laundering violations associated 

with narcotics organizations. 

Exam and Collections ($5,103,420,000 from 

direct appropriations, and an estimated 

$8,761,000 from reimbursable programs) This 

budget activity funds programs that enforce 

the tax laws and increase compliance through 

examination and collection programs that 

ensure proper payment and tax reporting. It 

also includes programs such as specialty 

program examinations (employment tax, 

excise tax and estate and gift exams), 

international collections and international 

examinations. The budget activity also 

supports appeals and litigation activities 

associated with exam and collection. 

Regulatory ($184,350,000 from direct 

appropriations, and an estimated $574,000 

from reimbursable programs) This budget 

activity funds the development and printing of 

published IRS guidance materials; 

interpretation of tax laws; advice on general 

legal servicing, ruling and agreements; 

enforcement of regulatory rules, laws, and 

approved business practices; and supporting 

taxpayers in the areas of pre-filing agreements, 

determination letters, and advance pricing 

agreements. The Return Preparer Strategy 

initiative is funded within this activity in 

addition to the Office of Professional 

Responsibility who is responsible for 

identifying, communicating, and enforcing the 

Treasury Circular 230 standards of 

competence, integrity, and conduct of 

professionals representing taxpayers before the 

IRS. 

Operations Support 

The FY 2012 President’s Budget request is 

$4,620,526,000 in direct appropriations, an 

estimated $39,446,000 from reimbursable 

programs, and an estimated $73,466,000 from 

user fees, for a total operating level of 

$4,733,438,000. The direct appropriations 

level includes an additional appropriation for 

tax enforcement and compliance activities 

funded through a program integrity allocation 

adjustment totaling $1,257,000,000, of which 

$312,000,000 will be funded from the 

Operations Support account. This 

appropriation funds the following budget 

activities. 

Infrastructure ($986,045,000 from direct 

appropriations, an estimated $516,000 from 

reimbursable programs, and an estimated 

$22,095,000 from user fees) This budget 

activity funds administrative services related 

to space and housing, rent and space 
alterations, building services, maintenance, 

guard services, and non-IT equipment. 

Shared Services and Support ($1,313,050,000 

from direct appropriations, and an estimated 

$20,577,000 from reimbursable programs) 

This budget activity funds policy management, 

IRS-wide support for research, strategic 

planning, communications and liaison, 

finance, human resources, and equal 

employment opportunity and diversity services 

and programs. It also funds printing and 

postage, business systems planning, security, 

corporate training, legal services, procurement, 

and specific employee benefits programs. 

Information Services ($2,321,431,000 from 

direct appropriations, an estimated 

$18,353,000 from reimbursable programs, and 

an estimated $51,371,000 from user fees) This 

budget activity funds staffing, equipment, and 

related costs to manage, maintain and operate 

the information systems critical to the support 

of tax administration programs. This includes 

the design and operation of security controls 

and disaster recovery planning. This budget 

activity funds the development and 

maintenance of the millions of lines of 

programming code that support all aspects and 

phases of tax processing and the operation and 

administration of the mainframes, servers, 

personal computers, networks, and a variety of 

management information systems. 

Business Systems Modernization 

The FY 2012 President’s Budget request is 

$333,600,000 in direct appropriations. This 

appropriation funds the following budget 

activity. 

Business Systems Modernization 

($333,600,000 from direct appropriations) 

This budget activity funds the planning and 

capital asset acquisition of information 

technology (IT) to continue the modernization 

of IT systems, including labor and related 

contractual costs. The completion of the core 

taxpayer account database, CADE 2, is the 

cornerstone of modernization and is a 

prerequisite to the development of the next 

generation of IRS service and enforcement 

initiatives. The integration strategy includes a 

particular focus on enhanced information 

technology security practices and robust 

accounting and financial management 

controls. This activity also funds the ongoing 

development of the Modernized e-File 

platform for filing tax returns electronically. 

Health Insurance Tax Credit 

Administration 

The FY 2011 President’s Budget request is 

$18,029,000 in direct appropriations. This 

appropriation funds the following budget 

activity. 

Health Insurance Tax Credit Administration 

($18,029,000 from direct appropriations)This 

budget activity funds costs to administer a 

refundable tax credit for health insurance to 

qualified individuals, which was enacted as 

part of the Trade Adjustment Assistance 

Reform Act of 2002. 

Legislative Proposals 

 

The FY 2012 President’s Budget includes a 

number of legislative proposals intended to 

improve tax compliance with minimum 

taxpayer burden. These proposals will 

specifically target the tax gap and generate 

more than $10 billion over the next ten years. 

The implementation cost for the proposals 

included in the FY 2011 President’s Budget, is 

estimated to be $50.4 million over three years 

and includes the initial startup, processing and 

compliance operational costs. Among other 

proposals, the Administration proposes to 

expand information reporting, improve 

compliance by businesses, strengthen tax 

administration, and expand penalties. 
IRS Performance by Program

Program Performance Measure FY 2008 FY 2009 FY 2010 FY 2011 FY 2012

Actual Actual Actual Target Target

Taxpayer Services Customer Contacts Resolved Per 

Staff Year (E)

12,634 12,918 10,744 12,074 12,061

Taxpayer Services Customer Service Representative 

(CSR) Level of Service (%) (Oe)

52.8 70.0 74.0 71.0 80.0

Taxpayer Services Percent of Individual Returns 

Processed Electronically (%) (Oe)

57.6 65.9 69.3 74.0 76.0

Enforcement Automated Collection System 

(ACS) Accuracy (%) (Oe)

95.3 94.3 95.9 94.0 94.0

Enforcement Automated Underreporter 

Coverage (%) (E)

2.6 2.6 3.0 3.3 4.0

Enforcement Examination Efficiency - Individual 

(1040 form) (E)

138 138 140 134 126

Key: Oe - Outcome Measure, E - Efficiency Measure, Ot - Output/Workload Measure, M - Management/Cust. Satisfaction, DISC - 

Discontinued, and B - Baseline

Description of Performance 

 

In FY 2010, IRS continued to provide 

excellent service to taxpayers and enforced the 

laws in a balanced manner. The following is a 

summary of significant program performance 

improvements. 

Enforcement 

In FY 2010, revenue from all enforcement 

sources reached $57.6 billion, 18 percent more 

than in FY 2009. 

This increase in enforcement revenue 

demonstrates that the investment in the IRS 

over the past two years is producing 

significant return. The IRS expanded its 

enforcement presence in the international field, 

continued to pursue high-wealth/high-income, 

noncompliant taxpayers, and audited more 

charities and other tax-exempt organizations. 

As a result, the IRS made improvements over 

FY 2009 in these key areas: 

• Examined more than 1.58 million individual returns, an increase of 

11 percent, reaching the highest rate in 

the past decade; 

• Increased high-income/high-wealth 

audits on taxpayers with income 

greater than $200,000 by 5.5 percent 

and audits for those with income 

greater than $1 million by more than 8 

percent; 

• Increased automated underreporter 

contact closures by 19.8 percent, 

surpassing the four million mark for 

the first time, with more than 4.3 

million; 

• Increased collection case closures by 

6.3 percent and criminal investigations 

by 12.4 percent; 

Total Enforcement Revenue Collected

37.6 43.1 47.3 48.7

59.2 56.4

48.9

57.6

0

20

40

60

FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10

In Billions
• Increased large corporate audits by 

8.1 percent, a significant achievement 

given the size (assets greater than $10 

million) and complexity of these 

corporate entities and audits of foreign 

corporations by almost 48 percent; and 

• Increased tax exempt and government 

entity compliance contacts by 

approximately 20 percent. 

As part of an overall strategy to improve 

offshore compliance, in FY 2010, the IRS 

continued to take aggressive steps to track tax 

evaders that hide their wealth by engaging in 

offshore tax evasion schemes. The IRS more 

than doubled its offshore presence by opening 

new offices in Asia and Central America, 

placed additional law enforcement personnel 

at its existing offices throughout the world, 

and expanded its interaction with key 

international organizations involved in tax and 

financial law compliance. All of these steps 

are designed to develop new leads in ongoing 

criminal tax and financial crime investigations. 

The IRS voluntary disclosure program (VDP) 

provides information on banks and 

professionals, including foreign professionals, 

who facilitate tax evasion. More than 15,000 

Americans with offshore accounts, some 

holding hundreds of millions of dollars, came 

forward during a voluntary disclosure period 

that ended in October 2009 to disclose 

information bringing them back into the U.S. 

tax system. An additional 3,000 Americans 

came forward with accounts at various banks 

since October 2009, with the total disclosures 

over the period expected to reach 20,000. In 

FY 2010, the IRS began reviewing the 

information from program participants to 

identify financial institutions, advisors, and 

others who promoted or otherwise helped 

Americans hide assets and income offshore. 

The IRS continues to ensure the largest 

corporate taxpayers are in compliance using 

strategies that are less time and resource 

intensive. The Compliance Assurance Process 

(CAP) program resolves issues early and 

ensures the filing of accurate returns. The IRS 

plans to make the CAP program permanent 

and is incorporating a number of program 

improvements. 

Taxpayer Service 

The IRS website has become the preferred 

source of information for millions of taxpayers 

to get answers to their tax questions, to 

questions about economic recovery legislation, 

and to prepare and file a federal tax return 

accurately and on time. IRS.gov/Español 

offers many of the same services and 

information in Spanish. 

To improve service to taxpayers during the 

2010 filing season, the IRS enhanced IRS.gov 

by providing a rotating spotlight feature on the 

front page. The spotlight, which changes 

every few seconds, highlights important 

taxpayer information by identifying how tax 

law changes such as Making Work Pay Credit

and First-Time Homebuyer Credit can benefit 

different types of taxpayers; and how to access 

online applications such as Where’s My 

Refund, an online tool for taxpayers to check 

on the status of their refund, and What If?, a 

list of questions and answers to assist 

taxpayers who are having difficult times 

financially handle various scenarios related to 

payment of taxes and other financial problems. 

Demand Increasing for Electronic Tools

2.2 2.4 2.2

4.0 4.5 0.8 0.9 1.2

3.7 2.2 1.0 4.6

9.3

5.7 5.6

4.7

0

2

4

6

8

10

12

14

16

FY 2006 FY 2007 FY 2008 FY 2009 FY 2010

In Millions

Withholding Calculator EITC Assistant

T/P Assistance Center Locator Request Electronic Filing PIN (new)

6.8

12.7

7.9

12.0

15.8
As shown in the chart, taxpayer demand for 

electronic tools has significantly increased and 

the IRS will continue to improve the speed, 

accessibility, and accuracy of on-line 

information as well as develop new 

applications to reach even more taxpayers. 

The IRS also is committed to continuing 

efforts to redesign IRS correspondence to 

improve clarity, accuracy, and effectiveness. 

In FY 2010, the IRS: 

• Completed the redesign of 115 notices 

(25 in Spanish) to provide clear and 

simple explanations of the notice 

purpose and required taxpayer actions; 

• Redesigned the area of IRS.gov that 

provides information on locating 

specific notices and an explanation of 

the redesign process; and 

• Released the first group of nine new 

notices. These notices account for 

approximately two million pieces of 

correspondence with individuals, 

businesses and exempt organizations. 

The IRS completed a successful 2010 filing 

season, rising to challenges posed by the 

implementation of provisions in the American 

Reinvestment and Recovery Act of 2009 

(Recovery Act), the Worker, Homeownership, 

and Business Assistance Act of 2009 

(WHBAA), and increased telephone demand 

for Economic Recovery Payment inquiries. 

The IRS received more than 141.9 million 

individual returns, of which 69.3 percent were 

e-filed. More than 34.6 million taxpayers 

prepared their own e-file return, 32.2 percent 

more than in 2009. 

The IRS issued 109.5 million refunds to 

individual taxpayers totaling $366 billion. The 

average dollar refund was $3,048 compared to 

$2,682 in 2009, an increase of almost 14 

percent. IRS also direct-deposited more than 

73 million refunds compared to 72.4 million in 

2009. Beginning in the 2010 filing season, 

taxpayers could purchase up to $5,000 of 

Series I U.S. Savings Bonds using their federal 

tax refund. More than 22,300 taxpayers took 

advantage of this opportunity, requesting more 

than 98,000 bonds totaling approximately 

$11.1 million. 

In FY 2010, the IRS expanded outreach and 

educational services to improve information, 

news, and taxpayer interactions through social 

media networks (Facebook, Twitter, YouTube, 

etc). For the first time, the IRS produced a 

number of podcasts that were available on 

IRS.gov and iTunes. In addition, the IRS 

created more than a dozen YouTube Videos on 

a variety of subjects including the Education 

Tax Credit, Making Work Pay, and the New 

Homebuyer Credit. These videos attracted 

more than 963,800 upload views and were 

available in English, American Sign 

Language, and Spanish. 

As always, providing high-quality, toll-free 

telephone service is important in helping 

taxpayers navigate the complex tax code. The 

IRS telephone assistors answered 36.7 million 

calls, 6.3 percent fewer than in 2009 while at 

the same time the IRS received 35.1 million 

automated calls, 21 percent more than in 2009, 

reflecting the growing taxpayer demand for 

self-service options. Telephone level of 

service (LOS) increased to 74 percent from the 

FY 2009 LOS of 70 percent. This reflects the 

success rate of taxpayers who call the IRS for 

live telephone assistance on the 1-800 help 

lines. In 2010, the IRS added an estimated 

wait time feature so taxpayers could make 

informed choices on whether to wait for a live 

assistor or use another service channel (i.e., 

self-assisted automated telephone services or 

IRS.gov) to answer their questions. Accuracy 

rates for both customer tax law and account 

questions remain above 92 percent. 

The IRS also provides in-person service at its 

Taxpayer Assistance Centers (TACs), for 
taxpayers resolving tax issues and needing help to 

prepare their tax returns. Approximately 6.4 

million taxpayers visited a TAC, three percent 

more than in 2009. Walk-in service remains 

popular among elderly taxpayers, those with 

limited English and computer proficiency, and 

taxpayers without internet access. 

Business System Modernization 

IRS modernization efforts continue to focus on 

core tax administration systems designed to 

provide more sophisticated tools to taxpayers 

and to IRS employees. The following 

highlights IRS accomplishments: 

• Customer Account Data Engine 

(CADE) posted more than 41.2 million 

returns, generated more than 35.8 

million refunds and, for the first time, 

accepted more than seven million 

payments submitted with taxpayer 

returns. In FY 2010, the IRS revised 

its CADE strategy to implement a new 

taxpayer account database for the 2012 

filing season. This new database will 

accelerate the refund processing time 

for most taxpayers. 

• Modernized e-File (MeF) deployed an 

additional release that allowed for the 

acceptance of Form 1040 and 22 supporting forms and schedules. This new 

functionality is designed to reach 61 

percent of the e-File population, or 

approximately 55.1 million filers. 
Emergency Economic Stabilization Act Programs 

Program Disbursements and Cost/Savings 

(Dollars in Thousands) 

1

Amount applied to the Section 115 Purchase Cap (i.e., the portion of the $475 billion cap expected to be disbursed). 2 Estimated lifetime program costs or savings (-) including interest effects, but excluding administrative costs. 3 Treasury guaranteed up to $5 billion of potential losses incurred on a $301 billion portfolio of loans. 

Summary 

 

The Emergency Economic Stabilization Act of 

2008 (EESA) was enacted in October 2008 in 

response to one of the worst financial crisis 

faced by the United States in our history and 

for the first time in 80 years the U.S. financial 

system was at risk of collapse. To address the 

crises, EESA established the Office of 

Financial Stability (OFS) within the Office of 

Domestic Finance of the Treasury Department 

to implement the Troubled Assets Relief 

Program (TARP). EESA vested authority to 

the Secretary of Treasury to “purchase, and to 

make and fund commitments to purchase, 

troubled assets from any financial institution, 

on such terms and conditions as are determined 

by the Secretary.” The OFS carries out the 

mission and objectives of the EESA of: 

ensuring the overall stability and liquidity of 

the financial system; preventing avoidable 

foreclosures and helping preserve 

homeownership; pro-tecting taxpayer 

interests, and promoting transparency. 

The authority for OFS administrative 

budget funds is provided in Section 118 of 

EESA. In FY 2012 OFS plans to obligate 

$311 million and use 270 FTE, a decrease 

of $83 million and an increase of 19 FTE 

from the FY 2011 estimates. 

The Dodd-Frank Act enacted in on July 

21, 2010 reduced the TARP authority to 

purchase troubled assets from $700 billion 

to $475 billion; requires that repayments 

of amounts invested under TARP cannot 

be used to increase the purchase authority 

and are dedicated to reducing the Federal 

debt; and prohibits new obligations for any 

program or initiative that was not already 

initiated prior to June 25, 2010. 

Over the past two years, emergency 

actions taken through TARP and other 

FY 2009 FY 2010

Total 

Disbursements

1

Cost/(Savings) 

BA Outlays2

Capital Purchase Program $204,617,573 $277,153 $204,894,726 ($12,424,572)

($212,771)

($39,186)

($3,805,048)

($3,707,147)

Public-Private Investment 

Program

$3,689,583 $18,716,901 $22,406,484 

AIG Investment Program $69,835,000 $0 $69,835,000 $8,038,208 

Consumer and Business 

Lending Initiative

$4,300,000 $939,581 $5,239,581 

Home Affordable 

Modification Program

$27,065,760 $18,560,021 $45,625,781 $45,625,781 

Targeted Investment 

Program

$40,000,000 $0 $40,000,000 

Automotive Industry 

Financing Program 

$77,968,009 $3,790,000 $81,758,009 $14,800,582 

Asset Guarantee Program3 $5,000,000 $0 $5,000,000 

Total $432,475,926 $42,283,655 $474,759,581 $48,275,847 
financial stability initiatives have helped 

prevent financial catastrophe by unfreezing the 

markets for credit and capital; bringing down 

the cost of borrowing for businesses, 

individuals, and state and local governments; 

restoring confidence in the financial system; 

and restarting economic growth. The 

conditions of most security markets and large 

financial institutions have improved 

substantially since the crisis in 2008. 

Borrowing costs for large banks, nonfinancial 

businesses, and state and local governments 

have returned to near normal levels. Frozen 

securities markets have reopened. Prices for 

legacy se-curities have improved. Large banks 

are better capitalized than they were before the 

crisis and restructuring in the financial industry 

is well underway. 

Further, as a result of improved financial 

conditions and careful stewardship of the 

program, the ultimate cost to the taxpayer of 

TARP investments is estimated to be 

significantly lower than initially expected. The 

FY 2010 MSR budget total impact of the 

program on the deficit was projected to be 

$341 billion, but it is now expected to total 

only $48.3 billion (see Program Caps and 

Obligations table above) as of November 30, 

2010. 

EESA programs include: 

Capital Purchase Program 

Pursuant to EESA, the Capital Purchase Program 

(CPP) - OFS’ largest and most significant programwas launched to stabilize the financial system by 

bolstering the capital position of viable institutions 

and, in doing so, to build confidence in these 

institutions and the financial system as a whole. 

With the additional capital, CPP participants were 

better equipped to undertake new lending, even 

while absorbing write downs and charge-offs on 

loans that were not performing. 

OFS ultimately provided a total of $205 

billion in capital to 707 institutions in 48 

states, including more than 450 small and 

community banks, enabling them to 

absorb losses from bad assets while 

continuing to lend to consumers and 

businesses. 

American International Group, Inc. 

(AIG) Investment Program 

OFS committed to provide assistance to 

certain systemically significant financial 

institutions that were at substantial risk of 

failure on a case-by-case basis in order to 

provide stability to institutions that are 

critical to a functioning financial system 

and prevent broader disruption to financial 

markets. Starting in September 2008, the 

Federal Reserve and OFS took a series of 

actions related to AIG in order to prevent 

AIG’s disorderly failure and mitigate 

systemic risks. These actions addressed 

the liquidity and capital needs of AIG, 

helping to stabilize the company. OFS 

provided this as-sistance by purchasing 

preferred shares in AIG and also received 

warrants to purchase common shares in 

the institution. 

OFS purchased $40 billion in cumulative 

preferred stock from AIG under the 

TARP, the proceeds of which were used to 

repay the Federal Reserve loan in part. In 

April 2009, OFS exchanged the $40 

billion in cumulative preferred stock for 

$41.6 billion in non-cumulative pre-ferred 

stock and created an additional equity 

capital facility, under which AIG may 

draw up to $29.8 billion as needed in 

exchange for issuing additional preferred 

stock to OFS. 

On September 30, 2010, the Treasury, 

Federal Reserve Bank of New York and 

AIG announced plans for a restructuring 

of the Federal Government’s investments 
in AIG. The components of the capital 

restructuring plan began to close in January 

2011. Under the re- structuring, the Treasury 

will be receiving additional allotment of AIG 

common stock that is outside of the TARP AIG 

investments. When aggr-egating Treasury’s 

total investment in AIG, we expect to earn a 

positive return from the AIG investments. 

