Message from the Secretary of the Treasury 

Dear Member: 

The Fiscal Year (FY) 2020 President's Budget (Budget) prioritizes Treasury's goals to maintain a strong 

economy and create economic and job opportunities by promoting economic growth and stability at 

home and abroad, and to strengthen national security by combating threats and protecting the integrity 

of the financial system. In particular, the Budget requests $12.7 billion for Treasury's operating bureaus 

and $1.6 billion for our international programs. 

Consistent with the Administration's priorities, the Budget provides $35 million to support

implementation of the Foreign Investment Risk Review Modernization Act (FIRRMA). FIRRMA, enacted 

in 2018, expands the Committee on Foreign Investment in the United States' jurisdiction and 

strengthens its authorities to protect critical U.S. technologies and infrastructure from new and evolving 

threats, while preserving an open investment environment. 

Treasury's request includes $11.5 billion for the Internal Revenue Service (IRS) and provides $290 million 

in funding for the first installment in a multi-year plan to greatly modernize IRS systems and operations 

and deliver a customer experience comparable to the best financial institutions in the world. I cannot 

emphasize enough the long-term critical need we have to invest in the modernization of IRS information 

technology systems and infrastructure. The integrity of the voluntary tax compliance system depends on 

it. In addition, the Budget requests a program integrity cap adjustment to protect the integrity of the tax 

system and reduce the tax gap, returning $32 billion in measurable net savings to taxpayers over ten 

years. 

Treasury's request also includes increased resources for the Office of Terrorism and Financial 

Intelligence and the Financial Crimes Enforcement Network (FinCEN) to continue their critical work 

safeguarding the financial system from abuse and combating other national security threats using nonkinetic economic tools. These resources continue important investments in the Terrorist Financing 

Targeting Center, address sanctions workload increases and demand for staffing, and build core 

information technology infrastructure. The Budget provides funding to expand FinCEN's role in fighting 

cybercrime and the exploitation of emerging payment systems such as cryptocurrency. 

The Budget includes funding increases for the Office of Critical Infrastructure Protection and Compliance 

Policy to enhance Treasury's capacity to identify and remediate new threats and vulnerabilities. 

The FY 2020 Congressional Budget Justification includes the information required for the Annual 

Performance Report. I have validated the accuracy, completeness, and reliability of the performance 

data in this report. 

Sincerely,

Steven T. Mnuchin

Executive Summary - 1

FY 2020 EXECUTIVE SUMMARY

FY 2020 President’s Budget Discretionary Appropriation Request
Executive Summary - 2

MISSION STATEMENT

Maintain a strong economy and create economic and job opportunities by promoting conditions 

that enable economic growth and stability at home and abroad; strengthen national security by 

combating threats and protecting the integrity of the financial system; and manage the U.S. 

Government’s finances and resources effectively.

OVERVIEW OF REQUEST

The Budget requests $12.7 billion in base discretionary resources for the Department of the 

Treasury’s domestic programs, a $62 million or 0.5 % decrease from the FY 2019 enacted level. 

It also requests $1.6 billion for Treasury’s international programs, a $4.5 million or 0.3 %

increase from the FY 2018 enacted level. The Budget:

• Provides $35 million to fully fund Foreign Investment Risk Review Modernization Act

(FIRRMA) implementation (partially offset by an estimated $10 million in user fees). By 

modernizing the Committee on Foreign Investment in the United States, FIRRMA improves 

the government’s ability to protect national security while preserving the longstanding open 

investment policy of the United States. The budget includes funding for Treasury in the 

Departmental Offices salary and expenses account ($20 million) and creates a new FIRRMAspecific account to address Committee-wide requirements ($20 million, including $15 

million for Treasury-specific information technology requirements and $5 million to support 

government-wide emerging needs). 

• Provides the Internal Revenue Service (IRS) with $11.5 billion from base discretionary 

appropriations to collect more than $3 trillion in revenue, to deliver quality customer service 

to more than 180 million taxpayers, and to begin to transform systems to improve tax 

administration over the long-term. 

o The request provides $290 million for the multi-year IT modernization efforts. Every 

day, private-sector companies introduce technologies that raise Americans’ expectations 

of the services that they receive from their government. While IRS systems process 

trillions of tax dollars and hundreds of millions of interactions every year, some using 

cutting edge technology, it is increasingly difficult to meet these expectations without 

wholesale changes to the core tax systems. IRS’s computing infrastructure cannot keep 

pace with the desire for instantaneous data, real-time interactions, and taxpayer-centered 

customer service. The cost to operate the IRS technology ecosystem is quickly becoming 

prohibitive. The IRS’s ability to successfully modernize information technology is 

critical to our ability to continue to deliver the IRS mission in a cost-effective way.

o In addition to the amounts above, the request includes a program integrity initiative to 

support deficit reduction and protect the integrity of the tax system. The FY 2020 Budget 

investment is $362 million. Additional resources will be provided in later years. These 

investments will generate approximately $47 billion in additional revenue and will cost 

approximately $15 billion, yielding estimated net savings of $32 billion over ten years. 

o The request includes $4.7 billion in the enforcement account to stabilize staffing, increase 

future audit rates, improve predictive modeling of tax compliance risk areas, and increase 

the number of identity theft criminal investigations. 

• Provides $236 million for Treasury Departmental Offices to address priorities: fully fund 

FIRRMA implementation, strengthen financial-sector wide cybersecurity vulnerability 

detection and response, and respond to growing workload with an increase for Domestic 

Finance policy and Management staff. 
Executive Summary - 3

• Provides $167 million for Treasury’s Office of Terrorism and Financial Intelligence (TFI), a 

$25 million increase over the FY 2018 enacted level; and $125 million for the Financial 

Crimes Enforcement Network (FinCEN), a $10 million increase over the FY 2018 enacted 

level. These increases will allow TFI and FinCEN to continue their critical work 

safeguarding the financial system from abuse and combating other national security threats 

using non-kinetic economic tools. These additional resources will be deployed to 

economically isolate rogue regimes, support the Terrorist Financing Targeting Center in 

Saudi Arabia, implement the Countering America’s Adversaries through Sanctions Act, and 

counter the financial networks that support terrorists, organized transnational crime, weapons 

of mass destruction proliferators, and other threats.

• Proposes to transfer all alcohol and tobacco responsibilities from the Department of Justice’s 

Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) to Treasury’s Alcohol and 

Tobacco Tax and Trade Bureau (TTB). This transfer would leverage TTB’s resources and 

expertise relating to the alcohol and tobacco industries and allow ATF to continue to focus 

on its firearms and explosives mandates, enabling both agencies to more efficiently and 

effectively carry out their core missions of protecting the public.

• Provides $1.6 billion for Treasury’s International Programs to support the most critical 

investments in multilateral development institutions, while ensuring that U.S. contributions 

are set at an appropriate level relative to our partner countries. The proposed funding level 

meets current year U.S. commitments to international financial institutions and maintains 

funding for the Office of Technical Assistance. The request includes $206.5 million for the 

first of up to six installments for International Bank of Reconstruction and Development 

general and selective capital increases, which upon payment protect U.S. shareholding at the 

institution. 

• Consolidates and streamlines Federal Financial Literacy Education Efforts. The Budget 

proposes that Federal efforts to promote financial literacy be focused on the high-impact 

areas of: basic financial capability, housing, higher education, military and veteran 

programs, and investment and retirement planning. More than 20 Federal agencies have 

some form of financial education or literacy programs. Collectively, Federal agencies spent 

an estimated $250 million on financial literacy and education activities in 2017. 

Streamlining and consolidating programs and activities will be a multi-year effort.

• Proposes to impose appropriate Congressional oversight of the Treasury Financial Stability 

Oversight Council and Office of Financial Research (OFR) by subjecting their activities to 

the normal appropriations process. The Budget continues the reduced level of OFR spending

commensurate with the renewed fiscal discipline being applied across the Federal 

Government.

• Brings accountability and transparency to regulatory oversight functions. The Federal 

Insurance Office within Treasury is coordinating with state insurance regulators and 

insurance industry groups to improve oversight and administration of the Terrorism Risk 

Insurance Program (TRIP), as recommended in Treasury’s October 2017 report to the 

President on asset management and insurance. Treasury is also evaluating reforms, to be 

included in any legislation extending TRIP beyond its current sunset date of December 31, 

2020, to further decrease taxpayer exposure. 
Executive Summary - 4 

Fiscal Year Comparison of Full-Time Equivalent (FTE) Staffing (Direct and Reimbursable)
Executive Summary 

-5

FY 2020 President’s Budget by Strategic Goal
Executive Summary - 6
Executive Summary - 7 

DO CFIUS TFI Cyber DSCIP OIG TIGTA SIGTARP CDFI FinCEN TTB FS IRS Total

FY 2019 Annualized CR Rate $214,576 $0 $141,778 $24,000 $4,426 $37,044 $169,634 $34,000 $250,000 $115,003 $111,439 $338,280 $11,187,554 $12,627,734 

(MCLs)Maintaining Current Levels $1,761 $1,553 $193 $558 $190 $138 $1,194 $1,001 $2,239 $50,565 $59,392 Non-Recurring Costs (22,349) ($4,426) ($26,775)Efficiency Savings/Reinvestment ($1,675) ($3,830) ($109,600) ($115,105)Realignment $1,651 (1,651) $0 

Adjustments to Base $1,737 $0 ($2,277) ($24,000) ($4,426) $193 $558 $190 $138 $1,194 $1,001 $2,239 ($59,035) ($82,488)FY 2020 Base $216,313 $0 $139,501 $0 $0 $37,237 $170,192 $34,190 $250,138 $116,197 $112,440 $340,519 $11,128,519 $12,545,246 

Program Decreases ($281) ($4,697) ($16,832) ($236,182) ($2,226) ($3,013) ($7,915) ($271,146)CFIUS User Fees ($10,000) ($10,000)Program Increases 19,660 20,000 27,211 $18,000 $6,118 88 505 142 44 10,729 6,000 7,733 343,870 $460,100 Rescission (25,000) ($25,000)

Subtotal, Program Changes $19,660 $10,000 $27,211 $18,000 $6,118 ($193) ($4,192) ($16,690) ($261,138) $8,503 $2,987 ($182) $343,870 $153,954 resourcesfunded from discretionary FY 2020 President's Budget 

$235,973 $10,000 $166,712 $18,000 $6,118 $37,044 $166,000 $17,500 ($11,000) $124,700 $115,427 $340,337 $11,472,389 $12,699,200 

Program Integrity Cap Adjustment $361,571 $361,571cap adjustmentincluding program integrity FY 2020 President's Budget 

$235,973 $10,000 $166,712 $18,000 $6,118 $37,044 $166,000 $17,500 ($11,000) $124,700 $115,427 $340,337 $11,833,960 $13,060,771 

(Dollars in Thousands)

Summary of FY 2020 Increases and Decreases
Executive Summary - 8

ORGANIZATION

Treasury is organized into the Departmental Offices, seven bureaus, and three offices of Inspector General. The

Departmental Offices are primarily responsible for headquarters operations and policy formulation, while the bureaus are

the operating units of the organization.
Executive Summary - 9

DEPARTMENTAL OFFICES

Domestic Finance works to preserve

confidence in the U.S. Treasury

securities market, strengthen financial

institutions and markets, and promote access to credit, in

service to long-term economic strength and stability.

Terrorism and Financial Intelligence (TFI) uses unique policy,

intelligence, enforcement and regulatory tools and

authorities to disrupt and disable terrorists, criminals,

and other national security threats while also

safeguarding the financial system against abuse by illicit

actors.

International Affairs protects economic prosperity and

national security by working to foster a most favorable

external environment for sustained jobs and economic

growth.

Tax Policy develops and implements tax policies and

programs, reviews regulations and rulings to administer

the Internal Revenue Code, and provides revenue

estimates for the President’s Budget.

Economic Policy reports on economic developments and

assists in the determination of appropriate economic

policies. It also reviews and analyzes domestic economic

issues and financial market developments.

The Treasurer of the United States serves as a principal

advisor to the Secretary and leads the Office of Consumer

Policy, which provides policy leadership, research, and

analysis to foster economic growth and financial security

for American families in a robust consumer marketplace. 

The Treasurer also oversees the U.S. Mint, including

advising the Secretary on coinage matters and liaising

with the Federal Reserve.

The Office of Management and Chief Financial Officer 

manages the Department’s financial resources and

oversees Treasury-wide programs, including human

capital, organizational performance, information

technology, acquisition, and diversity issues.

The Office of Risk Management oversees the

development and implementation of an

integrated risk management framework

for the Department, advising Treasury leaders on

managing credit, market, liquidity, fraud, operational,

strategic, and reputational risks.

 

Other offices within Departmental Offices include the

General Counsel, Legislative Affairs, and Public Affairs.
Executive Summary - 10

INSPECTORS GENERAL

 

Three Inspectors General – the Office of Inspector General

(OIG), the Treasury Inspector General for Tax Administration

(TIGTA), and the Special Inspector General for the Troubled Asset

Relief Program (SIGTARP) – provide independent audits,

investigations, and oversight of Treasury and our

programs.

BUREAUS

The Alcohol and Tobacco Tax and Trade Bureau (TTB) collects

federal excise taxes on alcohol, tobacco products, firearms,

and ammunition and enforces and administers laws

covering production, use, and distribution of alcohol and

tobacco products.

The Bureau of Engraving and Printing (BEP) develops

and produces U.S. currency notes, as well as secure

documents for government use.

The Financial Crimes Enforcement Network (FinCEN)

safeguards the financial system from illicit use and

combats money laundering. It also promotes national

security through the collection, analysis, and

dissemination of financial intelligence and strategic use of

financial authorities.

The Bureau of the Fiscal Service (Fiscal Service) promotes

financial integrity and operational efficiency by operating

the U.S. government’s collections and deposit systems,

and providing central payment services to the American

public on behalf of federal agencies. It also manages the

collection of delinquent debt, borrows funds needed to

operate the U.S. government through the sale of

marketable and special-purpose U.S. Treasury securities,

and accounts for the resulting debt. Additionally, it

delivers administrative shared services to federal agencies

and provides government-wide accounting and reporting. 

The Internal Revenue Service (IRS) determines, assesses, and

collects U.S. tax revenue and helps taxpayers understand

their tax responsibilities and combats tax-related fraud.

The United States Mint (U.S. Mint) designs, mints, and

issues U.S. circulating, numismatic, and bullion coins,

strikes Congressional gold medals and other medals of

national significance, and maintains physical custody and

protection of most of the nation’s gold and all its silver

assets.

The Office of the Comptroller of the Currency (OCC) charters,

regulates, and supervises national banks and federal

savings associations as well as federal branches and

agencies of foreign banks to ensure that they operate in a

safe and sound manner, provide fair access to financial

services, treat customers fairly, and comply with

applicable laws and regulations.
Executive Summary - 11

TREASURY STRATEGIC MANAGEMENT

FRAMEWORK

The Government Performance and Results Act (GPRA) and the GPRA Modernization Act of 2010 require

agencies to identify goals, report progress against targets, and conduct data-driven reviews. These practices

serve two key purposes for stakeholders within and outside of the organization — to assess the organization’s

health and impact, and to enhance effective decision-making and strategy, including resource allocation. In this

spirit, Treasury developed a strategic framework using best-in-class organizational performance practices to

help achieve our strategic goals and objectives.

ORGANIZATIONAL PERFORMANCE REVIEW CYCLE

Our organizational performance reviews provide a regular forum for open dialogue and coordination between

bureau and departmental policy office management and leadership. We bring together different perspectives to

set and align priorities, identify and solve problems, review agency performance, and drive results. The cycle

integrates statutory requirements to conduct quarterly performance reviews of agency goals and a Strategic

Objective Annual Review (SOAR), which analyzes cross-cutting performance and identifies a set of strategic

objectives as priority focus areas.

At designated points throughout the fiscal year, we set annual priorities, evaluate progress, problem-solve

around risks and challenges, and assess funding options in the context of performance outcomes. Treasury’s

process and framework for managing to our strategic objectives and performance outcomes is described in Table

1 below. 

TABLE 1: STRATEGIC FRAMEWORK Sessions

Fall

(October – November)

Winter

(February – March)

Spring

(April – May)

Summer

(June – July)

Focus

Organizational Performance SOAR Organizational Performance Budget

Chair

Assistant Secretary for

Management/Performance

Improvement Officer

(ASM/PIO)

ASM/PIO and Deputy PIO ASM/PIO ASM/PIO and Budget

Officer

Goals/Outcomes

• Review prior year’s

performance at the

bureau/office level

• Set priorities for year

ahead

• Recognize successes

• Identify shortfalls/

accountability

• Evaluate cross-agency

progress toward strategic

objectives

• Identify strategic shifts/

validate Treasury priorities

• Outline potential topics for

annual review with the

Office of Management and

Budget (OMB)

• Assess progress on priorities

• Identify necessary

adjustments/near-term

improvements

• Surface problems or

assistance needed

• Recognize successes

• Identify shortfalls/

accountability

• Connect priorities to

future funding

• Explore performance

impacts

• Strengthen information

technology

acquisition

budgeting

accountability
Executive Summary - 12 

FY 2018 – 2022 STRATEGIC FRAMEWORK

The strategic framework comprises the Department’s FY 2018–2022 strategic goals and objectives and 

FY 2018–2019 Agency Priority Goals (APGs), which align to specific objectives. All bureaus and offices align

their programs and performance within this framework. FY 2018 marks the first year of implementing our new

strategic plan, which emphasizes achieving important outcomes through a series of focused objectives and

underlying strategies.

Strategic Goals Strategic Objectives/APGs

Contributing

Bureaus/Offices

Economic

Goal 1: Boost U.S.

Economic Growth

1.1: Tax Law Implementation

 Aligned APG: Reducing Refund Fraud

1.2: Strong Economic Fundamentals

1.3: Trusted Currency and Services

 Aligned APG: Improved Business Qualification Process

1.4: Free and Fair Trade

Domestic Finance

International Affairs

Tax Policy

Treasurer

Economic Policy

IRS

BEP

U.S. Mint

TTB

OCC

Goal 2: Promote

Financial Stability

2.1: Housing Finance Reform

2.2: Foreign Exchange Practices

2.3: Foreign Technical Assistance

2.4: Financial Sector Critical Infrastructure and Cybersecurity

Domestic Finance

International Affairs

Management

OCC 

Security

Goal 3: Enhance

National Security

3.1: Strategic Threat Disruption

 Aligned APG: U.S. and Mexico Strategic Dialogue on Illicit Finance

3.2: Anti-Money Laundering and Combating Financing of Terrorism Framework

3.3: Economic Strength and National Security

TFI

FinCEN

International Affairs

Economic Policy

OCC 

Financial

Goal 4: Transform

Government-wide

Financial

Stewardship

4.1: Financial Data Access and Use

4.2: Debt Management

4.3: Federal Financial Performance

Domestic Finance

International Affairs

IRS

Fiscal Service

Management

Goal 5: Achieve

Operational

Excellence

5.1: Workforce Management

5.2: Treasury Infrastructure 

5.3: Customer Value

All Offices and

Bureaus, led by the

Office of

Management

The Government Performance and Results Act (GPRA) and the GPRAMA established the need for agencies to 

identify performance goals, report progress against targets, and conduct data-driven reviews. These practices 

serve two key purposes for stakeholders within and outside of the organization: to assess the organization’s 

health and impact and to inform decision-making and strategy (including effective resource allocation). In this 

spirit, we developed a strategic framework supported by best-in-class organizational performance practices to 

help achieve the Department’s strategic objectives.

Our organizational performance reviews provide a regular forum for open dialogue and coordination among 

Department, bureau, and office leadership and bringing together different perspectives to set and align 

priorities, identify and solve problems, review agency performance goals, and drive results. The cycle integrates 
Executive Summary - 13

statutory requirements to conduct performance reviews of agency strategic objectives, agency priority goals, and 

cross-agency priority goals.

AGENCY PRIORITY GOALS

Reducing Refund Fraud: The filing of fraudulent individual and business tax returns by identity thieves 

continues to have a significant impact on tax administration. Identity theft tax fraud occurs when an individual 

uses another person’s or business’ name and Taxpayer Identification Number to file a fraudulent tax return for 

the purpose of obtaining a tax refund. For processing year 2015, the IRS estimates between $2.24 billion and 

$3.34 billion of identity theft tax refunds were unprotected (i.e., refunds were paid on probable identity theft 

refund fraud claims and are likely unrecoverable). For processing year 2016, the IRS estimates between $1.68 

billion and $2.31 billion of identity theft tax refunds were unprotected. That same year, the IRS successfully 

protected between $10.56 billion and $10.61 billion in identity theft refunds (i.e., IRS defenses prevented 

payment). The IRS is using data analytics and public-private partnerships to reduce the amount of unprotected 

identity theft tax refunds paid by two percent by December 31, 2019. Progress toward this goal is measured 

using the IRS’s annual Taxonomy, a statistical estimation of the amount of revenue protected and unprotected 

from identity refund fraud based on analysis and sampling of returns. Although the Taxonomy provides a 

statistical estimation of fraud detection, the detection methods are evaluated continuously for opportunities to 

improve detection or reduce taxpayer burden. 

Improved Business Qualification: Ongoing growth in the alcohol beverage industry in recent years has resulted

in an increased volume in permit applications for new alcohol producers. This growth in workload has

contributed to delayed permit approvals that exceeded TTB’s service standards. Through targeted process

improvements, TTB has achieved significant improvement, far exceeding the 20% reduction in processing times

targeted for this APG. Reaching the goal of consistently achieving the service standard for original permit

applications has proven difficult, with application volumes high and continuing to increase. Despite these

challenges, TTB made a significant year-to-year improvement, increasing the percent of permits processed

within the 75-day standard from 48% in FY 2017 to 71% in FY 2018. TTB will seek to make performance

improvements in FY 2019 through several key strategies, including ongoing enhancements to the new Permits

Online system, increased familiarity with the new system by both TTB staff and industry, continued process

improvements, and planned rulemaking to streamline the permit application. TTB continues to target high

electronic filing rates to support timely processing, and tracks system satisfaction rates to ensure its eGov

systems effectively serve and meet the expectations of its customers. System satisfaction rates ended the year

at 77%, below the target of 80%; however, TTB expects satisfaction to improve in FY 2019 as prospective and

current TTB permittees adapt to the new system features and functionality, and as TTB continues to make

progress in timely processing. 
Executive Summary - 14

U.S. and Mexico Strategic Dialogue on Illicit Finance: Established in 2014, the Strategic Dialogue on Illicit

Finance (SDIF) was created in an effort to deliver greater economic growth and opportunity for the citizens of

Mexico and the United States by safeguarding our financial systems against the threats of illicit finance. SDIF

will increase U.S. and Mexican effectiveness against transnational criminal organizations (TCOs), including

drug trafficking organizations (DTOs), operating in the United States and Mexico through (SDIF) that focuses

on taking enforcement actions, sharing key illicit finance information, safeguarding our financial systems

against threats, and increasing the effectiveness and capacity of AML/CFT regimes. Since the 2018 Mexican

presidential election, SDIF progress has slowed due to the transition of the newly elected presidency. TFI will

continue to monitor Mexico’s progress in appointing the new permanent or temporary SDIF team and will

subsequently evaluate next steps for this initiative.

In addition to these Department-level reviews, bureaus and offices validate performance data each quarter and 

many run their own internal performance reviews.1

 

1/ The FY 2018 Verification and Validation Report is available at: https://www.treasury.gov/about/budgetperformance/annual-performance-plan/Documents/Treasury_Measure_Verification_and_Validation.pdf
Executive Summary - 15

ENTERPRISE RISK MANAGEMENT

FRAMEWORK

OMB Circular No. A-123, Management’s Responsibility for Enterprise Risk Management and Internal Control

provides guidance to federal managers to effectively manage risks to achieve strategic objectives. Management,

together with the Chief Risk Officer (CRO), is responsible for establishing a governance structure to effectively

implement a robust process of risk management and internal control. Successful implementation requires us to

establish and foster an open, transparent culture that encourages people to communicate information about

potential risks and other concerns. 

The CRO monitors regular Risk Management Committee meetings that unite the Departmental Offices to

discuss top risks to Departmental goals and objectives, response strategies and lessons learned. The Office of

Risk Management (ORM) has also established an Enterprise Risk Management (ERM) Council, chaired by the

CRO, which brings together risk managers from each of our bureaus on a regular basis to establish a

Department-wide framework and taxonomy for ERM, and share best practices. ORM works with the offices and

bureaus across Treasury to monitor and annually update our risk profile.

Beyond its work at Treasury, ORM leads an interagency ERM community of practice including officials from 30

agencies. This group grew from ORM’s efforts to support federal agencies in their implementation of ERM,

including the July 2016 publication of the Playbook: Enterprise Risk Management (ERM) for the U.S. Federal

Government. This government-wide working group meets on a bimonthly basis to discuss common risks and

various methods of implementing the guidelines of the Circular.

ENTERPRISE RISKS AND CHALLENGES

Through the FY 2018 SOAR and enterprise risk management process, we identified the following cross-cutting

operational risks. 

Workforce Management: Difficulties hiring and managing the Treasury workforce may create knowledge gaps

and a lack of expertise in several areas important to our mission. The increased pressures on existing staff can

cause high attrition and low engagement. The current human capital system impedes our ability to shape our

workforce and realign it to mission needs.

Reshaping Priorities: We have many extremely important ongoing missions and are also at the forefront of

several new initiatives to improve and keep our economy on a stable footing. Due to uncertain funding amounts

and timing, new or changing legislative requirements, and reduced capacity, there is a risk that we will not be

as agile as we should be in balancing new innovations or initiatives with existing requirements or projects.