Targeted Investment Program 

OFS established the Targeted Investment 

Program (TIP) under the TARP in December 

2008. Through TIP, OFS sought to prevent a 

loss of confidence in critical financial 

institutions, which could result in significant 

financial market disruptions, threaten the 

financial strength of similarly situated financial 

institutions, impair broader financial markets, 

and undermine the overall economy. 

OFS invested $20 billion in each of Bank of 

America (BofA) and Citigroup under the TIP. 

As of December 31, 2009, the TIP was closed 

as part of Treasury’s winding down of TARP. 

The Budget reflects that both Citigroup and 

Bank of America fully redeemed the 

Government's TIP investments of $40 billion 

during 2010 and generated $3.8 billion in 

profits for taxpayers. 

Automotive Industry Financing Program 

 OFS established the Automotive Industry 

Financing Program (AIFP) on December 19, 

2008, to help prevent a significant disruption to 

the American automotive industry, which 

would have posed a substantial disruption to financial market stability and had a negative 

effect on the economy. Under the AIFP, OFS 

allocated $82 billion in emergency loans and 

other investments from the TARP to General 

Motors Corporation (GM) and Chrysler LLC 

(Chrysler) to provide a path for these 

companies to go potentially through orderly 

restructurings and achieve viability. 

 In November and December 2010, 

Treasury received $13.5 billion for the sale 

of over 400 million shares of GM, 

reducing Treasury’s ownership percentage of GM common stock from 60.8% 

to 33.3%. Treasury also accepted an offer 

from GM to repurchase $2.1 billion of 

preferred stock, a deal which was closed in 

December 2010. 

 

 Asset Guarantee Program 

Pursuant to section 102 of EESA, OFS 

established the Asset Guarantee Program 

(AGP) with the same objective as the TIP 

of preserving financial market stability. 

The AGP provided protection against the 

risk of significant loss in a pool of assets 

held by Cititgroup, a systemically 

significant financial in-stitution that faced 

a risk of losing market confidence due in 

large part to its holdings of distressed or 

illiquid assets. The AGP helped the 

institution maintain the confidence of its 

depositors and other funding sources while 

continuing to meet the credit needs of 

households and businesses. 

The AGP closed in December 2009 

without paying any claims and generated 

$3.7 billion in revenue for taxpayers. 

The Consumer and Business Lending 

Initiative (CBLI) 

The CBLI was intended to help unlock the 

flow of credit to consumers and small 

businesses. OFS designed three initiatives 

to restore consumer and business lending: 

the Term Asset-Backed Securities Loan 

Facility (TALF), the Community 

Development Capital Initiative (CDCI) 

and the SBA 7(a) Securities Purchase 

Program. 
TALF 

The Term Asset-Backed Securities Loan 

Facility (TALF) was created by the Federal 

Reserve Board (FRB) to provide low cost 

funding to investors in certain classes of Asset 

Backed Securities (ABS). The TALF’s 

objective was to stimulate investor demand for 

certain types of eligible ABS, specifically those 

backed by loans to consumers and small 

businesses, and ultimately to bring down the 

cost and increase the availability of new credit 

to consumers and businesses. The OFS agreed 

to participate in the program and originally 

provided up to $20 billion of TARP funds in 

liquidity and credit protection to the FRB for 

first-losses arising under TALF loans. On July 

20, 2010, OFS’ commitment was reduced to 

$4.3 billion. To-date, OFS has experienced no 

losses under the program. 

Community Development Capital Initiative 

In February 2010, the OFS announced the 

CDCI to invest lower cost capital in 

Community Development Financial 

Institutions (CDFI) that lend to small 

businesses in the country’s hardest-hit 

communities. Under the terms of the program, 

CDFI banks and thrifts, which must be certified 

by Treasury as targeting more than 60 percent 

of their small business lending and other 

economic development activities to 

underserved communities, are eligible to 

receive investments of capital with an initial 

dividend rate of 2 percent. CDFIs that 

participated in CPP and were in good standing 

were eligible to exchange those investments 

into this program. 

SBA 7(a) Security Purchase Program 

In March 2010, Treasury announced the SBA 

7(a) Securities Purchase Program to help 

restore the confidence needed for financial 

institutions to increase lending to small 

business, and to ensure that credit flows 

again to entrepreneurs and small business 

owners. The OFS began the purchase of 

guaranteed securities backed by the Small 

Business Administration 7(a) loans (7(a) 

Sec-urities), as part of the Unlocking 

Credit for Small Business Initiative. As of 

December 30, 2010, OFS had purchased 

and settled $368.1 million of these 

securities. 

Public-Private Investment Program 

OFS, in conjunction with the Federal 

Reserve and the FDIC, announced the 

Public-Private Investment Program (PPIP) 

on March 23, 2009, as a part of the 

Financial Stability Plan. The PublicPrivate Investment Program (PPIP) is part 

of the OFS’s efforts to help restart the 

market by enabling financial institutions to 

make new loans available to households 

and businesses, and by providing liquidity 

for legacy securities. 

Under this program, OFS made equity and 

debt investments in newly-formed 

investment vehicles (referred to as Public 

Private Investment Funds or “PPIFs”) 

established by private investment 

managers for the purpose of purchasing 

legacy securities. 

Treasury Housing Programs Under 

TARP 

Fiscal year 2010 has seen an expansion of 

programs designed to provide stability for 

both the housing market and homeowners. 

These programs assist homeowners who 

are experiencing financial hardships to 

remain in their homes while they get back 

on their feet or relocate to a more 

sustainable living situation. These 

programs fall into three initiatives: 
1) Making Home Affordable Program (MHA); 

2) Housing Finance Agency (HFA) HardestHit Fund; and 

3) Federal Housing Administration (FHA)-

Refinance Program. 

MHA includes sub programs that assist 

borrowers in refinancing first and second 

mortgages, including benefits for unemployed 

homeowners, as well as modification 

alternatives. In FY 2010, additional programs 

were introduced under MHA. These programs 

include: options for Federal Housing Administration (FHA) guaranteed loans and 

expanded second lien benefits. 

The Housing Finance Agency (HFA) HardestHit Fund was implemented in 2010 and 

provides targeted aid to families in the states 

hit hardest by the housing market downturn 

and un-employment. Eighteen states and the 

District of Columbia are developing custom 

programs targeted to address the specific needs 

and economic conditions of their state. 

The FHA-Refinance Program is a joint 

initiative with the Department of Housing 

and Urban Development (HUD) which is 

intended to encourage refinancing of 

existing underwater (i.e. the borrower 

owes more than the home is worth) 

mortgage loans not currently insured by 

FHA into FHA-insured mortgages. 

Legislative Proposals 

 

OFS does not have any legislative 

proposals. 

Description of Performance 

 

OFS has established the following 

Operational Goals: 

1) Ensure the Overall Stability and 

Liquidity of the Financial System, 

2) Prevent Avoidable Foreclosures by 

Providing and Preserving Homeownership 

 
Housing Government Sponsored Enterprise Programs

Program Summary by Budget Activity

(Dollars in thousands)

Budget Activity FY 2010 FY 2011 FY 2012 Change FY10 to FY12

Actual Estimated Estimated $ Change % Change

 Preferred Stock Purchase Agreements Obligations $52,600,000 $47,500,000 $28,700,000 ($18,800,000) (-39.58%)

 GSE MBS Purchase Program on Securities Purchased $29,877,874 $0 $0 $0 0%

 GSE Credit Facility Loan Levels $0 $0 $0 $0 0%

 New Issue Bond Purchase Program Securities Purchased $15,308,598 $0 $0 $0 0%

 Temporary Credit and Liquidity Program Obligations $8,209,840 $0 $0 $0 0%

Summary

The Housing Government Sponsored 

Enterprise (GSE) Programs consist of five

different programs with respect to, Fannie Mae 

and Freddie Mac, and the Federal Home Loan 

Banks (FHLBs). These programs were created 

to provide stability to the financial markets 

and promote mortgage affordability while at 

the same time protecting the taxpayer. 

Preferred Stock Purchase Agreements 

($28.7 billion in obligations) 

This measure enhances market stability by 

providing additional security to holders of 

Fannie Mae and Freddie Mac securities, 

which, in turn, leads to increased mortgage 

affordability by providing additional 

confidence to investors in GSE mortgagebacked securities. This commitment also 

significantly diminishes the potential for

mandatory triggering of receivership. To this 

end, the PSPAs are an effective means of 

averting systemic risk while at the same time 

protecting the taxpayer. They are more 

efficient than a one-time equity injection, in 

that Treasury will use them only as needed and 

on terms that the Treasury deems appropriate.

In addition, beginning in 2011 the Treasury 

has begun to charge the GSEs a periodic 

commitment fee that will be payable quarterly 

to compensate the taxpayers for the ongoing 

support provided to the GSEs under the terms 

of the PSPAs. 

GSE MBS Purchase Program (No funding)

To promote the stability of the mortgage 

market, Treasury has purchased GSE MBS in 

the secondary market. By purchasing these 

guaranteed securities, Treasury sought to 

broaden access to mortgage funding for 

current and prospective homeowners as well as 

to promote market stability.

The size and timing of this program is subject 

to the discretion of the Secretary of the 

Treasury. The scale of the program was based 

on developments in the capital markets and 

housing markets. Given that Treasury can 

hold these securities to maturity, the spreads 

between Treasury’s cost of funds and GSE 

MBS yield should result in a positive return to 

the taxpayer. Treasury's authority to purchase 

GSE MBS expired on December 31, 2009.
GSE Credit Facility Program (No funding)

Loans would be for short-term durations and 

would in general be expected to be for less 

than one month but no shorter than one week. 

The rate on a loan request ordinarily would be 

based on the daily LIBOR fix for a similar 

term of the loan plus 50 basis points. The rate 

is set at the discretion of the Secretary of the 

Treasury with the objective of protecting the 

taxpayer, and is subject to change. All loans 

would be collateralized and collateral is 

limited to mortgage backed securities issued 

by Freddie Mac and Fannie Mae and advances 

made by the FHLBs. No loans were needed or 

issued under this program. This facility offered

liquidity if needed until December 31, 2009. 

New Issue Bond Program (No funding)

HFAs submitted detailed program 

participation requests to Treasury’s financial 

agents. In order to haircut the NIBP requests to 

an acceptable level that could be 

recommended for adoption. HFAs were able to 

request that a portion or all of their NIBP 

allocation be used to issue single or multifamily bonds. HFAs will pay the GSEs and 

Treasury an amount intended to cover both the 

cost of financing the newly issued bonds as 

well as a fee designed to cover risk posed by 

the HFA. Treasury purchased approximately 

$15.3 billion under its authority for this 

program in FY 2010. Treasury’s authority to 

enter additional purchase commitments under 

the program expired on December 31, 2009, 

however, the funds remaining in escrow may 

continue to be used for the issuance of new 

housing bonds through December 31, 2011.

Temporary Credit and Liquidity Program (No 

funding)

Through Fannie Mae and Freddie Mac, the 

TCLP provided replacement credit and 

liquidity facilities to HFAs to help reduce the 

costs of maintaining existing financing for the 

HFAs. The pricing and fee structure of the 

TCLP and NIBP were designed to be 

commercially reasonable, and allow the 

Housing GSEs to fully cover all costs of the 

programs. Therefore, it is expected that the 

Housing GSEs will be able to fulfill all of their 

obligations under the HFA Initiative. The 

HFA Initiative will be funded by fees paid by 

the HFAs to the Housing GSEs. 

Legislative Proposals

The Housing GSE programs have no

Legislative proposals for FY 2012.
Financial Stability Oversight Council and Office of Financial Research 

Program Summary by Budget Activity 

(Dollars in thousands) 

Budget Activity FY 2010 FY 2011 FY 2012 Change FY10-FY12 

Actual Estimated Estimated $ Change % Change

 Financial Stability Oversight Council $0 $7,435 $7,885 $450 6.1%

 Office of Financial Research $0 $33,890 $74,468 $40,578 119.7%

Total Cost of Operations $0 $41,325 $82,353 $41,028 99.3%

Explanation of Budget Estimate 

 

The Financial Stability Oversight Council 

(FSOC), established under the Dodd-Frank 

Wall Street Reform and Consumer Protection 

Act of 2010 (Dodd-Frank Act), held its first 

meeting on October 1, 2010, and successive 

meetings on November 23, 2010 and January 

18, 2011. Future meetings will be held on at 

least a quarterly basis. An integrated roadmap 

was released following the first meeting 

combining member agencies internal 

implementation plans, including timeframes 

for key deliverables. Over the next year, the 

FSOC is working to establish processes for 

designating nonbank financial companies and 

financial market utilities, developing 

recommendations for stricter standards for 

monitoring and reporting on systemic risk, and 

developing tools for monitoring the financial 

system for emerging risks. 

Under the Dodd-Frank Act, the Director of the 

Office of Financial Research (OFR) is 

appointed by the President and confirmed by 

the Senate. Prior to confirmation, Treasury, 

under the Secretary’s authority, is managing 

OFR with all of the Director’s statutory 

authority. 

OFR has two primary divisions: a Data Center 

and a Research and Analysis Center. The Data 

Center will in part set standards for financial 

reporting and work to improve the quality of 

financial data that is collected so it can be 

organized in ways that are more meaningful 

for identifying vulnerabilities in the system as 

a whole. The Research and Analysis Center 

will analyze market activities to identify 

potential risks to the financial system and 

report findings to FSOC members and 

Congress. 

OFR’s first priority is improving data 

standards to help FSOC monitor systemic risk 

and improve risk management, reporting and 

other business functions at individual financial 

firms. The problem of monitoring systemic 

risk is closely related to the risk management 

challenge that individual firms face. To 

monitor systemic risk, positions in thousands 

of diverse financial products, involving 

thousands of individual financial firms, have 

to be aggregated across the entire financial 

system. Standardizing the way financial 

transactions are reported can greatly facilitate 

this process for regulators and individual 

firms. The OFR will, in consultation with 

relevant stakeholders, develop standards for 

financial data. 

Purpose of Program 

 

Prior to the financial crisis of 2008-2009, the 

existing regulatory framework focused 

regulators narrowly on individual institutions 

and markets, which allowed supervisory gaps 

to grow and regulatory inconsistencies to 

emerge – in turn, allowing arbitrage and 

weakened standards. The Dodd-Frank Act 

established the FSOC with a clear statutory 

mandate that created for the first time 
collective accountability for identifying and 

responding to emerging threats to financial 

stability. FSOC is a collaborative body 

chaired by the Secretary of the Treasury that 

brings together the expertise of the federal 

financial regulators, an insurance expert 

appointed by the President, and state 

regulators. The FSOC is an executive agency 

of government and is not an office or bureau 

of the Department of the Treasury. However, 

under the Dodd-Frank Act, FSOC 

administrative expenses are considered 

expenses of OFR and are paid for by OFR. 

OFR was established by the Dodd-Frank Act 

to support the FSOC and its members in its 

identification and analysis of risks in the 

financial system. To accomplish this, OFR 

will collect and standardize financial data, 

develop and publish key reference databases, 

and conduct research to identify potential 

sources of systemic risk. OFR is an office of 

the Department of the Treasury. 

Explanation of Budget Activities 

 

Under the terms of the Dodd-Frank Act, the 

OFR and the FSOC will be funded through 

mandatory transfers from the Federal Reserve 

until July 21, 2012. Thereafter, the two 

entities will be funded through assessments on 

bank holding companies with total 

consolidated assets of $50 billion or more, as 

well as non-bank financial institutions subject 

to supervision by the Federal Reserve Board. 

Financial Stability Oversight Council 

($7,885,000) FSOC has a clear statutory 

mandate to improve coordination among 

financial regulators and identify risks and 

respond to emerging threats to financial 

stability. FSOC has ten voting members, 

including nine federal financial regulatory 

agencies and an independent member with 

insurance expertise, and five non-voting 

members. As a coordinative body, FSOC is an 

executive agency of the Federal Government 

and is not a bureau or office of the Department 

of the Treasury. 

Office of Financial Research ($74,468,000)

The Dodd-Frank Act established OFR within 

the Treasury Department to support the FSOC 

and its members by improving the quality of 

financial data available to policymakers and by 

facilitating more robust and sophisticated 

analysis of the financial system. The data and 

analysis provided by OFR will enhance the 

FSOC’s ability to identify and analyze risks in 

the financial system. 

Description of Performance 

 

There are no measures specified for managing 

FSOC or OFR performance at this time. 

Information on FSOC is provided on 

www.treasury.gov, www.financialstability.gov 

and member agency websites. Transparency 

on FSOC decisions will be provided through 

annual reports to Congress and the public and 

testimony by the Chairperson on FSOC 

activities and emerging threats to financial 

stability. Information on OFR is available at 

www.treasury.gov/ofr. 

OFR, as an office of the Department of the 

Treasury, is currently working on developing a 

performance plan for office operations.
Small Business Lending Fund 

Program Disbursement and Cost 

(Dollars in Millions) 

FY 2011 Estimates 

Program Level Subsidy Amount Subsidy Rate

$17,399 $1,260 7.24%

All investment activity will take place in FY 2011 

Program Summary by Budget Activity 

(Dollars in thousands)

Budget Activity FY 2010 FY 2011 FY 2012 Change FY10-FY12 

Actual Estimated Estimated $ Change % Change

 Program* $0 $1,260,000 $0 ($1,260,000) -100.00%

 Administration $0 $54,649 $72,603 $17,954 32.9%

Total Outlays $0 $1,314,649 $72,603 ($1,242,046) -94.5%

Total FTE 0 41 55 14 34.2%

*Reflects only on-budget amounts 

Summary 

 

Public Law 111-240, also known as the Small 

Business Jobs Act (hereafter “the Act”), 

established the Small Business Lending Fund 

(SBLF). The SBLF encourages lending to small 

businesses by providing Tier 1 capital to qualified 

community banks with assets of less than $10 

billion. Through the SBLF, Main Street banks and 

small businesses can work together to help create 

jobs and promote economic growth in local 

communities across the nation. 

FY 2011 and 2012 priorities include processing all 

received applications by September 27, 2011 in 

strict adherence to the eligibility requirements of 

the legislation; executing a compliance regimen to 

ensure that all fund participants abide with the 

terms of the program; and installing an asset 

management capability to effectively monitor the 

Fund and minimize risk to Treasury. 

Purpose of Program 

 

The SBLF is intended to increase the availability 

of credit to small businesses by providing capital 

to eligible institutions with assets of less than $10 

billion. The dividend or interest rate a bank pays 

for SBLF funding will be reduced as the 

institution’s qualified small business lending 

increases, relative to the bank’s baseline small 

business lending established at the time the 

applicant is awarded SBLF funding by the 

Treasury. Because banks leverage their capital, 

the SBLF could help increase lending to small 

businesses in an amount that is multiples of the 

total capital provided to participating institutions. 

These new loans will help small businesses grow 

and create new jobs. 

An insured depository institution is eligible if it 

has assets of less than $10 billion and it meets the 

other requirements for participation. If the 

institution is controlled by a holding company, the 

combined assets of the holding company 

determine eligibility. Community development 

loan funds are also eligible. 

Banks that have total assets of $1 billion or less 

may apply for SBLF funding that equals up to 5% 

of risk-weighted assets. Banks that have assets of 

more than $1 billion, but less than $10 billion may 

apply for SBLF funding that equals up to 3% of 

risk-weighted assets. 

The Small Business Lending Fund also provides 

an option for eligible community banks to 

refinance preferred stock issued to the Treasury 
through the Capital Purchase Program (CPP) or 

the Community Development Capital Initiative 

(CDCI) under certain conditions. 

An institution is not eligible if it is on the Federal 

Deposit Insurance Corporation’s problem bank list 

(or similar list) or has been removed from that list 

in the previous 90 days. 

With the approval of its regulator, an institution 

may exit the Small Business Lending Fund at any 

time simply by repaying the funding provided 

along with any accrued dividends. 

Pursuant to the Act, all funds received by the 

Treasury in connection with purchases made, 

including interest payments, dividend payments, 

and proceeds from the sale of any financial 

instrument, will be used to pay down the public 

debt. 

Though all investments will be occurring in FY 

2011, the holding, managing, and selling the 

capital investments will require a staff presence in 

future years. The SBLF program office has been 

designed to ensure that strong internal controls are 

in place and that costs are minimized by 

leveraging existing Treasury infrastructure 

whenever possible. 

 

 

Explanation of Budget Activities 

 

Pursuant to the Act, all investment activity will 

occur in FY 2011. The Act also requires that the 

cost of purchases of preferred stock and other 

financial instruments made as capital investments 

shall be determined as provided under the Federal 

Credit Reform Act of 1990. 

After careful analysis and credit modeling, 

Treasury estimates a total program volume of 

$17.4 billion. Treasury credit modeling also 

indicates a projected subsidy rate of 7.24% and a 

budget cost of $1.26 billion for SBLF. 

The authority to pay administrative expenses is 

provided by Section 4108 (b) of the Act. 

Administrative expenses will include the costs of 

government employee salaries, contract support, 

and reimbursement to the Treasury Office of 

Inspector General for program audits. Pursuant to 

the Act, Treasury will be submitting semi-annual 

reports to the appropriate committees of Congress 

detailing administrative expenses. 

Legislative Proposals 

 

The SBLF has no legislative proposals. 

Description of Performance 

 

Performance metrics are currently in development 

for the SBLF and will be finalized in 2011. 
State Small Business Credit Initiative 

Program Summary by Budget Activity 

(Dollars in thousands)

Budget Activity FY 2010 FY 2011 FY 2012 Change FY10-FY12 

Actual Estimated Estimated $ Change % Change

 SSBCI Program $0 $487,000 $732,000 $245,000 50.3%

 Administration $0 $6,410 $7,488 $1,078 16.9%

Total Outlays $0 $493,410 $739,488 $246,488 49.9%

Total FTE 0 9 12 3 33.3%

Summary 

 

The State Small Business Credit Initiative 

(SSBCI) is a Federal program that provides 

direct funding support to states for use in 

programs designed to increase access to credit 

for small businesses. The SSBCI was 

appropriated with $1.5 billion to support State 

capital access programs (CAPs) and other 

credit support programs (OCSP) that support 

lending to small businesses and small 

manufacturers. CAPs provide portfolio 

insurance for business loans based on a 

separate loan loss reserve fund for each 

participating financial institution. OCSPs 

include collateral support programs, loan 

participation programs, state-sponsored 

venture capital programs, loan guarantee 

programs or similar programs. 

The estimated outlays for FYs 2011 and 2012 

anticipate disbursement of at least one third of 

the total $1.5 billion appropriation in FY 

2011, as all states are required to apply no 

later than June 27, 2011, and $732 million in 

FY 2012. 

Purpose of Program 

 

The purpose of the SSBCI is to increase the 

availability of credit for small business, to 

generate jobs and other economic 

development benefits for states. It is expected 

to help spur up to $15 billion in lending to 

small businesses. Under SSBCI, participating 

states will use the federal funds for programs 

that leverage private lending to help finance 

small businesses and manufacturers that are 

creditworthy, but are not getting the loans they 

need to expand and create jobs. SSBCI will 

allow states to build on successful models for 

state small business programs, including 

Capital Access Programs (CAPs), collateral 

support programs, and loan guarantee 

programs. 

Explanation of Budget Activities 

 

Each state that is approved for participation in 

the SSBCI will receive its allocation of funds 

in three disbursements as follows: 33 percent, 

33 percent and 34 percent. As a precondition 

to receipt of the second and third 

disbursements, the state must, among other 

things, certify to Treasury that it has 

expended, transferred or obligated 80 percent 

or more of the last-disbursed one-third 

disbursement of allocated funds to or for the 

account of one or more approved state 

programs. Furthermore, funds allocated to the 

states should be transferred within two years 

beginning on the date the application is 

approved. 

Less than 3 percent of the appropriation has 

been allocated for administrative expenses. 

The administrative costs are expected to be 

spent over a period of seven years beginning 

on the date of the enactment of the Act on 

September 27, 2010. 
Legislative Proposals 

 

The State Small Business Credit Initiative 

has no legislative proposals.

Description of Performance 

 

Performance metrics are currently in 

development for the State Small Business 

Credit Initiative and will be finalized in 2011. 
Bureau of Engraving and Printing 

Program Summary by Budget Activity 

(Dollars in thousands)

Budget Activity FY 2010 FY 2011 FY 2012 Change FY10 to FY12

Actual Estimated Estimated $ Change % Change

 Manufacturing $555,000 $527,000 $582,050 $27,050 4.9%

 Protection and Accountability of Assets $61,000 $61,000 $0 ($61,000) (100.0%)

Total Cost of Operations $616,000 $588,000 $582,050 ($33,950) (5.5%)

Reimbursable FTE 1,889 1,950 1,925 36 1.9%

BEP operations are financed by reimbursements to a revolving fund and as such the BEP is unaffected by a 

continuing resolution. 

The Bureau of Engraving and Printing Protection and Accountability budget activity is being eliminated and 

consolidated into the Manufacturing budget activity beginning in FY 2012.

Summary 

 

The mission of the Bureau of Engraving and 

Printing (BEP) is to develop and produce 

United States currency notes, trusted 

worldwide. The Bureau of Engraving and 

Printing (BEP) operates on the basis of 

authority conferred upon the Secretary of the 

Treasury by 31 U.S.C. 321(a) (4) to engrave 

and print currency and other security 

documents. Operations are financed through a 

revolving fund and are reimbursed through 

product sales for direct and indirect costs of 

operations including administrative expenses. 

In addition, BEP is authorized to include an 

amount sufficient to fund capital investment 

and to meet working capital requirements in 

the prices charged for products. 

For FY 2012, the Bureau of Engraving and 

Printing’s estimated total revenues are 

$582,050,000, and estimated total 

expenditures are $582,050,000. 

BEP’s vision is to maintain its position as a 

world-class securities printer, providing its 

customers and the public superior products 

through excellence in manufacturing and 

technological innovation. It strives to produce 

U.S. currency of the highest quality, as well as 

many other security documents issued by the 

Federal Government. Other activities at the 

Bureau include engraving plates and dies; 

manufacturing inks used to print security 

products; purchasing materials, supplies and 

equipment; and storing and delivering 

products in accordance with the requirements 

of customers. In addition, the Bureau provides 

technical assistance and advice to other 

Federal agencies in the design and production 

of documents, which, because of their innate 

value or other characteristics, require 

counterfeit deterrence. The Bureau’s top 

priorities for FY 2012 include the continued 

re-tooling and retrofitting of the currency 

production process which will allow BEP to 

improve productivity, reduce its environmental 

impact and provide the capabilities needed to 

produce increasingly more complex currency 

note designs. This new equipment will ensure 

that BEP continues to operate in an efficient 

and cost-effective manner. 

 

Another initiative for FY 2012 is to continue 

efforts to test and produce tactile features that 

will enhance future note designs and serve the 

needs of currency users with visual 

impairments. A research group from the 

Bureau visited several foreign bank note 
printers to gather information on their progress 

in developing tactile features. Testing is being 

conducted to determine which processes and 

features would work best at the production 

volumes needed for U.S. currency. While no 

timetable has been set for the introduction of 

this currency, the next redesign will 

incorporate changes to make U.S. currency 

more accessible to those who are blind and 

visually impaired. In addition, because 

aggressive law enforcement, effective design, 

and public education are all essential 

components of a concerted anti-counterfeiting 

program, the Bureau will continue its work in 

2012 with the Advanced Counterfeit Deterrent 

Committee to research and develop future 

currency designs that will enhance and protect 

future notes. 

BEP FY 2012 Budget Highlights

(Dollars in thousands)

Budget Estimate Amount

FY 2010 Actual $616,000

FY 2011 Estimated $588,000

Changes to Base: 

Maintaining Current Levels (MCLs): $4,850

Maintain Current Levels $4,850

Efficiencies, Savings & Base Reductions: ($11,800)

Energy Savings ($2,200)

IT Process Streamlining ($200)

Improved Business Practices ($5,000)

Replace Mainframe ($2,400)

Spoilage Reduction Savings ($1,000)

Visual Inspection Systems ($1,000)

Subtotal FY 2012 Changes to Base ($6,950)

Total FY 2012 Base $581,050

Program Changes: 

Program Increases: $1,000

R&D Equipment - Tactile Features $1,000

Subtotal FY 2012 Program Changes $1,000

Total FY 2012 Estimated $582,050

FY 2012 Budget Adjustments 

 

Maintaining Current Levels (MCLs) 

Maintain Current Levels +$4,850,000 / +0 

FTE 

Funds are required for inflation adjustments in 

non-labor expenses such as rent adjustments, 

postage, raw materials and inventories, 

supplies and equipment, health benefits and 

the increase in Federal Employee Retirement 

System participation. No inflation adjustment 

is requested for pay in FY 2012. 

Efficiencies, Savings & Base Reductions 

Energy Savings -$2,200,000 / +0 FTE 

Energy Savings - improvements in energy 

efficiency through replacement and/or upgrade 

of older assets with more energy efficient and 

environmentally responsible assets. 

IT Process Streamlining -$200,000 / +0 FTE 

Savings from data center efficiency and 

consolidation, increased server virtualization, 

and decreased energy usage and IT operation 

costs. 

Improved Business Practices -$5,000,000 / -15 

FTE

Improved Business Practices - Current manual 

administrative processes will be eliminated 

with the completion of BEP’s Manufacturing 

Support Suite. Reductions of 15 FTE will be 

achieved through proposed buy-outs and 

attrition. 

Replace Mainframe -$2,400,000 / +0 FTE 

Replace BEP Mainframe computer with offsite 

Oracle On-Demand Computer Hosting Service 

- Switching from BEP’s mainframe computer 

to Oracle On-Demand hosting service will 

result in operation and maintenance cost 

savings. 

Spoilage Reduction Savings -$1,000,000 / +0 

FTE 

Spoilage Reduction Savings - reduced material 

spoilage during currency note production 

process should enable reduced purchases of 

currency paper and other materials used in 

manufacturing currency notes. 

Visual Inspection Systems -$1,000,000 / -10 

FTE 

Productivity Improvements from new Visual 

Currency Inspection Systems - Completed 
installation of new Visual Currency Inspection 

System to improve inspection quality and 

automate work currently performed by FTEs, 

resulting in personnel cost savings. 

Program Increases 

R&D Equipment - Tactile Features 

+$1,000,000 / +0 FTE 

Represents the purchase of lab equipment for 

research and development, needed to develop 

and test new tactile feature for the visually 

impaired in future currency redesigns. 

Explanation of Budget Activities 

 

Salaries and Expenses 

Manufacturing ($582,050,000 from 

reimbursable programs)

BEP manufactures high quality security 

documents that deter counterfeiting. These 

manufactured products are grouped into two 

programs: Federal Reserve notes, and other 

security documents. The manufacturing of 

state-of–the-art currency deters counterfeiting, 

contributes to public confidence, and 

facilitates daily commerce ensuring seamless, 

“business as usual” transactions as new 

currency designs are introduced to the public. 

Protection and Accountability of Assets (No 

funding)

The Department of the Treasury proposes to 

eliminate the Protection and Accountability 

budget activity, and consolidate it into the 

Manufacturing budget activity beginning in 

FY 2012. During the past eight years since the 

Protection and Accountability of Assets 

budget activity was created, the Department 

has determined that it fails to serve a 

meaningful purpose on a standalone basis and 

unnecessarily complicates budgetary and other 

financial reporting. 

Legislative Proposals 

 

BEP requests legislation to repeal that portion 

of 31 USC Sec. 5114(c), which limits a 

contract term for the manufacture of 

distinctive currency paper to four years. By 

repealing this limit, the contract term for the 

manufacture of distinctive currency paper will 

match all other federal contracts which allow 

five years. Proposed Amendment: Section 

5114(c) of Title 31, United States Code 

(relating to engraving and printing currency 

and security documents), is amended by 

striking "for a period of not more than 4 

years". This proposal may open up the supply 

of U.S. currency paper to competition by 

ending the four year contract limitation. 

Potential suppliers consider four years too 

short of a payback period for production of 

this unique product, which GAO identified as 

a barrier to competition. 

To prevent money laundering, BEP proposes 

the following legislative amendment: In the 

current fiscal year and hereafter, any person 

who forwards to the Bureau of Engraving and 

Printing (BEP) a mutilated paper currency 

claim equal to or exceeding $10,000 for 

redemption shall be required to provide BEP 

their taxpayer identifying number.

Capital Investments Summary 

 

BEP’s IT portfolio includes an estimated $18 

million cost to implement the Oracle 

eBusiness integrated manufacturing suite 

which will run at the Oracle Corporation’s 

“Federal on Demand” Shared Service Center 

in Austin, Texas. After implementation, BEP 

anticipates annual operating and maintenance 

cost savings of $2.4M compared to continued 

usage of the current BEP-operated mainframe. 

Due to this modernization, BEP anticipates 

productivity improvements of five percent by 

revising work practices in administrative and 

support areas for a savings of $5M annually. 
This savings estimate was developed as a 

result of BEP’s discussion with other 

manufacturing entities that implemented the 

Oracle E-Business Suite, after reviewing best 

practices supported by the software, and 

completing an initial requirements definition 

process. 

BEP Performance by Budget Activity

Budget Activity Performance Measure FY 2008 FY 2009 FY 2010 FY 2011 FY 2012

Actual Actual Actual Target Target

Manufacturing Currency Shipment 

Discrepancies Per Million Notes 

(%) (Ot)

0.01 0.0 0.0 0.01 0.01

Manufacturing Manufacturing Costs For 

Currency (Dollar Costs Per 

Thousand Notes Produced) ($) 

(E)

29.47 32.77 44.85 48.0 48.0

Manufacturing Percent of Currency Notes 

Delivered to the Federal Reserve 

that Meet Customer Quality and 

Requirements (%) (Oe)

100.0 99.9 97.5 99.9 99.9

Key: Oe - Outcome Measure, E - Efficiency Measure, Ot - Output/Workload Measure, M - Management/Cust. Satisfaction, 

DISC - Discontinued, and B – Baseline

Description of Performance 

 

Manufacturing Costs for Currency (dollar cost 

per 1,000 notes produced) is an indicator of 

manufacturing efficiency and effectiveness of 

program management. This measure is based 

on contracted price factors, and anticipated 

productivity improvements, as well as the mix 

of denominations ordered year to year. As 

more sophisticated counterfeit deterrent design 

features are produced, paper and ink costs 

increase, resulting in increased total 

manufacturing costs. Actual performance 

against standard depends on BEP’s ability to 

meet annual spoilage, efficiency, and capacity 

utilization goals. This measure has performed 

at or better than its annual targets for the past 

seven years. 

Percent of currency notes delivered to the 

Federal Reserve Board that meet customer 

quality and requirements is a qualitative 

indicator reflecting the Bureaus’ ability to 

provide a quality product. All notes delivered 

to the Federal Reserve Board go through 

rigorous quality inspections. These 

inspections ensure that all counterfeit deterrent 

features, both overt and covert are functioning 

as designed. 

Currency Shipment Discrepancies is an 

indicator of the Bureau’s ability to provide 

effective product security and accountability. 

This measure refers to product overages or 

underages of as little as a single currency note 

in shipments of finished notes to the Federal 

Reserve Banks expressed as a percentage of 

total program. BEP continually strives to meet 

its long term goal of 0 percent, and has been 

able to do so several times. 
United States Mint 

Program Summary by Budget Activity 

(Dollars in thousands)

Budget Activity FY 2010 FY 2011 FY 2012 Change FY10 to FY12

Actual Estimated Estimated $ Change % Change

 Manufacturing $3,602,988 $2,457,862 $2,515,589 ($1,087,399) (30.2%)

 Protection $43,979 $51,016 $0 ($43,979) (100.0%)

Total Cost of Operations $3,646,967 $2,508,878 $2,515,589 ($1,131,378) (31.0%)

Capital Investment $23,794 $30,830 $30,296 $6,502 27.3%

Total Resources $3,670,761 $2,539,708 $2,545,885 ($1,124,876) (30.6%)

Reimbursable FTE 1,778 1,873 1,873 95 5.3%

The Department of the Treasury is eliminating the Protection budget activity and consolidating it into the 

Manufacturing budget activity beginning in FY 2012.

Summary 

 

The United States Mint supports the 

Department of the Treasury’s strategic 

objective to promote trust and confidence in 

U.S. currency worldwide by enabling 

commerce through safe, secure U.S. notes and 

coins. 

Since FY 1996, the United States Mint has 

been operating under the United States Mint’s 

Public Enterprise Fund (PEF). As authorized 

by Public Law 104-52 (31 U.S.C. § 5136), the 

PEF eliminates the need for appropriations. 

Proceeds from the sales of circulating coins to 

the Federal Reserve Banks and numismatic 

items to the public are the source of funding 

for operations. Both operating expenses and 

capital investments are associated with the 

production of circulating and numismatic 

coins and coin-related products and protective 

services. The United States Mint provides 

security for assets, including the government’s 

reserves of gold bullion, silver bullion, coins 

and coinage metals. Revenues in excess of 

amounts required by the PEF are transferred to 

the United States Treasury General Fund. 

The United States Mint’s key priorities for FY 

2012 include: 

• Circulating - Efficiently and effectively 

produce and distribute approximately 9.6 

billion circulating coins in FY 2012 to 

meet the needs of commerce, an important 

strategic objective for the Department of 

the Treasury. Honor national parks and 

other national sites through effective 

administration of the United States Mint 

America the Beautiful Quarters Program in 

compliance with the America’s Beautiful 

National Parks Quarter Dollar Coin Act of 

2008. 

• Bullion - Prepare and distribute bullion 

coins while employing precious metal 

purchasing strategies that minimize or 

eliminate the financial risk that can arise 

from adverse market price fluctuations. 

• Numismatic - Prepare and distribute 

numismatic products in sufficient 

quantities to make them accessible, 

available, and affordable to people who 

choose to purchase them. Design, strike 

and prepare for presentation Congressional 

gold medals and commemorative coins, as 

required by law. 
• Protection - Continue to secure over $320 

billion in market value of the nation’s gold 

reserves, silver and other assets. 

FY 2012 United States Mint estimated total 

revenues are $2,745,700,000, total expenses 

are $2,515,589,000, capital investments are 

$30,296,000, and net results are $230,111,000 

in earnings. 

Mint FY 2012 Budget Highlights

(Dollars in thousands)

Budget Estimate Amount

FY 2010 Actual $3,646,967

FY 2011 Estimated $2,539,708

Changes to Base: 

Maintaining Current Levels (MCLs): $26,277

Maintain Current Levels $26,277

Efficiencies, Savings & Base Reductions: ($20,100)

Contract Savings – Procurement/IT ($7,200)

Postpone Low Priority Capital Projects ($12,900)

Subtotal FY 2012 Changes to Base $6,177

Total FY 2012 Base $2,545,885

Total FY 2012 Estimated $2,545,885

Totals include capital investments since a FY 2012 

savings proposal involves capital investment savings.

FY 2012 Budget Adjustments 

 

Maintaining Current Levels (MCLs) 

Maintain Current Levels +$26,277,000 / +0 

FTE 

Funds are required for inflation adjustments in 

non-labor expenses such as rent adjustments, 

postage, raw materials and inventories, 

supplies and equipment, health benefits and 

the increase in Federal Employee Retirement 

System participation. No inflation adjustment 

is requested for pay in FY 2012. 

Efficiencies, Savings & Base Reductions 

Capital Projects Postponed to Out-years 

-$12,900,000 / +0 FTE 

The United States Mint reduced its FY 2012 

capital budget $12.9 million by delaying 

several capital projects to out-years. The 

agency’s capital plan includes funding for 

various equipment replacement, building 

maintenance and safety projects. The plans 

are developed based on factors such as 

equipment lifecycle, production needs and 

facility assessments. Careful consideration is 

given to each project and projects are then 

prioritized. 

Contract Savings – Procurement/IT 

-$7,200,000 / +0 FTE 

Procurement Savings: In FY 2010, the United 

States Mint achieved $47.6 million in nonmetal procurement savings through acquisition 

improvement plans. The United States Mint 

will continue efforts to achieve procurement 

savings by combining multiple contracts, 

renegotiating current contract terms and 

ensuring greater competition where possible 

through FY 2012. Through these efforts, the 

United States Mint expects to achieve an 

estimated $5.7 million in procurement savings 

in FY 2012.

Information Technology (IT) Savings: The 

United States Mint has employed several 

improved Information Technology strategies 

that have and are continuing to yield cost 

savings. IT consulting services/systems 

support services, IT maintenance contract 

consolidation, and IT telecommunications 

consolidation efforts are yielding continued 

budget savings. These initiatives are projected 

to save over $1.5 million in FY 2012. 

Explanation of Budget Activities 

 

Manufacturing ($2,515,589,000 from 

reimbursable programs, not including capital)

The United States Mint manufactures and sells 

coin products. For budget reporting purposes, 

these products are grouped into two programs: 

Circulating Coinage and Numismatic 

Programs.

Circulating Coinage 

The United States Mint enables commerce by 

minting and issuing circulating coinage to 

meet the needs of the United States. 

Circulating coinage includes the penny (onecent), nickel (five-cent), dime (ten-cent), 
quarter-dollar, half-dollar and dollar 

denominations. The United States Mint 

delivers the circulating coinage to the Federal 

Reserve Banks, at face value, for distribution 

as demanded by commerce. 