Evolving Cyber Climate: Treasury and the whole financial sector face increasing attacks from cyber criminals

and state actors attempting to disrupt or steal data from sensitive systems. The tactics, techniques, and

procedures used by perpetrators of these incidents are constantly evolving.

Limited Analytic Capabilities: Aging infrastructure can impede analytics capabilities, program innovation, and

improved delivery of products and services.
Executive Summary - 16

Critical System Failures: Reliance on aging technologies could lead to system outages or failures that disrupt

core mission work.

Human Capital Plan Implementation

In FY 2020, Treasury’s Human Capital Community will continue its efforts towards a 

competency-based management approach. In alignment with these efforts, below are some of 

the strategies that are the focus for FY 2019:

• Continued implementation of the Integrated Talent Management System (DASHRCHCO)

• Explore designing a mentoring program (DASHR-CHCO)

• Develop comprehensive training policy (DASHR-CHCO)

• Finalize competency approach and begin development of competency library(ies) 

(DASHR-CHCO)

• Establish career ladders to support succession planning for PT/NRC (TTB)

• Increase the quality and quantity of the applicant pool (BEP)

• Enhance hiring strategies and process to better screen applicants (IRS)

• Institutionalize Knowledge Management as a workforce solution (IRS)

• Continue to strengthen the EEO/Diversity & Inclusion Programs across the service (IRS)

• Institute succession planning in support of Mint’s Future State to mitigate the loss of 

institutional knowledge (Mint)

• Support employees impacted by the FY 2019 relocation (BFS)

• Engage in collective bargaining with NTEU over new Performance Management 

Program including mandatory Diversity and Inclusion elements.

• Close vacancy gaps by executing the FY 2019 hiring surge (FinCEN)

Summary of Management and Performance Challenges

OIG and TIGTA have identified the most significant management and performance challenges 

facing the Department, in accordance with the Reports Consolidation Act of 2000. These 

challenges do not necessarily indicate deficiencies in performance; some represent inherent risks 

that require continuous monitoring. Refer to Section C of Part 3, Other Information, in the 

FY 2018 Treasury Agency Financial Report (AFR) for a detailed discussion of these challenges, 

including our progress toward addressing them.2 GAO releases a government-wide high-risk list 

every two years. Treasury has shared responsibility for one risk area and lead responsibility in 

another.

OIG - Identified Management Challenges:

• Operating in an Uncertain Environment;

• Cyber Threats;

• Anti-Money Laundering and Terrorist Financing/Bank Secrecy Act Enforcement; and 

• Efforts to Promote Spending Transparency and to Prevent and Detect Improper 

Payments.

TIGTA - Identified Management Challenges:

• Security Over Taxpayer Data and Protection of IRS Resources;

 2 The FY 2018 AFR is available at https://home.treasury.gov/system/files/266/Treasury-FY-2018-AFR-111518.pdf. 

The response letters are on pages 184-189.
Executive Summary - 17

• Implementing the Tax Cuts and Jobs Act and Other Tax Law Changes;

• Identity theft and Impersonation Fraud;

• Providing Quality Tax Pay Service;

• Upgrading Tax Systems and Expanding Online Services;

• Improving Tax Reporting and Payment Compliance;

• Reducing Fraudulent Claims and Improper Payments;

• Impact of Global Economy on Tax Administration;

• Protecting Taxpayer Rights; and 

• Achieving Program Efficiencies and Cost Savings.

GAO - Identified High-Risk Areas:

• Modernizing the U.S Financial Regulatory System (OFR/FSOC/OCC/Federal Reserve)

• Enforcement of Tax Laws (IRS)

Good Accounting Obligation in Government Act (GAO-IG Act)

• In January 2019, the GAO-IG Act become law, requiring each agency to include in its 

annual budget justification, a report that identifies each public GAO and OIG/TIGTA 

recommendation that has remained unimplemented for one year or more from the annual 

budget justification submission date. 

Please see https://home.treasury.gov/about/budget-financial-reporting-planning-and-performance

for more information. 



Department of the Treasury 

Internal Revenue Service 

Congressional Budget 

Justification and Annual 

Performance Report and Plan 

Fiscal Year 2020
IRS-i 

Table of Contents

Section I – Budget Request...................................................................................................... 1

1A – Mission Statement ....................................................................................................... 1

1.1 – Appropriations Detail Table ....................................................................................... 1

1B – Summary of the Request............................................................................................. 2

1.2 – Budget Adjustments Table ......................................................................................... 9

1C – Base Adjustment and Program Changes Description............................................ 10

Other Adjustment............................................................................................................... 10

Maintaining Current Levels (MCLs) ............................................................................... 11

Efficiencies / Savings ...... ................................................................................................. 11

Increase e-File Savings ..................................................................................................... 11

Space Optimization ........................................................................................................... 11

Reduce Contractual Services ............................................................................................ 11

Non-Recur Administrative Provision Section 112 Tax Reform ........................................ 11

Program Increases.............................................................................................................. 11

IRS Integrated Modernization Business Plan ................................................................... 11

Data Analytics to Enhance Compliance ........................................................................... 12

Prevent Identity Theft........................................................................................................ 15

O&M of Prior-year Enterprise-wide Cybersecurity Investments..................................... 17

O&M of Critical Systems.................................................................................................. 17

1.3 – Operating Levels Table............................................................................................. 18

1D – Appropriations Language and Explanation of Changes ....................................... 19

1E – Legislative Proposals ................................................................................................. 25

1F - IRS Use of Evidence and Evaluation ........................................................................ 27

Section II – Budget and Performance Plan .......................................................................... 30

Taxpayer Services............................................................................................................... 31

2.1 – Budget Adjustments Table ........................................................................................ 32

2.2 – Operating Levels Table ............................................................................................ 33

2.3 – Appropriation Detail Table ...................................................................................... 34

2A – Pre-Filing Taxpayer Assistance and Education ....................................................... 34

2.1.1 – Budget and Performance Report and Plan ........................................................... 36

2B – Filing and Account Services ..................................................................................... 37

2.1.2 – Budget and Performance Report and Plan ........................................................... 39

Enforcement........................................................................................................................ 40

2.1 – Budget Adjustments Table ........................................................................................ 41

2.2 – Operating Levels Table ............................................................................................ 42

2.3 – Appropriation Detail Table ...................................................................................... 43

2C – Investigations ............................................................................................................ 43

2.1.3 – Budget and Performance Report and Plan ........................................................... 45

2D – Exam and Collections .............................................................................................. 45

2.1.4 – Budget and Performance Report and Plan ........................................................... 51

2E – Regulatory ................................................................................................................ 51

2.1.5 – Budget and Performance Report and Plan ........................................................... 53
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Operations Support............................................................................................................ 54

2.1 – Budget Adjustments Table ........................................................................................ 55

2.2 – Operating Levels Table ............................................................................................ 56

2.3 – Appropriation Detail Table ...................................................................................... 57

2F – Infrastructure ............................................................................................................ 57

2.1.6 – Budget and Performance Report and Plan ........................................................... 58

2G – Shared Services and Support ................................................................................... 58

2.1.7 – Budget and Performance Report and Plan ........................................................... 62

2H – Information Services ................................................................................................ 62

2.1.8 – Budget and Performance Report and Plan ........................................................... 65

Business Systems Modernization ...................................................................................... 66

2.1 – Budget Adjustments Table ........................................................................................ 67

2.2 – Operating Levels Table ............................................................................................ 67

2.3 – Appropriation Detail Table ...................................................................................... 68

2I – Business Systems Modernization ............................................................................... 68

2.1.9 – Budget and Performance Report and Plan ........................................................... 80

Section III – Supplemental Information ............................................................................... 81

3.1 – Summary of Capital Investments ............................................................................ 81

3.2 – Return on Investment (ROI) for IRS Major Enforcement Programs ................. 83

3.3 – IRS Performance Measures Table........................................................................... 85

3.4 – Summary of FY 2018 Savings Realized ................................................................... 88

Section IV – Appendix............................................................................................................ 89

4.1 – Appropriations Detail Table with Program Integrity Cap Adjustment .............. 89

Increase Audit Coverage ................................................................................................... 92

Increase Collection Coverage ........................................................................................... 94

Fight Cybercrimes and Counterterrorism ........................................................................ 96

Return Review Program .................................................................................................... 98

IT Support for Enforcement Efforts .................................................................................. 99

Expand Coverage in the Tax-Exempt Sector .................................................................. 100

4.2 – Summary of IRS FY 2020 Identity Theft Budget Request .................................. 101

4.3 – Summary of IRS FY 2020 ACA Budget Request ................................................. 101

4.4 – Summary of IRS FY 2020 Cyber Security Budget Request ................................ 102

4.5 – Summary of IRS FY 2020 Request ........................................................................ 103
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Section I – Budget Request

1A – Mission Statement 

Provide America’s taxpayers top-quality service by helping them understand and meet their 

tax responsibilities and enforce the law with integrity and fairness to all. 

1.1 – Appropriations Detail Table 

Dollars in Thousands

Internal Revenue Service Change % Change

Appropriated Resources

FY 2018

Enacted1

FY 2019

Annualized CR2 

FY 2020

Request3

FY 2019 to FY 2020 

Request

FY 2019 to FY 2020 

Request

New Appropriated 

Resources: FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

Taxpayer Services 27,871 $2,512,554 28,834 $2,571,554 26,639 $2,402,000 (2,195) ($169,554) -7.6% -6.6%

Pre-Filing Taxpayer 

Assistance and Education 4,636 640,379 4,603 634,019 4,606 634,762 3 743 0.1% 0.1%

Filing and Account Services 23,235 1,872,175 24,231 1,937,535 22,033 1,767,238 (2,198) (170,297) -9.1% -8.8%

Enforcement 34,789 $4,627,000 34,049 $4,672,000 34,182 $4,705,368 133 $33,368 0.4% 0.7%

Investigations 2,950 581,680 2,893 597,658 2,964 614,046 71 16,388 2.5% 2.7%

Exam and Collections 30,876 3,875,098 30,084 3,894,129 30,209 3,923,583 125 29,454 0.4% 0.8%

Regulatory 963 170,222 1,072 180,213 1,009 167,739 (63) (12,474) -5.9% -6.9%

Operations Support 10,389 $4,181,000 10,340 $3,834,000 10,683 $4,075,021 343 $241,021 3.3% 6.3%

Infrastructure 870,360 858,932 853,738 (5,194) -0.6%

Shared Services and Support 4,315 920,283 4,269 942,568 4,287 953,686 18 11,118 0.4% 1.2%

Information Services 6,074 2,390,357 6,071 2,032,500 6,396 2,267,597 325 235,097 5.4% 11.6%

Business Systems 

Modernization 219 $110,000 361 $110,000 441 $290,000 80 $180,000 22.2% 163.6%

Subtotal New Appropriated 

Resources 73,268 $11,430,554 73,584 $11,187,554 71,945 $11,472,389 (1,639) $284,835 -2.2% 2.5%

Other Resources:

Reimbursables 795 171,140 521 116,551 521 122,379 5,828 5.0%

Offsetting Collections (Non 

Reimbursable) 26,069 37,719 39,605 1,886 5.0%

User Fees 14 283,267 60 563,053 71 460,900 11 36,857 18.3% 8.7%

Recovery from Prior Years 13,233 17,994 18,905 911 5.1%

Unobligated Balances from 

Prior Years 236 360,031 289 357,637 100 153,567 (189) (343,080) -65.4% -69.1%

Transfers In/Out (4,188)

Subtotal Other Resources 1,045 $849,552 870 $1,092,954 692 $795,356 (178) ($297,598) -20.5% -27.2%

Total Budgetary Resources 74,313 $12,280,106 74,454 $12,280,508 72,637 $12,267,745 (1,817) ($12,763) -2.4% -0.1%

1 FY 2018 Enacted includes $320 million in Section 113 Administrative Provision funding in the following amounts: $19 million in Taxpayer 

Services, $10 million in Enforcement, and $291 million in Operations Support. FY 2018 Enacted also includes an interappropriation transfer of 

$256 million to Operations Support ($13 million from Taxpayer Services and $243 million from Enforcement) and budget activity adjustments in 

accordance with Section 608 of Public Law 115-141. FY 2018 full-time equivalent (FTE) are actuals and reconcile to the final FY 2018 column in 

the FY 2020 President's Appendix. Other Resources are actuals.

2 FY 2019 Annualized Continuing Resolution (CR) includes a $200 million interappropriation transfer from Enforcement to Operations Support to 

cover operations and maintenance requirements in FY 2019. FY 2019 Annualized CR also includes $77 million ($65 million in Taxpayer Services

and $12 million in Enforcement) for the Section 112 Administrative Provision to implement requirements under the Tax Cuts and Jobs Act (Public 

Law 115-97). $320 million is automatically available in a full year continuing resolution scenario under IRS Administrative Provision Section 113. 

Of this amount, $243 million is excluded for illustrative purposes consistent with the requirements identified for implementing the Tax Cuts and 

Jobs Act and the FY 2019 Section 112 / Tax Reform Spending Plan transmitted to Congress on February 28, 2019. Additional information and a 

full accounting of these funds can be found in the FY 2020 President’s Budget Appendix.

3 FY 2020 Request column excludes the proposed $362 million discretionary program integrity investment in FY 2020: $200 million for 

Enforcement and $162 million for Operations Support. More information about the program integrity cap adjustment can be found in Section 4.1.
IRS-2 

1B – Summary of the Request 

The Internal Revenue Service (IRS) is responsible for administering the nation’s tax system 

and meeting the needs of America’s taxpayers by helping them understand and meet their tax 

responsibilities and by enforcing the law with integrity and fairness. 

The IRS interacts with almost every American and generates 95 percent of the funding that 

supports the federal government’s operations. With the U.S. tax base becoming more 

complex, one of the IRS’s key responsibilities is to make it easier for taxpayers to understand 

and meet their tax obligations.

During 2018, the IRS processed 253 million tax forms, including individual income tax, 

corporation income tax, and employment tax returns. The IRS provided more than 

$400 billion in tax refunds to taxpayers, protected billions of taxpayer records, and collected 

$3.5 trillion in taxes (gross receipts before tax refunds). 

The IRS’s primary operations include collection of individual and corporate taxes, 

examination of returns, taxpayer assistance, and oversight of tax-exempt organizations, as 

well as administering multiple refundable tax credits and other specialized programs. 

FY 2020 Budget Request and Priorities 

The FY 2020 President’s Budget (Budget) request is $11.472 billion, $285 million or 

2.6 percent more than the FY 2019 Annualized Continuing Resolution (CR) level of 

$11.188 billion. The base budget request provides funding to carry out the IRS mission. 

Appropriation Account ($ in Millions)

Taxpayer Services $2,402.0

Enforcement 4,705.4

Operations Support 4,075.0

Business Systems Modernization 290.0

Total Appropriated Resources $11,472.4

The Budget includes an increase of $344 million for four high-priority areas: modernization 

(the IRS Integrated Modernization Business Plan), cybersecurity and identity theft, 

infrastructure, and data analytics. The investment in modernization provides a down payment 

on a multi-year plan to modernize IRS systems and operations and deliver a customer 

experience comparable to the best financial institutions; the integrity of the voluntary tax 

compliance system depends on it. These priorities will allow the IRS to continue to support 

taxpayer service, protect trillions of dollars in tax revenue, and secure taxpayer information. 

The Budget will allow the IRS to: 

• Help all taxpayers meet their tax obligations by simplifying the process of filing and

amending returns and submitting payments;

• Protect the integrity of the tax system by reviewing and enforcing the tax code;
IRS-3 

• Partner with key stakeholders in the state and local tax administration, tax

preparation, and international communities;

• Cultivate and retain a well-equipped, diverse, flexible, and engaged workforce;

• Advance data access, usability, and analytics to inform decision making; and

• Drive increased agility, efficiency, effectiveness, and security in operations.

Tax Administration Challenges and Risks 

Over the past several years, the IRS’s

workload and responsibilities increased 

even as staffing levels declined. For 

example, since FY 2010, the total 

number of returns filed increased by 

eight percent, information returns filed 

increased by 33 percent, and staffing 

decreased by about 19 percent, primarily 

in compliance and enforcement. In FY 

2018, 0.5 percent of all returns filed 

were audited compared to 0.9 percent in 

FY 2010. Meanwhile, cybersecurity and identity theft refund fraud prevention programs 

consume a larger share of the budget. In FY 2019, the IRS plans to replace attrition and hire 

approximately 2,000 additional enforcement personnel. 

The Budget addresses the growing demand for online taxpayer services and stronger 

compliance efforts by investing in secure and modernized technology. The Budget would 

allow the IRS to leverage data and behavioral analytics to target the most effective noncompliance work in collection and enforcement, address cybersecurity threats, refresh aged IT 

infrastructure, and recruit top talent. 

Strategic Plan 2018 - 2022 

In 2018, the IRS published its FY 2018-2022 Strategic Plan. The plan articulates the IRS 

vision to become a taxpayer-centric and modern organization and will guide the IRS’s

strategic decision-making over the coming years. The plan includes six strategic goals:

• Empower and enable all taxpayers to meet their tax obligations.

• Protect the integrity of the tax system by encouraging compliance through

administering and enforcing the tax code.

• Collaborate with external partners proactively to improve tax administration.

• Cultivate a well-equipped, diverse, flexible and engaged workforce.

• Advance data access, usability and analytics to inform decision-making and improve

operational outcomes.

• Drive increased agility, efficiency, effectiveness and security in IRS operations.

1,645,607 

(0.9% coverage rate)

930,427

(0.5% coverage rate)

FY 2010 FY 2015 FY 2017 FY 2018

Number of Returns Examined 
IRS-4 

The plan aligns with five out of 17 strategic objectives in the Department of the Treasury’s 

FY 2018-2022 Strategic Plan:

• Treasury Objective 1.1: Tax Law Implementation

• Treasury Objective 4.1: Financial Data Access and Use

• Treasury Objectives 5.1-5.3: Workforce Management, Treasury Infrastructure and

Customer Value

By combatting refund fraud and identity theft, transforming taxpayer services to meet 

taxpayer expectations, maintaining a skilled and talented workforce, increasing operational 

efficiency and effectiveness, and meeting the tax needs of a diverse U.S. population, the 

strategic plan is a guide to accomplishing the IRS mission and vision. 

Tax Reform 

The IRS is responsible for implementing the most extensive tax legislation in decades, the 

Tax Cuts and Jobs Act (TCJA), enacted on December 22, 2017. Implementation of most of 

the 119 TCJA tax provisions took place during calendar year 2018 for the 2019 filing season 

and beyond. The IRS has created and revised more than 500 tax products and 57 systems, 

retrained employees, and educated millions of taxpayers about the tax changes. Congress 

provided $320 million in FY 2018 and $77 million in FY 2019 for these activities, including: 

• Providing assistance to taxpayers on issues involving interpretations of the law and

related published guidance.

• Training IRS employees on the new law and helping the public, tax professionals, and

industry partners understand how the law applies to them.

• Reprogramming information technology systems, with special focus on return

processing and compliance systems (the backbone of the tax system).

This effort required the participation of all IRS divisions and was led by the Tax Reform 

Implementation Office (TRIO). TRIO coordinated activities to implement the TCJA’s farreaching provisions. By the end of calendar year 2018, the IRS had initiated systems testing 

for almost all filing season programming and approved more than 700 hires, with more than 

615 new employees selected, 367 on-board, and the remainder in progress. While the IRS 

experienced a delay in training, each business unit provided technical training to employees as 

the filing season approached. Frontline employees who interact with taxpayers during the 

filing season received more hours of training than they did in previous years. 

In February 2018, the IRS hosted outside stakeholders in five roundtable discussions that 

addressed individual, withholding, business, international, and tax-exempt provisions. Since 

that time, the IRS has worked closely with tax professionals, industry associations, advisory 

groups, and many others to hear and understand practitioners’ and professionals’ priorities 

and interests. 
IRS-5

IRS Integrated Modernization Business Plan

The Budget requests $290 million for the IRS Integrated Modernization Business Plan

(Modernization Plan) for a total budget of $300 million in FY 2020, including at least 

$10 million from IRS user fees. The plan is critical to maintaining the voluntary tax 

compliance system and will position the IRS to deliver a customer experience comparable to 

the best financial institutions in the world. The plan – validated by an independent third-party 

assessor – calls for a total investment of approximately $2.3 to $2.7 billion over six years, 

delivered in two phases. The technologies provided for in the plan, such as customer callback 

and online notifications, will simplify taxpayer interactions with the IRS across all service

channels and expedite return processing times, allowing taxpayers to comply and receive 

refunds faster. Modernizing will stabilize rising operations and maintenance (O&M) costs. 

Currently, O&M costs are about $2.2 billion a year and are projected to reach $3 billion by 

FY 2026. The National Taxpayer Advocate Annual Report to Congress 2018 rated the need 

to replace antiquated technology systems as the IRS’s top priority:

IRS performance already is significantly limited by its aging systems, and if those 

systems aren’t replaced, the gap between what the IRS should be able to do and what 

the IRS is actually able to do will continue to increase in ways that don’t garner 

headlines but increasingly harm taxpayers and impair revenue collection.
IRS-6

The IRS Integrated Modernization Business Plan will provide a path to rectify these issues, 

transform the taxpayer experience, and improve compliance by focusing on the following four 

core areas: Taxpayer Experience

• Help taxpayers resolve issues quickly and efficiently 

• Empower taxpayers with information about their account, obligations, 

and payment options 

• Make services available to customers when they need them

• Protect taxpayer information and data

Core Taxpayer 

Services and 

Enforcement

• Integrate tax processing systems to increase the cost effectiveness of 

operations 

• Enable real-time processing and increase transparency of return status 

• Increase data usability and the use of data analytics to combat fraud

Modernized 

IRS 

Operations

• Reduce complexity of the technical environment 

• Leverage data to deliver secure, agile, and efficient applications and 

services

• Strengthen organizational agility through automation and streamlining 

processes

Cybersecurity

and Data 

Protection

• Establish trusted and streamlined access to information through 

identity and access management technologies 

• Proactively identify emerging threats and vulnerabilities through the 

use of real-time intelligence information and analytics

• Protect taxpayer data and systems via end-to-end visibility & common 

platforms

Program Integrity Cap Adjustment 

In addition to the base appropriations request of $11.472 billion, the Budget proposes a 

$362 million discretionary program integrity cap adjustment in FY 2020 to fund new and 

continuing investments in expanding and improving the effectiveness and efficiency of the 

IRS’s overall tax enforcement program. The Budget proposes $200 million for the 

Enforcement account and $162 million for the Operations Support account. Additional 

adjustments are provided in future years to fund new initiatives and inflation. These 

investments will generate $47.1 billion in new revenue over 10 years and will cost about 

$14.5 billion, for net revenue of $32.6 billion. This return on investment (ROI) is likely 

understated because it does not reflect the effect that enhanced enforcement has on deterring 

non-compliance. The deterrent effect helps to ensure the continued payment of more than 

$3 trillion in taxes paid voluntarily each year. More information about the cap adjustment is 
IRS-7

found in Section 4.1 of the Appendix and in the Budget Process Chapter of the 

FY 2020 President’s Budget. 

2018 Filing Season 

The IRS delivered a successful 2018 filing season that opened on January 29, 2018. The IRS 

held its 12th annual Earned Income Tax Credit (EITC) Awareness Day on January 26, 2018. 

This day marked the kickoff of a multilingual communication effort intended to increase 

awareness of EITC eligibility, encourage participation, and emphasize filing of accurate 

returns. The day also highlighted free tax preparation and electronic filing options through 

the Volunteer Income Tax Assistance (VITA), Tax Counseling for the Elderly (TCE), and 

Free-File programs.

Other highlights from the 2018 filing season:

• Achieved an 80 percent filing season telephone level of service (LOS), an increase of 

one percent over the 2017 filing season.

• Answered more than 10 million calls and addressed another 17 million calls through 

automated systems.

• Received about 137 million individual returns, with almost 91 percent filed 

electronically.

• Received about 31 million business returns, an increase of one percent over the 

2017 filing season, with almost 20.4 million filed electronically, an increase of six 

percent from 2017.

• Issued more than 95 million refunds totaling $265 billion with an average refund of 

$2,780 and more than 84 percent paid through direct deposit.

• Served nearly five million taxpayers, almost three million through face-to-face assistor 

contacts and two million who had their issues resolved over the phone when they 

called for an appointment. 

• Received 387 million visits to IRS.gov, with 265 million taxpayers checking the 

Where’s My Refund? tool for the status of their refund. This figure represents a 

24 percent increase in the use of IRS.gov and an eight percent increase in Where’s My 

Refund? compared to last filing season.

• Leveraged both filtering capabilities and the Protecting Americans from Tax Hikes 

Act (PATH Act) refund hold to automate and expand the selection of potentially 

fraudulent returns. Held 9.4 million returns with $46.9 billion in potentially fraudulent 

refunds until February 15 and identified about 340,000 PATH Act returns with 

possible overstated income or withholding issues.

• Launched the Field Assistance Scheduling Tool to schedule appointments for 

taxpayers in all Taxpayer Assistance Centers (TAC) and Virtual Service Delivery 

sites. 
IRS-8

• Created or revised 722 tax products significantly affected by the Disaster Tax Relief 

and Airport and Airway Extension Act of 2017 (P.L. 115-63), the Tax Cuts and Jobs 

Act (P.L. 115-97), and the Bipartisan Budget Act of 2018 (P.L. 115-123).

Return on Investment

The IRS remains one of the most cost-effective investments in the federal government and 

one of the most efficient tax administrators in the world. In FY 2018, the IRS collected 

$3.5 trillion in tax revenue. Congress appropriated $11.4 billion for the IRS in FY 2018 and 

IRS enforcement programs collected $59.4 billion, for a return on investment (ROI) of about 

$5.2 for every $1 invested in the IRS. This ROI estimate is likely understated because it does 

not include the revenue effect of the deterrence value of IRS enforcement programs or the 

effect of education and outreach on voluntary tax compliance.