Beginning in 2010 through 2020, the United 

States Mint will mint and issue 

commemorative quarter-dollar coins honoring 

national parks and other national sites, in 

accordance with the America’s Beautiful 

National Parks Quarter Dollar Coin Act of 

2008 (Public Law 110-456). This program 

honors national parks and sites in the order in 

which they were first established as a national 

park or site. Similar to the issuance of coins 

under the 50 State Quarters Program, quarterdollar coins featuring five different coin 

designs will be issued each year of this 

program.

Numismatic Program

The United States Mint produces numismatic 

and bullion coins, medals, and other products 

for sale to collectors and the general public. 

These coins include annual recurring programs 

(such as proof and uncirculated sets), silver 

proof coins, the American Eagle and the 

American Buffalo precious metal bullion and 

proof coins, and medals which are legislated to 

commemorate specific events or individuals. 

In FY 2012, the United States Mint will 

produce the United States Army 

Commemorative Coin (Public Law 110-450). 

The current FY 2012 budget estimate for 

numismatic and bullion products includes 

resource needs of $1,903.5 million to generate 

$1,958.4 million in revenues from the sale of 

these products. 

Legislative Proposals 

 

The “Eliminate the 20 percent requirement in 

the Native American $1 Coin Act” legislative 

proposal seeks to eliminate the requirement 

that the number of $1 coins minted and issued 

in a year with the Sacagawea-design on the 

obverse be not less than 20 percent of the total 

number of $1 coins minted and issued in a 

year. Proposed amendment: Section 5112(r) 

of title 31, United States Code, is amended by 

striking paragraph (5). Approval of this 

proposal would allow the United States Mint 

to mint and issue all $1 coins in amounts 

necessary to meet public demand for coins of 

each particular design. It would also eliminate 

the excessive expense of minting and issuing 

Native American $1 Coins in amounts that 

exceed the public demand for them. 

Capital Investments Summary 

 

This United States Mint’s FY 2012 circulating 

and protection capital budget request is $20.0 

million. The United States Mint invests in 

capital projects to maintain, upgrade or acquire 

physical structures, equipment, physical 

security, and to implement its information 

technology roadmap. Total capital projects are 

estimated to be $30.3 million in FY 2012. 

This includes approximately $12.3 million for 

circulating projects, $7.7 million for security 

improvement projects, and $10.3 million for 

numismatic projects.

 
Mint Performance by Budget Activity

Budget Activity Performance Measure FY 2008 FY 2009 FY 2010 FY 2011 FY 2012

Actual Actual Actual Target Target

Manufacturing Numismatic Customer Base 

(Units)(Ot)

1.27 1.06 0.799 0.976 0.976

Manufacturing Customer Satisfaction Index (%) 

(Oe)

87.5 88.3 86.1 88.0 88.0

Manufacturing Safety Incident Recordable Rate 

(Oe)

N/A N/A 2.29 3.34 3.34

Key: Oe - Outcome Measure, E - Efficiency Measure, Ot - Output/Workload Measure, M - Management/Cust. Satisfaction, 

DISC - Discontinued, and B – Baseline

Description of Performance 

 

Customer Satisfaction Index (CSI) 

A United States Mint contractor conducts a 

quarterly Customer Satisfaction Measure 

(CSM) Tracking Survey among a random 

sample of active customers. The CSM Survey 

is intended to capture customer satisfaction 

with the United States Mint’s performance as a 

coin supplier and the quality of specific 

products. The CSI is a single quantitative 

score of CSM Survey results. In FY 2010, the 

United States Mint’s results were 86.1 percent, 

below the target of 88 percent and down from 

the FY 2009 year-end result of 88.3 percent.

Numismatic Customer Base 

The numismatic customer base consists of the 

total number of unique purchasers (in millions) 

within a fiscal year. The numismatic customer 

base measure provides information on the 

continued and new demand for numismatic 

products. The numismatic customer base 

totaled 798,515 in FY 2010, below the target 

of 976,000. Performance declined primarily 

because the bureau was unable to offer key 

gold and silver numismatic products for sale. 

Planchets were diverted to the bullion program 

in accordance with a statutory requirement to 

fulfill bullion demand. 

By the close of FY 2010, the United States 

Mint had expanded planchet supply to fulfill 

bullion demand and redirect a portion of 

precious metal blanks for numismatic 

products. Releasing the popular American 

Eagle numismatic products is expected to 

improve customer retention and acquisition as 

well as customer satisfaction in FY 2011 and 

beyond. This measure is currently being 

reexamined for its usefulness. 

Safety Incident Recordable Rate 

Safety incident recordable rate is the number 

of injuries and illnesses meeting the 

Occupational Health and Safety 

Administration recording criteria per 100 fulltime workers. The safety incident recordable 

rate fell to 2.29 in FY 2010, below the target 

of 3.86. The United States Mint will continue 

to place a high priority on ensuring employee 

safety.
Office of Comptroller of the Currency

Program Summary by Budget Activity

(Dollars in thousands)

Budget Activity FY 2010 FY 2011 1/ FY 2012 2/ FY 2010 to FY 2012

Actual Estimated Estimated $ Change % Change

 Supervise $618,254 $680,090 $900,836 $282,582 45.7%

 Regulate $97,735 $107,511 $111,936 $14,201 14.5%

 Charter $24,434 $26,878 $27,984 $3,550 14.5%

Total Cost of Operations $740,423 $814,479 $1,040,756 $300,333 40.6%

Reimbursable FTE 3,101 3,140 3,976 875 28.2% 1) It is anticipated that for the majority of FY 2011, the OCC will not be regulating the Federal savings associations; accordingly, 

the FY 2011 estimates only reflect the cost of regulating the National Banking System. Figures are subject to revision once the 

personnel realignment provisions of the Dodd-Frank Act are implemented.

(2) FY 2012 estimates include the cost of regulating the National Banking System and Federal savings associations. Figures are 

subject to revision once the personnel realignment provisions of the Dodd-Frank Act are implemented.

Summary

The OCC was created by Congress to charter 

national banks, oversee a nationwide system of 

banking institutions, and ensure national banks 

are safe and sound, competitive and profitable, 

and capable of serving in the best possible 

manner the banking needs of their customers. 

As the regulator of national banks, the OCC 

has established four strategic goals outlined in 

its strategic plan that help support a strong 

economy for the American public: 1) assuring 

the safety and soundness of the institutions 

subject to its jurisdiction; 2) fair access to 

financial services and fair treatment of bank 

customers; 3) a flexible legal and regulatory 

framework that enables the institutions subject 

to its jurisdiction to provide a full competitive 

array of financial services; and 4) an expert, 

highly motivated, and diverse workforce that 

makes effective use of OCC resources. The 

OCC organizes its activities under three 

programs: (1) Supervise, (2) Regulate, and (3) 

Charter, to achieve the goals and objectives.

As of September 30, 2010, the OCC 

supervised 1,487 national bank charters and 51 

federal branches of foreign banks in the United 

States. Total assets under the OCC’s

supervision are approximately $8.6 trillion or 

approximately 70 percent of total United 

States commercial banking assets. As a result 

of the Dodd-Frank Act, in FY 2012 the OCC 

anticipates supervising approximately 700 

Federal savings associations with assets 

currently totaling approximately $0.9 trillion. 

The average size and complexity of the 

institutions in the national banking system 

continue to grow. This combined with OCC’s 

supervision of Federal savings associations 

and responsibility for the Home Owners’ Loan 

Act creates increasing and diverse challenges 

for the OCC. 

The OCC’s priorities focus on strengthening 

the resiliency of the institutions subject to its 

jurisdiction through its supervisory and 

regulatory programs and activities. Through 

on-site examinations, OCC will work to ensure 

that national banks and Federal savings 

associations appropriately identify, account 

for, and follow prudent strategies for problem 

assets; instill a strong corporate governance 

culture that fosters sound loan underwriting 

standards, properly aligned incentive 

compensation structures, and strong internal 

controls, risk management, and compliance 
functions. Other supervisory priorities will be 

identifying and resolving potential problem 

banks at the earliest possible stage; 

encouraging national banks and Federal 

savings associations to meet the needs of 

credit worthy borrowers, including appropriate 

and effective residential mortgage 

modification programs, and ensuring that they 

comply with the Community Reinvestment 

Act and the Bank Secrecy Act/Anti-Money 

Laundering (BSA/AML) and USA PATRIOT 

Act requirements; and further enhancing 

OCC’s supervisory analytical tools. 

A major focus of the OCC’s supervisory, 

regulatory, and administrative programs in 

FYs 2011-2012 will be implementing 

applicable provisions of the Dodd-Frank Act. 

The OCC will work closely within the 

Treasury and other federal regulatory agencies 

on these initiatives, including developing and 

issuing implementing rulemakings on a broad 

range of topics, including regulatory capital; 

permissible proprietary trading, hedge fund, 

and private equity fund investments (the socalled Volcker rule); derivative margin 

requirements; executive compensation; risk 

retention standards for securitizations; and real 

estate appraisals. Similarly, the OCC is 

working to provide smooth transitions for the 

transfer and integration of various regulatory 

and supervisory functions across and among 

the agencies. These efforts will include the 

transfer of certain supervisory responsibilities 

and personnel associated with consumer 

compliance activities to the Consumer 

Financial Protection Bureau (CFPB) and the 

integration of the Office of Thrift Supervision 

(OTS) functions and personnel into the OCC.

In FY 2011, an estimated $814,479 is needed

to fund ongoing OCC operations and address 

program priorities effectively. Estimated OCC 

revenue for FY 2011 is $820,200. 

Operations are funded primarily 

(approximately 97 percent) from semiannual 

assessments levied on national banks, and for 

FY 2012, national banks and Federal savings 

associations. Revenue from investments in 

Treasury securities and other income comprise 

the remaining three percent of the OCC’s 

funding. 

The OCC does not receive congressional 

appropriations to fund any portion of its 

operations.

OCC FY 2012 Budget Highlights

(Dollars in thousands)

Budget Estimate Amount

FY 2010 Actual $740,423

FY 2011 Estimated $814,479

Changes to Base:

Maintaining Current Levels (MCLs): $4,564

Maintaining Current Levels $4,564

Subtotal FY 2012 Changes to Base $4,564

Total FY 2012 Base $819,043

Program Changes:

Program Increases: $221,713

Adjustment $221,713

Subtotal FY 2012 Program Changes $221,713

Total FY 2012 Estimate $1,040,756

Explanation of Budget Activities

Supervise ($680,090,000 from reimbursable 

programs)

The Supervise program consists of ongoing 

supervision and enforcement activities 

undertaken to ensure that each national bank is 

operating in a safe and sound manner and is 

complying with applicable laws, rules, and 

regulations relative to the bank and the 

customers and communities it serves. 

Included are bank examinations and 

enforcement activities; resolution of disputes 

through the National Bank Appeals process; 

ongoing monitoring of banks; and analysis of 

systemic risks and market trends in the 

national banking system or groups of national 

banks, the financial services industry, and the 

economic and regulatory environment.
Regulate ($107,511,000 from reimbursable 

programs)

The Regulate program consists of ongoing 

activities that result in the establishment of 

regulations, policies, operating guidance, and 

interpretations of general applicability to 

national banks. These regulations, policies, 

and interpretations may establish system-wide 

standards, define acceptable banking practices, 

provide guidance on risks and responsibilities 

facing national banks, or prohibit (or restrict) 

banking practices deemed to be imprudent or 

unsafe. This includes the establishment of 

examination policies, handbooks, and 

interpretations for examiners as well as 

representation of the OCC’s regulatory 

authorities and interpretations in 

administrative, judicial, and congressional 

hearings.

Charter ($26,878,000 from reimbursable 

programs)

The Charter program consists of ongoing 

activities that result in the chartering of 

national banks as well as the evaluation of the 

permissibility of structures and activities of 

national banks and their subsidiaries. This 

includes the review and approval of new 

national bank charters, federal branches and 

agencies, mergers, acquisitions, conversions, 

business combinations, corporate 

reorganizations, changes in control, operating 

subsidiaries, branches, relocations, and 

subordinated debt issues.

Capital Investments Summary

Central Application Tracking System (CATS)

- This initiative will significantly improve the 

accuracy, tracking, monitoring, recording, and 

reporting of the applications and notices by the 

Licensing and Community Affairs 

Departments. 

Personnel Administration and Security System 

(PASS) - This initiative will improve and 

automate core personnel security processes, 

including on-boarding and off-boarding. The

PASS initiative will bring the OCC into 

compliance with audit and Homeland Security 

Presidential Directive 12 (HSPD-12)

requirements. 

OCC Performance by Budget Activity

Budget Activity Performance Measure FY 2008 FY 2009 FY 2010 FY 2011 FY 2012

Actual Actual Actual Target Target

Prevented or mitigated 

financial and economic 

crises

Percent of National Banks 

With Composite CAMELS 

Rating 1 or 2 (Oe)

92.0 82.0 70.0 90.0 90.0

Prevented or mitigated 

financial and economic 

crises

Percentage of National 

Banks with Consumer 

Compliance Rating of 1 or 2 

(Oe)

97.0 97.0 95.0 94.0 94.0

Prevented or mitigated 

financial and economic 

crises

Rehabilitated National Banks 

as a Percentage of Problem 

National Banks One Year 

Ago (CAMEL 3,4, or 5) (Oe)

47.0 29.0 23.0 40.0 40.0

Improved economic 

opportunity at home 

and abroad

Percentage of National 

Banks that are Categorized 

as Well Capitalized (Oe)

99.0 86.0 90.0 95.0 95.0

Charter Percentage of Licensing Applica 

and Notices Completed within 

Established Timeframes (Oe)

95.0 95.0 96.0 95.0 95.0

Key: Oe - Outcome Measure, E - Efficiency Measure, Ot - Output/Workload Measure, M - Management/Cust. 

Satisfaction, DISC - Discontinued, and B - Baseline
Description of Performance

The Federal Deposit Insurance Act established 

a system that classifies insured depository 

institutions into five categories (well 

capitalized, adequately capitalized, 

undercapitalized, significantly 

undercapitalized, and critically 

undercapitalized) based on their capital levels 

relative to their risks. Through September 30, 

2010, 90 percent of national banks were 

classified as well capitalized. 

The composite CAMELS (Capital adequacy, 

Asset quality, Management, Earnings, 

Liquidity, and Sensitivity to market risk) 

rating reflects the overall condition of a bank. 

Bank regulatory agencies use the Uniform 

Financial Institutions Rating System, 

CAMELS, to provide a general framework for 

evaluating all significant financial, operational, 

and compliance factors inherent in a bank. 

The rating scale is 1 through 5 of which 1 is 

the highest rating granted. CAMELS ratings 

are assigned at the completion of every 

supervisory cycle or when there is a significant 

event leading to a change in CAMELS. 

Through September 30, 2010, 70 percent of 

national banks earned composite CAMELS 

rating of either 1 or 2.

Problem banks ultimately can reach a point at 

which rehabilitation is no longer feasible. The 

OCC’s early identification and intervention 

with problem banks can lead to successful 

remediation of these banks. As a result, 23 

percent of banks with composite CAMELS 

ratings of 3, 4, or 5 one year ago have 

improved their ratings to either 1 or 2 this 

year.

To ensure fair access to financial services and 

fair treatment of bank customers, the OCC 

evaluates a bank’s compliance with consumer 

laws and regulations. Each bank is assigned a 

consumer compliance rating based on an 

evaluation of its present compliance with 

consumer protection and civil rights statutes 

and regulations, and the adequacy of its 

operating systems designed to ensure 

continuing compliance. Ratings are on a scale 

of 1 through 5 in increasing order of 

supervisory concern. National banks continue 

to show strong compliance with consumer 

protection regulations with 95 percent earning 

a consumer compliance rating of either 1 or 2 

through September 30, 2010.

The OCC’s timely and effective approval of 

corporate applications contributes to the 

nation’s economy by enabling national banks 

to complete various corporate transactions and 

introduce new financial products and services. 

Time frames have been established for 

completing each type of application and 

notice. The OCC completed 96 percent of 

applications and notices within the time 

standard through September 30, 2010.

The OCC implemented a performance 

measure—Total OCC Costs Relative to Every 

$100,000 in Bank Assets Regulated—that 

reflects the efficiency of its operations while 

meeting the increasing supervisory demands of 

a growing and more complex national banking 

system. This measure supports the OCC’s 

strategic goal of efficient use of agency 

resources.
Office of Thrift Supervision

Program Summary by Budget Activity

(Dollars in thousands)

Budget Activity FY 2010 FY 2011 FY 2012 FY 2010 to FY 2012

Actual Estimated Estimated $ Change % Change

 Supervision of the Thrift Industry $232,047 $253,605 $0 ($232,047) (100.0%)

Total Cost of Operations $232,047 $253,605 $0 ($232,047) (100.0%)

Reimbursable FTE 1,016 1,021 - (1,016) (100.0%)

Summary

The Office of Thrift Supervision (OTS) was 

established by Congress as a bureau of the 

Department of the Treasury pursuant to the 

Financial Institutions Reform, Recovery, and 

Enforcement Act of 1989, Public Law 101-73. 

OTS charters, examines, supervises, and 

regulates federal savings associations insured 

by the Federal Deposit Insurance Corporation 

(FDIC). OTS also examines, supervises, and 

regulates state-chartered, FDIC-insured 

savings associations and provides for the 

registration, examination, and supervision of 

savings association affiliates and holding 

companies. OTS sets capital standards for 

Federal and State savings associations and 

reviews applications of state-chartered savings 

associations for conversion to federal thrifts. 

The OTS also supervises 436 holding 

company enterprises with approximately $4.2 

trillion in U.S. domiciled consolidated assets. 

These enterprises owned 398 thrifts with total 

assets of $717 billion or 77 percent of total 

thrift industry assets.

In July 2010, Congress passed, and the 

President signed the Dodd-Frank Wall Street 

Reform and Consumer Protection Act, Public 

Law 111–203 (Dodd-Frank Act), abolishing 

OTS and transferring its functions to the 

Office of the Comptroller of the Currency 

(OCC), The Federal Reserve Board, the 

Federal Deposit Insurance Corporation 

(FDIC), and The Consumer Financial Protection Bureau according to the Dodd-Frank Act 

timetable, starting as early as one year after its

enactment. 

As of September 30, 2010, the OTS regulated 

741 thrifts with total assets of $928 billion. 

OTS receives no appropriated funds from 

Congress. Income of the bureau is derived 

principally from assessments on savings 

associations and their holding companies, 

examination fees, and interest on investments 

in U.S. Government obligations. 

OTS FY 2012 Budget Highlights

(Do

Budget Estimate Amount

FY 2010 Actual $232,047

FY 2011 Estimated $253,605

Total FY 2012 Base $253,605

Program Changes:

Program Decreases: ($253,605)

Transfer of Resources ($253,605)

Subtotal FY 2012 Program Changes ($253,605)

Total FY 2012 Estimated $0

llars in thousands)

(1) The Dodd-Frank Wall Street Reform and Consumer Protection Act, Public Law 111-203 (Dodd-Frank Act), abolishes and 

transfers the functions of the Office of Thrift Supervision in Fiscal Year 2011. 
Explanation of Budget Activities

Supervision of the Thrift Industry (No funding)

OTS examines savings associations every 12-

18 months for safety and soundness and 

compliance with consumer protection laws and 

regulations. During these exams, the 

association’s ability to identify, measure, 

monitor and control risk is evaluated, 

including the risk posed by other entities 

within the corporate structure. When 

weaknesses are identified, increased 

supervisory action, including additional field 

visits, accelerating the normal 12-18 month 

exam cycle, and/or enforcement action is 

taken.

Capital Investments Summary

OTS has no major IT investments planned for 

FY 2011.

OTS Performance by Budget Activity

Budget Activity Performance Measure FY 2008 FY 2009 FY 2010 FY 2011 FY 2012

Actual Actual Actual Target Target

Prevented or mitigated 

financial and economic crises

Percent of Safety and Soundness 

Exams Started as Scheduled (Ot)

94.0 94.0 97.0 90.0 Disc

Prevented or mitigated 

financial and economic crises

Percent of Thrifts that are Well 

Capitalized (Oe)

98.4 97.0 95.0 95.0 Disc

Prevented or mitigated 

financial and economic crises

Percent of Thrifts with Composite 

CAMELS Ratings of 1 or 2 (%) (Oe)

90.0 84.0 77.0 80.0 Disc

Prevented or mitigated 

financial and economic crises

Percent of Thrifts with a Compliance 

Examination Ratings of 1 or 2 (Oe)

95.8 95.0 92.0 90.0 Disc

Key: Oe - Outcome Measure, E - Efficiency Measure, Ot - Output/Workload Measure, M - Management/Cust. Satisfaction, DISC -

Discontinued, and B - Baseline

Description of Performance

OTS anticipates meeting the targets for each of 

its performance measures in FY 2011. With 

the transfer of OTS functions under the DoddFrank Act OTS performance measures will be 

discontinued in FY 2012
Treasury International Programs 

Program Summary 

(Dollars in Thousands) 

 FY 2010 FY 2011 FY 2012 

 Enacted 

Annualized 

CR Level 

President's 

Budget 

Increase/ 

Decrease 

Percent 

Change 

Poverty Reduction and Economic Growth (MDBs) $1,552,170 $1,552,170 $2,072,564 $520,394 33.5% 

International Development Association (IDA) 1,262,500 1,262,500 1,358,500 96,000 7.6% 

Int'l Bank for Reconstruction and Development (IBRD) 117,364 117,364 

Inter-American Development Bank (IDB and FSO) 102,018 102,018 

Multilateral Investment Fund (MIF) 25,000 25,000 25,000 0 0.0% 

Inter-American Investment Corporation (IIC) 4,670 4,670 20,429 15,759 337.4% 

Asian Development Bank (AsDB) 106,586 106,586 

Asian Development Fund (AsDF) 105,000 105,000 115,250 10,250 9.8% 

African Development Bank (AfDB) 32,418 32,418 

African Development Fund (AfDF) 155,000 155,000 195,000 40,000 25.8% 

European Bank for Reconstruction & Development (EBRD) 0 0 

Food Security $30,000 $30,000 $338,000 $308,000 1026.7% 

Global Agriculture and Food Security Program (GAFSP)* 308,000 308,000 

Int'l Fund for Agricultural Development (IFAD) 30,000 30,000 30,000 0 0.0% 

Combating Climate Change and Environmental Degradation $481,500 $481,500 $748,750 $267,250 55.5% 

Clean Technology Fund (CTF) 300,000 300,000 400,000 100,000 33.3% 

Strategic Climate Funds (SCF) 75,000 75,000 190,000 115,000 153.3% 

 Pilot Program for Climate Resilience (PPRC) 40,000 40,000 

 Forest Investment Program (FIP) 130,000 130,000 

 Scaling-Up Renewable Energy Program (SREP) 20,000 20,000 

Global Environment Facility (GEF) 86,500 86,500 143,750 57,250 66.2% 

Tropical Forest Conservation Act (TFCA) 20,000 20,000 15,000 (5,000) -25.0% 

Debt Relief $40,000 $40,000 $174,500 $134,500 336.3% 

Bilateral Debt Reduction/HIPC Trust Fund 40,000 40,000 0 (40,000) -100.0% 

Multilateral Debt Relief Initiative (MDRI) for IDA15** 91,000 91,000 

MDRI for IDA16, AfDF12*** 83,500 83,500 

Treasury Office of Technical Assistance $25,000 $25,000 $30,120 $5,120 20.5% 

Total $2,128,670 $2,128,670 $3,363,934 $1,235,264 58.0% 

* In FY 2010, the U.S. Agency for International Development transferred $66.6 million in Development Assistance funds to Treasury for payment to the Global 

Agriculture and Food Security Fund. 

** This funding will both meet the U.S.'s remaining commitment to MDRI under IDA15 and cancel IDA15 arrears, assuming full funding of IDA's FY2011 request. 

*** $76 million is for the FY 2012 IDA16 MDRI commitment and $7.5 million is for the FY 2012 AfDF MDRI commitment. 

Summary 

 

International Development Association (IDA) 

The FY 2012 request includes $1,358.5 

million for the first of three annual payments 

to the sixteenth replenishment of IDA 

(IDA16). IDA is a facility within the World 

Bank Group that makes grants and highly 

concessional or “soft” loans to the world’s 79 

poorest countries, and is the centerpiece of 

U.S. multilateral development assistance. 

IDA is the single largest source of 

development finance globally across a range 

of sectors, addressing primary education, basic 

health services, clean water and sanitation, 

environmental safeguards, business climate 

improvements, infra-structure and institutional 

reforms. 
International Bank for Reconstruction and 

Development (IBRD) 

The FY 2012 request includes $117.4 million 

for the first of five installments of the United 

States capital subscription to the IBRD 

General Capital Increase (GCI). IBRD is a 

facility within the World Bank Group that 

makes non-concessional or “hard” loans to 

primarily middle-income countries and as well 

as some creditworthy low-income countries. 

The IBRD focuses on supporting poverty 

reduction, economic development and global 

public goods, including climate change and 

food security. The Bank plans to continue 

strong increases in lending to support 

renewable energy and energy efficiency 

projects as well as agriculture and food 

production. The Bank also serves as the 

premier center for research and knowledge on 

development, helping to promote lessons 

learned and identify innovations that can even 

more significantly leverage the Bank’s 

resources to combat poverty. 

Inter-American Development Bank (IDB) 

The FY2012 request includes $102.0 million 

for the first of five installments for the IDB’s 

ninth GCI. The Inter-American Development 

Bank makes “hard” or non-concessional loans 

to middle-income governments, some 

creditworthy low-income countries, and 

private sector firms in Latin America and the 

Caribbean. Established in 1959, the IDB is 

the largest source of development financing in 

the region, providing 26 borrowing member 

countries close to 50 percent of their 

multilateral financing. 

Multilateral Investment Fund (MIF) 

The FY 2012 request includes $25.0 million 

for the sixth installment payment of the first 

replenishment of the MIF. The MIF is a 

facility within the IDB Group, focusing on 

private sector development in the Western 

Hemisphere. The MIF promotes micro and 

small enterprise growth in Latin America and 

works directly with private sector and public 

sector partners to strengthen the environment 

for business, build the capabilities and skills 

of the workforce and broaden the economic 

participation of smaller enterprises. 

Inter-American Investment Corporation (IIC) 

The FY 2012 request includes $20.4 million to 

clear remaining U.S. arrears to the InterAmerican Investment Corporation. The IIC, a 

facility of the IDB Group was established to 

promote private small and medium-sized 

enterprises (SMEs) in Latin America and the 

Caribbean by offering a combination of direct 

loans and equity investments in individual 

companies, lending through private local 

banks, and participation in regional equity 

funds. 

Asian Development Bank (AsDB) 

The FY 2012 request includes $106.6 million 

for the second of five capital contributions for 

the fifth General Capital Increase. The Asian 

Development Bank is the “hard” or nonconcessional window that makes loans to 

middle-income countries and creditworthy 

low income countries in Asia. The United 

States has been a leading shareholder of the 

Asian Development Bank since it was 

established in 1966. The AsDB’s comparative 

advantage is infrastructure finance in such 

core sectors as energy, transport, and water – 

typically these sectors will comprise 80 

percent or more of AsDB operations in a 

given year. 

Asian Development Fund (AsDF) 

The FY 2012 request includes $115.3 million 

for the third installment of a four-year 

commitment under the agreement of the ninth 

replenishment of the Asian Development 

Fund. As the Asian Development Bank’s 

“soft” or concessional window, the AsDF is a 

critical provider of donor resources to some of 

the poorest countries in Asia. These resources 

finance policy support and policy reform, 
production capacity, human development, 

environmentally sustainable investments, 

good governance and capacity building for 

development management, and regional 

cooperation. Additionally, the AsDF places an 

emphasis on infrastructure finance, and the 

U.S. has been immensely successful in 

directing the AsDF’s resources towards U.S. 

priority countries, including Afghanistan and 

Pakistan. 

African Development Bank (AfDB) 

The FY 2012 request includes $32.4 million 

for the first of eight installments for the 

AfDB’s sixth GCI. The African Development 

Bank is the non-concessional or “hard” 

window that makes public sector loans to the 

15 middle-income countries in Africa, and 

private sector loans to both middle- and lowincome countries. Through its support to 

Africa’s middle-income countries, the AfDB 

is helping to create a new generation of 

markets for U.S. businesses and workers, 

enhancing the region’s capacity to grow 

without reliance on donor aid. 

African Development Fund (AfDF) 

The FY 2012 request includes $195.0 million 

for the first of three annual payments to the 

twelfth replenishment of the AfDf (AfDF-12). 

The African Development Fund is a facility 

within the African Development Bank Group 

that works with the 40 poorest countries in 

Africa, offering grants and highly 

concessional or “soft” loans. The AfDF has a 

strong strategic focus on infrastructure, 

economic governance, and regional 

integration. The AfDF is particularly active in 

the infrastructure sector, a key challenge to 

economic growth on the continent. 

European Bank for Reconstruction and 

Development (EBRD) 

For FY 2012, the Administration does not 

have an appropriations request for the EBRD. 

The EBRD makes “hard” or non-concessional 

loans and equity investments in primarily 

private sector firms in developing countries, as 

well as governments of developing countries 

in the region. 

The Global Agriculture and Food Security 

Program (GAFSP) 

The FY 2012 request includes $308.0 million 

for the Global Agriculture and Food Security 

Program. As part of the Administration’s food 

security initiative, the U.S. Department of the 

Treasury has worked with our partners in the 

G-8 and G-20 to establish the GAFSP. 

GAFSP is a multilateral fund to increase 

investments in agriculture and food security in 

poor countries by leveraging U.S. resources. 

This fund, launched on April 22, 2010 by 

Secretary Geithner, provides an opportunity to 

forge a global response among G20 members 

and non-G20 countries as well as private 

sector and civil society organizations. 

International Fund for Agricultural 

Development (IFAD) 

The FY 2012 request includes $30.0 million 

for the third of three payments to the eighth 

replenishment of the International Fund for 

Agricultural Development. IFAD, a 

specialized facility of the United Nations, is 

the only multilateral development institution 

focused exclusively on reducing poverty and 

improving food security in the rural areas of 

developing countries. Through low-interest 

loans and grants, IFAD develops and finances 

projects that help smallholder farmers increase 

agricultural productivity and incomes, 

improve nutritional levels, and access larger 

markets. 

Clean Technology Fund (CTF) 

The FY 2012 request includes $400.0 million 

for the CTF. The CTF is one of two 

multilateral Climate Investment Funds (CIF). 

The CTF aims to reduce global emissions 

growth and combat climate change by helping 

to close the price gap in developing countries 
between commercially available clean 

technologies and dirtier conventional 

alternatives in the power sector, the transport 

sector, and in energy efficiency. The CTF 

focuses on spurring large-scale clean energy 

investments in middle income developing 

countries with rapidly growing levels of 

greenhouse gas pollution. 

Strategic Climate Fund (SCF) 

The FY 2012 request includes $190.0 million 

for the SCF. The SCF, the other facility of the 

multilateral Climate Investment Funds (CIF), 

supports three targeted programs to pilot new 

approaches and scaled-up activities to address 

climate change challenges in developing 

countries, while promoting low-carbon, 

climate resilient economic growth. The three 

programs are the Pilot Program for Climate 

Resilience (PPRC), the Forest Investment 

Program (FIP) and the Program for ScalingUp Renewable Energy in Low Income 

Countries (SREP). 

Global Environment Facility (GEF) 

The FY 2012 request includes $143.8 million 

for the GEF, a multilateral fund that provides 

incremental finance—mostly grants—for 

projects that improve the global environment, 

such as reducing greenhouse gas pollution and 

conserving biodiversity. The GEF supports 

capacity building and innovative and costeffective investments whose design and 

environmental benefits can be duplicated (and 

financed) elsewhere. 

Tropical Forest Conservation Act 

The FY 2012 request of $15 million will be 

used to support Treasury implementation of 

the Tropical Forest Conservation Act which 

authorizes debt relief for low and middle 

income countries to support conservation of 

tropical forests. Under the program, treated 

debt is reduced and “redirected” to provide for 

grants to local nongovernmental organizations 

and other entities engaged in forest 

conservation in the beneficiary country. The 

United States uses appropriated funds to pay 

for the budget cost of this debt reduction and 

redirection. 

Multilateral Debt Relief Initiative 

The FY 2012 request includes $91.0 million 

for the remaining U.S. commitment to MDRI 

under IDA15 and $83.5 million for payment 

toward the U.S. commitment to MDRI in the 

IDA16 and AfDF12 periods. Building upon 

the Heavily Indebted Poor Countries (HIPC) 

Initiative, the Multilateral Debt Relief 

Initiative (MDRI) provides 100 percent 

cancellation of remaining eligible debts owed 

to the World Bank’s International 

Development Association (IDA), the African 

Development Bank’s African Development 

Fund (AfDF), and the International Monetary 

Fund (IMF) for countries that complete the 

HIPC initiative. 

Treasury Technical Assistance 

The FY 2012 request of $30.1 million for the 

Department of Treasury’s International 

Affairs Technical Assistance Program 

provides highly experienced financial advisors 

to reform-minded developing countries, 

transitional economies, and nations recovering 

from conflict. Through the Office of 

Technical Assistance (OTA), Treasury 

advisors work side-by-side with government 

officials in finance ministries and central 

banks in more than fifty countries to 

strengthen their capacity to manage public 

finances – through efficient revenue 

collection, well-planned and executed 

budgets, judicious debt management, 

fundamentally sound banking systems, and 

strong controls to combat corruption and 

economic crimes. 

Description of Performance 

 

Strengthening transparency and ensuring 

accountability are critical objectives of the 
United States’ continued support for the 

MDBs and other International Programs, and 

Treasury is tightly focused on these criteria. 

That is why Treasury actively seeks clear and 

consistent accountability standards and 

measures, and promotes policies that direct 

funds to what has been proven to work and 

away from what cannot be measured. 

Performance, transparency, monitoring and 

results are at the heart of all of these efforts. 

As a result of U.S. leadership in these areas, 

the MDBs have adopted expansive disclosure 

requirements, stronger auditing functions, 

better internal controls and are at the leading 

edge of impact evaluations and performancedriven investment. Treasury has also 

succeeded in fostering cutting-edge systems 

for measuring, monitoring, and incorporating 

development results in MDB operations, and 

persuading the MDBs to adopt mechanisms 

under which donor funds are distributed on the 

basis of performance. In this way, the MDBs 

provide strong incentives to recipient 

countries to fulfill their obligations, greatly 

improving prospects for success and 

strengthening economic growth and 

development. 

Treasury also pursues these same standards in 

the Technical Assistance programs, and across 

the other important International Programs 

managed by the Department. 
Summary of FY 2012 Appropriations Language 

Below is a summary of the Treasury 

appropriations language proposed for FY 

2012. 

Departmental Offices 

Federal Funds 

___________________________________

Salaries and Expense 

(Including Transfer of Funds) 

For necessary expenses of the Departmental 

Offices including operation and maintenance 

of the Treasury Building and Annex; hire of 

passenger motor vehicles; maintenance, 

repairs, and improvements of, and purchase of 

commercial insurance policies for real 

properties leased or owned overseas, when 

necessary for the performance of official 

business, $324,889,000: Provided, That 

notwithstanding any other provision of law, of 

the amount appropriated under this heading, 

up to $1,000,000, may be contributed to the 

Global Forum on Transparency and Exchange 

of Information for Tax Purposes, a Part II 

Program of the Organization for Economic 

Cooperation and Development, to cover the 

cost assessed by that organization for 

Treasury's participation therein: Provided 

further, That of the amount appropriated 

under this heading, not to exceed $3,000,000, 

to remain available until September 30, 2013, 

is for information technology modernization 

requirements; not to exceed $200,000 is for 

official reception and representation 

expenses; $200,000 is to support international 

representation commitments of the Secretary; 

and not to exceed $258,000 is for unforeseen 

emergencies of a confidential nature, to be 

allocated and expended under the direction of 

the Secretary of the Treasury and to be 

accounted for solely on his certificate: 

Provided further, That of the amount 

appropriated under this heading, $6,787,000, 

to remain available until September 30, 2013, 

is for the Treasury-wide Financial Statement 

Audit and Internal Control Program, of which 

such amounts as may be necessary may be 

transferred to accounts of the Department's 

offices and bureaus to conduct audits: 

Provided further, That this transfer authority 

shall be in addition to any other provided in 

this Act: Provided further, That of the amount 

appropriated under this heading, $500,000, to 

remain available until September 30, 2013, is 

for secure space requirements: Provided 

further, That of the amount appropriated 

under this heading, up to $3,400,000, to 

remain available until September 30, 2014, is 

to develop and implement programs within the 

Office of Critical Infrastructure Protection 

and Compliance Policy, including entering 

into cooperative agreements : Provided 

further, That of the funds made available 

under this heading, $2,500,000 is for 

strengthening the Department's acquisition 

workforce capacity and capabilities: Provided 

further, That with respect to the previous 

proviso, such funds shall be available for 

training, recruitment, retention, and hiring 

members of the acquisition workforce as 

defined by the Office of Federal Procurement 

Policy Act, as amended (41 U.S.C. 401 et 

seq.): Provided further, That with respect to 

the seventh proviso, such funds shall be 

available for information technology in 

support of acquisition workforce effectiveness 

or for management solutions to improve 

acquisition management.

Office of Inspector General 

___________________________________

For necessary expenses of the Office of 

Inspector General in carrying out the 

provisions of the Inspector General Act of 

1978, as amended, $29,855,000, of which not 

to exceed $2,000,000 for official travel 

expenses, including hire of passenger motor 

vehicles; and of which not to exceed $100,000 

for unforeseen emergencies of a confidential 

nature, to be allocated and expended under 

the direction of the Inspector General of the 
Treasury. 

Treasury Inspector General for Tax 

Administration 

___________________________________ 

Salaries and Expenses 

For necessary expenses of the Treasury 

Inspector General for Tax Administration in 

carrying out the Inspector General Act of 

1978, as amended, including purchase (not to 

exceed 150 for replacement only for policetype use) and hire of passenger motor vehicles 

(31 U.S.C. 1343(b)); services authorized by 5 

U.S.C. 3109, at such rates as may be 

determined by the Inspector General for Tax 

Administration; $157,831,000, of which not to 

exceed $6,000,000 shall be available for 

official travel expenses; of which not to exceed 

$500,000 shall be available for unforeseen 

emergencies of a confidential nature, to be 

allocated and expended under the direction of 

the Inspector General for Tax Administration. 

Treasury Forfeiture Fund 

___________________________________ 

(Cancellation) 

Of the unobligated balances available under 

this heading, $600,000,000 are hereby 

permanently cancelled. 

Community Development Financial 

Institutions Fund Program Account 

___________________________________

To carry out the Community Development 

Banking and Financial Institutions Act of 

1994 (Public Law 103–325), including 

services authorized by 5 U.S.C. 3109, but at 

rates for individuals not to exceed the per 

diem rate equivalent to the rate for ES-3, 

$227,259,000, to remain available until 

September 30, 2013; of which $12,000,000 

shall be for financial assistance, technical 

assistance, training and outreach programs, 

under sections 105 through 109 of the 

Community Development Banking and 

Financial Institutions Act of 1994 (12 U.S.C. 

4704–4708), designed to benefit Native 

communities and provided primarily through 

qualified community development lender 

organizations with experience and expertise in 

community development banking and lending 

in Indian country, Native American 

organizations, tribes and tribal organizations 

and other suitable providers; of which, 

notwithstanding section 108(d) of such Act, up 

to $25,000,000 shall be for a Healthy Food 

Financing Initiative to provide grants and 

loans to community development financial 

institutions for the purpose of offering 

affordable financing and technical assistance 

to expand the availability of healthy food 

options in distressed communities; of which 

$41,425,000 shall be for initiatives to 

establish bank accounts for low and 

moderate-income persons who do not have 

bank accounts with financial institutions and 

to improve access to the provision of bank 

accounts as authorized by section 1204 of 

Public Law 111–203; of which up to 

$22,965,000 may be used for administrative 

expenses, including administration of the New 

Markets Tax Credit; of which up to 

$10,315,000 may be used for the cost of direct 

loans; and of which up to $250,000 may be 

used for administrative expenses to carry out 

the direct loan program: Provided, That the 

cost of direct loans, including the cost of 

modifying such loans, shall be as defined in 

section 502 of the Congressional Budget Act 

of 1974: Provided further, That these funds 

are available to subsidize gross obligations 

for the principal amount of direct loans not to 

exceed $25,000,000. 

Special Inspector General for the Troubled 

Asset Relief Program 

___________________________________

Salaries and Expenses 

For necessary expenses of the Office of the 

Special Inspector General in carrying out 

the provisions of the Emergency Economic 

Stabilization Act of 2008 (Public Law 110–

343), as amended, $47,374,000.
Financial Crimes Enforcement Network 

Federal Funds 

___________________________________

Salaries and Expenses 

For necessary expenses of the Financial 

Crimes Enforcement Network, including hire 

of passenger motor vehicles; travel and 

training expenses, including for course 

development, of non-Federal and foreign 

government personnel to attend meetings and 

training concerned with domestic and foreign 

financial intelligence activities, law 

enforcement, and financial regulation; not to 

exceed $14,000 for official reception and 

representation expenses; and for assistance to 

Federal law enforcement agencies, with or 

without reimbursement, $84,297,000, of which 

not to exceed $15,835,000 shall remain 

available until September 30, 2014: Provided, 

That funds appropriated in this account may 

be used to procure personal services 

contracts. 