Investment Labor Costing Methodology

The IRS uses a variety of methods to calculate the cost of its investments. Costs for 

investments that require labor funding are calculated by converting the workload to the 

number and type of staff (e.g., Revenue Agents, Revenue Officers, or Special Agents) needed 

to deliver targeted performance goals. Once the number of full-time equivalents (FTE) and 

type of staff are determined, the cost of the FTE is estimated using a Unit Cost Rate (UCR) 

calculator, a tool for projecting FTE salary and non-salary support costs and/or savings. The 

UCR calculator fully covers the salary, benefits, and support costs needed for each FTE. 

Proposed FTE increases in the Budget assume an April 1 hire date, except for frontline 

positions in Submission Processing and Account Management and 

Assistance - Electronic/Correspondence Assistance, which assume an October 1 hire date 

because they provide service to taxpayers during the filing season and can be brought on 

board faster than most other positions. These programs are not as dependent on the traditional 

hiring and training process as other IRS programs because there is a large, existing seasonal 

workforce available to meet work demand. 
IRS-9

1.2 – Budget Adjustments Table

Dollars in Thousands

Internal Revenue Service 

Summary of Proposed FY 2020 Request FTE Amount

FY 2019 Annualized CR Level1

73,584 $11,187,554 

Changes to Base:

Other Adjustments (1,029)

Offset to O&M for Critical IT Systems (1,029)

Maintaining Current Levels (MCLs) $50,565 

Non-Pay Inflation Adjustment 50,565 

Efficiencies/Savings: (1,071) ($109,600)

Increase e-File Savings (116) (6,183)

Space Optimization (24,700)

Reduce Contractual Services (1,717)

Non-Recur for Section 112 Tax Reform Funding (955) (77,000)

Subtotal FY 2019 Changes to Base (2,100) ($59,035)

FY 2019 Current Services 71,484 $11,128,519 

Program Changes:

Program Increases

IRS Technology Modernization Plan 80 180,000 

Data Analytics to Enhance Compliance 190 33,833 

Prevent Identity Theft 29 22,488 

O&M of Prior-year Enterprise-wide Cybersecurity Investments 6,744 

O&M of Critical Systems 162 100,805 

Subtotal FY 2020 Program Increases 461 $343,870 

Total FY 2020 Budget Request 71,945 $11,472,389 

See footnotes in 1.1 -- Appropriations Detail Table
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1C – Base Adjustment and Program Changes Description

Base Adjustment...........................................................................+$77,000,000 / -391 FTE 

The FY 2019 Annualized Continuing Resolution (CR) level of $11.188 billion includes a 

$200 million inter-appropriation transfer from Enforcement to Operations Support to cover 

anticipated operations and maintenance requirements in FY 2019. The IRS will submit a 

notice to Congress with respect to this transfer. The Annualized CR level also includes $320 

million for tax reform, although the tables only include $77 million ($65 million in Taxpayer 

Services and $12 million in Enforcement) reflected in the expenditure plan that the IRS 

submitted in February 2019 for the Section 112 Administrative Provision to implement 

requirements under the Tax Cuts and Jobs Act (Public Law 115-97). 

Other Adjustment..............................................$0 / -1,029 FTE

Offset to Support O&M of Critical Systems $0 / -1,029 FTE

The request realigns $102 million from the Taxpayer Services account to the Operations 

Support account to support critical systems that benefit both Taxpayer Services and 

Enforcement programs. These funds will be used for the operations and maintenance of 

information technology that is critical to service and enforcement. 

37 million

23 million

305 million

496 million

FY 2010 FY 2018

Taxpayer Assistance through Website Usage Continues to Grow 

(Since FY 2010, Website Usage is Up by 62%) 

 Live Assistance Calls Website Usage
IRS-11 

Maintaining Current Levels (MCLs)................................... +$50,565,000 / 0 FTE

Non-Pay Inflation Adjustment +$50,565,000 / 0 FTE 

Funds are requested for non-labor inflationary cost increases for items such as travel, 

contracts, rent, supplies, and equipment. 

Efficiencies / Savings ..........................................-$109,600,000 / -1,071 FTE

Increase e-File Savings -$6,183,000 / -116 FTE

The IRS projects a total of 1,870,800 fewer returns filed on paper (1,256,100 individual and 

614,700 business returns). As a result, the IRS would need 116 fewer FTE in submission 

processing, generating a savings of $6.2 million. 

Space Optimization -$24,700,000 / 0 FTE

The IRS will reduce expenditures on rent and improve usage of office space across the 

country. Since 2013, the IRS has released 3.2 million square feet, closing 106 buildings and 

reducing rent costs by about 10 percent. In FY 2018, the IRS released 492,100 square feet for 

an estimated $10.6 million in rent savings and will continue to consolidate space in FY 2020.

Reduce Contractual Services -$1,717,000 / 0 FTE

The IRS will generate savings by improving the effectiveness of existing acquisition practices 

to reduce the cost of contracts. 

Non-Recur Administrative Provision Section 112 Tax Reform -$77,000,000 / -955 FTE

The non-recurrence of one-time funding provided by the Section 112 Administrative 

Provision to implement the Tax Cuts and Jobs Act. 

Program Increases 

IRS Integrated Modernization Business Plan +$180,000,000 / +80 FTE 

The Budget requests an increase of 

$180 million for the IRS Integrated 

Modernization Business Plan for a 

total budget of $300 million in 

FY 2020, including at least 

$10 million from IRS user fees. The 

plan is essential to maintaining the voluntary tax compliance system and will position the IRS 

to deliver a customer experience comparable to the best financial institutions in the 

world. Please see page IRS-68 for additional details. 

Position Type/Other Costs FTE Positions $000

IRS Integrated Modernization Business 

Plan 80.00 160 $180,000

IT Specialist 80.00 160 105,000

Contractual Services 62,106

Hardware & Software 12,894

Total 80.00 160 $180,000
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Data Analytics to Enhance Compliance +$33,833,000 / +190 FTE

This investment in advanced data 

analytics will improve the IRS’s risk 

identification capabilities and reduce 

the need for manual or limited risk 

assessments. This change will allow 

IRS to focus on identifying 

compliance risks. Recent changes in 

tax law has reduced the accuracy of 

the current use of traditional 

“backward looking” risk 

identification tools and this 

investment will help IRS identify 

new risks. This investment will result 

in an additional 1,032 large business 

return examination closures and 

increase the examination coverage 

rate by 0.3 percent starting in FY 2022. 

The IRS has begun applying data analytics to improve effectiveness including: 

• Identity theft prevention – Applied analytics and modeling to the development of

identity theft filters that contributed to the protection of $6 billion in revenue in 2017.

• Notice redesign – Leveraged behavioral insights to improve taxpayer compliance

through redesigned notices. Pilot results indicate this redesign improves results at

lower cost, with up to an 11 percent improvement in payment compliance, resulting in

$650 million to $1 billion in additional collections and up to a 31 percent increase in

the use of self-service tools and a 20 percent decrease in IRS costs.

• Compliance risk assessment – Developed data products that use predictive models

based on machine learning and risk identified by subject matter experts to assess risk

among large corporations and pass-through entities. These products already identified

a previously unrecognized area of noncompliance among partnerships for which

appropriate treatments are now being determined.

• Employment tax investigations – Developed algorithms to select criminal cases for

national priority initiatives. To date, the algorithm for employment tax has identified

18 cases with an average estimated tax loss 30 percent greater ($3 million versus

$2.3 million) than traditional methods.

• Exam selection – Evaluated 250 data elements to develop a multi-phase statistical

algorithm to predict the likelihood of change on Employee Plan returns that exceeded

past program results by more than 20 percent in back testing.

While the IRS has made strides in this area, it faces a changing data environment and needs to 

transform with it. For example, the significant changes stemming from the TCJA make the 

role of data analytics even more critical. Current risk assessment tools need to be adapted for 

Position Type/Other Costs FTE Positions $000

Data Analytics to Enhance Compliance 178.00 356 $31,792

Program Analyst 13.50 27 1,738

Manager 4.00 8 434

Attorney 1.00 2 178

Tax Law Specialist 2.00 4 333

Special Agent 25.00 50 8,948

Investigative Analyst 7.50 15 939

Data Scientist 9.50 19 1,452

Analyst 15.00 30 1,312

Revenue Agent 54.50 109 11,429

Economist 7.00 14 1,121

IT Specialist 8.50 17 1,066

Tax Technician 26.00 52 2,443

Clerical 4.50 9 399

Other Direct Costs 11.50 23 $2,041

Attorney 7.50 15 1,593

Support Staff 2.50 5 216

Paralegal 0.50 1 61

Appeals Officer 1.00 2 171

Total 189.50 379 $33,833
IRS-13 

significant changes to transfer pricing rules, repatriation provisions, and base erosion 

provisions. Identity theft filters need to be monitored for effectiveness, modified, or retired. 

The absence of historical data reflecting the new tax code provisions poses a challenge to the 

way these tools were traditionally developed. For example, Discriminant Index Function 

(DIF) scoring used for exam selection is based on past filings under the old tax law and would 

take years to revise using traditional techniques such as the National Research Program 

(NRP). The TCJA affected diverse entities, ranging from multi-national corporations to 

partnerships and pass-through entities to individuals, opening new risks. Also, certain 

documents not captured electronically (for example, information letters for Section 965 

deemed repatriation tax and forms related to new Base Erosion and Profit Shifting reporting 

requirements) will require advanced techniques to extract and interpret data to assess 

compliance behaviors. Leveraging the value of data analytics is a key strategy of the IRS’s 

Strategic Plan as well.

The IRS will use these resources to: 

• Support systemic data analysis to identify emerging trends and build effective

compliance strategies;

• Refine existing data models and expand the IRS’s capability to apply advanced

predictive modeling techniques across additional taxpayer populations with unique

risk points;

• Apply advanced analytic techniques such as machine learning and natural language

processing to support case selection;

• Identify previously unknown non-compliance areas;

• Pair data professionals with relevant subject matter experts to tailor data analysis and

modeling to support compliance and enforcement;

• Explore partnerships with academia and other partners (e.g., Joint Chiefs of Global

Tax Enforcement) to collaborate on data strategies and leverage their data and

analytics experience;

• Make effective use of new data sources (such as Base Erosion and Profit Shifting

(BEPS) country-by-country reporting); and

• Lead a data- driven culture change.
IRS-14 

Other Direct Costs 

IRS Activity Cost FTE Positions Explanation

Appeals $170 1.00 2

Support examination efforts on key compliance areas 

focused on improving voluntary compliance and providing a 

high level of customer service.

Chief Counsel $1,871 10.50 21 Provide support for increases in requests for legal advice, 

litigation assistance, and collection due process.

Total $2,041 11.50 23

Dollars in thousands
IRS-15

Prevent Identity Theft +$22,488,000 / +29 FTE

This investment will support the IRS’s efforts to prevent identity theft. The IRS will use these 

resources to hire 29 FTE ($7.8 million) and 

acquire IT contractual services for 

($14.7 million).

The additional resources would be used to:

• Develop methods to analyze more than 

41 additional data points from returns 

filed with industry partners and 

determine which are accurate indicators 

of fraud; 

• Provide development costs needed to 

expand the ability to securely generate 

and distribute secret keys to W-2 preparers and verify that the W-2 data submitted is 

not fraudulent; 

• Fulfill IRS agreements with state/industry partners to analyze/act on millions of 

additional tax fraud leads in real time, thereby stopping millions of fraudulent refunds;

and

• Expand Business Master File (BMF) identity theft filters and authentication efforts 

and expand the Entity Fabrication project to detect and prevent perpetration of 

fraudulent use of Employer Identification Numbers (EINs) to obtain unwarranted 

refunds.

The funding will be used to hire additional Special Agents to conduct more criminal 

investigations related to Identity Theft. With these additional agents, the IRS will complete

about 250 additional criminal investigations between FY 2020 and FY 2025. Most of the new 

investigations will happen after FY 2021-FY 2022 because the time necessary for the agents 

to be at full performance levels and the average cycle time to complete cases (300-400 days).

In addition, the initiative includes funding for contractor support that will: identify classes of 

fraud use cases; define how they vary across the fraud actor community; facilitate sharing 

anonymized data for analysis and identification of fraud classes; monitor tax fraud 

communication on the deep web to increase awareness of criminal activity; examine the fraud 

lifecycle to identify steps that non-compliant taxpayers take and the ways the IRS can defend 

against each step; determine how to build effective prevention and defense strategies early in 

the lifecycle and develop machine ingestible common vocabulary for fraud intelligence that 

allows non-compliant characteristics and techniques to be efficiently shared; operate and 

maintain critical databases and websites to support identity authentication; and reduce the use 

of Social Security Numbers (SSN) in IRS through software, infrastructure and other related 

support.

These resources will be used to provide investigative staff with an “investigative tool” that is 

an externally-hosted Virtual Desktop. Virtual Desktop Infrastructure (VDI) creates an agile 

Position Type/Other Costs FTE Positions $000

Criminal Investigation 22.00 44 $6,161

Special Agent 12.00 24 4,295

Analyst 10.00 20 1,252

IT Contractual Support 614

Privacy, Government Liaison, and 

Disclosure 2.50 5 $1,424

Analyst 2.50 5 326

Training/Travel 1,098

Information Sharing and Assistance 

Center $6,948

IT Contractual Support 6,948

Eliminate SSN on Materials $7,100

Contractual Services 7,100

Other Direct Costs 4.50 9 $855

Attorney 3.50 7 773

Tax Admin. Specialist 1.00 2 82

Total 29.00 58 $22,488
IRS-16

non-government attributable internet surveillance and research capability that is secure, 

contained, and is external to the IRS enterprise computing environment. IRS CI can use this 

tool to develop leads, schemes and cases by synthesizing disparate data sources, creating an 

integrated view of all available data using cutting edge technology and allowing CI users to 

complete in-depth searches and complex analytics. This additional analytical and 

investigative capacity will allow CI to combat cyber-criminals who exploit stolen taxpayer PII 

obtained through sophisticated data breaches and intrusions. 

Other Direct Costs

IRS Activity Cost FTE Positions Explanation

Chief Counsel $710 4.50 9 Provide legal advice and assistance to investigations.

Total $710 4.50 9

Dollars in thousands
IRS-17

O&M of Prior-year Enterprise-wide Cybersecurity Investments +$6,744,000 / 0 FTE

The Budget includes an increase 

of $6.7 million to support O&M 

for prior year Cybersecurity 

Enhancement Account (CEA) 

investments. The CEA O&M will 

be funded by Treasury bureaus through Treasury Franchise Fund (TFF) billing. This increase 

represents the IRS’s portion of the total Departmental O&M cost of $17.5 million.

O&M of Critical Systems +$100,805,000 / +162 FTE

These funds will allow IRS to deliver 

IT services and solutions that drive 

effective tax administration. 

Development and O&M expenses 

have risen due to the increased 

sophistication of cyber threats, which 

require o strengthened security.

These funds will be used to deliver core O&M services and to address aging infrastructure by

reducing aged hardware from a target of 43.8 percent in FY 2019 to 39 percent by the end of 

FY 2020. They will also cover maintenance on investments impacted by tax reform 

implementation; the continuation of the migration to the Linux operating environment; and 

implementing the Treasury Enterprise Infrastructure Solutions effort. 

Position Type/Other Costs FTE Positions $000

O&M of Prior-Year Enterprise-wide 

Cybersecurity Investments $6,744

Contractual Services 6,744

Total $6,744

Position Type/Other Costs FTE Positions $000

Restore Operations and Maintenance 

of Critical Systems 162.00 324 $100,805

IT Specialist 162.00 324 55,716

Contractual Services 24,002

Hardware & Software 21,087

Total 162.00 324 $100,805
IRS-18

1.3 – Operating Levels Table

Dollars in thousands

Internal Revenue Service

Object Classification

FY 2018

Enacted

FY 2019

Annualized CR

FY 2020

Request

11.1 Full-Time Permanent Positions 5,667,801 5,749,579 5,679,699

11.3 Other than Full-Time Permanent Positions 81,640 80,924 81,045

11.5 Other Personnel Compensation 254,266 224,860 226,086

11.8 Special Personal Services Payments 31,344 32,871 32,871

11.9 Personnel Compensation (Total) 6,035,051 6,088,234 6,019,701

12.1 Personnel Benefits 2,141,461 2,198,873 2,167,992

13.0 Benefits to Former Personnel 39,998 38,668 38,667

Total Personnel and Compensation Benefits $8,216,510 $8,325,775 $8,226,360

21.0 Travel 78,871 101,244 107,356

22.0 Transportation of Things 17,286 21,452 24,794

23.1 Rental Payments to GSA 589,687 590,575 578,055

23.2 Rent Payments to Others 12,283 12,437 12,692

23.3 Communications, Utilities, & Misc 292,401 340,986 367,155

24.0 Printing & Reproduction 35,096 29,653 30,258

25.1 Advisory & Assistance Services 1,094,549 844,119 1,082,433

25.2 Other Services 90,783 85,543 96,026

25.3 Purchase of Goods & Services from Govt. Accounts 174,914 191,489 196,301

25.4 Operation & Maintenance of Facilities 186,039 189,254 193,469

25.5 Research & Development Contracts 6

25.6 Medical Care 14,554 15,009 15,370

25.7 Operation & Maintenance of Equipment 68,855 69,437 87,911

26.0 Supplies and Materials 34,615 35,124 36,221

31.0 Equipment 458,310 286,963 368,894

32.0 Land and Structures 20,231 5,613 6,093

41.0 Grants, Subsidies 36,890 36,890 36,890

42.0 Insurance Claims & Indemnities 4,474 2,022 2,063

44.0 Refunds

91.0 Unvouchered 4,200 3,969 4,048

Total Non-Personnel $3,214,044 $2,861,779 $3,246,029

New Appropriated Resources $11,430,554 $11,187,554 $11,472,389

Appropriations:

Taxpayer Services 2,512,554 2,571,554 2,402,000

Enforcement 4,627,000 4,672,000 4,705,368

Operations Support 4,181,000 3,834,000 4,075,021

Business Systems Modernization 110,000 110,000 290,000

New Appropriated Resources $11,430,554 $11,187,554 $11,472,389

FTE 73,268 73,584 71,945

See footnotes in 1.1 -- Appropriations Detail Table
IRS-19

1D – Appropriations Language and Explanation of Changes

Appropriations Language Explanation of Changes

DEPARTMENT OF THE TREASURY

INTERNAL REVENUE SERVICE

TAXPAYER SERVICES

For necessary expenses of the Internal Revenue 

Service to provide taxpayer services, including prefiling 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, $2,402,000,000; of which not less 

than $8,890,000 shall be for the Tax Counseling for 

the Elderly Program; of which not less than 

$12,000,000 shall be available for low-income 

taxpayer clinic grants; of which not less than 

$15,000,000, to remain available until September 

30, 2021, shall be available for a Community

Volunteer Income Tax Assistance matching grants 

program for tax return preparation assistance; and 

of which not less than $206,000,000 shall be 

available for operating expenses of the Taxpayer 

Advocate Service: Provided, That of the amounts 

made available for the Taxpayer Advocate Service, 

not less than $5,000,000 shall be for identity theft 

casework.

Note.—A full-year 2019 appropriation for this 

account was not enacted at the time the budget was 

prepared; therefore, the budget assumes this account 

is operating under the Continuing Appropriations 

Act, 2019 (Division C of P.L. 115–245, as 

amended). The amounts included for 2019 reflect the 

annualized level provided by the continuing 

resolution.

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 
IRS-20

violations of internal revenue laws and other 

financial crimes, to purchase 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, $4,705,368,000, of which not to 

exceed $50,000,000 shall remain available until 

September 30, 2021, and of which not less than 

$60,257,000 shall be for the Interagency Crime and 

Drug Enforcement program: Provided, That of the 

funds provided under this paragraph,

$4,705,368,000 is provided to meet the terms of 

section 251(b)(2) of the Balanced Budget and 

Emergency Deficit Control Act of 1985, as 

amended.

In addition, not less than $199,886,000 for tax 

activities under this heading, including tax 

compliance to address the Federal tax gap: 

Provided, That such amount is additional new 

budget authority for tax activities, including tax 

compliance to address the Federal tax gap, as 

specified for purposes of section 251(b)(2) of the 

Balanced Budget and Emergency Deficit Control 

Act of 1985, as amended. 

Note.—A full-year 2019 appropriation for this 

account was not enacted at the time the budget was 

prepared; therefore, the budget assumes this account 

is operating under the Continuing Appropriations 

Act, 2019 (Division C of P.L. 115–245, as 

amended). The amounts included for 2019 reflect the 

annualized level provided by the continuing 

resolution.

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 

Language required for the proposed 

program integrity cap adjustment. 

More information about the cap 

adjustment can be found in section 4.1 

– Appropriations Detail Table with 

Program Integrity Cap Adjustment of 

the Appendix and Budget Process 

Chapter of the FY 2020 President’s 

Budget.
IRS-21

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

of the Internal Revenue Service Oversight Board; 

and other services as authorized by 5 U.S.C. 3109, 

at such rates as may be determined by the 

Commissioner; $4,075,021,000, of which not to 

exceed $250,000,000 shall remain available until 

September 30, 2021; of which not to exceed 

$10,000,000 shall remain available until expended 

for acquisition of equipment and construction, repair 

and renovation of facilities; of which not to exceed 

$1,000,000 shall remain available until September 

30, 2022, for research; of which not to exceed 

$20,000 shall be for official reception and 

representation expenses: Provided, That not later 

than 30 days after the end of each quarter, the 

Internal Revenue Service shall submit a report to the 

Committees on Appropriations of the House of 

Representatives and the Senate and the Comptroller 

General of the United States detailing the cost and 

schedule performance for its major information 

technology investments, including the purpose and 

life-cycle stages of the investments; the reasons for 

any cost and schedule variances; the risks of such 

investments and strategies the Internal Revenue 

Service is using to mitigate such risks; and the 

expected developmental milestones to be achieved 

and costs to be incurred in the next quarter: 

Provided further, That the Internal Revenue Service

shall include, in its budget justification for fiscal 

year 2020, a summary of cost and schedule 

performance information for its major information 

technology systems: Provided further, That of the 

funds provided under this paragraph, 

$4,075,021,000 is provided to meet the terms of 

section 251(b)(2) of the Balanced Budget and 

Emergency Deficit Control Act of 1985, as 

amended.

In addition, not less than $161,685,000 for tax 

activities under this heading, including tax 

compliance to address the Federal tax gap: 

Provided, That such amount is additional new 

budget authority for tax activities, including tax 

compliance to address the Federal tax gap, as 

specified for purposes of section 251(b)(2) of the 

Increasing two-year authority from the 

$50 million cap to $250 million to 

provide sufficient time for a robust IT 

lifecycle process including vision, 

strategy, solution, design, and 

development, thereby improving 

contracting outcomes; consistent with 

a recent recommendation from the 

Treasury Inspector General for Tax 

Administration (TIGTA), Sixty-Four 

Percent of the Internal Revenue 

Service’s Information Technology 

Hardware Infrastructure Is Beyond Its 

Useful Life.

Language required for the proposed 

program integrity cap adjustment. 

More information about the cap 

adjustment can be found in section 4.1 

– Appropriations Detail Table with 

Program Integrity Cap Adjustment of 

the Appendix and Budget Process 

Chapter of the FY 2020 President’s 

Budget.
IRS-22

Balanced Budget and Emergency Deficit Control 

Act of 1985, as amended. 

Note.—A full-year 2019 appropriation for this 

account was not enacted at the time the budget was 

prepared; therefore, the budget assumes this account 

is operating under the Continuing Appropriations 

Act, 2018 (Division C of P.L. 115–245, as 

amended). The amounts included for 2019 reflect the 

annualized level provided by the continuing 

resolution.

BUSINESS SYSTEMS MODERNIZATION

For necessary expenses of the Internal Revenue 

Service's business systems modernization program, 

$290,000,000, to remain available until September 

30, 2022, 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 not later than 30 days after the end 

of each quarter, the Internal Revenue Service shall 

submit a report to the Committees on Appropriations 

of the House of Representatives and the Senate and 

the Comptroller General of the United States 

detailing the cost and schedule performance for 

major information technology investments, including 

the purposes and life-cycle stages of the investments; 

the reasons for any cost and schedule variances; the 

risks of such investments and the strategies the 

Internal Revenue Service is using to mitigate such 

risks; and the expected developmental milestones to 

be achieved and costs to be incurred in the next 

quarter.

Note.—A full-year 2019 appropriation for this 

account was not enacted at the time the budget was 

prepared; therefore, the budget assumes this account 

is operating under the Continuing Appropriations 

Act, 2019 (Division C of P.L. 115–245, as 

amended). The amounts included for 2019 reflect 

the annualized level provided by the continuing 

resolution.

IRS Integrated Modernization 

Business Plan FY 2020 request 
IRS-23

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 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 an employee training program, which shall 

include the following topics: taxpayers' rights, 

dealing courteously with taxpayers, cross-cultural 

relations, ethics, and the impartial application of tax 

law.

SEC. 103. The Internal Revenue Service shall 

institute and enforce policies and procedures that 

will safeguard the confidentiality of taxpayer 

information and protect taxpayers against identity 

theft. 

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 improvements to the Internal 

Revenue Service 1–800 help line service a priority 

and allocate resources necessary to enhance the 

response time to taxpayer communications, 

particularly with regard to victims of tax-related 

crimes.