Financial Management Service 

Federal Funds 

___________________________________ 

Salaries and Expenses 

For necessary expenses of the Financial 

Management Service, $218,805,000, of which 

not to exceed $4,120,000 shall remain 

available until September 30, 2014, for 

information systems modernization initiatives; 

and of which not to exceed $2,500 shall be 

available for official reception and 

representation expenses. 

Alcohol and Tobacco Tax and Trade 

Bureau 

Federal Funds 

___________________________________

Salaries and Expenses 

For necessary expenses of carrying out 

section 1111 of the Homeland Security Act of 

2002, including hire of passenger motor 

vehicles, $97,878,000; of which not to exceed 

$6,000 for official reception and 

representation expenses; not to exceed 

$50,000 for cooperative research and 

development programs for laboratory 

services; and provision of laboratory 

assistance to State and local agencies with or 

without reimbursement. 

United States Mint 

Federal Funds 

___________________________________

Public Enterprise Fund 

Pursuant to section 5136 of title 31, United 

States Code, the United States Mint is 

provided funding through the United States 

Mint Public Enterprise Fund for costs 

associated with the production of circulating 

coins, numismatic coins, and protective 

services, including both operating expenses 

and capital investments. The aggregate 

amount of new liabilities and obligations 

incurred during fiscal year 2012 under such 

section 5136 for circulating coinage and 

protective service capital investments of the 

United States Mint shall not exceed 

$20,000,000. 

Bureau of the Public Debt 

Federal Funds 

___________________________________

Administering the Public Debt 

For necessary expenses connected with any 

public-debt issues of the United States, 

$173,635,000, of which not to exceed $2,500 

shall be available for official reception and 

representation expenses, and of which 

$10,000,000 shall remain available until 

September 30, 2014, for the Do Not Pay 

portal initiative: Provided, That the sum 

appropriated herein from the general fund for 

fiscal year 2012 shall be reduced by not more 

than $8,000,000 as definitive security issue 

fees and Legacy Treasury Direct Investor 

Account Maintenance fees are collected, so as 

to result in a final fiscal year 2012 

appropriation from the general fund estimated 

at $165,635,000. In addition, $165,000 to be 

derived from the Oil Spill Liability Trust Fund 

to reimburse the Bureau for administrative 

and personnel expenses for financial 
management of the Fund, as authorized by 

section 1012 of Public Law 101–380. 

Internal Revenue Service 

Federal Funds 

___________________________________ 

Taxpayer Services 

(Including Transfer of Funds) 

For necessary expenses of the Internal 

Revenue Service to provide taxpayer services, 

including pre-filing assistance and education, 

filing and account services, taxpayer 

advocacy services, and other services as 

authorized by 5 U.S.C. 3109, at such rates as 

may be determined by the Commissioner, 

$2,345,133,000, of which not less than 

$5,100,000 shall be for the Tax Counseling for 

the Elderly Program, of which not less than 

$9,500,000 shall be available for low-income 

taxpayer clinic grants, of which not less than 

$8,000,000, to remain available until 

September 30, 2013, shall be available for a 

Community Volunteer Income Tax Assistance 

matching grants program for tax return 

preparation assistance, and of which up to 

$6,000,000 may be transferred as necessary 

from this account to "Health Insurance Tax 

Credit Administration" upon advance 

notification of the Committees on 

Appropriations: Provided, That this transfer 

authority shall be in addition to any other 

transfer authority provided in this Act.

Enforcement 

For necessary expenses for tax enforcement 

activities of the Internal Revenue Service to 

determine and collect owed taxes, to provide 

legal and litigation support, to conduct 

criminal investigations, to enforce criminal 

statutes related to violations of internal 

revenue laws and other financial crimes, to 

purchase (for police-type use, not to exceed 

850) and hire passenger motor vehicles (31 

U.S.C. 1343(b)), and to provide other services 

as authorized by 5 U.S.C. 3109, at such rates 

as may be determined by the Commissioner, 

$5,966,619,000, of which not less than 

$60,257,000 shall be for the Interagency 

Crime and Drug Enforcement program: 

Provided, That of the amount provided under 

this heading, not less than $936,000,000 shall 

be for the additional appropriation for 

Internal Revenue Service tax compliance 

activities included as an adjustment to the 

discretionary spending limits pursuant to the 

Concurrent Resolution on the Budget. 

Health Insurance Tax Credit Administration 

For expenses necessary to implement the 

health insurance tax credit included in the 

Trade Act of 2002 (Public Law 107–210), 

$18,029,000. 

Operations Support 

For necessary expenses of the Internal 

Revenue Service to support taxpayer services 

and enforcement programs, including rent 

payments; facilities services; printing; 

postage; physical security; headquarters and 

other IRS-wide administration activities; 

research and statistics of income; 

telecommunications; information technology 

development, enhancement, operations, 

maintenance, and security; the hire of 

passenger motor vehicles (31 U.S.C. 1343(b)); 

and other services as authorized by 5 U.S.C. 

3109, at such rates as may be determined by 

the Commissioner; $4,620,526,000, of which 

up to $250,000,000 shall remain available 

until September 30, 2013, for information 

technology support; of which up to 

$65,000,000 shall remain available until 

expended for acquisition of real property, 

equipment, construction and renovation of 

facilities; of which not to exceed $1,000,000 

shall remain available until September 30, 

2014, for research; of which not to exceed 

$2,000,000 shall be for the Internal Revenue 

Service Oversight Board; of which not to 

exceed $25,000 shall be for official reception 

and representation: Provided, That of the 

amounts provided under this heading, such 

sums as are necessary shall be available to 

fully support tax enforcement activities, 
including not less than $321,000,000 for the 

additional appropriation for Internal Revenue 

Service tax compliance activities included as 

an adjustment to the discretionary spending 

limits pursuant to the Concurrent Resolution 

on the Budget. 

Business Systems Modernization 

For necessary expenses of the Internal 

Revenue Service's business systems 

modernization program, $333,600,000, to 

remain available until September 30, 2014, 

for the capital asset acquisition of information 

technology systems, including management 

and related contractual costs of said 

acquisitions, including related Internal 

Revenue Service labor costs, and contractual 

costs associated with operations authorized by 

5 U.S.C. 3109: Provided, That, with the 

exception of labor costs, none of these funds 

may be obligated until the Internal Revenue 

Service submits to the Committees on 

Appropriations a plan for expenditure that: 

(1) meets the capital planning and investment 

control review requirements established by the 

Office of Management and Budget, including 

Circular A-11; (2) complies with the Internal 

Revenue Service's enterprise architecture, 

including the modernization blueprint; (3) 

conforms with the Internal Revenue Service's 

enterprise life cycle methodology; (4) is 

approved by the Internal Revenue Service, the 

Department of the Treasury, and the Office of 

Management and Budget; (5) has been 

received by the Government Accountability 

Office; and (6) complies with the acquisition 

rules, requirements, guidelines, and systems 

acquisition management practices of the 

Federal Government. 

Administrative Provisions-Internal 

Revenue Service 

___________________________________

(Including Transfer of Funds) 

SEC. 101. Not to exceed 5 percent of any 

appropriation made available in this Act to 

the Internal Revenue Service or not to exceed 

3 percent of appropriations under the heading 

"Enforcement'' may be transferred to any 

other Internal Revenue Service appropriation 

upon the advance notification of the 

Committees on Appropriations. SEC. 102. The 

Internal Revenue Service shall maintain a 

training program to ensure that Internal 

Revenue Service employees are trained in 

taxpayers' rights, in dealing courteously with 

taxpayers, and in crosscultural relations. 

SEC. 103. The Internal Revenue Service shall 

institute and enforce policies and procedures 

that will safeguard the confidentiality of 

taxpayer information. 

SEC. 104. Funds made available by this or 

any other Act to the Internal Revenue Service 

shall be available for improved facilities and 

increased staffing to provide sufficient and 

effective 1–800 help line service for taxpayers. 

The Commissioner shall continue to make the 

improvement of the Internal Revenue Service 

1–800 help line service a priority and allocate 

resources necessary to increase phone lines 

and staff to improve the Internal Revenue 

Service 1–800 help line service. 

SEC. 105. Of the funds made available by this 

Act to the Internal Revenue Service, not less 

than $8,490,000,000 shall be available only 

for tax compliance, of which not less than 

$1,257,000,000 shall be available for the 

additional appropriation for Internal Revenue 

Service tax compliance activities included as 

an adjustment to the discretionary spending 

limits in the Concurrent Resolution on the 

Budget.

Administrative Provisions—Department of 

the Treasury 

___________________________________

(Including Transfer of Funds) 

SEC. 107. Appropriations to the Department 

of the Treasury in this Act shall be available 

for uniforms or allowances therefor, as 

authorized by law (5 U.S.C. 5901), including 

maintenance, repairs, and cleaning; purchase 
of insurance for official motor vehicles 

operated in foreign countries; purchase of 

motor vehicles without regard to the general 

purchase price limitations for vehicles 

purchased and used overseas for the current 

fiscal year; entering into contracts with the 

Department of State for the furnishing of 

health and medical services to employees and 

their dependents serving in foreign countries; 

and services authorized by 5 U.S.C. 3109. 

SEC. 108. Not to exceed 2 percent of any 

appropriations in this Act made available to 

the Departmental Offices—Salaries and 

Expenses, Office of Inspector General, 

Financial Management Service, Alcohol and 

Tobacco Tax and Trade Bureau, Financial 

Crimes Enforcement Network, and Bureau of 

the Public Debt, may be transferred between 

such appropriations upon the advance 

notification to the Committees on 

Appropriations: Provided, That no transfer 

may increase or decrease any such 

appropriation by more than 2 percent. 

SEC. 109. Not to exceed 2 percent of any 

appropriation made available in this Act to 

the Internal Revenue Service may be 

transferred to the Treasury Inspector General 

for Tax Administration's appropriation upon 

the advance notification to the Committees on 

Appropriations: Provided, That no transfer 

may increase or decrease any such 

appropriation by more than 2 percent. 

SEC. 110. Of the funds available for the 

purchase of law enforcement vehicles, no 

funds may be obligated until the Secretary of 

the Treasury certifies that the purchase by the 

respective Treasury bureau is consistent with 

departmental vehicle management principles: 

Provided, That the Secretary may delegate 

this authority to the Assistant Secretary for 

Management. 

SEC. 111. None of the funds appropriated in 

this Act or otherwise available to the 

Department of the Treasury or the Bureau of 

Engraving and Printing may be used to 

redesign the $1 Federal Reserve note. 

SEC. 112. The Secretary of the Treasury may 

transfer funds from Financial Management 

Service, Salaries and Expenses to the Debt 

Collection Fund as necessary to cover the 

costs of debt collection: Provided, That such 

amounts shall be reimbursed to such salaries 

and expenses account from debt collections 

received in the Debt Collection Fund. 

SEC. 113. Section 122(g)(1) of Public Law 

105–119 (5 U.S.C. 3104 note), is further 

amended by striking " 12 years'' and inserting 

" 14 years''. 

This section continues, for one 

additional year, the Alcohol and Tobacco Tax 

and Trade Bureau’s Pay Demonstration 

Project to use as an intervention tool in the 

recruitment and retention of critical staff 

positions. 

SEC. 114. Funds appropriated by this Act, or 

made available by the transfer of funds in this 

Act, for the Department of the Treasury's 

intelligence or intelligence related activities 

are deemed to be specifically authorized by 

the Congress for purposes of section 504 of 

the National Security Act of 1947 (50 U.S.C. 

414) during fiscal year 2012 until the 

enactment of the Intelligence Authorization 

Act for Fiscal Year 2012. 

SEC. 115. Not to exceed $5,000 shall be made 

available from the Bureau of Engraving and 

Printing's Industrial Revolving Fund for 

necessary official reception and 

representation expenses. 

SEC. 116. Section 5114(c) of Title 31, United 

States Code (relating to engraving and 
printing currency and security documents), is 

amended by striking "for a period of not more 

than 4 years". 

This section refers to repealing the limit on the 

contract term for the manufacture of 

distinctive currency paper to four years, to 

open up the supply of U.S. currency paper to 

increased competition. 

SEC. 117. Section 1324 of title 31, United 

States Code, is amended by adding at the end 

thereof the following new subsection: "(c) 

Amounts appropriated under subsection (a) of 

this section shall be administered, as 

appropriate, as if they were made available 

through separate appropriations to the 

Secretary of the Treasury, the Secretary of 

Homeland Security, and the Attorney General. 

Funds so appropriated shall be available to 

the Secretary of the Treasury for refunds by 

the Internal Revenue Service of taxes collected 

pursuant to the Internal Revenue Code and 

related interest; separately to the Secretary of 

the Treasury for refunds and drawbacks of 

alcohol, tobacco, firearms and ammunition 

taxes and refunds of other taxes which may 

arise and any interest on such refunds, 

including payment of claims for prior fiscal 

years; to the Secretary of Homeland Security 

for refunds and drawbacks of receipts 

collected pursuant to the customs revenue 

functions administered by the Department of 

Homeland Security pursuant to delegation by 

the Secretary of the Treasury and any interest 

on such refunds, including payment of claims 

for prior fiscal years; and to the Attorney 

General for refunds of firearms taxes and 

refunds of other taxes which may arise and 

any interest on such refunds, including 

payment of claims for prior fiscal years. 

This section refers to funds appropriated or 

otherwise made available to the Secretary of 

the Treasury, the Secretary of Homeland 

Security, and the Attorney General for refunds 

of taxes and related interest on such refunds, 

drawbacks, and payments of claims for prior 

fiscal years. This provision will alleviate the 

need for the Internal Revenue Service to make 

such refunds, drawbacks and payments on 

behalf of the other federal agencies, and will 

minimize the administrative and accounting 

burdens associated with this process. This 

proposal will not create any new spending. 

SEC. 118. In the current fiscal year and 

hereafter, any person who forwards to the 

Bureau of Engraving and Printing (BEP) a 

mutilated paper currency claim equal to or 

exceeding $10,000 for redemption will be 

required to provide BEP their taxpayer 

identifying number. 

This section refers to establishment of a new 

requirement that taxpayer identifying numbers 

be provided with mutilated currency 

redemption claims greater than or equal to 

$10,000, to reduce risks of the mutilated 

currency redemption program being used as a 

means for money laundering. 

SEC. 119. Section 5112(r) of title 31, United 

States Code, is amended by striking 

paragraph (5). 

This section would repeal the requirement that 

the number of $1 coins minted and issued in a 

given year with the Sacagawea-design on the 

coin’s obverse side must be not less than 20 

percent of the total number of $1 coins minted 

and issued in that year; this section would 

allow the United States Mint to meet public 

demand for $1 coins of each particular design 

while also eliminating excessive expenses that 

would otherwise be incurred to mint and issue 

Native American $1 Coins in amounts that 

exceed the public demand for them. 

The following amendments (Section 120 

through Section 124) will provide authority 

for FinCEN to rely on examinations 
conducted by state supervisory agencies for 

nonbank financial institutions, increase 

information sharing between FinCEN and 

counterpart anti-money laundering/ counterterrorist financing regulators, and expand the 

universe of individuals covered by the 

prohibition on Suspicious Activity Report 

(SAR) disclosures. 

SEC. 120. Section 5318(a)(1) of title 31, 

United States Code (relating to compliance, 

exemptions, and summons authority), is 

amended by - (1) Inserting after 

"appropriate", "federal or (in the case of 

financial institutions without a federal 

supervisor) state"; and (2) Inserting after 

"Service." "In lieu of delegating such 

authority to a state supervisory agency, the 

Secretary is also authorized to rely on 

examinations conducted by a state supervisory 

agency of a category of financial institution. 

The Secretary may only rely on such state 

examinations if the Secretary determines that 

under the laws of the state, the category of 

financial institution is required to comply with 

this subchapter and regulations prescribed 

under this subchapter, or the state supervisory 

agency is authorized to ensure that the 

category of financial institution complies with 

this subchapter and regulations prescribed 

under this subchapter." 

SEC. 121. Public Law 91–508, as amended 

(12 U.S.C. 1958 et seq.) is amended in section 

128, by - (1) Striking "sections 1730d (1) and" 

and inserting in lieu thereof "section"; (2) 

Striking "bank supervisory agency, or other"; 

(3) Inserting after "appropriate", "federal or 

(in the case of financial institutions without a 

federal supervisor) state"; and (4) Inserting 

after "agency." "In lieu of delegating such 

responsibility to a state supervisory agency, 

the Secretary is also authorized to rely on 

examinations conducted by a state supervisory 

agency of a category of financial institution. 

The Secretary may only rely on such state 

examinations if the Secretary determines that 

under the laws of the state, the category of 

financial institution is required to comply with 

this chapter and section 1829b (and 

regulations prescribed under this chapter and 

section 1829b), or the state supervisory 

agency is authorized to ensure that the 

category of financial institution complies with 

this chapter and section 1829b (and 

regulations prescribed under this chapter and 

section 1829b)." 

SEC. 122. Section 310(b)(2)(E) of title 31, 

United States Code (relating to the Financial 

Crimes Enforcement Network), is amended by 

inserting after "Federal" the first time that it 

appears, "and foreign". 

SEC. 123. Section 5318(g)(2)(A) of title 31, 

United States Code (relating to reporting of 

suspicious transactions), is amended by - (1) 

Inserting after "employee" at the end of clause 

(ii) "; and"; and (2) Inserting after ";and" 

"(iii) no other person that the Secretary may 

prescribe by regulation, who has knowledge 

that such report was made, may disclose to 

any person involved in the transaction that the 

transaction has been reported". 

SEC. 124. Section 5319 of title 31, United 

States Code (relating to availability of 

reports), is amended by inserting after "title 

5", ", or under any state law having or 

intended to have a similar effect". 