SEC. 105. The Internal Revenue Service shall issue a 

notice of confirmation of any address change 

relating to an employer making employment tax 

payments, and such notice shall be sent to both the 

employer's former and new address and an officer or 

employee of the Internal Revenue Service shall give 

special consideration to an offer-in-compromise 

from a taxpayer who has been the victim of fraud by 

a third-party payroll tax preparer.

SEC. 106. None of the funds made available under 

this Act may be used by the Internal Revenue Service 
IRS-24

to target citizens of the United States for exercising 

any right guaranteed under the First Amendment to 

the Constitution of the United States.

SEC. 107. None of the funds made available in this 

Act may be used by the Internal Revenue Service to 

target groups for regulatory scrutiny based on their 

ideological beliefs. 

SEC. 108. Section 9503(a) of title 5, United States 

Code, is amended by striking the clause "Before 

September 30, 2013" and inserting "before 

September 30, 2023".

SEC. 109. Section 9503(a)(5) of title 5, United States 

Code, is amended by inserting before the semicolon 

the following:

", but are renewable for an additional two years, 

based on a critical organizational need". 

SEC. 110. Notwithstanding any Congressional 

notification requirements for a reprogramming of 

funds in this Act, funds provided in this Act for the 

Internal Revenue Service shall be available for 

obligation and expenditure through a 

reprogramming of funds that augments or reduces 

existing programs, projects, or activities by up to 

$10,000,000 without prior Congressional 

notification of such action.

Restoring Streamlined Critical Pay 

authority through September 30, 2023. 

Providing authority to reprogram up to 

$10 million within appropriations 

accounts without formal notification 

procedures. This increase will allow 

the IRS to allocate funds to highest 

priority needs at end of fiscal year, 

including infrastructure, and respond 

to late-breaking workload and program 

demand changes. 
IRS-25

1E – Legislative Proposals

Lower the threshold from 250 to 10 for mandatory electronic reporting of W-2 data by 

employers: Providing the IRS with timely and accurate Wage and Tax Statement (W-2) 

information reported by employers facilitates pre-refund verification of wage and withholding 

information, which in turn reduces the issuance of questionable tax refunds through early 

detection of fraud and other erroneous refund claims. Extra time and resources are needed for 

the Social Security Administration (SSA) to process paper W-2s submitted by employers 

before information on paper statements can be transmitted to the IRS. Under current law, 

employers who file 250 or more Forms W-2 in a year must e-file these information returns, 

but those filing fewer than 250 Forms W-2 in a year may choose to file on paper. To enhance 

pre-refund W-2 checks, the Budget proposes increasing the number of employers subject to 

mandatory electronic reporting of W-2 data. The proposal would reduce the W-2 e-file 

threshold from 250 to 10 Forms W-2.

Require a social security number (SSN) that is valid for work to claim child tax credit 

(CTC), earned income tax credit (EITC), and credit for other dependents (ODTC): The 

Administration proposes requiring an SSN that is valid for work to claim the EITC, CTC 

(both the refundable and non-refundable portion), and/or the ODTC for the taxable year. For 

all credits, this requirement would apply to taxpayers (including both the primary and 

secondary filer on a joint return) and all qualifying children or dependents. Under current 

law, taxpayers who do not have an SSN that is valid for work may claim the CTC if the 

qualifying child for whom the credit is claimed has a valid SSN. Furthermore, the ODTC, 

created by the Tax Cuts and Jobs Act, allows taxpayers whose dependents do not meet the 

requirements of the CTC, including the SSN requirement, to claim this non-refundable credit. 

This proposal would ensure that only individuals who are authorized to work in the United 

States could claim these credits by extending the SSN requirement for qualifying children to 

parents on the tax form for the CTC and instituting an SSN requirement for the ODTC. While 

this SSN requirement is already current law for the EITC, this proposal also would close an 

administrative gap to strengthen enforcement of the provision.

Provide the IRS with greater flexibility to address correctable errors: The budget would

expand the IRS authority to correct errors on taxpayer returns. Current statute only allows the 

IRS to correct errors on returns in certain limited instances, such as basic math errors or the 

failure to include the appropriate social security number or taxpayer identification number. 

This proposal would expand the instances in which the IRS could correct a taxpayer’s return 

including cases where: (1) the information provided by the taxpayer does not match the 

information contained in Government databases or Form W-2, or from other third party 

databases as the Secretary determines by regulation; (2) the taxpayer has exceeded the 

lifetime limit for claiming a deduction or credit; or (3) the taxpayer has failed to include with 

his or her return certain documentation that is required to be included on or attached to the 

return. This proposal would make it easier for IRS to correct clear taxpayer errors, directly 

improving tax compliance and reducing EITC and other improper payments and freeing IRS 

resources for other enforcement activities. 
IRS-26

Increase Oversight of Paid Tax Return Preparers: Paid tax return preparers have an 

important role in tax administration because they assist taxpayers in complying with their 

obligations under the tax laws. Incompetent and dishonest tax return preparers increase 

collection costs, reduce revenues, disadvantage taxpayers by potentially subjecting them to 

penalties and interest because of incorrect returns, and undermine confidence in the tax 

system. To promote high quality services from paid tax return preparers, the proposal would 

explicitly provide that the Secretary of the Treasury has the authority to regulate all paid tax 

return preparers.

Improve clarity in worker classification and information reporting requirements: The

Budget proposes to: (1) establish a new safe harbor that allows a service recipient to classify a 

service provider as an independent contractor and requires withholding of individual income 

taxes to this independent contractor at a rate of five percent on the first $20,000 of payments; 

and (2) raises the reporting threshold for payments to all independent contractors from $600 

to $1,000, and reduces the reporting threshold for third-party settlement organizations from 

$20,000 and 200 transactions per payee to $1,000 without regard to the number of 

transactions. In addition, Form 1099-K would be required to be filed with the IRS by January 

31 of the year following the year for which the information is being reported. The proposal 

increases clarity in the tax code, reduces costly litigation, and improves tax compliance.

Except Certain Federal Student Aid (FSA) Programs from Section 6103 Restrictions: 

Section 6103 of the Internal Revenue Code of 1986 (26 U.S.C. 6103) (IRC) provides that tax 

returns and tax return information are confidential and cannot be disclosed or used unless 

permitted under the IRC. The Administration proposes to authorize the IRS to disclose tax 

return information directly to the U.S. Department of Education for administering programs 

authorized by Title IV of the Higher Education Act of 1965. The section 6103 exception is 

expected to improve administration of student aid programs, enhance program cost 

estimation, increase servicing efficiency, and reduce improper payments. 

Program Integrity Cap Adjustment: In addition to the base appropriations request, the 

Budget proposes a $362 million discretionary program integrity cap adjustment in FY 2020 to 

fund new and continuing investments in the IRS’s tax enforcement program. The Budget 

proposes $200 million for the Enforcement account and $162 million for the Operations 

Support account. It also proposes additional adjustments in future years to fund new 

initiatives and inflation. The proposed investments will generate about $47.1 billion in 

additional revenue over 10 years and would cost about $14.5 billion for a net revenue of 

$32.6 billion.

Streamlined Critical Pay (SCP): The Budget proposes to reinstate Streamlined Critical Pay 

(SCP) authority through September 30, 2023. The authority to make new SCP appointments 

expired September 30, 2013. As a result of the expired authority, the IRS continues to face 

challenges recruiting top-level talent, especially IT professionals who help protect taxpayer 

data from cyber-attacks and who assist with modernizing the IRS's IT infrastructure. The

Office of Personnel Management existing government-wide Critical Position Pay (CPP) 

authority is not a sufficient alternative to SCP.
IRS-27

1F - IRS Use of Evidence and Evaluation

The IRS continues to improve program performance by using data and analytics to develop

evidence that informs innovation and improves program delivery. 

Significant Accomplishments 

Highest Priorities

Advance Data Access, Usability and Analytics to Inform Decision-Making and Improve 

Operational Outcomes

• TCJA: The IRS Statistics of Income (SOI) office is incorporating TCJA-related 

changes into its programs, updating processing routines to incorporate as many aspects 

of the new laws as possible. To facilitate this update, SOI has identified a senior 

employee to coordinate throughout IRS to ensure successful implementation. To 

provide its federal customers and the public with access to relevant data showing the 

effect of the laws, SOI will develop expanded data files and timely and innovative web 

products, including periodic filing-season reports. 

• Creating More Accessible Statistics: SOI will continue to implement its 

comprehensive plan to modernize its public communications efforts. New initiatives 

will include developing a comprehensive taxonomy that will facilitate improved 

search results for customers. Further changes to the Tax Stats web pages will include 

improving organization and usability and incorporating new products based on the 

TCJA. These efforts will provide more accessible data to the public and will assist 

SOI in meeting OMB data dissemination requirements. 

• Modernization of Business Publication Methodologies: Having completed a redesign 

of its business tax publications, which include data published for corporations and 

partnerships, SOI will update the processes it uses to prepare data for publication. The 

redesigned publications comply with revised disclosure guidelines set forth in Tax 

Information Security Guidelines for Federal, State and Local Agencies 

(Publication 1075). 

• Submission Processing Center Realignment: In conjunction with the closure of select 

IRS Submission Processing Centers, SOI is leading a Research, Applied Analytics 

& Statistics (RAAS)-wide effort to realign the processing of its statistical samples 

among the remaining centers. Training and processing are already underway in the 

new centers, and SOI is working with other components to ensure that sufficient staff 

are assigned to each project and that all staff receive adequate training. SOI will 

continue to ensure that the realignment realizes cost savings, while maintaining the 

quality and integrity of data collected for SOI’s statistical samples.

• Joint Statistical Research Program: SOI’s Joint Statistical Research Program, 

introduced in 2012, facilitates work between RAAS staff and academics, non-profit 

organizations, and other federal government agencies on projects designed to address 

key tax administration issues. 
IRS-28

This research examines a broad range of topics, such as the effects of economic conditions 

or tax law changes on taxpayer behavior. Currently, SOI is supporting a project that 

examines the effect of economic shocks, including tax rate changes, on charitable giving. 

• Expand Available Data on Businesses: SOI publishes a variety of tables and reports 

that capture information on businesses, including sole proprietorships, partnerships, 

corporations, and S-corporations. In FY 2019, the division will expand these 

products, publishing a new table providing data on all income sources, deductions, tax 

credits, etc., for all taxpayers who report any income from a small business or farm 

and by updating its integrated business statistics. The latter comprises a set of tables 

that combines data from the various types of businesses (corporations, partnerships, 

sole proprietorships, etc.) to provide a comprehensive snapshot of U.S. business 

taxpayers.

• Providing Information on the Tax System to the Public: SOI releases a Data Book

annually, which provides an extensive overview of IRS’s operations, workforce, and 

budget. The Data Book contains extensive data visualizations designed to improve its 

accessibility and the web version includes dedicated pages for each section of the 

publication.

In FY 2018, SOI released detailed geographic data for individuals, including statistics 

by state, county, zip code, and metro- and micro-politan area. Additionally, SOI 

released migration data, which detail the flow of individuals between regions.

SOI also released the 2017 IRS Research Bulletin that features selected papers from 

the latest IRS Research Conference. The papers, authored by researchers from IRS, 

academia, and other federal agencies, highlight research on key areas related to tax 

compliance and current tax issues affecting tax administration.

At three intervals in the year, SOI released cumulative filing season statistics based on 

administrative data that included return frequencies, adjusted gross income, income 

tax after credits, and the percentage of AGI (Adjusted Gross Income) composed of 

capital gains. In FY 2019, SOI plans to enhance these tables, highlighting items 

affected by the TCJA. The data will provide an early glimpse of the effect of the new 

laws on return filing patterns, payment methods, and measures of income and tax.

Additionally, SOI released five publications detailing filing projections for various tax 

returns. These publications included projections of information and withholding 

documents, multi-year return projections for the United States, including estimates for 

business, individual, and tax-exempt returns to be filed, individual return projections 

by major processing categories, including balance due and refund returns, projections 

of returns filed by IRS campus, and state-level projections. Recent updates include 

adjustments to the forecasts based on changes implemented under the TCJA. The IRS 

publishes these projections throughout the year. They include changes in filing 

patterns, economic and demographic trends, legislative requirements, and IRS 

administrative processes. The projections are widely used by the public and 

throughout the IRS to assist in workload planning. 

In FY 2018, SOI released more than 600 additional tables and reports containing 

detailed information on a wide range of topics. These tables included the Tax Year 
IRS-29

2015 Partnership tables, which include balance sheet and income statement 

information, as well as statistics on the number of partners. These tables are the first 

to be developed using the new IRS disclosure guidelines for business tax returns. 

SOI’s other releases include updated statistical tables for individuals, sole 

proprietorships, estates, gifts, tax-exempt organizations and bonds, and international 

taxpayers and entities. 


IRS-30 

Section II – Budget and Performance Plan

Treasury Strategic Objectives and Agency Priority Goals 

The Budget supports the following Department of the Treasury Strategic Objectives for 

FY 2018 – 2022 and Agency Priority Goals for FY 2018 – 2019 for all appropriations: 

• Strategic Goal 1: Boost U.S. Economic Growth, Strategic Objective 1.1: Tax Law

Implementation: Administer tax law to better enable all taxpayers to meet their

obligations, while protecting the integrity of the tax system.

• Strategic Goal 4: Transform Government-wide Financial Stewardship, Strategic

Objective 4.1: Financial Data Access and Use: Increase the access and use of federal

financial data to strengthen government-wide decision-making, transparency, and

accountability.

• Strategic Goal 5: Achieve Operational Excellence, Strategic Objectives 5.1 – 5.3:

ο 5.1 Workforce Management: Foster a culture of innovation to hire, engage, 

develop, and optimize a diverse workforce with the competencies necessary to 

accomplish our mission. 

ο 5.2 Treasury Infrastructure: Better enable mission delivery by improving the 

reliability, security, and resiliency of Treasury’s infrastructure.

ο 5.3 Customer Value: Improve customer value by increasing the quality and 

lowering the cost of Treasury’s products and services. 

• Agency Priority Goal (aligned to strategic objective 1.1): Reduce the amount of

unprotected identity theft tax refunds paid by two percent by December 31, 2019.
IRS-31 

Taxpayer Services 

Appropriation Description

The Taxpayer Services appropriation provides funding for taxpayer service activities and 

programs. This includes printing forms and publications, processing tax returns and related 

documents, offering filing and account services, taxpayer assistance, and providing taxpayer 

advocacy services.

The Taxpayer Services budget request for FY 2020 is $2,402,000,000 in direct appropriations 

and 26,639 FTE. This amount is a decrease of $169,554,000, or 6.59 percent, and 2,195 FTE 

less than the FY 2019 Annualized Continuing Resolution level of $2,571,554,000 and 

28,834 FTE. The FY 2019 Annualized Continuing Resolution level includes $65 million of 

the $77 million provided by the Section 112 Administrative Provision to implement the Tax 

Cuts and Jobs Act (Public Law 115-97). 
IRS-32 

2.1 – Budget Adjustments Table 

Dollars in thousands

Taxpayer Services

Summary of Proposed FY 2020 Request FTE Amount

FY 2019 Annualized CR Level1 28,834 $2,571,554

Changes to Base:

Other Adjustments (1,192) ($101,636)

Offset to O&M for Critical IT Systems (1,192) (101,636)

Maintaining Current Levels (MCLs) $3,161

Non-Pay Inflation Adjustment 3,161

Efficiencies/Savings: (1,003) ($71,079)

Increase e-File Savings (116) (6,079)

Non-Recur for Section 112 Tax Reform Funding (887) (65,000)

Subtotal FY 2019 Changes to Base (2,195) ($169,554)

FY 2019 Current Services 26,639 $2,402,000

Total FY 2020 Budget Request 26,639 $2,402,000

See footnotes in 1.1 -- Appropriations Detail Table
IRS-33 

2.2 – Operating Levels Table

Dollars in thousands

Taxpayer Services

Object Classification

FY 2018

Enacted

FY 2019

Annualized CR

FY 2020

Request

11.1 Full-Time Permanent Positions 1,521,243 1,568,873 1,445,297

11.3 Other than Full-Time Permanent Positions 48,118 44,599 44,599

11.5 Other Personnel Compensation 107,257 92,380 92,317

11.8 Special Personal Services Payments 1,209 1,209

11.9 Personnel Compensation (Total) 1,676,618 1,707,061 1,583,422

12.1 Personnel Benefits 606,343 632,032 582,774

13.0 Benefits to Former Personnel 39,027 37,538 37,538

Total Personnel and Compensation Benefits $2,321,988 $2,376,631 $2,203,734

21.0 Travel 11,183 11,827 12,287

22.0 Transportation of Things 642 658 671

23.3 Communications, Utilities, & Misc 897 8,944 9,123

24.0 Printing & Reproduction 9,002 8,121 8,261

25.1 Advisory & Assistance Services 49,641 44,924 45,830

25.2 Other Services 15,540 15,247 15,554

25.3 Purchase of Goods & Services from Govt. Accounts 61,994 63,092 64,354

25.4 Operation & Maintenance of Facilities 1

25.7 Operation & Maintenance of Equipment 63 242 247

26.0 Supplies and Materials 4,121 4,415 4,475

31.0 Equipment 349 243 248

41.0 Grants, Subsidies 36,890 36,890 36,890

42.0 Insurance Claims & Indemnities 243 320 326

Total Non-Personnel $190,566 $194,923 $198,266

New Appropriated Resources $2,512,554 $2,571,554 $2,402,000

Budget Activities:

Pre-filing Taxpayer Assistance & Education 640,379 634,019 634,762

Filing & Account Services 1,872,175 1,937,535 1,767,238

New Appropriated Resources $2,512,554 $2,571,554 $2,402,000

FTE 27,871 28,834 26,639

See footnotes in 1.1 -- Appropriations Detail Table
IRS-34 

2.3 – Appropriation Detail Table 

2A – Pre-Filing Taxpayer Assistance and Education ($634,762,000 in direct 

appropriations, and an estimated $171,000 from reimbursable programs). This budget 

activity funds direct labor and non-labor expenses to assist with tax return preparation, 

including tax law interpretation, publication, production, and advocate services. The program 

activities include:

• Pre-Filing Services Management supports headquarters staffing and support for

Taxpayer Advocate Service and Customer Assistance Relationship and Education

(CARE) program activities. CARE provides pre-filing taxpayer assistance and

education.

• Taxpayer Communication and Education researches customer needs; develops and

manages educational programs; establishes partnerships with stakeholder groups; and

disseminates tax information to taxpayers and the public through a variety of media,

including publications and mailings, websites, broadcasting, and advertising.

• Media and Publications develops and produces notices, forms, and publications for

printed and electronic tax materials, and provides media production services to

taxpayers.

• Taxpayer Advocacy provides advocate services to taxpayers by identifying the

underlying causes of taxpayer problems and participating in the development of

systematic and/or procedural remedies.

• Account Management and Assistance – Field Assistance provides face-to-face

assistance, education, and compliance services to taxpayers. It includes return

preparation, answering tax questions, resolving account and notice inquiries, and

supplying forms and publications to taxpayers.

• Taxpayer Advocate Case Processing provides advocate services to taxpayers to

resolve taxpayer problems through prompt identification, referral, and settlement.

Dollars in thousands

Taxpayer Services

Appropriated Resources

FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

New Appropriated Resources:

Pre-Filing Taxpayer Assistance and Education 4,636 640,379 4,603 634,019 4,606 634,762 3 743 0.07% 0.12%

Filing and Account Services 23,235 1,872,175 24,231 1,937,535 22,033 1,767,238 (2,198) (170,297) -9.07% -8.79%

Subtotal New Appropriated Resources 27,871 $2,512,554 28,834 $2,571,554 26,639 $2,402,000 (2,195) ($169,554) -7.61% -6.59%

Other Resources:

Reimbursables 669 69,706 373 33,158 373 34,816 1,658 5.00%

Offsetting Collections - Non Reimbursables

User Fees 14 797 60 13,000 71 3,900 11 (9,100) 18.33% -70.00%

Recovery from Prior Years 134

Unobligated Balances from Prior Years 45,900 169 17,555 (169) (17,555) -100.00% -100.00%

Transfers In/Out (41,034) (1,000) 1,000 -100.00%

Resources from Other Accounts

Subtotal Other Resources 683 $75,503 602 $62,713 444 $38,716 (158) ($23,997) -26.25% -38.26%

Total Budgetary Resources 28,554 $2,588,057 29,436 $2,634,267 27,083 $2,440,716 (2,353) ($193,551) -7.99% -7.35%

See footnotes in 1.1--Appropriations Detail Table

% Change

FY 2019 to FY 2020 

Request

FY 2018

Enacted

Change

FY 2019

Annualized CR

FY 2020

Request

FY 2018 to FY 2020 

Request
IRS-35 

• W&I HQ Management and Administration provides staffing, training, and direct

support for Wage and Investment management activities of strategic planning,

communications and liaison, finance, human resources, equity, diversity and inclusion,

business modernization, and embedded training.

• Taxpayer Services Research provides resources to support taxpayer services by

conducting taxpayer behavioral studies, data analysis, and uses advanced analytics to

deliver results and conclusions to inform business decisions to improve IRS products

and services.

• National Distribution Center processes orders for IRS forms and publications received

from individual taxpayers, tax practitioners, and IRS tax return preparation partners.

Description of FY 2018 Performance 

In FY 2018, the Timeliness of Critical Individual Filing Season (CIFS) Tax Products to the 

Public (i.e., tax forms, schedules, instructions, and publications) was 59.6 percent (56 out of 

94 products delivered timely), falling short of the FY 2018 target of 89 percent. TCJA 

affected 37 (39 percent) of the 94 total CIFS tax products. The first major task required the 

IRS to address withholding tables. The IRS incorporated all modifications, issued the 

affected tax products, and planned a coordinated release of the new withholding rates by 

January 8, 2018. This added an unexpected additional 57 tax products to the work plan. 

Despite the short timeframe, about 60 percent of CIFS tax products were made available to 

the public on time. 

The IRS will change the definition of two measures for FY 2019 to reflect the significant 

changes required by TCJA. For the CIFS measure, the date by which the IRS must release a 

CIFS tax product to the public to be considered timely will change from the fifth workday in 

January to seven calendar days from the official IRS start of the individual filing season. For 

FY 2019, the IRS expects to achieve a target of 85 percent and 89 percent for FY 2020. 

The IRS will make similar changes to the Timeliness of Critical Tax Exempt/Government 

Entities (TE/GE) and Business (CTB) Filing Season Tax Products measure. The measure is 

being modified for FY 2019 to assess tax products available seven calendar days from the 

official IRS start of the (individual) filing season instead of the fifth workday in January. In 

FY 2018, the IRS Timeliness of Critical Tax TE/GE and Business Filing Season Tax products 

to the Public was 100 percent, exceeding the target of 91 percent. The IRS achieved these 

results through workload planning to prioritize critical products over other products to ensure 

taxpayers had the products needed to complete their tax returns timely. For FY 2019, the IRS 

expects to achieve a target of 85 percent and 89 percent for FY 2020. 

In FY 2018, the Enterprise Self Assistance Participation Rate (ESAPR) reached 82 percent 

compared to the actual of 79 percent for the same period in FY 2017. This indicator 

represents the percentage of taxpayer assistance requests resolved using self-assisted 

automated services. Total taxpayer services increased by 16.8 percent from FY 2017 while 

taxpayer self‐assistance services provided by the IRS increased by 21.2 percent. The driving 

factor for the increase in web services was Transcript Delivery System usage, which increased 

by 211 percent (80.3 million vs. 25.8 million) in FY 2018 compared to FY 2017. Other 
IRS-36 

online applications on IRS.gov contributing to the increase include: Where's My Refund? (up 

11 percent); Interactive Tax Assistant (up 22 percent); Online Payment Agreement (up 19 

percent) and electronic payments (up 10.5 percent) from FY 2017. This increase in the 

ESAPR measure demonstrates IRS’s progress toward providing expanded service options, 

and taxpayers’ increased adoption of self-assistance options across various IRS service 

channels. The ESAPR measure will be used as an indicator for FY 2019 and FY 2020. 

FY 2020 Changes by Budget Activity

2.1.1 – Budget and Performance Report and Plan

Dollars in thousands

Pre-Filing Taxpayer Assistance & Education FTE Amount

FY 2019 Annualized CR Level 4,604 $634,019

Changes to Base:

Other Adjustments 9 $960

Offset to O&M for Critical IT Systems 9 960

Pay Annualization $783

Non-Pay 783

Efficiency/Savings (7) ($1,000)

Non-Recur for Section 112 Tax Reform Funding (7) (1,000)

Subtotal FY 2020 Changes to Base 2 $743

FY 2020 Current Services 4,606 $634,762

Total FY 2020 Request 4,606 $634,762

See footnotes in 1.1 -- Appropriations Detail Table

Dollars in thousands

Pre-Filing Taxpayer Assistance & Education FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Resource Level Actual Actual Actual Actual Enacted Annualized CR Request

Appropriated Resources1 $595,168 $609,196 $609,445 $594,962 $640,379 $634,019 $634,762

Reimbursable Resources2 45 51 13 4 260 163 171

User Fees2 22,400 4,141

Budget Activity Total $617,613 $613,388 $609,458 $594,966 $640,639 $634,182 $634,933

1

The FY 2014 - FY 2018 appropriated resources represents the approved operating plan including any inter-BAC transfers and inter-appropriation transfers.

2

The FY 2014 - FY 2018 columns represent realized resources for reimbursables and user fees.

Pre-Filing Taxpayer Assistance & Education FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Measure Actual Actual Actual Actual Actual Target Target Target

Timeliness of Critical Filing Season Tax Products to the Public (Ot)1 99.1% 89.0% 92.5% 93.1% 59.6% 89.0% 85.0% 89.0%

Timeliness of Critical TE/GE & Business Tax Products to the Public 

(Ot)1 98.7% 92.6% 98.0% 96.7% 100.0% 91.0% 85.0% 89.0%

Enterprise Self Assistance Participation Rate (E) (L)2 84.7% 88.7% 89.0% 79.0% 82.0% Indicator

1

Modified for FY 2019

Key: Oe - Outcome Measure, E - Efficiency Measure, Ot - Output/Workload Measure, and L - Strategic Goal Measure

2 Starting in FY 2017, the IRS modified the Taxpayer Self Assistance Rate measure (renamed to Enterprise Self Assistance Participation Rate) to include additional self-service channels 

including Get Transcript and payment applications such as Direct Pay and Online Payment Agreements. As new self-assistance applications are provided to the public, they will be added 

to the methodology.
IRS-37 

2B – Filing and Account Services ($1,767,238,000 in direct appropriations, $34,645,000 

from reimbursable programs, and $3,900,000 from user fees): This budget activity funds 

direct labor and non-labor expenses that provide filing and account services to taxpayers, 

process paper and electronically-submitted tax returns, issue refunds, and maintain taxpayer 

accounts. The public continues to file more returns electronically (more than 90 percent of 

individual returns were filed electronically during the 2018 filing season). The program 

activities include:

• Filing and Account Services Management administers filing and account services

programs.

• Submission Processing processes paper and electronically-submitted tax returns and

supplemental documents, accounts for tax revenue, processes information documents,

and issues refunds and tax notices.

• Account Management and Assistance – Electronic/Correspondence Assistance

provides education and assistance to taxpayers and resolves accounts and notice

inquiries through telephone, paper, and internet correspondence.

• Electronic Products and Services Support (EPSS) provides centralized operations and

support capabilities for the IRS suite of electronic products, including e-help desk,

technology support, and operations support.

• Electronic Tax Administration (ETA) markets and administers electronic tax

administration products and services.

• Health Care Tax Administration provides funds to administer the health insurance tax

credit portion of the Trade Adjustment Assistance Reform Act of 2002.

• Joint Operations Center (JOC) provides service, support, and technology for

telephone, correspondence, and electronic media inquiries; real time monitoring and

routing of inbound calls; monitoring of Customer Service Representative accuracy;

and management of the enterprise telephone database.

Description of FY 2018 Performance

Millions of individual and business taxpayers file their returns electronically. In FY 2018, the 

IRS achieved an 87.2 percent individual e-file rate, exceeding the prior year performance of 

86.9 percent, but falling slightly short of its 88 percent target. The IRS achieved a 

55.6 percent business e-file rate exceeding the FY 2018 target of 54 percent. The IRS will 

continue to promote the benefits of e-filing (i.e., faster refunds, greater accuracy, secure and 

confidential submission, and quick confirmation). Starting in FY 2019, the individual e-file 

rate measure will be discontinued from budget reporting given how many taxpayers file 

electronically. The business e-file target will be increased to 58 percent for FY 2019 and 

60 percent for FY 2020. 

In FY 2018, Customer Accuracy – Tax Law was at 95.5 percent, exceeding the target of 

95.0 percent. The IRS will continue to monitor results from the Embedded Quality Review 

System and continue to hold weekly conference calls throughout the year to discuss quality 

defects/errors and procedures to ensure the target is met. For FY 2019 and FY 2020, the IRS 
IRS-38 

set a tax law accuracy target of 92 percent since the complexity of the TCJA changes may 

affect performance. For Customer Accuracy – Accounts (Phones), the IRS correctly 

answered 96.1 percent of account questions over the telephone, exceeding the target of 

95 percent. For FY 2019 and FY 2020, the IRS expects to achieve an accounts (phones) 

accuracy rate of 94 percent based on complexity of TCJA changes. For FY 2019, the IRS will 

maintain both accuracy measures to gauge the effects of tax reform 

In FY 2018, the IRS Customer Contacts Resolved per Staff Year reached 31,409. This 

measure was baselined in FY 2017 as self-service applications, such as Get Transcript and 

Direct Pay, were added to the methodology and used as an indicator for FY 2018. Customer 

Contacts include activities such as automated and assistor calls answered, and web services 

completed. Several of the components that make up the Customer Contacts Resolved Per 

Staff Year measure also are included in the Enterprise Self Assistance Participation Rate; 

therefore, the IRS will discontinue this measure beginning in FY 2019. 

The Customer Service Representative (CSR) Level of Service (LOS) measures the relative 

success rate of taxpayers wanting to speak with a CSR. In FY 2018, the CSR LOS exceeded 

the target of 75 percent, reaching 75.9 percent and provided a filing season LOS of 

80 percent. Customer Service Representatives answered 25.3 million calls, an 8.9 percent 

increase compared to FY 2017. Resource levels in FY 2018 for taxpayer services and call 

demand allowed the IRS to increase LOS and to reduce paper correspondence. For FY 2018, 

this inventory totaled more than 580,000 pieces of correspondence with a 31 percent overage 

rate compared to a much higher 48 percent overage rate with more than 850,000 pieces of 

correspondence in FY 2015. The IRS created and continues to create new web-based 

applications for taxpayers. The increase in self-assistance web applications, along with the 

high level of telephone service, should continue to reduce paper correspondence receipts. In 

FY 2019, the IRS will continue to create detailed forecasts of expected telephone and 

correspondence demand. The IRS will monitor demand in real-time and resources allocated 

down to the half hour, allowing the IRS to shift staff between telephones and paper 

processing. The IRS has revised the target for FY 2019 level of service to 63 percent based 

on the delayed training that has overlapped with the filing season. In order to mitigate the 

impact of the delayed training, the IRS has allocated $40 million in user fees (not reflected in 

the tables) to LOS in addition to the funds provided in the FY 2019 enacted appropriation 

(Public Law 116-6). The target level of service for FY 2020 is 68 percent. 

Refund Timeliness is the percentage of refunds resulting from processing individual paper 

returns issued within 40 days or less. In FY 2018, Refund Timeliness reached 98.2 percent, 

exceeding the target of 97 percent. This measure is being discontinued for FY 2019 reporting 

because it is based on paper returns, which account for roughly 10 percent of the individual 

filing population. 

The current Taxpayer Satisfaction indicator – the All Individual Tax Filer Score, is based on 

the American Customer Satisfaction Index (ACSI) survey and is included for FY 2019 

reporting. The All Individual Tax Filer score is calculated from separate ACSI Individual 

Paper Filer and Electronic Filer Customer Satisfaction Index Scores. The ACSI is the only 

uniform, cross-industry/government measure of customer satisfaction with the quality of 

goods and services available to U.S. residents. The ACSI scores are released on an annual 
IRS-39 

basis at the end of January and are based on a 100-point scale. In FY 2018, the score was 74 

and reflected a steady increase over the past five years.

FY 2020 Changes by Budget Activity

2.1.2 – Budget and Performance Report and Plan

Dollars in thousands

Filing and Account Services FTE Amount

FY 2019 Annualized CR Level 24,231 $1,937,535

Changes to Base:

Other Adjustments (1,258) ($102,596)

Offset to O&M for Critical IT Systems (1,258) (102,596)

Maintaining Current Levels (MCLs) $2,378

Non-Pay 2,378

Efficiency/Savings (996) ($70,079)

Increase e-File Savings (116) (6,079)

Non-Recur for Section 112 Tax Reform Funding (880) (64,000)

Subtotal FY 2020 Changes to Base (2,254) ($170,297)

FY 2020 Current Services 21,977 $1,767,238

Total FY 2020 Request 21,977 $1,767,238

See footnotes in 1.1 -- Appropriations Detail Table

Filing and Account Services FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Resource Level Actual Actual Actual Actual Enacted Annualized CR Request

Appropriated Resources1 $1,550,027 $1,564,488 $1,712,511 $1,811,902 $1,872,175 $1,937,535 $1,767,238

Reimbursable Resources2 28,555 30,147 34,905 62,794 69,446 32,995 34,645

User Fees2 160,342 40,553 69,987 3,900 797 13,000 3,900

Budget Activity Total $1,738,924 $1,635,188 $1,817,403 $1,878,596 $1,942,418 $1,983,530 $1,805,783

2

The FY 2014 - FY 2018 columns represent realized resources for reimbursables and user fees.

Filing and Account Services FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Measures Actual Actual Actual Actual Actual Target Target Target

Percent Individual Returns Processed Electronically (Oe)1 84.1% 85.3% 86.4% 86.9% 87.2% 88.0% DISC

Percent of Business Returns Processed Electronically (Oe) 43.1% 47.0% 50.0% 52.9% 55.6% 54.0% 58.0% 60.0%

Customer Accuracy - Tax Law (Phones) (Ot) 95.0% 95.0% 96.4% 96.7% 95.5% 95.0% 92.0% 92.0%

Customer Accuracy - Accounts (Phones) (Ot) 96.2% 95.5% 96.1% 96.0% 96.1% 95.0% 94.0% 94.0%

Customer Contacts Resolved per Staff Year (E)1 21,018 26,245 28,497 25,535 31,409 Indicator DISC

Customer Service Representative Level of Service (Oe)2 64.4% 38.1% 53.4% 77.1% 75.9% 75.0% 63.0% 68.0%

Refund Timeliness - Individual (Paper) (Ot)1 98.7% 98.8% 98.7% 98.4% 98.2% 97.0% DISC

Taxpayers Satisfied with the IRS (based on a 100 point scale)3, 4 73 73 74 74 74 Indicator Indicator Indicator

Key: Oe - Outcome Measure, E - Efficiency Measure, Ot - Output/Workload Measure, and L - Long Term Goal

2

The FY 2019 level of service target was calculated at the FY 2019 Enacted level.

3

New measure added for FY 2019

4

Based on the American Customer Satisfaction Index (ACSI) survey; the All Individual Tax Filer score is calculated from separate ACSI Individual Paper Filer and Electronic Filer customer satisfaction 

index scores; available on an annual basis at the end of January and computed on a 100-point scale. 

Dollars in thousands

1

The FY 2014 - FY 2018 appropriated resources represents the approved operating plan including any inter-BAC transfers and inter-appropriation transfers.

1

Discontinued (DISC) for FY 2019



IRS-40 

Enforcement 

Appropriation Description

The Enforcement appropriation provides funding for the examination of tax returns, both 

domestic and international; administrative and judicial settlement of taxpayer appeals of 

examination findings; technical rulings; monitoring of employee pension plans; determination 

of qualifications of organizations seeking tax-exempt status; examination of tax returns of 

exempt organizations; enforcement of statutes relating to detection and investigation of 

criminal violations of the internal revenue laws; identification of underreporting of tax 

obligations; securing of unfiled tax returns; and collection of unpaid accounts. 

The Enforcement budget request for FY 2020 is $4,705,368,000 in direct appropriations and 

34,182 FTE, excluding the proposed program integrity cap adjustment. This amount is an 

increase of $33,368,000, or 0.71 percent, and 133 FTE above the FY 2019 Annualized 

Continuing Resolution level of $4,672,000,000 and 34,049 FTE. The FY 2019 Annualized 

Continuing Resolution level includes a $200 million inter-appropriation transfer from 

Enforcement to Operations Support and $12 million of the Section 112 funds for TCJA. 
IRS-41 

2.1 – Budget Adjustments Table

Dollars in thousands

Enforcement

Summary of Proposed FY 2020 Request FTE Amount

FY 2019 Annualized CR Level1 34,049 $4,672,000

Changes to Base:

Maintaining Current Levels (MCLs) $6,249

Non-Pay Inflation Adjustment 6,249

Efficiencies/Savings: (68) ($13,717)

Reduce Contractual Services (1,717)

Non-Recur for Section 112 Tax Reform Funding (68) (12,000)

Subtotal FY 2019 Changes to Base (68) ($7,468)

FY 2019 Current Services 33,981 $4,664,532

Program Changes:

Program Increases

Data Analytics to Enhance Compliance 174 28,470

Prevent Identity Theft 27 12,366

Subtotal FY 2019 Program Increases 201 $40,836

Total FY 2020 Budget Request 34,182 $4,705,368

See footnotes in 1.1 -- Appropriations Detail Table
IRS-42 

2.2 – Operating Levels Table

Dollars in thousands

Enforcement

Object Classification

FY 2018

Enacted

FY 2019

Annualized CR

FY 2020

Request

11.1 Full-Time Permanent Positions 3,014,050 3,017,510 3,024,426

11.3 Other than Full-Time Permanent Positions 29,115 30,459 30,459

11.5 Other Personnel Compensation 121,088 110,104 110,835

11.8 Special Personal Services Payments 30,903 31,190 31,190

11.9 Personnel Compensation (Total) 3,195,156 3,189,263 3,196,910

12.1 Personnel Benefits 1,147,736 1,169,490 1,173,134

13.0 Benefits to Former Personnel 633 783 782

Total Personnel and Compensation Benefits $4,343,525 $4,359,536 $4,370,826

21.0 Travel 53,354 70,464 75,364

22.0 Transportation of Things 3,473 7,844 10,883

23.1 Rental Payments to GSA 4

23.2 Rent Payments to Others 233 270 282

23.3 Communications, Utilities, & Misc 1,721 1,925 2,012

24.0 Printing & Reproduction 1,988 2,371 2,422

25.1 Advisory & Assistance Services 114,963 108,991 116,444

25.2 Other Services 38,394 40,121 41,635

25.3 Purchase of Goods & Services from Govt. Accounts 33,110 45,494 46,408

25.4 Operation & Maintenance of Facilities 11 10 11

25.6 Medical Care 5 43 43

25.7 Operation & Maintenance of Equipment 927 1,790 3,749

26.0 Supplies and Materials 20,682 21,827 22,630

31.0 Equipment 6,412 6,419 7,666

32.0 Land and Structures 6 3 3

42.0 Insurance Claims & Indemnities 3,992 923 942

91.0 Unvouchered 4,200 3,969 4,048

Total Non-Personnel $283,475 $312,464 $334,542

New Appropriated Resources $4,627,000 $4,672,000 $4,705,368

Budget Activities:

Investigations 581,680 597,658 614,046

Exam & Collections 3,875,098 3,894,129 3,923,583

Regulatory 170,222 180,213 167,739

New Appropriated Resources $4,627,000 $4,672,000 $4,705,368

FTE 34,789 34,049 34,182

See footnotes in 1.1 -- Appropriations Detail Table
IRS-43 

2.3 – Appropriation Detail Table 

2C – Investigations ($614,046,000 in direct appropriations, and an estimated $35,831,000 

from reimbursable programs): This budget activity funds the Criminal Investigation (CI) 

programs that explore potential criminal and civil violations of tax laws; enforce criminal 

statutes relating to violations of tax laws and other financial crimes; and recommend 

prosecution as warranted. The program activities include:

• General Management and Administration supports the headquarters management

activities of strategic planning, communications, finance, and human resources for

CI activities.

• Identity Theft, through CI's collaboration with internal and external business partners,

combats the inherent risks of Stolen Identity Refund Fraud (SIRF) by focusing on

significant tax investigations, prosecutions to maximize deterrence, and preventing the

IRS from issuing fraudulent refunds.

• CI supports the enforcement of criminal statutes relating to violations of internal

revenue laws and other financial crimes. CI investigates cases of suspected intent to

defraud involving both legal and illegal sources of income and recommends

prosecution as warranted. This includes the investigation and prosecution of tax and

money-laundering violations associated with narcotics organizations.

• Criminal Tax Legal Support provides legal advice and support from IRS Counsel to

CI.

• International Investigations supports international investigations involving U.S.

citizens residing abroad, non-resident aliens, expatriates (U.S. citizens living abroad

who have renounced their citizenship), and investigations involving other international

issues, including legal support (e.g., Foreign Tax Credit and Foreign Earned Income

Exclusion, Corporations, Non-Profits, Pension Plans, etc.).

• Cybersecurity supports CI’s cyber-efforts around inherent risks to CI’s networks and

systems, while focusing enforcement and investigative actions on the criminals that

Dollars in thousands

Enforcement

Appropriated Resources

FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

New Appropriated Resources:

Investigations 2,950 581,680 2,893 597,658 2,964 614,046 71 16,388 2.45% 2.74%

Exam and Collections 30,876 3,875,098 30,084 3,894,129 30,209 3,923,583 125 29,454 0.42% 0.76%

Regulatory 963 170,222 1,072 180,213 1,009 167,739 (63) (12,474) -5.88% -6.92%

Subtotal New Appropriated Resources 34,789 $4,627,000 34,049 $4,672,000 34,182 $4,705,368 133 $33,368 0.39% 0.71%

Other Resources:

Reimbursables 57 32,177 64 34,571 64 36,300 1,729 5.00%

Offsetting Collections - Non Reimbursables 26,069 37,719 39,605 1,886 5.00%

User Fees 43 (43) -100.00%

Recovery from Prior Years 3,347 4,000 4,000

Unobligated Balances from Prior Years 28,702 14,175 55,990 41,815 294.99%

Transfers In/Out 76 1,000 (1,000) -100.00%

Resources from Other Accounts

Subtotal Other Resources 57 $90,371 64 $91,508 64 $135,895 $44,387 48.51%

Total Budgetary Resources 34,846 $4,717,371 34,113 $4,763,508 34,246 $4,841,263 133 $77,755 0.39% 1.63%

FY 2019

Annualized CR

FY 2019 to FY 2020 

Request

FY 2019 to FY 2020 

Request

FY 2020

Request

See footnotes in 1.1--Appropriations Detail Table

% Change

FY 2018

Enacted

Change
IRS-44 

pose those threats. This activity also supports security program management that 

protects the safeguarding of all data and systems within CI while adhering to all 

federal regulatory security compliance mandates and local security policies. 

Description of FY 2018 Performance 

CI serves the American public by investigating potential criminal violations of the Internal 

Revenue Code and related financial crimes in a manner that fosters confidence in the tax 

system and compliance with the law. CI uses the following measures to evaluate its success 

in achieving its mission. 

In FY 2018, CI completed 3,051 criminal investigations, exceeding the year-end target of 

3,000. Overall performance in FY 2018 continued to be affected by a steady decrease in the 

number of special agents as well as CI’s focus on traditional tax case programs, which tend to 

have a longer cycle time. Cases of a legal and illegal source nature decreased 3.1 percent and 

6.5 percent, respectively, while narcotics cases increased 11 percent compared to FY 2017. 

Legal source cases include people that earn their income legally, but willfully violate the tax 

laws (i.e. Tax Evasion). Illegal cases include income from sources such as embezzlement, 

mortgage fraud, telemarketing fraud, money laundering, etc. Narcotics cases are similar to 

illegal, these cases are specific to profit, and financial gains of organized drug groups 

involved in narcotics trafficking and/or narcotics/money laundering. CI will continue to 

utilize proven case development strategies, expand case development efforts, and leverage 

interagency partnerships to identify, initiate, and complete criminal investigations in all 

program areas, based on projected staffing, the IRS reduced its FY 2019 target to 

2,800 completed investigations and its FY 2020 target to 2,700 completed investigations. 

In FY 2018, the number of criminal convictions was 1,879, an 18.3 percent decrease 

compared to FY 2017 and slightly below the target of 1,900. Fewer special agents has led to 

a decline in the number of cases initiated and consequently in the number of cases 

recommended for prosecution, which contributed to lower inventory levels in the judicial 

process. Despite this decline, quality investigations initiated and completed in previous years 

continue to be recommended for prosecution and are processed by the Department of Justice 

(DOJ). CI management will continue to ensure appropriate and consistent contact with the 

DOJ Tax Division and U.S. Attorney Offices regarding prosecutorial priorities and 

appropriate movement of pipeline investigations. Starting in FY 2019, the IRS will 

discontinue this measure because it is a component of an existing measure (conviction rate). 

The FY 2018 conviction rate was slightly higher than it was in FY 2017 (91.7 percent vs. 

91.5 percent) but below the year‐end target of 92 percent, because of attrition, case 

complexity, and bandwidth at partner agencies. Acquittals and dismissals decreased by 31.3 

percent and 19.8 percent, respectively, compared to FY 2017. Appropriate case selection and 

effective field performance continue to increase the number of cases resulting in convictions 

and likely mitigated other effects. Consequently, CI's rate of conviction, one of the highest in 

federal law enforcement, continues to be a strong indicator of investigative quality. Since CI 

does not prosecute its own cases, it must depend on DOJ’s ability to accept its cases for 

prosecution and to move such cases through the courts. CI management will continue to 

coordinate with the DOJ Tax Division and U.S. Attorney Offices on prosecutorial priorities 
IRS-45 

and on the appropriate movement of pipeline investigations to ensure a high rate of conviction 

and to meet the FY 2019 and FY 2020 targets of 92 percent. 

FY 2020 Changes by Budget Activity

2.1.3 – Budget and Performance Report and Plan 

2D – Exam and Collections ($3,923,583,000 in direct appropriations and an estimated 

$107,000 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. This budget activity also includes campus support of the 

Questionable Refund program and appeals and litigation activities associated with exam and 

collection. The program activities include:

• Compliance Services Management supports management associated with exam and

compliance program activities.

• Payment Compliance – Correspondence Collection supports IRS collection activities

by initiating contact and collecting delinquent taxpayer liabilities through written

notices and other means.

Dollars in thousands

Investigations FTE Amount

FY 2019 Annualized CR Level 2,893 $597,659

Changes to Base:

Maintaining Current Levels (MCLs) $1,165

Non-Pay 1,165

Subtotal FY 2020 Changes to Base $1,165

FY 2020 Current Services 2,893 $598,824

Program Changes:

Program Increases 71 $15,222

Data Analytics to Enhance Compliance 45 9,958

Prevent Identity Theft 26 5,264

Subtotal FY 2020 Program Increases 71 $15,222

Total FY 2020 Request 2,964 $614,046

See footnotes in 1.1 -- Appropriations Detail Table

Investigations FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Resource Level Actual Actual Actual Actual Enacted Annualized 

CR Request

Appropriated Resources1 $601,740 $601,665 $591,449 $589,295 $581,680 $597,658 $614,046

Reimbursable Resources2 27,133 29,957 29,053 33,618 28,295 34,125 35,831

User Fees2

Budget Activity Total $628,873 $631,622 $620,502 $622,913 $609,975 $631,783 $649,877

1

The FY 2014 - FY 2018 appropriated resources represents the approved operating plan including any inter-BAC transfers and inter-appropriation transfers.

2

The FY 2014 - FY 2018 columns represent realized resources for reimbursables and user fees.

Investigations FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Measures Actual Actual Actual Actual Actual Target Target Target

Criminal Investigations Completed (Ot) 4,606 4,486 3,721 3,089 3,051 3,000 2,800 2,700

Number of Convictions (Oe)1 3,110 2,879 2,672 2,300 1,879 1,900 DISC

Conviction Rate (Oe) 93.4% 93.2% 92.1% 91.5% 91.7% 92.0% 92.0% 92.0%

1

Discontinued (DISC) for FY 2019

Dollars in thousands

Key: Oe - Outcome Measure, Ot - Output/Workload Measure
IRS-46 

• Automated Collections and Support initiates contact and collects delinquent taxpayer

liabilities through the centralized Automated Collection System (ACS).

• Payment Compliance – Field Collection conducts field investigations and collection

efforts associated with delinquent taxpayer and business entity liabilities, including

direct taxpayer contact and outreach programs to protect the interest of the Federal

Government in delinquent tax liability situations.

• Tax Reporting Compliance – Document Matching supports the Automated

Underreporter (AUR), Combined Annual Wage Reporting (CAWR), Federal

Unemployment Tax Act (FUTA), and other Document Matching Programs.

• Tax Reporting Compliance – Electronic/Correspondence Exam initiates written

correspondence with taxpayers related to tax issues arising from claims on their tax

returns.

• Tax Reporting Compliance – Field Exam compares taxpayer income levels and

corresponding tax liabilities to ensure the accuracy of taxpayer returns.

• Fraud/Bank Secrecy Act enforces the anti-money laundering provisions of the Bank

Secrecy Act of 1970 (BSA) and the USA Patriot Act of 2001. It examines non-bank

financial institutions for compliance with these laws, receives and processes more than

15 million financial reports annually, and manages a centralized database of that

information for the Financial Crimes Enforcement Network. The Fraud program

follows the money trail to support the criminal investigation of tax evasion operations.

Fraud technical advisors and revenue agents provide investigative leads and referrals

to federal, state, and local law enforcement agencies.

• Appeals provides an administrative review process that provides a channel for

impartial case settlement before a case is docketed in a court of law.

• Litigation provides legal support for the IRS in litigation of cases, including

interpretation of the tax law.

• Specialty Programs – Exams examines federal tax returns of businesses and

individuals responsible for the filing and payment of employment, excise, estate, and

gift taxes.

• International Collection supports international field collection efforts associated with

delinquent taxpayer and business entity liabilities from U.S. citizens residing abroad,

non-resident aliens, expatriates (U.S. citizens living abroad who have renounced their

citizenship), and those involving other international issues (e.g., Foreign Tax Credit

and Foreign Earned Income Exclusion).

• International Exams supports the international exam program involving U.S. citizens

residing abroad, non-resident aliens, expatriates, and other examinations involving

other international issues including legal support (e.g., Foreign Tax Credit and Foreign

Earned Income Exclusion, Corporations, Non-Profits, Pension Plans, etc.).

• Enforcement Research provides resources for market-based research to identify

compliance issues, for conducting tests of treatments to address noncompliance, and

for the implementation of successful treatments of taxpayer non-compliant behavior.
IRS-47 

• Unit General Management and Administration provides staffing, training, and direct

support for headquarters management activities of strategic planning, communication

and liaison, finance, human resources, equity, diversity and inclusion, business system

planning, and embedded training.

• EITC Management and Administration supports headquarters management associated

with administering the Earned Income Tax Credit (EITC) program.