SEC. 125. The Secretary of the Treasury may 

transfer, in fiscal year 2012, from amounts 

that would otherwise be made available in 

fiscal years 2012, 2013, and 2014 under 

section 9703(g)(4) of title 31, United States 

Code, up to $30,000,000, to remain available 

until September 30, 2014, to the Financial 

Crimes Enforcement Network for BSA IT 

Modernization, notwithstanding the obligation 

requirement of such section. 
This provision provides the Secretary 

authority to transfer up to $30 million from 

the Treasury Forfeiture Fund’s unobligated 

balances to the Financial Crimes Enforcement 

Network for Bank Secrecy Act IT 

Modernization, where the $30 million will 

remain available until September 30, 2014. 
Mandatory Funding Levels for the FY 2012 President’s Budget – Treasury Chapter 

Mandatory Funding Levels for the FY 2012 President's Budget - Treasury Chapter 

(dollars in millions) 

Appropriations (Dollars in Millions) FY 2010 FY 2011 FY 2012 Increase/ Increase/ 

Enacted Estimate Estimate Decrease Decrease 

INTEREST PAYMENTS: 392,788 397,056 433,349 $36,293 9.1%

MANDATORY ACCOUNTS: 

 Terrorism Insurance Program 3 457 474 $17 3.7%

 GSE Mortgage-Backed Securities Purchase Program 29 2,792 17 -$2,775 -99.4%

 Office of Financial Stability 406 394 311 -$83 -21.1%

 Troubled Asset Relief Program (TARP) 23 1,556 0 -$1,556 -100.0%

 Troubled Asset Relief Program Equity Purchase Program 4,558 330 0 -$330 -100.0%

 Troubled Asset Relief Program Home Affordable Modification Program 164 0 0 $0 0.0%

 Grants to States for Low-Income Housing Projects 3,054 123 450 $327 265.9%

 Grants for Specified Energy Property 4,293 4,754 6,838 $2,084 43.8%

 Small Business Lending Fund Program Account 0 1,315 73 -$1,242 -94.4%

 State Small Business Credit Initiative 1,500 0 0 $0 0.0%

 Community Development Financial Institution Fund Program Account 2 4 0 -$4 -100.0%

 Presidential Election Campaign Fund 41 38 36 -$2 -5.3%

 Office of Financial Research 0 41 82 $41 100.0%

 Treasury Forfeiture Fund 1,083 1,017 1,214 $197 19.4%

 Biomass Energy Development -7 -6 -20 -$14 0.0%

 Payment to Terrestrial Wildlife Habitat Restoration Trust Fund 5 0 0 $0 0.0%

 Debt Collection Special Fund (FMS) 58 63 64 $1 1.6%

 Financial Agent Services 590 603 606 $3 0.5%

 Payment to FRA for AMTRAK Debt Restructuring 0 52 176 $124 238.5%

 Federal Reserve Bank Reimbursement 304 321 321 $0 0.0%

 Claims, Judgments and Relief Acts 1,119 4,528 2,692 -$1,836 -40.5%

 Check Forgery Insurance Fund 0 3 2 -$1 -33.3%

 Continued Dumping and Subsidy Offset 109 0 0 $0 0.0%

 Cheyenne River Sioux Tribe Terrestrial Wildlife Habitat Restoration 14 0 0 $0 0.0%

 Internal Revenue Collections for Puerto Rico 378 574 510 -$64 -11.1%

 Reimbursement to Federal Reserve Banks 103 121 126 $5 4.1%

 Payment of Government Losses in Shipment 0 1 1 $0 0.0%

 Payment Where Recovery Rebate Exceeds Liability for Tax 81 0 0 $0 0.0%

 Payment Where Earned Income Credit Exceeds Liability for Tax 54,712 44,940 46,495 $1,555 3.5%

 Payment Where Child Credit Exceeds Liability for Tax 22,659 22,924 25,136 $2,212 9.6%

 Payment Where Health Coverage Tax Credit Exceeds Liability for Tax 205 185 195 $10 5.4%

 Payment where Alternative Minimum Tax Credit Exceeds Liability for Tax 1,034 605 40 -$565 -93.4%

 Payment where Tax Credit to Aid First-Time Homebuyers Exceeds Liability for Tax 8,668 7,348 0 -$7,348 -100.0%

 Payment where Certain Tax Credit Exceeds Liability for Tax 86 32 0 -$32 -100.0%

 Payment Where American Opportunity Credit Exceeds Liability for Tax 3,851 3,861 4,416 $555 100.0% 

 Making Work Pay Tax Credit 13,694 13,876 0 -$13,876 -100.0%

 Build American Bond Payments, Recovery Act 1,376 2,814 3,589 $775 27.5%

 Payment Where COBRA Credit Exceeds Liability for Tax 3,857 2,987 220 -$2,767 -92.6%

 Payment Where Tax Credit for Certain Government Retirees Exceeds Liability for Tax 46 0 47 $47 0.0%

 Payment to Issuer of Qualified Zone Academy Bonds 0 13 24 $11 84.6%

 Payment to Issuer of Qualified School Construction 0 464 849 $385 83.0%

 Payment to Issuer of New Clean Renewable Energy Bonds 0 13 24 $11 84.6%

 Payment to Issuer of Qualified Energy Conservation Bonds 0 26 47 $21 80.8%

 Payment Where Adoption Credit Exceeds Liability for Tax 0 940 410 -$530 -56.4%

 Payment Where Small Business Health Insurance Tax Credit Exceeds Liability for Tax 0 182 259 $77 42.3%

 Therapeutic Discovery Program Grants and Administration 5 985 4 -$981 -99.6%

 IRS Miscellaneous Retained Fees 290 254 259 $5 2.0%

 IRS Informant Payments 19 18 25 $7 38.9%

 Offsets: 

 GSE Mortgage-Backed Securities Direct Loans, Negative Subsidies -1,214 -227 0 $227 -100.0%

 GSE, Mortgage-Backed Securities Direct Loans, Downward Reestimate -8,392 -467 0 $467 -100.0%

 Troubled Asset Relief Program, Negative Subsidies -2,336 -1,579 0 $1,579 -100.0%

 Troubled Asset Relief Program, Downward Reestimates of Subsidies -116,557 -43,475 0 $43,475 -100.0%

 Proceeds, GSE Equity Related Transactions -12,142 -17,492 -21,040 -$3,548 20.3%

 Other Offsets -1,824 -4,043 -5,990 -$1,947 48.2%

 Subtotal Offsets: -142,465 -67,283 -27,030 $40,253 -59.8%

 Subtotal, MANDATORY ACCOUNTS -$14,053 $54,265 $68,996 $14,731 27.1%

TOTAL, DEPARTMENT OF THE TREASURY $378,735 $451,321 $502,345 $51,024 11.3%
Total Treasury Department Mandatory 

Budget 

Interest Payments – $433.3 billion 

These are permanent, indefinite funds for interest 

payments. 

Mandatory Accounts – $69 billion 

These are special accounts for which the Congress 

has given the Department of Treasury permanent 

authority to expend funds as appropriations. 

Offsetting Collections – $27.1 billion 

Treasury receipts from other government agencies 

and private sources are subtracted from the total 

Treasury budget as an offset. 

Interest Payments 

These payments include: 

• Interest on the Public Debt - including all 

interest paid on Treasury securities sold to 

the public (e.g., foreign and domestic 

financial institutions, individuals, insurance 

companies, state and local governments, 

etc.) and to Federal Government trust funds, 

revolving funds and deposit funds. 

• Refunding Internal Revenue Collections - as 

provided in 26 U.S.C. 6611, interest, 

compounded daily, is paid on Internal 

Revenue collections that must be refunded. 

• Interest on Uninvested Funds - interest paid 

on certain uninvested funds placed in trust in 

the Treasury in accordance with various 

statutes (31 U.S.C. 1321; 2 U.S.C. 158 (P.L. 

94-289); 20 U.S.C. 74a (P.L. 94-418) and 

101; 24 U.S.C. 46 (P.L. 94-290; and 69 Stat. 

533). 

• Interest paid to Credit Financing Accounts - 

Interest on invested balances is paid to the 

financing accounts from the general fund of 

the Treasury, in accordance with section 

505(c) of the Federal Credit Reform Act of 

1990 (FCRA). 

• Federal Interest Liabilities to the States -

Pursuant to the Cash Management 

Improvement Act (P.L. 101-453, 104 Stat. 

1058) as amended (P.L. 102-589, 106 Stat. 

5133), and Treasury implementing 

regulations codified at 31 CFR Part 205, 

under certain circumstances, interest is paid 

to States when Federal funds are not 

transferred to States in a timely manner. 

• Payment to the Resolution Funding Corp - 

The Financial Institutions Reform, 

Recovery, and Enforcement Act of 1989 

authorized and appropriated to the Secretary 

of the Treasury, such sums as may be 

necessary to cover interest payments on 

obligations issued by the Resolution 

Funding Corporation (REFCORP). 

REFCORP was established under the Act to 

raise $31.2 billion for the Resolution Trust 

Corporation (RTC) in order to resolve 

savings institution insolvencies. 

Permanent Authority Appropriations 

Terrorism Risk Insurance Program 

The Terrorism Risk Insurance Extension Act of 

2007 (P.L. 110-160) reauthorized the program 

established by the Terrorism Risk Insurance Act 

(TRIA) of 2002 (P.L. 107-297). The 2007 Act 

extended the Terrorism Insurance Program for 

seven years, through December 31, 2014. 

GSE Mortgage-Backed Securities 

Purchase Program 

The authority for all of the programs displayed in 

this account was provided in Section 1117 of the 

Housing and Economic Recovery Act of 2008 

(P.L. 110-289) and expired on December 31, 

2009. As required by FCRA, this account records 

the subsidy costs associated with the GSE MBS 

and State HFA purchase programs. The subsidy 

amounts are estimated on a present value basis. 

Office of Financial Stability 

The Emergency Economic Stabilization Act 

(EESA) of 2008 (P.L. 110-343) authorized the 

establishment of the Troubled Asset Relief 

Program (TARP) and the Office of Financial 

Stability (OFS) to purchase and insure certain 
types of troubled assets for the purpose of 

providing stability to and preventing disruption in 

the economy and financial systems and protecting 

taxpayers. The Act gives the Treasury Secretary 

broad and flexible authority to purchase and insure 

mortgage and other troubled assets, as well as 

inject capital by taking limited equity positions, as 

needed to stabilize the financial markets. This 

account provides for the administrative costs for 

the OFS. 

Troubled Asset Relief Program (TARP) 

As authorized by the Emergency Economic 

Stabilization Act of 2008 (EESA) (P.L. 110-343) 

and required by the Federal Credit Reform Act of 

1990, as amended, this account records the 

subsidy costs associated with the TARP direct 

loans obligated and loan guarantees (including 

modifications of direct loans or loan guarantees 

that resulted from obligations or commitments in 

any year). The direct loan programs serviced by 

this account include the Automotive Industry 

Financing Program (AIFP), Term-Asset Backed 

Securities Loan Facility (TALF), Public-Private 

Investment Program (PPIP) and the Small 

Business Lending Initiative (SBLI). The 

guaranteed loan commitments that were serviced 

by this account include the Asset Guarantee 

Program (AGP). 

The Dodd-Frank Wall Street Reform Act, enacted 

on July 21, 2010, reduced TARP authority to 

purchase troubled assets from $700 billion to $475 

billion; required that repayments of amounts 

invested under TARP cannot be used to increase 

purchase authority and are dedicated to reducing 

the Federal debt; and prohibited new obligations 

for any program or initiative that had not been 

initiated by June 25, 2010. 

The authority to make new financial commitments 

via the TARP expired on October 3, 2010 under 

the terms of EESA. However, Treasury can 

continue to execute commitments entered into 

before October 3rd, 2010. 

TARP Equity Purchase Program 

As authorized by the Emergency Economic 

Stabilization Act of 2008 (EESA) (P.L. 110-343) 

and required by the Federal Credit Reform Act of 

1990, as amended, this account records the 

subsidy costs associated with TARP equity 

purchase obligations (including modifications of 

equity purchases that resulted from obligations in 

any year). The equity purchase programs serviced 

by this account include the American International 

Group Investment Program (AIGP), Targeted 

Investment Program (TIP), Automotive Industry 

Financing Program (AIFP), Public-Private 

Investment Program (PPIP), Community 

Development Capital Initiative (CDCI), and the 

Capital Purchase Program (CPP). 

TARP Home Affordable Modification 

Program 

The Making Home Affordable (MHA) Program 

was launched in March 2009 under the authority 

of Sections 101 and 109 of the Emergency 

Economic Stabilization Act of 2008, as amended 

(P.L. 110-343) (EESA). The centerpiece of MHA 

is the Home Affordable Modification Program 

(HAMP) which offers affordable and sustainable 

mortgage modifications to responsible 

homeowners at risk of losing their homes to 

foreclosure. 

Complementing HAMP are other MHA programs 

to provide temporary mortgage payment relief to 

unemployed borrowers; to increase affordability 

by modifying second mortgages when a 

corresponding first mortgage is modified under 

HAMP; to assist borrowers whose loans are highly 

overleveraged by encouraging servicers to reduce 

principal; and for borrowers who are unable to 

retain homeownership, provide a transition to 

more affordable housing through a short sale or 

deed-in-lieu of foreclosure. Funds under EESA are 

also supporting an FHA refinance option that 

allows overleveraged homeowners to refinance 

into a new FHA-insured loan if their existing 

mortgage holders agree to a short refinance and to 

write down principal. 

Grants to States for Low-Income 

Housing Projects 

Section 1602 of the American Recovery and 

Reinvestment Act of 2009 (Recovery Act) 

authorized and directed the Secretary of the 

Treasury to establish payments to States for lowincome housing projects in lieu of low-income 

housing tax credits (LIHTC). This account 

presents the estimated disbursements for this 
program. 

The program provides payments to State housing 

credit agencies to make sub-awards to finance the 

construction or acquisition and rehabilitation of 

qualified low-income housing in the same manner 

and generally subject to the same limitations as 

LIHTCs allocated under section 42 of the Internal 

Revenue Code (IRC) through December 31, 2011. 

The Recovery Act specifies that the exchange of 

credits for cash payments applies only to the 2009 

LIHTC ceiling under IRC 42(h)(3)(C), and that 

states may elect to exchange credits for cash 

payments subject to the requirements and 

limitations provided in Division B, sections 1404 

& 1602 of the Recovery Act. 

Grants for Specified Energy Property 

Section 1603 of the American Recovery and 

Reinvestment Act of 2009 authorized and directed 

the Secretary of the Treasury to establish 

payments in lieu of tax credits for taxpayers that 

place in service qualifying renewable energy 

facilities. This account presents the estimated 

disbursements for this program. 

Payments are available for property placed in 

service in 2009, 2010 or 2011. In some cases, if 

construction begins in 2009, 2010, or 2011, the 

payment can be claimed for property placed in 

service before 2013, 2014 or 2017. In general, 

projects that meet eligibility criteria for the energy 

property investment tax credit are eligible for the 

payments. The Tax Relief, Unemployment 

Insurance Reauthorization and Job Creation Act of 

2010 (Public Law 111-312), Section 707(a), 

extended through 2011, the time within which 

certain eligible property must be placed on service 

or start construction. 

Small Business Lending Fund (SBLF) 

Program Account 

Enacted as part of the Small Business Jobs and 

Credit Act of 2010 (P.L. 111-240), the SBLF is 

designed to increase the availability of credit to 

small businesses by providing capital to eligible 

financial institutions with assets of less than $10 

billion. The dividend or interest rate a bank pays 

for SBLF funding will be reduced as the 

institution's qualified small business lending 

increases. Because banks leverage their capital, the 

Small Business Lending Fund could help increase 

lending to small businesses in amounts that are 

multiples of the total capital provided to 

participating institutions. The account totals also 

include the costs of administering the program. 

State Small Business Credit Initiative

Section 3003 of the Small Business Jobs and 

Credit Act of 2010 (P.L. 111-240) authorizes and 

directs the Secretary of Treasury to establish a 

seven-year State Small Business Credit Initiative 

(SSBCI). This account represents the 

appropriation in the amount of $1.5 billion to be 

used by the U.S. Department of the Treasury to 

provide direct support to States for use in 

programs designed to increase access to credit for 

small businesses. Additionally, this appropriation 

includes reasonable costs of administering the 

program and less than three percent has been 

allocated for the administration over the life of the 

program. 

Community Development Financial 

Institutions Fund Program Account 

The balance of the funds is received from CDFI 

dividend and investment income. The CDFI Fund 

intends to fund the Award Management 

Information System modernization effort with 

these funds. 

Presidential Election Campaign Fund 

Individual Federal income tax returns include an 

optional Federal income tax designation of $3 that 

an individual may elect to be paid to the 

Presidential Election Campaign Fund (PECF). 

Approximately every four years, the Department 

of the Treasury makes distributions from the 

PECF to qualified Presidential candidates and 

national party committees for use in the 

Presidential elections. 

Office of Financial Research and the 

Financial Stability Oversight Council 

The Financial Stability Oversight Council (FSOC) 

and Office of Financial Research (OFR) were 

established under the Dodd-Frank Wall Street 

Reform and Consumer Protection Act of 2010 

(Public Law 111-203). FSOC's purpose is to 

identify risks to the financial stability of the 
United States, promote market discipline, and 

respond to emerging threats to the stability of the 

U.S. financial system. OFR's purpose is to support 

FSOC by collecting data on behalf of FSOC, 

developing and promoting data standards, 

conducting research, and developing tools for risk 

measurement and monitoring. Through July 21, 

2012, FSOC and OFR are funded through transfers 

from the Board of Governors of the Federal 

Reserve System. After July 21, 2012, FSOC and 

OFR will be funded through assessments on bank 

holding companies with total consolidated assets 

of $50 billion or more and nonbank financial 

companies supervised by the Board of Governors. 

Treasury Forfeiture Fund 

Non-tax forfeitures made by participating bureaus 

of the Department of the Treasury and the 

Department of Homeland Security are deposited 

into the Fund. This revenue is available to pay or 

reimburse certain costs and expenses related to 

seizures and forfeitures that occur pursuant to laws 

enforced by the bureaus and other expenses 

authorized by 31 U.S.C. 9703. Upon notification 

of Congress, revenue can also be used to fund law 

enforcement related activities based on requests 

from member bureaus and evaluation by the 

Secretary of the Treasury. 

Biomass Energy Development 

This account provides loan guarantees for the 

construction of biomass-to-ethanol facilities, as 

authorized under Title II of the Energy Security 

Act of 1980. All of the loans guaranteed by this 

account went into default. The guarantees have 

been paid off, and the assets of all but one of the 

projects have been liquidated. The one remaining 

project entered into a Forbearance agreement with 

DOE in April 2009. Quarterly payments may 

resume after March 2011. 

Payment to Terrestrial Wildlife Habitat 

Restoration Trust Fund 

Section 604(b) of the Water Resources 

Development Act of 1999 (P.L. 106-53) requires 

that the Secretary of the Treasury, beginning in 

1999, deposit $5 million annually (74 percent into 

the Cheyenne River Sioux Tribe Terrestrial 

Wildlife Restoration Trust Fund and 26 percent 

into the Lower Brule Sioux Tribe Terrestrial 

Wildlife Restoration Trust Fund) until a total of at 

least $57.4 million has been deposited. After the 

funds are fully capitalized by deposits from the 

general fund of the Treasury, interest earned will 

be available to the Tribes to carry out the purposes 

of the funds. Full capitalization occurred in FY 

2010; therefore no additional deposits will be 

provided by the general fund of the Treasury. 

Tribes are now able to draw down on the interest 

earned from these investments. 

Debt Collection Special Fund 

Under current law, when the Financial 

Management Service (FMS) levies a payment to 

collect a delinquent tax debt referred by the 

Internal Revenue Service (IRS), the IRS pays a fee 

out of its annual appropriation to FMS to process 

the transaction. The Budget proposes to instead 

have the debtor pay the transaction costs in 

addition to their original debt. This would allow 

the IRS to refer all appropriate tax debts for offset, 

maximize revenue, and shift the cost of 

enforcement to delinquent debtors. These 

schedules reflect the elimination of discretionary 

spending and collections as a result of this 

proposal. 

Financial Agent Services 

This account reimburses financial institutions for 

the services they provide as depositaries and 

financial agents of the Federal Government. The 

services provided are authorized under statutes 

including, but not limited to, 12 U.S.C. 90 and 

265. Additionally, financial agent and financial 

analysis costs for the Government Sponsored 

Enterprise Mortgage Backed Securities Purchase 

Program and State Housing Finance Agency 

program are reimbursed from this account. 

Payment to FRA for AMTRAK Debt 

Restructuring 

The Passenger Rail Investment and Improvement 

Act (PRIIA) of 2008 (Section 205), enacted 

October 16, 2008, provides that the Secretary of 

the Treasury, in consultation with the Secretary of 

Transportation and the National Railroad 

Passenger Corporation (Amtrak), may make 

agreements to restructure (including repay) 

Amtrak's indebtedness, including leases, 

outstanding as of the date of enactment of PRIIA. 
This authorization expired two years after the date 

of enactment. 

Federal Reserve Bank Reinvestment 

This fund was established by the Treasury and 

General Government Appropriations Act, 1998, 

Title I, (P.L. 105-61, 111 Stat. 1276) as a 

permanent, indefinite appropriation to reimburse 

Federal Reserve Banks for services provided in 

their capacity as depositaries and fiscal agents for 

the United States. 

Claims, Judgments and Relief Acts 

Appropriations are made for cases in which the 

Federal Government is found by courts to be liable 

for payment of claims and interest for damages not 

chargeable to appropriations of individual 

agencies, and for payment of private and public 

relief acts. Public Law 95-26 authorized a 

permanent, indefinite appropriation to pay certain 

judgments from the general funds of the Treasury. 

Check Forgery Insurance Fund 

This fund was established to maintain the Check 

Forgery Insurance Fund. The Fund facilitates 

timely payments for replacement Treasury checks 

necessitated due to a claim of forgery. Public Law 

108-447 expanded the use of the fund to include 

payments made via electronic funds transfer. A 

technical correction to the Fund's statutes to ensure 

and clarify that the Fund can be utilized as a 

funding source for relief of administrative 

disbursing errors was enacted by section 119 of 

Division D of Public Law 110-161. 

Continued Dumping and Subsidy Offset 

The Bureau of Customs and Border Protection, 

Department of Homeland Security, collects duties 

assessed pursuant to a countervailing duty order, 

an antidumping duty order, or a finding under the 

Antidumping Act of 1921. Under a provision 

enacted in 2000, the Bureau of Customs and 

Border Protection, through the Treasury, 

distributes these duties to affected domestic 

producers. The authority to distribute assessments 

collected after October 1, 2007 was repealed. 

Assessments collected before October 1, 2007 will 

be disbursed as if the authority had not been 

repealed. 

Cheyenne River Sioux Tribe Terrestrial 

Wildlife Habitat Restoration 

This schedule reflects the payments made to the 

Cheyenne River Sioux Tribe Terrestrial Wildlife 

Restoration Trust Fund and the Lower Brule Sioux 

Tribe Terrestrial Wildlife Restoration Trust Fund. 

Federal Financing Bank

The Federal Financing Bank (FFB) was created in 

1973 to reduce the costs of certain Federal and 

federally assisted borrowing and to ensure the 

coordination of borrowing in a manner least 

disruptive to private financial markets and 

institutions. FFB loans are also used to finance 

direct agency activities such as construction of 

Federal buildings, activities of the U.S. Postal 

Service, and the financial stabilization initiatives 

of the National Credit Union Administration. 