• Integrity & Verification Operations supports civil fraud detection and prevention

efforts in a pre-refund environment including monitoring performance and developing

policy, procedures, and guidance for processing civil revenue protection programs.

• ID Theft Victim Assistance has end-to-end responsibility and accountability for

identity theft victim assistance policy and operations, which includes paper inventories

from tax related- ID theft, the Identity Theft Protection Specialized Unit (IPSU), and

Return Preparer Misconduct.

• Whistleblower Office provides staffing, training, and direct support to process, assess,

and analyze tips from individuals who identify tax problems in the course of their

daily business, regardless of where encountered (including workplace).

• Communications and Liaison coordinates local government and liaison relationships;

manages congressional, state, and national stakeholder relationships and issues;

coordinates crosscutting issues, including audit management and legislative

implementation; manages national media contacts and local media relationships; and

ensures compliance with disclosure and privacy laws.

• Return Integrity, Verification & Program Management provides policy and program

oversight of revenue protection efforts such as detection, prevention and treatment of

improper refunds (identity theft and non-compliance), including managing systemic

solutions regarding payment of valid refund claims and the development of innovative

technology solutions supporting service-wide revenue protection strategies.

Description of FY 2018 Performance – Exam

The Examination program provides taxpayers top quality service by helping them understand 

and meet their tax responsibilities and by applying the tax law with integrity and fairness. 

The performance goals that the IRS uses to gauge the Examination program’s performance 

are discussed below.

In FY 2018, Individual Exam Coverage was 0.6 percent, meeting the target. There IRS 

completed about 22,000 fewer individual audits, a 2.5 percent decrease compared to FY 2017. 

Examination will continue to address cycle time, length of audits, work in process and 

planned starts to maintain the current level of closures and ensure it meets future targets. The 

IRS will balance this data with the current level of attrition and projected hiring. For FY 2019 

and FY 2020, the IRS will lower the target to 0.5 percent due to fewer staff available to work 

cases and the increase in the number of individual filers.

In FY 2018, the Field Exam National Quality Review Score was 89.1 percent, exceeding the 

target of 84.4 percent. Examination analyzes quality data trends and the effect of 
IRS-48 

organizational changes on quality scores. This measure will be discontinued from budget 

reporting in FY 2019 because the quality scores have been relatively constant 

In FY 2018, Office Exam Quality was 87.2 percent, exceeding the target of 86.7 percent. 

Improvement efforts included delivery of educational workshops, completion of case closing 

check sheets and the use of job aids. This measure will be discontinued from budget reporting 

starting in FY 2019 because the quality scores have been relatively constant over the years. 

The Program Office will continue to monitor the scores to improve quality. 

The Examination Quality – Large Business measure is calculated through a review of a 

statistically valid random sample of closed large-business return cases. Case scores are based 

on the percentage of elements passed within each of the three Examination audit standards 

(planning, executing, and resolving). In FY 2018, Examination Quality – Large Business was

76 percent, 14 percentage points below the target of 90 percent. The decline in the 

Examination Quality Score is a result of low scores in all three audit standards. Actions taken 

to improve scores include: considering the filing/compliance requirements of related tax 

returns and subsequent year tax returns; documenting the reconciliation of the internal 

financial information to the tax return; and documenting the audit trail and techniques used 

for resolving the case. This measure will be discontinued from budget reporting in FY 2019 

because the quality scores have been flat over the last two years and are not directly affected 

by funding levels. The Program Office will continue to monitor the scores to improve quality. 

The Examination Coverage – Business (Assets > $10 million) measure is calculated by taking 

the total number of LB&I returns with assets of more than $10 million, including all 

partnerships examined and closed by LB&I during the current fiscal year, divided by total 

filings for the preceding calendar year. In FY 2018, Business Examination Coverage was

2.2 percent, below the target of 2.4 percent. The IRS’s Large Business & International 

Division met the mid‐size corporations closure FY 2018 target but fell short of the target for 

flow‐thru and high‐corporation closures. Factors contributing to the FY 2018 performance 

shortfall included suspension of new inventory for a period in FY 2017 while workload 

selection methods were reviewed, and fewer resources available to close large business 

returns because of higher than predicted attrition and Federal Emergency Management 

Agency disaster assistance. In addition, resources were redirected to develop and implement 

compliance campaigns. Some of the campaigns involve new compliance treatment streams 

that use methods other than examining returns, which results in fewer return closures. The 

FY 2019 target is 2.2 percent. 1.5 percent in 2020. 

In FY 2018, Exam Efficiency - Individual (the number of closures divided by the total Exam 

FTE) was 131, below the target of 134. While 9.5 percent fewer FTEs were expended for 

FY 2018 in closing individual returns, Examination completed 22,600 fewer individual audits, 

only a 2.5 percent decrease compared to FY 2017. Examination will continue to address 

cycle time, length of audits, work in process and planned starts to maintain the current level of 

closures to ensure it meets FY 2019 targets. The FY 2019 Exam Efficiency – Individual is

109 and the FY 2020 target is 121. 

The Automated Underreporter (AUR) Efficiency measure is calculated by taking the total 

number of W&I and SB/SE contact closures (a closure resulting from a case where IRS made 
IRS-49 

contact) divided by the total FTEs, including overtime. In FY 2018, AUR Efficiency was

2,205, exceeding the year-end target of 2,133, a one percent improvement compared to 

FY 2017. This measure will be discontinued from budget reporting in FY 2019. 

The AUR Coverage measure is calculated by taking the total number of contact closures 

divided by total prior calendar year individual filings. In FY 2018, AUR Coverage was 

2.0 percent, exceeding the target of 1.9 percent. Examination will monitor resources, work in 

process, and planned starts to ensure future targets are met. The target in FY 2019 is 

1.6 percent for FY 2019 and 1.7 percent for FY 2020 

The Time to Start Compliance Resolution is a new measure and will be used as an indicator in 

FY 2019. It is the percentage of all individual income tax enforcement cases started within 

six months of the return posting date. It will reflect the effect of expedited issue detection and 

more integrated enforcement approaches. It supports expedited document matching, 

enhanced anomaly detection leading to faster issue identification, and data and analytics to 

improve issue identification and treatment selection.

Time to Resolve Compliance Issue After Filing is a new measure and will be used as an 

indicator in FY 2019. It measures the average time (in days) it takes to close all individual 

income tax enforcement cases. This measure reflects the complete life cycle from return 

filing to resolution. It will reflect the effect of process enhancements, such as new 

self-correction capabilities, including Online Account. It supports expedited document 

matching and enhanced anomaly detection, which will lead to faster issue identification.

Repeat Non-Compliance Rate is a new measure and will be used as an indicator in FY 2019. 

It measures the percentage of individual taxpayers with repeat non-compliance two years after 

the initial tax year for filing, payment, or reporting compliance. This measure supports 

expedited document matching, enhanced anomaly detection leading to faster issue 

identification, and Enterprise Case Management. It also promotes improved customer service 

through expanded access to new self-correction capabilities and improved behavioral 

analytics. It allows the IRS to better understand and change non-compliant taxpayer behavior. 

Description of FY 2018 Performance ‒ Collection

The Collection program collects delinquent taxes, secures delinquent tax returns through the 

fair and equitable application of tax laws, and provides education to customers to promote 

future compliance. The performance goals that the IRS uses to gauge collection program 

performance are discussed below.

The Collection Coverage measure is calculated by taking the total volume of collection work 

disposed (i.e., completed) divided by total collection work available. In FY 2018, Collection 

Coverage was 41.6 percent, exceeding the target of 38.6 percent. Net dispositions decreased 

1 percent compared to FY 2017 (20.4 million vs. 20.6 million). Beginning Inventory, and 

Returned to Inventory cases decreased 0.6 percent and 6.9 percent, respectively, while New 

Issuance Receipts and Reissuances increased 13.5 percent and 75 percent, respectively. The 

IRS will set a target of 40.1 percent for FY 2019 and 38.3 percent in FY 2020 based on the 

most recent disposition and inventory projections. 
IRS-50 

The Collection Efficiency measure is the volume of collection work disposed divided by total 

collection FTE. In FY 2018, Collection Efficiency was 2,216, exceeding the target of 2,101. 

While FTEs declined almost 5 percent, total closures decreased only one percent compared to 

FY 2017 with improved efficiency (2,216 vs. 2,135). This measure will be discontinued from 

budget reporting in FY 2019. 

The Field Collection Quality measure is calculated by taking the quality attributes reviewed 

and determined to be correct by a third-party quality reviewer divided by the total number of 

quality attributes reviewed. In FY 2018, the Field Collection National Quality Review Score 

was 79.2 percent, exceeding the target of 78 percent. The advanced technical training 

conducted in FY 2018 was a major contributor to improved quality scores. This measure will 

be discontinued from budget reporting in FY 2019 but maintained by the program office as 

required by the IRS Restructuring and Reform Act of 1998. 

The Automatic Collection System (ACS) Accuracy measure reflects the percentage of correct 

responses from a random weighted sampling of calls selected for quality review by the 

Centralized Quality Review System. In FY 2018, the ACS Accuracy was 94.0 percent, below 

the target of 95 percent. Factors such as new hires and more complex work contributed to the 

shortfall. Additionally, two new call sites in Ogden and Cincinnati stood up and were added 

to the quality results in May 2018. This measure will be discontinued from budget reporting 

in FY 2019. 

The Cost to Collect $100 (in cents) measure is an existing metric that has not been reported 

with the Budget request before and will be used as an indicator in FY 2019. This measure is 

computed as total operating costs divided by gross collection divided by 100. 

FY 2020 Changes by Budget Activity 

Dollars in thousands

Exam and Collections FTE Amount

FY 2019 Annualized CR Level 30,084 $3,894,129

Changes to Base:

Maintaining Current Levels (MCLs) $4,630

Non-Pay 4,630

Efficiency/Savings ($700)

Non-Recur for Section 112 Tax Reform Funding (700)

Subtotal FY 2020 Changes to Base $3,930

FY 2020 Current Services 30,084 $3,898,059

Program Changes:

Program Increases 130 $25,524

Data Analytics to Enhance Compliance 129 18,422

Prevent Identity Theft 1 7,102

O&M of Critical Systems

Subtotal FY 2020 Program Increases 130 $25,524

Total FY 2020 Request 30,214 $3,923,583

See footnotes in 1.1 -- Appropriations Detail Table
IRS-51 

2.1.4 – Budget and Performance Report and Plan

2E – Regulatory ($167,739,000 in direct appropriations and an estimated $362,000 from 

reimbursable programs): This budget activity funds the development of published IRS 

guidance materials; interpretation of tax laws; internal advice to IRS on general non-tax legal 

issues; enforcement of regulatory rules, laws, and approved business practices; and support 

for taxpayers in the areas of pre-filing agreements, determination letters, and advance pricing 

agreements. The activities include:

• Tax Law Interpretation and Published Guidance interprets tax law through published

guidance, technical advice, and other technical legal services.

• General Legal Services provides advice to the IRS on non-tax legal issues, including

procurement, personnel, labor relations, equal employment opportunity, fiscal law, tort

claims and damages, ethics, and conflict of interest.

Exam and Collections FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Resource Level Actual Actual Actual Actual Enacted Annualized CR Request

Appropriated Resources1 $4,154,342 $4,018,292 $3,945,578 $3,901,041 $3,875,098 $3,894,129 $3,923,583

Reimbursable Resources2 640 456 450 3,289 102 107

User Fees2 36 43

Budget Activity Total $4,154,342 $4,018,932 $3,946,070 $3,901,491 $3,878,387 $3,894,274 $3,923,690

1

The FY 2014 - FY 2018 appropriated resources represents the approved operating plan including any inter-BAC transfers and inter-appropriation transfers.

2

The FY 2014 - FY 2018 columns represent realized resources for reimbursables and user fees.

Exam and Collections FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Measures Actual Actual Actual Actual Actual Target Target Target

Examination Coverage - Individual (Oe) 0.9% 0.8% 0.7% 0.6% 0.6% 0.6% 0.5% 0.5%

Field Exam National Quality Review Score (Oe)1 88.4% 86.7% 86.8% 85.0% 89.1% 84.4% DISC

Office Exam National Quality Review Score (Oe)1 90.6% 88.3% 88.4% 87.9% 87.2% 86.7% DISC

Examination Quality - Large Business (Oe)1

83.0% 86.0% 83.0% 78.0% 76.0% 90.0% DISC

Examination Coverage - Business (Assets > $10 million) (Oe) 4.3% 3.9% 3.0% 2.5% 2.2% 2.4% 2.2% 1.5%

Examination Efficiency - Individual (E) 138 148 143 121 131 134 122 122

Automated Underreporter (AUR) Efficiency (E)1 1,935 2,209 2,196 2,188 2,205 2,133 DISC

Automated Underreporter (AUR) Coverage (E) 2.6% 2.3% 2.3% 2.2% 2.0% 1.9% 1.6% 1.7%

Time to Start Compliance Resolution (E, L)2 N/A Indicator

Time to Resolve Compliance Issue After Filing (E)2

N/A Indicator

Repeat Non-Compliance Rate (Ot)2 N/A Indicator

Collection Coverage - Units (Ot) 45.9% 46.3% 43.4% 42.2% 41.6% 38.6% 40.1% 38.3%

Collection Efficiency - Units (E)1 2,051 2,448 2,266 2,135 2,216 2,101 DISC

Field Collection National Quality Review Score (Ot)1 81.6% 79.2% 79.2% 76.7% 79.2% 78.0% DISC

Automated Collection System (ACS) Accuracy (Oe)1 95.2% 95.3% 95.4% 94.7% 94.0% 95.0% DISC

Cost to Collect $100 (in cents) (E)2 0.38 0.35 0.35 0.34 Indicator 

2

New measure added for FY 2019

Dollars in thousands

Key: Oe - Outcome Measure, E - Efficiency Measure, L - Strategic Plan Goal, Ot - Output/Workload Measure

1

Discontinued (DISC) for FY 2019
IRS-52 

• Rulings and Agreements applies the tax law to specific taxpayers in the form of

pre-filing agreements, determination letters, advance pricing agreements, and other

pre-filing determinations and advice.

• International Regulatory Legal Support supports Counsel’s work in tax law

interpretation and rulings and agreements related to international issues.

• Return Preparer Strategy provides staffing, training, and direct support associated

with the Return Preparer Strategy.

• Office of Professional Responsibility identifies, communicates, and enforces Treasury

Circular 230 standards of competence, integrity, and conduct of those who represent

taxpayers before the IRS, including attorneys, Certified Public Accountants (CPAs),

enrolled agents, enrolled actuaries and appraisers, and other professionals.

Description of FY 2018 Performance 

Tax Exempt and Government Entities (TE/GE) Determination Case Closures includes both 

applications for tax-exempt status for employee retirement plans and applications from 

various charitable entities seeking tax-exempt status. The IRS reviews applications to 

determine eligibility and closes them upon approval or disapproval. In FY 2018, TE/GE

completed 98,249 Determination Case Closures, exceeding the target of 94,103. Employee 

Plans (EP) Determinations Division of TE/GE began the year with 71 technical employees. 

With a significant decrease in submissions, in November 2017, EP Determinations Division 

started to realign non‐Determination work to all employees. This process allowed for 

additional support for the Voluntary Compliance and EP Exam Divisions within TE/GE to 

assist with their workload. Exempt Organization (EO) Determinations will explore ways to 

increase the number of closures in a shorter period, thus striving to close more cases in FY 

2019 than originally planned through piloting new methods. This measure will be 

discontinued from budget reporting in FY 2019 

FY 2020 Changes by Budget Activity 

Dollars in thousands

Regulatory FTE Amount

FY 2019 Annualized CR Level 1,072 $180,213

Changes to Base:

Maintaining Current Levels (MCLs) $454

Non-Pay 454

Efficiency/Savings ($13,017)

Reduce Contractual Services (1,717)

Non-Recur for Section 112 Tax Reform Funding (11,300)

Subtotal FY 2020 Changes to Base ($12,563)

FY 2020 Current Services 1,072 $167,650

Program Changes:

Program Increases 1 $88

Data Analytics to Enhance Compliance 1 88

O&M of Critical Systems

Subtotal FY 2020 Program Increases 1 $88

Total FY 2020 Request 1,073 $167,738

See footnotes in 1.1 -- Appropriations Detail Table
IRS-53 

2.1.5 – Budget and Performance Report and Plan

Regulatory FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Resource Level Actual Actual Actual Actual Enacted Annualized CR Request

Appropriated Resources1 $158,415 $147,605 $137,245 $131,662 $170,222 $180,213 $167,739

Reimbursable Resources2 792 363 202 160 593 344 362

User Fees2 13,241 18,485 9,233 9,537

Budget Activity Total $172,448 $166,453 $146,680 $141,359 $170,815 $180,557 $168,101

1

The FY 2014 - FY 2018 appropriated resources represents the approved operating plan including any inter-BAC transfers and inter-appropriation transfers.

2

The FY 2014 - FY 2018 columns represent realized resources for reimbursables and user fees.

Regulatory FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Measure Actual Actual Actual Actual Actual Target Target Target

TE/GE Determination Case Closures (Ot)1 136,746 111,940 99,973 102,749 98,249 94,103 DISC

Key: Ot - Output/Workload Measure

1

Discontinued (DISC) for FY 2019

Dollars in thousands



IRS-54 

Operations Support

Appropriation Description

The Operations Support appropriation provides funding for overall planning, direction, and 

support for the IRS, including shared service support related to facilities services, rent 

payments, printing, postage, and security. This appropriation funds headquarters policy and 

management activities such as corporate support for strategic planning; communications and 

liaison; finance; human resources; equity, diversity, and inclusion; research and statistics of 

income; and necessary expenses for information systems and telecommunication support, 

including development, security, and maintenance of the IRS’s information systems.

The Operations Support budget request for FY 2020 is $4,075,021,000 in direct 

appropriations and 10,683 FTE, excluding the proposed program integrity cap adjustment. 

This is an increase of $241,021,000, or 6.29 percent, and 343 FTE more than the FY 2019 

Annualized Continuing Resolution of $3,834,000,000 and 10,340 FTE. The FY 2019 

Annualized Continuing Resolution level includes a $200 million inter-appropriation transfer 

from Enforcement to Operations Support to cover anticipated operations and maintenance 

requirements in FY 2019. 
IRS-55 

2.1 – Budget Adjustments Table

Dollars in thousands

Operations Support

Summary of Proposed FY 2020 Request FTE Amount

FY 2019 Annualized CR Level1 10,340 $3,834,000

Changes to Base:

Other Adjustments 163 $101,636

Offset to O&M for Critical IT Systems 163 101,636

Maintaining Current Levels (MCLs) $41,155

Non-Pay Inflation Adjustment 41,155

Efficiencies/Savings: ($24,804)

Increase e-File Savings (104)

Space Optimization (24,700)

Subtotal FY 2019 Changes to Base 163 $117,987

FY 2019 Current Services 10,503 $3,951,987

Program Changes:

Program Increases

Data Analytics to Enhance Compliance 16 5,363

Prevent Identity Theft 2 10,122

O&M of Prior-year Enterprise-wide Cybersecurity Investments 6,744

O&M of Critical Systems 162 100,805

Subtotal FY 2019 Program Increases 180 $123,034

Total FY 2020 Budget Request 10,683 $4,075,021

See footnotes in 1.1 -- Appropriations Detail Table
IRS-56 

2.2 – Operating Levels Table

Dollars in thousands

Operations Support

Object Classification

FY 2018

Enacted

FY 2019

Annualized CR

FY 2020

Request

11.1 Full-Time Permanent Positions 1,100,060 1,117,741 1,154,274

11.3 Other than Full-Time Permanent Positions 3,980 5,839 5,960

11.5 Other Personnel Compensation 25,111 21,985 22,399

11.8 Special Personal Services Payments 441 472 472

11.9 Personnel Compensation (Total) 1,129,592 1,146,037 1,183,105

12.1 Personnel Benefits 376,366 383,648 394,989

13.0 Benefits to Former Personnel 338 347 347

Total Personnel and Compensation Benefits $1,506,296 $1,530,032 $1,578,441

21.0 Travel 14,201 18,652 19,268

22.0 Transportation of Things 13,171 12,950 13,240

23.1 Rental Payments to GSA 589,683 590,575 578,055

23.2 Rent Payments to Others 12,050 12,167 12,410

23.3 Communications, Utilities, & Misc 289,783 330,117 356,020

24.0 Printing & Reproduction 24,106 19,161 19,575

25.1 Advisory & Assistance Services 866,878 648,579 741,804

25.2 Other Services 36,840 30,162 38,744

25.3 Purchase of Goods & Services from Govt. Accounts 79,806 82,898 85,534

25.4 Operation & Maintenance of Facilities 186,027 189,244 193,458

25.5 Research & Development Contracts 6

25.6 Medical Care 14,549 14,966 15,327

25.7 Operation & Maintenance of Equipment 66,654 66,844 81,612

26.0 Supplies and Materials 9,806 8,865 9,099

31.0 Equipment 450,680 272,399 325,549

32.0 Land and Structures 20,225 5,610 6,090

42.0 Insurance Claims & Indemnities 239 779 795

Total Non-Personnel $2,674,704 $2,303,968 $2,496,580

New Appropriated Resources $4,181,000 $3,834,000 $4,075,021

Budget Activities:

Infrastructure 870,360 858,932 853,738

Shared Services & Support 920,283 942,568 953,686

Information Services 2,390,357 2,032,500 2,267,597

New Appropriated Resources $4,181,000 $3,834,000 $4,075,021

FTE 10,389 10,340 10,683

See footnotes in 1.1 -- Appropriations Detail Table
IRS-57 

2.3 – Appropriation Detail Table 

2F – Infrastructure ($853,738,000 in direct appropriations and an estimated $730,000 from 

reimbursable programs): This budget activity funds administrative services related to space

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

non-IT equipment. The program activities include:

• Building Delegation oversees and manages the IRS GSA-delegated buildings,

including cleaning, maintenance, utilities, protection, administrative, and recurring and

one-time repair costs.

• Rent provides resources for all IRS rent needs.

• Space and Housing/Non-IT Equipment provides management of all IRS building

services, maintenance, space alterations, guard services, custodial overtime, utility

service needs, and non-IT equipment.

• Security covers all physical security costs, including guard services, security

equipment and maintenance, countermeasures, Homeland Security Presidential

Directive 12 (HSPD-12) and Treasury Enterprise Identity Credential and Access

Management (TEICAM).

Description of FY 2018 Performance 

The IRS continued to release excess office space through building closures and 

consolidations. 

The Rentable Square Feet per Person indicator is the amount of rentable square feet the IRS 

maintains per person requiring space. Through FY 2018, the Rentable Sq. Ft. per Person was 

301 compared to 297 in FY 2017. The IRS continued to release excess office space through 

building closures and consolidations. The IRS released 10 buildings and 492,110 square feet 

Dollars in thousands

Operations Support

Appropriated Resources

FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

New Appropriated Resources:

Infrastructure 870,360 858,932 853,738 (5,194) -0.60%

Shared Services and Support 4,315 920,283 4,269 942,568 4,287 953,686 18 11,118 0.42% 1.18%

Information Services 6,074 2,390,357 6,071 2,032,500 6,396 2,267,597 325 235,097 5.35% 11.57%

Subtotal New Appropriated Resources 10,389 $4,181,000 10,340 $3,834,000 10,683 $4,075,021 343 $241,021 3.32% 6.29%

Other Resources:

Reimbursables 69 69,257 84 48,822 84 51,263 2,441 5.00%

Offsetting Collections - Non Reimbursables

User Fees 205,052 411,000 427,000 16,000 3.89%

Recovery from Prior Years 9,752 10,830 11,741 911 8.41%

Unobligated Balances from Prior Years 91,901 192,377 63,482 (128,895) -67.00%

Transfers In/Out 36,770

Resources from Other Accounts

Subtotal Other Resources 69 $412,732 84 $663,029 84 $553,486 ($109,543) -16.52%

Total Budgetary Resources 10,458 $4,593,732 10,424 $4,497,029 10,767 $4,628,507 343 $131,478 3.29% 2.92%

FY 2019 to FY 2020 

Request

FY 2020

Request

FY 2019 to FY 2020 

Request

Change % Change

See footnotes in 1.1--Appropriations Detail Table

FY 2019

Annualized CR

FY 2018

Enacted
IRS-58 

of space from its portfolio in FY 2018, which will generate about $10.5 million in annual rent 

savings. The IRS expanded the number of offices that incorporate hoteling or shared 

workspace for employees and contractors who do not require full-time space. The IRS also 

intends to place new hires in existing space and renew leases at existing sites rather than 

opening new locations, when cost effective and when permitted by procurement regulations. 

These and other actions will help limit projected rent cost increases. The IRS also is 

analyzing how the submission processing ramp downs in Covington, KY and Fresno, CA 

might affect office space needs at those locations. 

FY 2020 Changes by Budget Activity 

2.1.6 – Budget and Performance Report and Plan

2G – Shared Services and Support ($953,686,000 in direct appropriations, and an 

estimated $30,447,000 from reimbursable programs): This budget activity funds policy 

management, IRS-wide support for research, strategic planning, communications and liaison, 

finance, human resources, and equity, diversity, and inclusion programs. It also funds 

printing and postage, business systems planning, security, legal services, and procurement. 

The program activities include: 

Dollars in thousands

Infrastructure FTE Amount

FY 2019 Annualized CR Level $858,932

Changes to Base:

Maintaining Current Levels (MCLs) $17,176

Non-Pay 17,176

Efficiency/Savings ($24,700)

Space Optimization (24,700)

Subtotal FY 2020 Changes to Base ($7,524)

FY 2020 Current Services $851,408

Program Changes:

Program Increases $2,330

Data Analytics to Enhance Compliance 1,889

Prevent Identity Theft 441

Subtotal FY 2020 Program Increases $2,330

Total FY 2020 Request $853,738

See footnotes in 1.1 -- Appropriations Detail Table

Infrastructure FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Resource Level Actual Actual Actual Actual Enacted Annualized 

CR Request

Appropriated Resources1 $845,558 $833,846 $838,048 $856,655 $870,360 $858,932 $853,738

Reimbursable Resources2 16,694 928 626 634 662 695 730

User Fees2 17,137 1,000

Budget Activity Total $879,389 $834,774 $838,674 $857,289 $871,022 $860,627 $854,468 1

The FY 2014 - FY 2018 appropriated resources represents the approved operating plan including any inter-BAC transfers and inter-appropriation transfers.

2

The FY 2014 - FY 2018 columns represent realized resources for reimbursables and user fees.

Infrastructure FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Measure Actual Actual Actual Actual Actual Target Target Target

Rentable Square Feet per Person (new for FY 2017) (Ot, L) 297 301 Indicator

Dollars in thousands

Key: Ot - Output/Workload Measure L - Strategic Plan Goal
IRS-59 

• National Headquarters Management and Administration directs the management

activities of strategic planning, communications and liaison, finance, human resources,

equity, diversity and inclusion programs, business systems planning, embedded

training, and the Treasury Franchise Fund. It sets policies and goals, provides

leadership and direction for the IRS, and builds partner relationships with key

stakeholders (Congress, GAO, OMB, and the Oversight Board). It provides policy

guidance for conducting planning and budgeting strategies, conducting analyses of

programs and investments to support strategic decision-making, and developing and

managing human resources. It also includes official reception and representation

expenses.

• Facilities Management & Security Services provides facilities and security services to

deliver a safe, secure and optimal work environment to IRS customers.

• Procurement supports the procurement function of the IRS.

• Equity, Diversity and Inclusion Field Services provides staffing, training, and direct

support to plan and manage the IRS’s Equity, Diversity and Inclusion program.

• Communications and Liaison coordinates local government and liaison relationships;

handles congressional, state, and national stakeholder relationships and issues;

coordinates cross-cutting issues, including managing audits and legislative

implementation; handles national media contacts and local media relationships; and

ensures IRS-wide compliance with disclosure and privacy laws.

• Employee Support Services plans and manages financial services, including relocation,

travel, purchase cards, corporate express, and employee clearances.

• Treasury Complaint Centers plan and manage the Treasury Complaint Centers.

• Shared Support not provided by Agency-Wide Shared Services provides resources for

shared cross-functional support, such as postage meters, shredders, courier services,

and post office boxes.

• Printing and Postage – Media and Publications provides operating divisions with

printing and postage, including shipping of taxpayer and internal-use materials.

• Statistics of Income provides resources for researching annual income, financial, and

tax data from tax returns filed by individuals, corporations, and tax-exempt

organizations.

• Research provides resources for market-based research to identify compliance issues,

for conducting tests of treatments to address noncompliance, and for the

implementation of successful strategies to address taxpayer noncompliance behavior.

• Protection of Sensitive Information manages and oversees the staffing, training,

equipment, and direct support for the protection of IRS employees, facilities, and

assets, and the protection and proper use of identity information.

• Wage and Investment (W&I) Business Modernization Support provides staffing,

training, and direct support for W&I’s enterprise-wide business modernization efforts,

including Customer Account Data Engine 2 (CADE 2) and Account Management

Services (AMS) technology solutions, and re-engineered business processes.
IRS-60 

Description of FY 2018 Performance 

Through support activities that include management and administration of human resources, 

security, and research, Operations Support continues to provide shared services to all IRS 

programs. 

Human Capital 

The future of the IRS depends on a workplace culture that empowers employees to improve 

the taxpayer experience and uphold the tax code fairly. In FY 2018, the IRS: 

• Worked with all Treasury Bureaus to procure a Treasury-wide Integrated Talent

Management (ITM) system. Continued to focus on encouraging the transfer of

institutional knowledge and developed three strategies for a Service-wide approach to

knowledge management solutions based on four best practice pillars: promote

collaboration (Connect), knowledge capture before employee separation (Learn), data

sharing (Share), and build employee expertise (Improve). These strategies include:

o A centralized online content repository (virtual library and video library) to

capture and transfer best practices from an experienced workforce

o A learning portal designed to consolidate various resources into a one-stop site

for all aspects of training, course development, curriculum development, and

career enhancement; and

o A corporate interactive platform to identify and transfer knowledge and

expertise across all IRS business organizations.
IRS-61 

Security 

Security of taxpayer data and providing a secure environment for employees are of utmost 

importance to the IRS. In FY 2018, the IRS: 

• Continued to improve the physical security of IRS facilities against internal and

external threats

• Improved authentication by launching a tool, Identity Verify (IDVerify), for the

Taxpayer Protection Program (TPP), that allows taxpayers to answer three simple

questions to confirm their identity and validate suspected identity theft returns with

functions such as See Balance Due and a link to Make a Payment.

• Developed indicators and models to detect and prevent fraudulent activity in IRS

online applications.

The IRS worked on several initiatives related to the Security Summit, a collaborative effort 

between the IRS, state tax administrators and private-sector tax partners. In FY 2018, the 

IRS:

• Conducted awareness campaigns for tax professionals – Protect Your Clients; Protect

Yourself: Don’t Take the Bait – and for taxpayers – National Tax Security Awareness

Week – because everyone has a role in fighting identity theft.

• Held a summer campaign – Protect Your Clients; Protect Yourself: Tax Security 101 –

which featured 10 news releases. In addition to raising awareness, the series helped

support identity theft education efforts at five Nationwide Tax Forum sessions

attended by more than 10,000 tax professionals.

• Conducted the second Tax Security Awareness Week, which generated news articles

across the country following 32 local press and partner events. In all, 24 state revenue

departments and dozens of other partner groups participated.

Research

The IRS invests in research to improve its ability to make data-driven decisions to improve 

operational outcomes. In FY 2018, the IRS delivered the first Enterprise Research Plan, a 

comprehensive document that contains active links to the Research and Analytic Project 

Repository and a database of more than 1,200 active and closed research projects. 

The plan established a new data and analytics steering group to create an enterprise 

framework to improve coordination, decision making, and alignment of data and analytics 

initiatives across business units. 
IRS-62 

2.1.7 – Budget and Performance Report and Plan 

2H – Information Services ($2,267,597,000 in direct appropriations, $20,086,000 in 

reimbursable resources, and $427,000,000 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 mainframes, 

servers, personal computers, networks, and a variety of management information systems. 

The program activities include: 

• Enterprise Program Management Office (EPMO) provides oversight and project

integration into daily IT processes for large-scale development, modernization and

enhancement projects. It enables a coordinated, cross-functional project planning,

implementation and performance assessment effort aimed at improving IT systems

quality, cost and delivery schedule.

• Security Services ensures effective security policies and programs to safeguard

taxpayer records, IRS employees, facilities, business processes, systems and other

resources. The program is responsible for corrective action efforts to establish

adequate service-wide security, including Security Policy Support and Oversight,

Mission Assurance, and Modernization Security.

• IT Executive Oversight provides support to the immediate Office of the Chief

Information Officer, and the Stakeholder Management (including Communications

Services and Program Oversight). The program provides executive direction for the

Dollars in thousands

Shared Services and Support FTE Amount

FY 2019 Annualized CR Level 4,270 $942,568

Changes to Base:

Maintaining Current Levels (MCLs) $7,246

Non-Pay 7,246

Subtotal FY 2020 Changes to Base $7,246

FY 2020 Current Services 4,270 $949,814

Program Changes:

Program Increases 16 $3,872

Data Analytics to Enhance Compliance 14 2,189

Prevent Identity Theft 2 1,683

Subtotal FY 2020 Program Increases 16 $3,872

Total FY 2020 Request 4,286 $953,686

See footnotes in 1.1 -- Appropriations Detail Table

Shared Services and Support FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Resource Level Actual Actual Actual Actual Enacted Annualized 

CR Request

Appropriated Resources1 $1,127,931 $1,126,230 $1,090,192 $964,702 $920,283 $942,568 $953,686

Reimbursable Resources2 19,886 17,126 19,443 19,194 27,995 28,997 30,447

User Fees2 7,819 1,768 1,000 1,000 1,000

Budget Activity Total $1,155,636 $1,145,124 $1,110,635 $984,896 $949,278 $971,565 $984,133

1

The FY 2014 - FY 2018 appropriated resources represents the approved operating plan including any inter-BAC transfers and inter-appropriation transfers.

2

The FY 2014 - FY 2018 columns represent realized resources for reimbursables and user fees.

Dollars in thousands
IRS-63 

IT organization, enabling IT to be a customer-focused supplier of IT solutions that is

responsive to customer business priorities and meets functional and operational needs 

effectively.

• Application Development performs the analysis, design, development, testing, and

implementation of about 85,000 application programs supporting critical tax

processing, management information reporting and financial management support

systems for the IRS. This program also supports external trading partner data

exchanges with federal government agencies, state and local governments, and other

third-party entities. The program controls application source code and deploys

applications to the production environment.

• Enterprise Operations designs, develops, and maintains IT that supports critical tax

processing, management information reporting, and financial management support

systems for the IRS. It supports data exchanges with external organizations, such as

other federal agencies, state and local governments, and external entities (e.g.,

employers and banks), and includes a comprehensive disaster recovery capability to

ensure continued operations in the event of a major interruption of service.

• Enterprise Network provides telecommunications service delivery to all customer

segments, including management of day-to-day operations of the telecommunications

environment. This includes the operation of equipment and services to meet business

user needs and the execution of routine changes for scheduled and unscheduled

modifications to the telecommunications infrastructure and applications. It addresses

all phases of engineering, acquisition, implementation, and operation of

telecommunications systems and services, including voice, video, and data

communications.

• Enterprise Services plans and manages service and delivery methods used across the

IT organization, including demand analysis, enterprise architecture, configuration

management, project reporting, enterprise life cycle management, release

management, systems engineering, dashboard reporting, and internal management.

• End User & Network Services maintains the IRS automated business processes at

headquarters and field sites, effectively allowing the IRS to fulfill its missions. The

support includes technical systems and applications software support to end users,

maintaining legacy operations, local and corporate systems administration activities,

email and domain user account maintenance. This activity monitors IRS network and

systems administration by utilizing automated management tools. It performs asset

management activities, and maintenance of the voice and data infrastructure at the

territory offices.

• Strategy and Planning provides the management and oversight of investments in IT,

demand analysis, project reporting, portfolio management, financial management,

acquisition planning, and other IT operational priorities.

• Information Technology Security Certification and Accreditation provides design and

operations of security controls and the technical mechanisms used by the IRS systems

and applications as part of the development of the system security plan, system risk

assessment, and IT contingency plan. It also supports security testing and evaluation
IRS-64 

as part of the certification process, including time preparing system documentation, 

interviewing contractors, and responding to information requests. 

• Disaster Recovery supports activities related to Enterprise Disaster Recovery

planning, including testing, evaluations, plan development, and technical and business

assessments.

• Infrastructure Currency (IC) funds the upgrade or replacement of outdated and aged

technology solutions related to the IT hardware, software and applications

development product portfolio.

• IT Infrastructure centralizes the resources achieved through efficiencies in various

parts of IT to ensure that replacement of the aging infrastructure is addressed

corporately.

Description of FY 2018 Performance 

The Percent of Aged Hardware is a new measure and shows the quantity of IT hardware in 

operation past its useful life as a percentage of total hardware in use. For FY 2018, the 

Percent of Aged Hardware was 45.5 percent versus 52.3 percent in FY 2017. The nearly 

seven percentage point reduction in FY 2018 from FY 2017 was attributable to: 

• Replacing nearly 21,000 assets aging during FY 2018 to prevent growth in IRS aged

hardware inventory; and,

• Removing certain asset categories (fax machines, low-end printers and scanners) that

are no longer being actively refreshed from the aged calculation to define the

inventory that is reflective of risk to the Information Technology (IT) environment

more accurately.

For FY 2019 and FY 2020, the IRS will lower the target to 43.8 percent and 39 percent 

respectively, as the IRS continues to dedicate funding to reducing the backlog. The measure 

definition changed in FY 2018, removing certain asset categories (fax machines, low-end 

printers and scanners) that are no longer being actively refreshed from the calculation to more 

accurately define the inventory that is reflective of risk to the IT environment. The IRS will 

monitor progress against FY 2019 aged hardware replacement targets. 
IRS-65 

FY 2020 Changes by Budget Activity 

2.1.8 – Budget and Performance Report and Plan 

Dollars in thousands

Information Services FTE Amount

FY 2019 Annualized CR Level 6,071 $2,032,500

Changes to Base:

Other Adjustments 163 $101,636

Offset to O&M for Critical IT Systems 163 101,636

Maintaining Current Levels (MCLs) $16,733

Non-Pay 16,733

Efficiency/Savings ($104)

Increase e-File Savings (104)

Subtotal FY 2020 Changes to Base 163 $118,265

FY 2020 Current Services 6,234 $2,150,765

Program Changes:

Program Increases 163 $116,831

Data Analytics to Enhance Compliance 1 1,284

Prevent Identity Theft 7,998

O&M of Prior-year Enterprise-wide Cybersecurtiy Investments 6,744

O&M of Critical Systems 162 100,805

Subtotal FY 2020 Program Increases 163 $116,831

Total FY 2020 Request 6,397 $2,267,596

See footnotes in 1.1 -- Appropriations Detail Table

Information Services FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Resource Level Actual Actual Actual Actual Enacted Annualized 

CR Request

Appropriated Resources1 $1,749,110 $1,641,360 $1,883,667 $1,950,191 $2,390,357 $2,032,500 $2,267,597

Reimbursable Resources2 4,734 24,262 19,660 35,307 40,600 19,130 20,086

User Fees2 198,206 373,610 263,250 201,584 204,032 410,000 427,000

Budget Activity Total $1,952,050 $2,039,232 $2,166,577 $2,187,082 $2,634,989 $2,461,630 $2,714,683

1

The FY 2014 - FY 2018 appropriated resources represents the approved operating plan including any inter-BAC transfers and inter-appropriation transfers.

2

The FY 2014 - FY 2018 columns represent realized resources for reimbursables and user fees.

Information Services FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Measures Actual Actual Actual Actual Actual Target Target Target

Percent of Aged Hardware (Ot, L)1

56.5% 52.2% 52.3% 45.5% 53.1% 43.8% 39.0%

Key: Ot - Output/Workload Measure L - Strategic Plan Goal

Dollars in thousands

1 This is a new budget level metric; the measure definition changed in FY 2018; removing certain asset categories (fax machines, low-end printers and scanners) that are no longer 

being actively refreshed from the calculation to more accurately define the inventory that’s reflective of risk to the IT environment. 



IRS-66 

Business Systems Modernization 

Appropriation Description 

The Business Systems Modernization (BSM) appropriation provides resources for the 

planning and capital asset acquisition of IT to modernize the IRS business systems. 

The BSM budget request for FY 2020 is $290,000,000 in direct appropriations and 441 FTE. 

This amount is an increase of $180,000,000, or 163.64 percent, and 80 FTE more than the 

FY 2019 Annualized Continuing Resolution level of $110,000,000 and 361 FTE. 
IRS-67 

2.1 – Budget Adjustments Table 

2.2 – Operating Levels Table 

Dollars in thousands

Business Systems Modernization

Summary of Proposed FY 2020 Request FTE Amount

FY 2019 Annualized CR Level1 361 $110,000

FY 2019 Current Services 361 $110,000

Program Changes:

Program Increases

IRS Technology Modernization Plan 80 180,000

Subtotal FY 2019 Program Increases 80 $180,000

Total FY 2020 Budget Request 441 $290,000

See footnotes in 1.1 -- Appropriations Detail Table

Dollars in thousands

Business Systems Modernization

Object Classification

FY 2018

Enacted

FY 2019

Annualized CR

FY 2020

Request

11.1 Full-Time Permanent Positions 32,448 45,455 55,702

11.3 Other than Full-Time Permanent Positions 427 27 27

11.5 Other Personnel Compensation 810 391 535

11.9 Personnel Compensation (Total) 33,685 45,873 56,264

12.1 Personnel Benefits 11,016 13,703 17,095

Total Personnel and Compensation Benefits $44,701 $59,576 $73,359

21.0 Travel 133 301 437

25.1 Advisory & Assistance Services 63,067 41,625 178,355

25.2 Other Services 9 13 93

25.3 Purchase of Goods & Services from Govt. Accounts 4 5 5

25.7 Operation & Maintenance of Equipment 1,211 561 2,303

26.0 Supplies and Materials 6 17 17

31.0 Equipment 869 7,902 35,431

Total Non-Personnel $65,299 $50,424 $216,641

New Appropriated Resources $110,000 $110,000 $290,000

Budget Activities:

IT Investments 110,000 110,000 290,000

New Appropriated Resources $110,000 $110,000 $290,000

FTE 219 361 441

See footnotes in 1.1 -- Appropriations Detail Table
IRS-68 

2.3 – Appropriation Detail Table 

2I – Business Systems Modernization ($290,000,000 in direct appropriations, and 

$30,000,000 in user fees): This budget activity funds the planning and capital asset 

acquisition of information technology (IT) to modernize IRS business systems, including 

labor and related contractual costs.

The IRS is implementing its multiyear Modernization Plan to address the long-term 

sustainability and affordability of its technological environment. The Plan will define the 

scope of projects, set timelines and target, describe milestones, and ultimately, include 

outcome measures for the investment. 

In FY 2020, the funding for the Modernization Plan is reflected in four pillars: Taxpayer 

Experience, Core Taxpayer Services and Enforcement, Modernized IRS Operations, and 

Cybersecurity and Data Protection and is further defined by investments in the Business 

Systems Modernization appropriation. 

Taxpayer Experience: +$40 million / +95 FTE 

By funding Taxpayer Experience modernization investments, the IRS expects to achieve the 

following outcomes and will measure performance using the key indicators in the table below. 

Dollars in thousands

Business Systems Modernization

Appropriated Resources

FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

New Appropriated Resources:

Business Systems Modernization 219 110,000 361 110,000 441 290,000 80 180,000 22.16% 163.64%

Subtotal New Appropriated Resources 219 $110,000 361 $110,000 441 $290,000 80 $180,000 22.16% 163.64%

Other Resources:

Reimbursables

Offsetting Collections - Non Reimbursables

User Fees 77,418 139,010 30,000 (109,010) -78.42%

Recovery from Prior Years 3,164 3,164

Unobligated Balances from Prior Years 236 193,528 120 133,530 100 34,095 (20) (99,435) -16.67% -74.47%

Transfers In/Out

Resources from Other Accounts

Subtotal Other Resources 236 $270,946 120 $275,704 100 $67,259 (20) ($208,445) -16.67% -75.60%

Total Budgetary Resources 455 $380,946 481 $385,704 541 $357,259 60 ($28,445) 12.47% -7.37%

FY 2019

Annualized CR

FY 2018

Enacted

See footnotes in 1.1--Appropriations Detail Table

Change % Change

FY 2019 to FY 2020 

Request

FY 2019 to FY 

2020 Request

FY 2020

Request

Modernization Plan 

Pillar Expected Outcomes Key Performance Indicators

Pillar 1:

Taxpayer Experience 

 Provide an option for customers to

receive a call back rather than wait on

the phone

 Reduce in-person visits by identity

theft victims through an online ID

verification service

 Make online tax payments easier and

more secure

 Enterprise SelfAssistance Participation

Rate

 Percentage (%) of

taxpayers offered a

callback that accept it

 Percentage (%) of notices

available electronically
IRS-69 

Web Applications (+$25 million / +91 FTE) – WebApps delivers a secure, unified online 

experience, accessible through a single online account. It provides taxpayers and business 

users accurate account information, transparent explanations and next steps to resolve 

tax-related issues, along with full-service payment options. This allows taxpayers to resolve 

more issues online with fewer direct interactions with the IRS over the telephone and in 

person. In FY 2020, Web Applications will continue to develop the capability for taxpayers 

to create and submit installment agreements online. 

Expected Benefits: 

• Eliminate the requirement for in-person visits by identify theft victims through an

online ID verification service;

• Make online tax payments easier; and

• Enable tax professionals to quickly and securely sign powers of attorney online.

Taxpayer Digital Communications Online Notice ($5 million / 4 FTE) – Taxpayer Digital 

Communications Online Notice (TDC-ON) will improve the user experience through the 

proliferation of reliable, user-friendly, secure online services. Funding will be used to 

develop digital notices through the secure messaging platform that provides communications 

to taxpayers who prefer that channel over mailed correspondence, including digital chat.

Expected Benefits:

• Increase taxpayer response rate to notices

• Lower the burden on taxpayers and the IRS for tax compliance and enforcement.

Live Assistance - Callback ($10 million / 0 FTE) – In the current IRS Contact Center 

environment, taxpayers wait in a live queue until a Customer Service Representative (CSR) is 

available. Wait times have averaged between 6-10 minutes on most of IRS’s primary 

telephone product lines over the past two years. Customer Callback will allow call center 

customers to keep their place in queue without remaining on the telephone. The system will 

call customers back when they are next in queue to be assisted by a CSR. 

Funding will be used to build a robust callback solution for all toll-free telephone services. In 

addition, the multi-year solution will provide robust call handling and enhanced call 

monitoring and reporting to reduce the risk for any additional wait times upon reconnect. 

Expected Benefits:

• Reduce wait time on telephone assistance applications for taxpayers and IRS

employees; and

 Enable tax professionals to quickly and

securely sign power of attorney online

 Communicate digitally with taxpayers

via Taxpayer Digital 

Communications Online 

Notice
IRS-70 

• Reduce burden by offering options for a callback or to remain in the live queue.

Core Taxpayer Services and Enforcement: +$160 million / +270 FTE 

By funding Core Taxpayer Services and Enforcement modernization investments, the IRS 

expects to achieve the following outcomes and will measure performance using the key 

indicators in the table below. 

Customer Account Data Engine 2 (CADE2) (+$80 million (+$70 million in direct 

appropriations and +$10 million in user fees) / +134 FTE) – Since the Individual Master File 

(IMF) was built almost 60 years ago, the IRS has made additions to the base code to reflect 

annual tax law changes. As a result, the base code of IMF now reflects every tax law change 

made since 1962 and includes embedded business logic that only an extremely small number 

of IRS personnel understand. Funding will be used to re-engineer the IMF core components 

of posting, settlement and analysis functions for individual taxpayer accounts by applying 

modern programming languages to the most complex areas of the Individual Master File. 

Expected Benefits:

• Simplifies modernization;

• Simplifies subsequent maintenance of system; and

• Allows business logic to be maintained by a broader set of business users rather than a

limited number of developers.

Enterprise Case Management ($45 million / 85 FTE) – Enterprise Case Management (ECM) 

will modernize, upgrade, and consolidate existing case management systems. The IRS has 

60+ legacy case management systems built on aging non-modernized platforms. These 

legacy systems have limited integration to transfer case information, resulting in taxpayer and 

IRS employee frustration as they must often work with multiple offices/systems to resolve 

Modernization 

Plan Pillar Expected Outcomes Key Performance Indicators

Pillar 2:

Core Taxpayer 

Services and 

Enforcement

 Fewer system interactions to resolve a

business transaction for cases

 Streamlined and integrated case

management, treatment, and execution

across Business Units

 Additional revenue protection through

at-filing anomaly and fraud detection

 Expand data analytics for fraud detection

 Modernize Individual Master File (IMF)

Core components of posting, settlement,

and analysis functions (runs 12 and 15)

 Percentage (%) of Business

Master File (BMF) tax

returns screened by the

Return Review Program

(RRP)

 Number of lines of legacy

code converted to modern

code
IRS-71 

issues. The enterprise platform will have common infrastructure, business functions and 

services that will allow for transfer of cases across business units. In FY 2020, ECM expects 

to deliver incremental capabilities and features to the ECM platform, allowing IRS business 

units to migrate their users to the new platform.

Expected Benefits:

• Providing readily available case data, including relevant historical data;

• Treating and resolving cases seamlessly and consistently across business units;

• Streamlining existing manual processes through enhanced automation;

• Storing electronic case files instead of paper;

• Utilizing a configurable, flexible and scalable COTS case management solution; and

• Simplifying the IT environment.

Return Review Program ($35 million / 50 FTE) – The Return Review Program (RRP) detects,

addresses, and prevents tax refund fraud and protects tax revenue. The RRP fraud framework 

is critical for IRS’s success in tackling ever-evolving tax schemes in a sophisticated, scalable 

and adaptable manner. Since filing season 2015, RRP has protected more than $8.9 billion in 

confirmed fraud and has a return on investment (ROI) of $18.5 to $1.

The IRS will improve and expand analytical capabilities that protect increasing levels of 

revenue from individual and business tax return fraud, enable predictive fraud and noncompliance detection, and incorporate tools that reveal patterns and relationships in masses of 

data to help identify returns that share traits indicative of schemes and other tax fraud or noncompliance. Additionally, IRS will develop fraud detection functionality and enhance 

automated verification for business returns and research and explore the fraud detection 

opportunities for foreign account withholding. 

Expected Benefits:

• At-filing anomaly and fraud detection to increase revenue protection; and

• Improved access to data from RRP for business analytics and fraud modeling.
IRS-72 

Modernized IRS Operations: +$20 million / 15 FTE: 

These investments achieve the following outcomes and will measure performance using the 

key indicators in the table below. 