Internal Revenue Collections for 

Puerto Rico

Excise taxes collected under the Internal Revenue 

laws of the United States on articles produced in 

Puerto Rico and either transported to the United 

States or consumed on the island are paid to 

Puerto Rico (26 U.S.C. 7652). 

Reimbursement to Federal Reserve 

Banks 

This fund was established by the Treasury, Postal 

Service and General Government Appropriations 

Act of 1991 (P.L. 101-509, 104 Stat. 1394) to 

allow the Bureau of the Public Debt to reimburse 

the Federal Reserve Banks for acting as fiscal 

agents of the Federal Government in support of 

financing the public debt. 

Payment of Government Losses in 

Shipment

This account was created as self-insurance to 

cover losses in shipment of Government property 

such as coins, currency, securities, certain losses 

incurred by the Postal Service, and losses in 

connection with the redemption of savings bonds. 
Payment Where Recovery Rebate 

Exceeds Liability for Tax 

The Economic Stimulus Act of 2008 (Public Law 

110-185), Section 101, allowed for the issuance of 

tax rebates (economic stimulus payments) to 

certain eligible taxpayers through December 31, 

2008. This was a one-time benefit provided to 

taxpayers to stimulate the economy. Additionally, 

in 2009 the rebate was provided to taxpayers who 

did not receive the full economic stimulus 

payment in 2008 and whose circumstances may 

have changed. No outlays are expected from this 

account in 2012, as the one-time program is no 

longer active. 

Payment Where Earned Income Credit 

Exceeds Liability for Tax

As provided by law Public Law 94-12, there are 

instances wherein the Earned Income Tax Credit 

(EITC) exceeds the amount of tax liability owed 

through the individual income tax system, 

resulting in an additional payment to the taxpayer. 

The EITC was made permanent by the Revenue 

Adjustment Act of 1978 (Public Law 95-600). The 

Act has been amended in subsequent bills. 

The American Recovery and Reinvestment Act of 

2009 (Public Law 111-5), Section 1002, 

temporarily increased the EITC for working 

families with three or more children, and increased 

the threshold for the phase-out range for all 

married couples filing a joint return for 2009 and 

2010 tax returns. The Tax Relief, Unemployment 

Insurance Reauthorization, and Job Creation Act 

of 2010 (Public Law 111-312), Section 103(c), 

extended this temporary benefit for 2011 and 2012

tax returns. 

Payment Where Child Credit Exceeds 

Liability for Tax 

As provided by law, there are instances where the 

child tax credit exceeds the amount of tax liability 

owed through the individual income tax system, 

resulting in an additional payment to the taxpayer. 

The child credit was originally authorized by the 

Taxpayer Relief Act of 1997 (Public Law 105-34). 

The American Recovery and Reinvestment Act of 

2009 (Public Law 111-5), Section 1003, expanded 

the pool of eligible low-income earners. The Tax 

Relief, Unemployment Insurance Reauthorization, 

and Job Creation Act of 2010 (Public Law 111-

312), Section 103(b), extended this temporary 

benefit for 2011 and 2012. 

Payment Where Health Care Coverage 

Tax Credit Exceeds Liability for Tax 

The Trade Act of 2002 established the Health 

Coverage Tax Credit (HCTC), an advanceable, 

refundable tax credit for a portion of the cost of 

qualified insurance. This credit is available to 

certain recipients of Trade Adjustment Assistance 

(TAA) and Pension Benefit Guaranty Corporation 

pension beneficiaries who are aged 55-64. 

Congress expanded the program in the American 

Recovery and Reinvestment Act of 2009 (Public 

Law 111-5), Sections 1899A-1899J. Increased 

benefits for certain HCTC eligible individuals 

include payment of 80 percent (up from 65 

percent) of health insurance premiums, up to 24 

months of coverage for qualified family members, 

and extension of COBRA benefits. The Omnibus 

Trade Act of 2010 (Public Law 111-344), Sections 

111-118, extends these benefits until February 13, 

2011. 

Payment Where Alternative Minimum 

Tax Exceeds Liability for Tax 

The Tax Relief and Health Care Act of 2006 

(Public Law 109-432) allows certain taxpayers to 

claim a refundable credit for a portion of their 

unused long-term alternative minimum tax (AMT) 

credits each year. The Emergency Economic 

Stabilization Act of 2008 (Public Law 110-343), 

Division C, Section 103, increased the AMT 

refundable credit portion from 20 percent to 50 

percent of unused long-term minimum tax credits 

for the taxable year in question. 

Payment Where Tax Credit to Aid FirstTime Homebuyers Exceeds Liability for 

Tax 

The Housing and Economic Recovery Act of 2008 

(Public Law 110-289), Section 3011, provided a 

refundable tax credit of up to $7,500 for first-time 

homebuyers. Taxpayers who qualified were 

allowed a one-time credit against their income tax 

for principal residences purchased on or after 

April 9, 2008, and before July 1, 2009. They must 

repay the credit over a 15-year period. 
The American Recovery and Reinvestment Act of 

2009 (Public Law 111-5), Section 1006, expanded 

and extended the credit, and eliminated the 

repayment requirement. Qualifying taxpayers may 

claim up to $8,000 on either their 2008 or 2009 tax 

returns for qualifying 2009 purchases. The 

Worker, Homeownership, and Business Assistance 

Act of 2009 (Public Law 111-92), Section 12, 

extended the application from November 30, 2009 

to April 30, 2010. The Act modified the buyer's 

settlement date to June 30, 2010, if a buyer entered 

into a binding contract by April 30, 2010. The Act 

also provided a "long-time resident" credit of up to 

$6,500 to taxpayers who do not qualify as firsttime homebuyers. The Homebuyer Assistance and 

Improvement Act of 2010 (Public Law 111-198), 

Section 2, extended eligibility for the credit to any 

taxpayer who entered into a written binding 

contract before May 1, 2010, to close on the 

purchase of a principal residence before October 1, 

2010. This account provides resources for the 

portion, if any, of the refundable tax credit amount 

that exceeds the taxpayer's tax liability. 

Payment Where Certain Tax Credits 

Exceeds Liability for Corporate Tax 

The Housing and Economic Recovery Act of 2008 

(Public Law 110-289), Section 3081, allowed 

certain businesses to accelerate the recognition of 

a portion of their historic AMT or research and 

development (R&D) credits in lieu of taking bonus 

depreciation. The American Recovery and 

Reinvestment Act of 2009 (Public Law 111-5), 

Section 1201(b), extended this temporary benefit 

through 2009 and the Tax Relief, Unemployment 

Insurance Reauthorization, and Job Creation Act 

of 2010 (Public Law 111-312), Section 401(c), 

extended this temporary benefit for 2011 and 

2012. 

Payment Where American Opportunity 

Credit Exceeds Liability for Tax 

The American Recovery and Reinvestment Act of 

2009 (Public Law 111-5), Section 1004, allows 

certain taxpayers to claim a refundable Hope 

Scholarship Credit for qualifying higher education 

expenses, up to 40 percent. The credit applies 

dollar-for-dollar to the first $2,000 of qualified 

tuition, fees and course materials paid by the 

taxpayer, and applies at a rate of 25 percent to the 

next $2,000 in qualified tuition, fees and course 

materials for a total credit of up to $2,500. This tax 

credit is subject to a phase-out for high-income 

taxpayers. The Tax Relief, Unemployment 

Insurance Reauthorization, and Job Creation Act 

of 2010 (Public Law 111-312), Section 103(a), 

extended this credit for 2011 and 2012, and the 

2012 Budget proposes to make this credit 

permanent. 

Making Work Pay Tax Credit 

The American Recovery and Reinvestment Act of 

2009 (Public Law 111-5), Section 1001, allows 

certain taxpayers to claim a refundable Making 

Work Pay tax credit of 6.2 percent of earned 

income, up to $400 for single taxpayers and up to 

$800 for married couples filing joint returns. The 

refundable credit phases out for high-income 

taxpayers. The Making Work Pay credit is claimed 

by taxpayers when they file their 2009 and 2010 

returns, and in order to accelerate the credit, it is 

being delivered in small increments through 

reduced payroll withholding. 

Build American Bond Payments, 

Recovery Act 

The American Recovery and Reinvestment Act of 

2009 (Public Law 111-5), Section 1531, allowed 

State and local governments to issue Build 

America Bonds through December 31, 2010. 

These tax credit bonds, which include Recovery 

Zone Bonds, differ from tax-exempt governmental 

obligation bonds in two principal ways: (1) 

interest paid on tax credit bonds is taxable; and (2) 

a portion of the interest paid on tax credit bonds 

takes the form of a federal tax credit. The bond 

issuer may elect to receive a direct payment in the 

amount of the tax credit. 

Payment Where COBRA Credit 

Exceeds Liability for Tax 

COBRA gives workers who lose their jobs, and 

thus their health benefits, the right to purchase 

group health coverage provided by the plan under 

certain circumstances pursuant to Part 6 of Subtitle 

B of Title I of the Employee Retirement Income 

Security Act of 1974 (other than Section 609), 

Title XXII of the Public Health Service Act, 

Section 4980B of the Internal Revenue Code of 

1986 (other than under Subsection (f)(1) of such 
Section insofar as it relates to pediatric vaccines), 

or Section 8905(a) of 5 U.S.C., or under a State 

program that provides comparable continuation 

coverage. 

The American Recovery and Reinvestment Act of 

2009 (Public Law 111-5), Section 3001, treated 

assistance eligible individuals who pay 35 percent 

of their COBRA premium as having paid the full 

amount. The Department of Defense 

Appropriation Act of 2010 (Public Law 111-118), 

Section 1010, extended the eligibility period for 

the program to February 28, 2010 and extended 

the duration period of the taxpayers' premium 

assistance coverage to 15 months. The Continuing 

Extension Act of 2010 (Public Law 111-157), 

Section 3, amended the American Recovery and 

Reinvestment Act of 2009 to extend the premium 

assistance for COBRA benefits through May 31, 

2010. 

Payment Where Tax Credit for Certain 

Government Retirees Exceeds Liability 

for Tax 

The American Recovery and Reinvestment Act of 

2009 (Public Law 111-5), Section 2201, allowed 

certain federal and state retirees to claim a onetime refundable credit of up to $250 ($500 in the 

case of a joint return where both spouses are 

eligible individuals) 

Payment to Issuer of Qualified Zone 

Academy Bonds 

The American Recovery and Reinvestment Act of 

2009 (Public Law 111-5), Section 1522, extended 

and expanded the calendar year limitation for 

Qualified Zone Academy Bonds to 

$1,400,000,000 for 2009 and 2010. The Tax 

Relief, Unemployment Insurance Reauthorization, 

and Job Creation Act of 2010 (Public Law 111-

312), Section 758, extended the Qualified Zone 

Academy Bonds for 2011 and reduced the 

calendar year limitation to $400,000,000. 

The Hiring Incentives to Restore Employment Act 

(Public Law 111-147), Section 301, amends 

Section 6431 of the Internal Revenue Code of 

1986 by allowing issuers of Qualified Zone 

Academy Bonds to irrevocably elect to issue the 

bonds as specified tax credit bonds with a directpay subsidy, in the same manner as the Build 

America Bonds direct-pay subsidy. The issuer of 

such qualifying bonds will receive a direct interest 

payment subsidy from the Federal government. 

Bondholders will receive a taxable interest 

payment from the issuer in lieu of a tax credit. 

Payment to Issuer of Qualified School 

Construction Bonds 

The American Recovery and Reinvestment Act of 

2009 (Public Law 111-5), Section 1521, created 

Qualified School Construction Bonds with a 

calendar year limitation of $11,000,000,000 for 

2009 and 2010 and zero after 2010. 

The Hiring Incentives to Restore Employment Act 

(Public Law 111-147), Section 301, amends 

Section 6431 of the Internal Revenue Code of 

1986 by allowing issuers of Qualified School 

Construction Bonds to irrevocably elect to issue 

the bonds as specified tax credit bonds with a 

direct-pay subsidy, in the same manner as the 

Build America Bonds direct-pay subsidy. The 

issuer of such qualifying bonds will receive a 

direct interest payment subsidy from the Federal 

government. Bondholders will receive a taxable 

interest payment from the issuer in lieu of a tax 

credit. 

Payment to Issuer of New Clean 

Renewable Energy Bonds 

The Emergency Economic Stabilization Act of 

2008 (Public Law 110-343), Section 107, created 

New Clean Renewable Energy Bonds; and the 

American Recovery and Reinvestment Act of 

2009 (Public Law 111-5), Section 1111, increased 

the limitation on issuance of New Clean 

Renewable Energy Bonds by $1,600,000,000. 

The Hiring Incentives to Restore Employment Act 

(Public Law 111-147), Section 301, amends 

Section 6431 of the Internal Revenue Code of 

1986 by allowing issuers of New Clean 

Renewable Energy Bonds to irrevocably elect to 

issue the bonds as specified tax credit bonds with a 

direct-pay subsidy, in the same manner as the 

Build America Bonds direct-pay subsidy. The 

issuer of such qualifying bonds will receive a 

direct interest payment subsidy from the Federal 

government. Bondholders will receive a taxable 

interest payment from the issuer in lieu of a tax 

credit. 
Payment to Issuer of Qualified Energy 

Conservation Bonds 

The Emergency Economic Stabilization Act of 

2008 (Public Law 110-343), Section 301, created 

Qualified Energy Conservation Bonds; and the 

American Recovery and Reinvestment Act of 

2009 (Public Law 111-5), Section 1112, increased 

the limitation on issuance of qualified energy 

conservation bonds from $800,000,000 to 

$3,200,000,000. 

The Hiring Incentives to Restore Employment Act 

(Public Law 111-147), Section 301, amends 

Section 6431 of the Internal Revenue Code of 

1986 by allowing issuers of Qualified Energy 

Conservation Bonds to irrevocably elect to issue 

the bonds as specified tax credit bonds with a 

direct-pay subsidy, in the same manner as the 

Build America Bonds direct-pay subsidy. The 

issuer of such qualifying bonds will receive a 

direct interest payment subsidy from the Federal 

government. Bondholders will receive a taxable 

interest payment from the issuer in lieu of a tax 

credit. 

Payment Where Adoption Credit 

Exceeds Liability for Tax 

The Economic Growth and Tax Relief 

Reconciliation Act of 2001 (EGTRRA) (Public 

Law 107-16), Section 202, increased the 

maximum credit and exclusion to $10,000 

(indexed for inflation after 2002) for both nonspecial needs and special needs adoptions; 

increased the phase-out starting point to $150,000 

(indexed for inflation after 2002); and allowed the 

credit against the AMT. 

The Patient Protection and Affordable Care Act 

(Public Law 111-148), Section 10909, extended 

the EGTRRA expansion of the adoption credit and 

exclusion from income for employer-provided 

adoption assistance for one year (for 2011); 

increased by $1,000 to $13,170 per child (indexed 

for inflation) the maximum adoption credit and 

exclusion from income for employer-provided 

adoption assistance for two years (2010 and 2011); 

and made the credit refundable for two years 

(2010 and 2011), meaning that eligible taxpayers 

can get it even if they do not owe tax for that year. 

In general, the credit is based on the reasonable 

and necessary expenses related to a legal adoption, 

including adoption fees, court costs, attorney's fees 

and travel expenses. 

The Tax Relief, Unemployment Insurance 

Reauthorization, and Job Creation Act of 2010 

(Public Law 111-312), Section 101(b), for taxable 

years beginning after December 31, 2011, limits 

the adoption credit and employer-provided 

adoption assistance exclusion for special needs 

adoptions only; reduces the maximum credit and 

exclusion to $6,000; reduces the phase-out range 

to lower income levels (i.e., between $75,000 and 

$115,000); and does not index for inflation the 

maximum credit, exclusion, and phase-out range. 

Payment Where Small Business Health 

Insurance Tax Credit Exceeds Liability 

for Tax 

The Affordable Care Act (P.L. 111-148), Section 

1421, allows certain small businesses to claim a 

credit when they pay at least half of the health care 

premiums for single health insurance coverage for 

their employees. Small businesses can claim the 

credit for 2010 through 2013 and for any two 

years after that. Generally, employers that have 

fewer than 25 full-time equivalent employees and 

pay wages averaging less than $50,000 per 

employee per year may qualify for the credit. 

Therapeutic Discovery Program Grants 

and Administration 

The Affordable Care Act (Public Law 111-148), 

Section 9023, provides tax credits and grants to 

qualifying small entities that show significant 

potential to produce new and cost-saving 

therapies, support U.S. jobs, and increase U.S. 

competitiveness. Credits and grants are for 

qualifying investments made during a taxable year 

beginning in 2009 or 2010. The total amount of 

credits and grants that may be allocated under the 

program shall not exceed $1,000,000,000 for the 

2-year period beginning with 2009. This account 

also includes the administrative costs. 

IRS Miscellaneous Retained Fees 

As provided by law (26 U.S.C. 7801) the 

Secretary of the Treasury may establish new fees 

or raise existing fees for services provided by the 

IRS, where such fees are authorized by another 

law, and may spend the new or increased fee 
receipts to supplement appropriations made 

available to the IRS appropriations accounts. 

Funds in this account are transferred to other IRS 

appropriations accounts for expenditure. 

IRS Informant Payments 

As provided by law (26 U.S.C. 7623), the 

Secretary of the Treasury may make payments to 

individuals resulting from information given that 

leads to the collection of Internal Revenue taxes. 

The Taxpayer Bill of Rights of 1996 (Public Law 

104-168) provides for payments of such sums to 

individuals from the proceeds of amounts (other 

than interest) collected by reason of the 

information provided, and any amount collected 

shall be available for such payments. This 

provision was further amended by the Tax Relief 

and Health Care Act of 2006 (Public Law 109-

432) to encourage use of the program. 

Offsetting Collections 

In general, amounts collected by the Federal 

Government are classified in two major categories: 

Governmental receipts – Revenues that arise from 

the sovereign and regulatory powers unique to the 

Federal Government. They consist primarily of tax 

receipts, but also include customs duties, court 

fines, certain licenses, etc. All governmental 

receipts are deposited into receipt accounts. These 

receipts are always reported in total (rather than as 

an offset to budget authority and outlays). 

Offsetting receipts - Collections that are offset 

against the budget authority and outlays of the 

collecting agency rather than reflected as 

governmental receipts in computing budget totals. 

Offsetting receipts are comprised of: 

• Proprietary Receipts - These receipts from the 

public are market-oriented and are derived 

from activities operated as business-type 

enterprises. 

• Intragovernmental Receipts - These are 

collections from other governmental accounts 

deposited in receipt accounts. These are 

further classified as follows: 

• Interfund Receipts - These are amounts 

derived from payments between federal and 

trust funds. 

• Intrafund Receipts - These are amounts 

derived from payments within the same fund 

group (i.e., within the federal fund group or 

within the trust fund group). 
Consumer Financial Protection Bureau

Program Summary by Budget Activity

(Dollars in thousands)

Budget Activity FY 2010 FY 2011 FY 2012

Actual Estimated Estimated $ Change % Change

Consumer Financial Protection Bureau $9,200 $142,825 $329,045 $186,220 130%

Total Cost of Operations $9,200 $142,825 $329,045 $186,220 130%

Summary

The Dodd-Frank Wall Street Reform and 

Consumer Protection Act of 2010 (DoddFrank Act) established the Bureau of 

Consumer Financial Protection (CFPB or 

Bureau) as an independent bureau within the 

Federal Reserve System and made it 

responsible for protecting consumers from 

abusive financial services practices. The 

Secretary of the Treasury is authorized to 

perform certain functions of the Bureau until 

the Director of the Bureau is appointed. On 

the designated transfer date, July 21, 2011,

certain consumer protection authorities will 

transfer to the Bureau from seven existing 

federal agencies. 

Once fully established, the CFPB will have 

important authorities under the Dodd-Frank 

Act and other consumer laws to look out for 

consumers as they borrow money or use other 

financial services. Among other things, the 

new consumer agency will: 

• Conduct rule-making, supervision, and 

enforcement for Federal consumer 

financial protection laws;

• Restrict unfair, deceptive, or abusive 

acts or practices;

• Create a center to take consumer 

complaints; 

• Promote financial education;

• Research consumer behavior;

• Monitor financial markets for new 

risks to consumers; and

• Enforce laws that outlaw discrimination and other unfair treatment in 

consumer finance.

The CFPB plans to have six primary divisions: 

Supervision and Enforcement; Consumer 

Engagement and Education; Research, 

Markets, and Regulations; External Affairs; 

General Counsel; and Chief Operating Officer.

The CFPB is funded by authorized transfers 

from the Federal Reserve System, subject to 

limits established in the Dodd-Frank Act. The 

CFPB is also authorized to request up to $200 

million in discretionary appropriations if the 

amount transferred by the Federal Reserve 

System is not sufficient. The CFPB is not 

requesting a discretionary appropriation in FY 

2011 or FY 2012.