Robotic Process Automation (+$4 million) – Robotic Process Automation (RPA) is the 

implementation of smart software designed to perform high-volume, repeatable tasks that are 

normally labor intensive. The software would be capable of navigating across different IT 

systems, mimicking the way staff perform certain work functions. These new tools will 

record the actions an employee takes to complete a computer-based task, then will rapidly 

replicate those actions as many times as necessary, with more accuracy. This will enhance the 

speed and accuracy of business process execution and allow IRS staff to focus on other work. 

Expected Benefits:

• Labor is freed up for more complex, value-add activities;

• Self-service for employees is increased; and

• Business processes are more accurate and efficient.

Cloud Execution (+$5 million) – Cloud Execution (CX) refers to the implementation of the 

IRS cloud strategy, leveraging a defined roadmap and process to ensure an effective and 

accelerated transition to the cloud. Current time-to-market for business applications is 

lengthened by complex internal architecture, systems, procurement timelines, and capacity – 

both technical and human resources. Additionally, keeping pace with hardware and software 

versions and timely application of patches can be difficult and must be prioritized as part of 

overall workload. 

Modernization 

Plan Pillar Expected Outcomes Key Performance Indicators

Pillar 3:

Modernized 

IRS Operations 

 Automate manual processes using

artificial intelligence and other advanced

techniques freeing up IRS staff for more

value-added work

 Quicker software deployment through

automating delivery and infrastructure

provisioning

 Create standard, reusable services and

common application programming

interface (API) code, reducing

duplicative/ “recreate” work for IRS

employees

 More efficient, scalable, resilient and

secure infrastructure

 Percentage (%) of Tier 2

software currency (formerly

Filing Season System

Software Currency)

 Percentage (%) of servers

using Standard Stack

configurations
IRS-73 

To address this challenge, the IRS is establishing cloud management, security, and 

governance and identifying potential Infrastructure-as-a-Service (IaaS), Platform-as-a-Service 

(PaaS), and Software-as-a-Service (SaaS) candidates for future migration. This move toward 

enterprise-wide cloud adoption will provide the IRS with convenient, on-demand network 

access to a shared pool of configurable computing resources (e.g., networks, servers, storage, 

applications, and services) that can be provisioned rapidly and released with minimal 

management effort or service provider interaction. 

Expected Benefits:

• Improve time-to-market;

• Increase operational efficiency and resilience;

• Enable increased innovation; and

• Enhance or maintain appropriate security posture.

NextGen Infrastructure (NGI) (+$10 million) – NGI addresses the aged infrastructure base 

(i.e., hardware, software, programming language) at the foundation of the IRS’s critical 

systems. Such conditions introduce security risks, excessive system downtime, increased 

costs, and incompatibilities across systems and programs. The IRS is shifting towards more 

efficient infrastructure that can more quickly provision and utilize virtual computing, network 

and storage solutions, and continuous operations monitoring technologies (as well as Cloud 

configurations on and off premise). NGI will enable the IRS to transform its software 

delivery using agile and DevOps methodologies, new automation tools, standardization (via 

Standard Stack configurations) and innovative collaboration practices that will reduce the 

time it takes to build working software. 

Expected Benefits:

• Smaller physical hardware footprint;

• Rapid provisioning of infrastructure and software;

• Limited downtime through insight into end user computing to diagnose and resolve

issues rapidly; and

• Improved efficiencies through automated security and functionality testing earlier in

the development life cycle.

Application Program Interface (API) (+$1 million) – API includes the creation of an 

integrated strategy for building common interfaces. Authorized third parties will have easier 

access and a streamlined data exchange with the IRS through standard, reusable services and 

common programming code. This effort also addresses security risks by changing the 

mechanisms by which systems across the IT ecosystem interact. 
IRS-74 

Cybersecurity and Data Protection: +$80 million / +61 FTE 

The Cybersecurity and Data Protection modernization investment will achieve the following 

outcomes, the performance of which the IRS will measure using the key indicator in the table 

below. 

The IRS defends against more than one million cyberattacks daily and has operated strong 

network perimeter defenses to mitigate threats, detect vulnerabilities, and monitor network 

security. This investment will fund: 

Vulnerability and Threat Management (+$31 million) – The effectiveness of vulnerability and 

threat management depends on the organization’s ability to keep up with current security 

threats and trends. Investment in this area allows for expanded capabilities and improved 

execution for the identification and mitigation of vulnerabilities across the disparate, 

geographically dispersed, IRS technology infrastructure. 

Expected Benefits:

• Leverage machine learning and predictive analytics to detect and respond to fraud and

internal threat;

• Enhance data collection, cleansing, and events management; and

• Reduce risk of data leaks.

Identity & Access Management (+$25 million) – The risk of unauthorized access to tax 

accounts continues to grow as the IRS focuses its efforts on delivering online tools to 

taxpayers. The IRS must control information about users on computers, including 

information that authenticates the identity of a user and information that describes information 

and actions they are authorized to access and/or perform. 

In addition, the IRS must ensure appropriate access to resources This covers issues such as 

how users gain an identity, the protection of that identity, and the technologies supporting that 

protection (e.g., network protocols, digital certificates, passwords, etc.). 

Expected Benefits:

• User identity control, privileged access protection, and critical data security; and

Modernization 

Plan Pillar Expected Outcomes Key Performance Indicators

Pillar 4:

Cybersecurity and 

Data Protection 

 Implement Data at Rest Encryption

(DARE)

 Provide DHS and Treasury with the

ability to monitor IRS network

 Prevent insider threats

 NIST cybersecurity

maturity at the IRS
IRS-75 

• Security compliance for building access.

Security Operations and Management (+$24 million) – The IRS engages in a collection of 

associated security activities that maintain the ongoing security posture. It consists of the 

monitoring, maintenance and management of the security aspects of the IT environment, its 

people, and its processes. 

Expected Benefits:

• In-depth real-time intrusion detection;

• Automated malware analysis of email and web-based threats;

• Improved incident analysis and forensic investigation through increased capabilities

for capturing network activity; and

• Accelerated detection and response with prioritized cyber threat intelligence.

Architecture Integration and Management (AIM) (+31.9 million): $14 million in user 

fees (+$17.9 million multi-year funding)

AIM provides engineering management capabilities essential to delivering a program of 

BSM’s magnitude and complexity. It also delivers IRS systems strategy, architecture, and 

engineering capabilities for the major modernization projects across all technology platforms; 

IT Infrastructure, Business Applications, Data Management, and IT Security. The AIM 

program translates enterprise and project objectives into targeted, actionable investments to 

provide the framework and direction for cohesive, successful modernization. This investment 

is not considered part of the IRS Integrated Modernization Business Plan.
IRS-76 

Core Infrastructure (+$19 million): $6 million in user fees (+$13 million multi-year 

funding)

Core Infrastructure provides mission-critical services for designing, engineering, testing, and 

deploying standardized, consolidated, virtual, and secure modernized development and 

production environments for use by BSM projects. This support effort scales with the 

development projects in the BSM portfolio. This investment is not considered part of the IRS 

Integrated Modernization Business Plan. 

Description of FY 2018 Performance 

The IRS’s modernization efforts focus on building and deploying advanced information 

technology systems, processes, and tools to improve efficiency and productivity. The 2019 

and 2020 target is 90 percent. 

Percent of Major IT Investments within +/- 10 percent Cost Variance at the Investment 

Level: Thirteen of 18 major investments (72.2 percent) were within the cost variance 

threshold at the end of FY 2018 and below the 90 percent target. Shown below are the 

investments falling short of the cost variance target. 

• Affordable Care Act Administration (ACA) the cost underrun is because of all ACA

projects being closed out and moved into operations and maintenance (O&M).

• Customer Account Data Engine 2 (CADE 2) the cost underrun is caused by the

Release 4 Authoritative Data Source (ADS) deployment project being closed out early.

• Web Applications cost underruns were caused by the actual spending for the 2018

Agile Development (first half) and Program 11 activities being less than planned.

• Integrated Financial System/CORE Financial System (IFS) the cost overrun was

due to the need for more contractor support than originally planned.

• IRS Mainframes and Servers Services and Support (MSSS) displays a cost underrun

due to a project mistakenly entered into Treasury’s SharePoint Investment Knowledge

Exchange (SPIKE*) and then closed out shortly after.

Percent of Major IT Investments within +/- 10 percent Schedule Variance at the 

Investment Level: Fifteen of 18 major investments (83.3 percent) were within the schedule 

Fiscal Year

Percent within +/- 10% 

Cost Variance

Percent within +/- 10% 

Schedule Variance

2018 72.2% 83.3%

Major IT (BSM and Non-BSM) Investments*
IRS-77 

variance threshold at the end of FY 2018. Shown below are the investments falling short of 

the 90 percent schedule variance target.

• ACA the schedule variance is showing ahead of schedule due to all ACA projects

being closed out and moved into operations and maintenance (O&M).

• CADE 2displays an ahead of schedule variance caused by the Release 4 Authoritative

Data Source (ADS) deployment project being closed out early.

• MSSS displays an ahead of schedule variance due to a project mistakenly entered into

Treasury’s SharePoint Investment Knowledge Exchange (SPIKE) and then closed out

shortly after.
IRS-78 

IRS BSM Project Activities

Business Systems Modernization 

Dollars in thousands

Funding

Category1

FY 2018 

Actuals

FY 2019

Projected 

Spend

FY 2020 

Request

FY 2020 

Projected 

Funding and 

Spend2

FY 2018 Actuals/FY 2019 Likely Enacted/ FY 2020 CJ Request 110,000 110,000 290,000 290,000

Carryover balances3 192,946 132,900 0 30,900

User Fees Subtotal 77,418 139,000 30,000 30,000

Total Funding $380,364 $381,900 $320,000 $350,900

Capital 92,128 132,053 215,907 226,939

Support 360 621 734 853

Labor 76,619 79,326 73,359 93,109

User Fees 77,418 139,000 30,000 30,000

Subtotal Projected Spending 246,525 351,000 320,000 350,900

Management Reserve 0 0 0 0

Total FTE 454 481 441 561

Pillar Total Spending $246,525 $351,000 $320,000 $350,900

Web Applications $39,953 $25,000 $25,000 $25,000

Capital 11,501 9,788 9,788 9,788

Support 215 170 170 170

Labor 14,674 15,042 15,042 15,042

U. Fees 13,562 0 0 0

FTE 92 91 91 91

Taxpayer Digital Communications - Online Notice $0 $5,000 $5,000 $5,000

Capital 0 5,000 4,300 4,300

Support 0 0 72 72

Labor 0 0 628 628

U. Fees 0 0 0 0

FTE 0 0 4 4

Live Assistance - Callback $0 $5,000 $10,000 $10,000

Capital 0 0 10,000 10,000

Support 0 0 0 0

Labor 0 0 0 0

U. Fees 0 5,000 0 0

FTE 0 0 0 0

Taxpayer Experience - Subtotal $39,953 $35,000 $40,000 $40,000

FTE 92 91 95 95

Taxpayer

Experience

Providing easy access to taxpayer information via digital channels. Funding will 

drive the IRS transition to digital government and supports the long-term vision of 

migrating services from expensive traditional channels to the internet. To keep 

pace with the ever changing state of web technology and increasing taxpayer 

demand for IRS service, the IRS must create and enhance online self-service 

capabilities for taxpayers, tax practitioners, and internal IRS stakeholders. Web 

Applications will continue to enhance the taxpayer’s experience by providing 

them the ability to enter into an installment agreement online. 

Providing digital notices through the secure messaging platform to taxpayers who 

prefer that channel over mailed correspondence, including digital chat and 

online notifications.

Providing expanded toll-free capacity to enhance Taxpayer communication and 

provide a foundation for FY 2021 full customer callback capability . Funding will 

expand toll-free capacity, building toward a robust callback solution that will 

empower taxpayers with options, when estimated wait times for their desired 

service meet the business rules for callback. 

Summary
IRS-79 

IRS BSM Project Activities (continued)

Business Systems Modernization 

Dollars in thousands

Funding

Category1

FY 2018 

Actuals

FY 2019

Projected 

Spend

FY 2020 

Request

FY 2020 

Projected 

Funding and 

Spend2

Pillar Total Spending $246,525 $351,000 $320,000 $350,900

Customer Account Data Engine (CADE 2) $69,972 $85,000 $80,000 $80,000

Capital 27,772 24,730 47,730 47,730

Support 76 105 105 105

Labor 25,093 22,165 22,165 22,165

U. Fees 17,030 38,000 10,000 10,000

FTE 153 134 134 134

Enterprise Case Management $34,125 $60,000 $45,000 $45,000

Capital 19,276 34,750 30,750 30,750

Support 51 150 150 150

Labor 9,001 14,100 14,100 14,100

U. Fees 5,797 11,000 0 0

FTE 56 86 85 85

Return Review Program $53,871 $35,000 $35,000 $35,000

Capital 11,722 26,654 26,654 26,654

Support 3 77 77 77

Labor 7,622 8,269 8,269 8,269

U. Fees 34,523 0 0 0

FTE 43 50 50 50

Core Tax Administration - Subtotal $157,967 $180,000 $160,000 $160,000

FTE 252 270 270 270

IRS Operations 0 20,500 20,000 20,000

Capital 0 0 17,372 17,372

Support 0 0 32 32

Labor 0 0 2,596 2,596

U. Fees 0 20,500 0 0

FTE 0 0 15 15

IRS Operations - Subtotal $0 $20,500 $20,000 $20,000

FTE 0 0 15 15

Cybersecurity $0 $64,500 $80,000 $80,000

Capital 0 0 69,313 69,313

Support 0 0 128 128

Labor 0 0 10,559 10,559

U. Fees 0 64,500 0 0

FTE 0 0 61 61

Cybersecurity - Subtotal 0 64,500 80,000 80,000

FTE 0 0 61 61

Enterprise Case Selection4 $873 0 0 0

Other Adjustments5 -14 0 0 0

Subtotal IRS Technology Modernization Plan $197,920 $300,000 $300,000 $300,000

FTE 345 362 441 441

Architecture, Integration, and Management $31,184 $32,000 $14,000 $31,900

Capital 18,877 24,702 0 10,603

Support 15 47 0 47

Labor 6,947 7,251 0 7,251

U. Fees 5,346 0 14,000 14,000

FTE 41 44 0 44

Core Infrastructure $17,425 $19,000 $6,000 $19,000

Capital 2,979 6,429 0 429

Support 0 72 0 72

Labor 13,286 12,499 0 12,499

U. Fees 1,160 0 6,000 6,000

FTE 69 76 0 76

Subtotal AIM and Core Infrastructure $48,609 $51,000 $20,000 $50,900

FTE 110 120 0 120

3

 Includes Recoveries that were re-obligated in FY 2018.

4, 5 Enterprise Case Selection, Modernize eFile, and Event Driven Architecture had adjustments appearing in FY 2018.

Provide shared infrastructure that leverages reusable engineering design patterns 

and best practices for standardized, virtual, and secure environments. These 

environments allow multiple BSM projects to develop, test, deploy, operate, and 

monitor in a common approach. 

1

 Capital Investment funding: capital and contractor labor costs. Support funding: training, travel, supplies costs. Labor funding: IRS employee pay and 

benefits costs. FTE: FY 2020 Initiative FTEs are costed at 1/2 year hiring, which equates to 0.5 FTEs per position.

2

 FY 2020 level excludes $3.168M in non-BSM Corporate Costs and also $0.115M of BSM which is aligned to the Stewardship Financial Plan (non-IT).

Cybersecurity 

and Data 

Protection

Enhancing the IRS Cybersecurity posture. The IRS defends more than one million 

cyberattacks daily and has historically operated strong network perimeter 

defenses to mitigate threats, detect vulnerabilities, and monitor network security. 

In FY 2020, IRS will focus on: Vulnerability and Threat Management, Identity and 

Access Management, and Security Operations and Management.

Provide system engineering management capabilities, including systems strategy, 

architecture, and engineering capabilities, across IT Infrastructure, Business 

Applications, Data Management, and IT Security. Provide portfolio control and 

management processes and tools, including governance, enterprise lifecycle 

support, tiered program management, and configuration/change management.

Core Taxpayer Services and Enforcement

Ensuring Taxpayer data is secure. CADE2 will continue work on completion of Java 

code conversion to modernize Individual Master File core components.

Providing a modernized case management platform. Working cases more 

efficiently to lessen taxpayer burden and increase employee productivity. 

Continuously deliver incremental capabilities and features to the ECM platform 

allowing Business Operating Divisions (BODs) to migrate users to the new 

platform.

Providing leading-edge technologies to advance the IRS effectiveness in detecting, 

addressing, and preventing tax refund fraud. RRP continues to evolve and enhance 

its system capabilities, and in FY 2020 will develop fraud detection functionality 

and enhance automated verification for business returns and expand the fraud 

detection functionality for foreign account withholding. 

 Modernized IRS

Operations

Providing tactical improvements to streamline IRS operations. The requirement for 

IT to provide better, more accurate service with fewer resources is ultimately the 

need that will drive IT operational efficiency to perform at its best. Toward this 

goal, IRS plans to pursue multiyear investments that would allow for a more agile 

and efficient operation. In FY 2020, the modernizing IRS Operations effort will 

continue to automate certain processes, define Application Programming 

Interface strategy, deliver a cloud-based ECM release, and continue to integrate 

DevOps into business processes.
IRS-80 

FY 2020 Changes by Budget Activity 

2.1.9 – Budget and Performance Report and Plan

Dollars in thousands

Business Systems Modernization FTE Amount

FY 2019 Annualized CR Level 361 $110,000

Changes to Base:

Subtotal FY 2020 Changes to Base 

FY 2020 Current Services 361 $110,000

Program Changes:

Program Increases 80 $180,000

IRS Technology Modernization Plan 80 180,000

Subtotal FY 2020 Program Increases 80 $180,000

Total FY 2020 Request 441 $290,000

See footnotes in 1.1 -- Appropriations Detail Table

Business Systems Modernization FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Resource Level Actual Actual Actual Actual Enacted Annualized CR Request

Appropriated Resources1 $145,235 $107,746 $190,945 $166,263 $110,000 $110,000 $290,000

Reimbursable Resources2

User Fees 25,464 77,418 139,010 30,000

Budget Activity Total $145,235 $107,746 $190,945 $191,727 $187,418 $249,010 $320,000

1

The FY 2014 - FY 2018 appropriated resources represents the approved operating plan including any inter-BAC transfers and inter-appropriation transfers.

2

The FY 2014 - FY 2018 columns represent realized resources for reimbursable resources and user fees.

Business Systems Modernization FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Measures Actual Actual Actual Actual Actual Target Target Target

66.7% 73.7% 76.2% 50.0% 72.2% 90.0% 90.0% 90.0%

100.0% 89.5% 85.7% 88.9% 83.3% 90.0% 90.0% 90.0%

Key: E - Efficiency Measure

Dollars in thousands

1

 Starting in FY 2015, the measure includes all major investments (BSM and non-BSM).

Percent of Major IT Investments within +/- 10% Schedule Variance at 

the Investment Level (E)1

Percent of Major IT Investments within +/- 10% Cost Variance at the 

Investment Level (E)1



IRS-81

Section III – Supplemental Information

3.1 – Summary of Capital Investments 

A summary of capital investment resources, including major information technology and 

nontechnology investments, can be viewed/downloaded at: 

http://www.treasury.gov/about/budget-performance/pages/summary-of-capitalinvestments.aspx. 

This website also contains a digital copy of this document. 

3A – Capital Investment Strategy 

The IRS Information Technology (IT) organization is a key enabler of efficient and effective tax 

administration. IT provides critical support as the IRS faces an increasingly complex tax 

administration environment. IT works to address evolving taxpayer expectations, pressure to 

achieve program and cost efficiencies, frequent tax law changes, growing challenges in 

combating refund fraud and identity theft, and workforce shortages. Specific challenges, such 

as aging infrastructure, insertion of emerging technologies, and expanding cybersecurity threats, 

further complicate the IT operating environment. 

To ensure that the organization’s technology is aligned with the IRS Strategic Plan 2018-2022, 

the enterprise needs to leverage modern technologies and adopt IT best practices. Guided by 

the Strategic Plan, the IT Vision 2.0, the Digital IRS Blueprint and Technology Roadmap, the 

IRS Integrated Modernization Business Plan articulates a vision to strengthen and modernize 

the IRS IT environment. The Capital Investment Strategy outlines the technology initiatives 

and IT investments undertaken to achieve that vision. 

IRS Strategic Plan FY 2018-2022 

The IRS Strategic Plan FY 2018–2022 sets the strategic direction and priorities for achieving 

the organization’s mission. The plan establishes a strategic foundation with six broad goals and 

twenty-one strategic objectives. Figure 1 illustrates the relationships among the six Strategic 

Plan goals, which include: 

• Empower and enable all taxpayers to meet

their tax obligations.

• Protect the integrity of the tax system by

encouraging compliance through

administering and enforcing the tax code.

• Collaborate with external partners

proactively to improve tax administration.

• Cultivate a well-equipped, diverse, flexible

and engaged workforce.

Figure 1 IRS Strategic Plan 2018-2022
IRS-82 

• Advance data access, usability and analytics to inform decision making and improve

operational outcomes.

• Drive increased agility, efficiency, effectiveness and security in IRS operations.

The IRS Strategic Plan defines the business strategic direction for the enterprise and is 

subsequently utilized to inform the IT strategic direction. 

IRS Integrated Modernization Business Plan

The IRS’s Integrated Modernization Business Plan supports the IRS’s mission to help 

America’s taxpayers understand and meet their tax responsibilities, while enforcing tax laws to 

ensure integrity and fairness for all. The Plan establishes a multi-year modernization approach 

to provide effective, reliable, IT solutions for taxpayers to fulfill their tax obligations
IRS-83 

3.2 – Return on Investment (ROI) for IRS Major Enforcement Programs

The actual cost and actual revenue collected for FY 2012 through FY 2018 for the three major 

enforcement programs, Examination, Collection, and Automated Underreporter (AUR) are 

provided below. The activities included in these programs include: 

Examination Program conducts examinations of tax returns of individual taxpayers, 

businesses, and other types of organizations to verify that the tax reported is correct. This 

includes examinations of individuals, small businesses, self-employed, large corporate 

businesses, partnerships, international, estate and gift, excise tax and employment tax-exempt

organizations, qualified pension benefit plans, and government entities. The examination costs 

include the cost of the Field Exam, Correspondence Exam, IRS Chief Counsel, and Appeals 

functions. 

Collection Program collects delinquent taxes and secures delinquent tax returns through the 

appropriate use of enforcement tools, such as lien, levy, seizure of assets, installment 

agreement, offer in compromise, substitute for return, summons, and IRC section 6020(b) 

(which allows the IRS to prepare returns if a taxpayer neglects or refuses to file), and provides 

education to taxpayers to enable future compliance. The cost of the Collection program 

includes Automated Collection System (ACS), Field Collection, and Payment 

Compliance/Correspondence Collection. 

Automated Underreporter (AUR) Program matches payer information returns (Forms 1099, 

W-2, etc.) against data reported to the IRS on individual tax returns. The information is verified

to identify any discrepancies. If a discrepancy is found, the case is given to a tax examiner for

research and analysis. If the tax examiner is unable to resolve the discrepancy, the IRS issues a

proposed notice and generates a proposed assessment.

ROI is calculated by dividing revenue by cost. This information provides an indication of the 

ROI for the three major enforcement programs over time but note that enforcement revenue 

collected in a fiscal year includes tax, interest, and penalties from multiple tax years. Some 

enforcement activities take more than a year to close and may generate revenue over several 

years 

In addition, these data reflect the average return on investment for these programs and do not 

include the indirect effects of IRS enforcement activities on voluntary compliance. Net revenue 

is maximized only when resources are allocated according to marginal direct and indirect 

return on investment, but those ratios are much more challenging to estimate than the average 

ROI shown here. As a result, the IRS will continue to allocate enforcement resources across a 

range of enforcement activities to ensure taxpayers pay the taxes they owe. 
IRS-84 

Return on Investment for IRS Major Enforcement Programs

Dollars in Millions

Enforcement Program Cost1 Revenue ROI Cost1 Revenue ROI Cost1 Revenue ROI Cost1 Revenue ROI Cost1 Revenue ROI

IRS Total $5,839 $57,146 9.8 $5,644 $54,203 9.6 $5,592 $54,291 9.7 $5,506 $53,214 9.7 $5,559 $59,366 10.7

Examination 3,965 18,983 4.8 3,974 13,320 3.4 3,782 12,023 3.2 3,695 14,510 3.9 3,716 15,017 4.0

Collection 1,618 33,198 20.5 1,419 35,740 25.2 1,576 37,259 23.6 1,598 33,701 21.1 1,635 38,985 23.8

Automated Underreporter (AUR) 256 4,965 19.4 251 5,143 20.5 234 5,009 21.4 214 5,003 23.4 208 5,364 25.8

FY 2018

1

The cost of the enforcement programs was calculated using budget data from the IRS Integrated Financial System (IFS) and includes direct dollars and FTE from the Enforcement appropriation, Exam and Collections 

budget activity, and dollars from the Operations Support appropriation prorated using actual FTE realized for each major enforcement program.

FY 2014 FY 2015 FY 2016 FY 2017
IRS-85 

3.3 – IRS Performance Measures Table 

Performance Measures FY2014 

Actual

FY2015 

Actual

FY2016 

Actual 

FY2017

Actual

FY2018 

Actual 

FY2018 

Target 

FY2019 

Target

FY2020 

Target

Customer Service Representative Level of Service 

(LOS)1 64.4% 38.1% 53.4% 77.1% 75.9% 75.0% 63.0% 68.0%

Customer Contacts Resolved per Staff Year2 21,018 26,245 28,497 25,535 31,409 Indicator DISC

Customer Accuracy - Tax Law (Phones) 95.0% 95.0% 96.4% 96.7% 95.5% 95.0% 92.0% 92.0%

Customer Accuracy - Accounts (Phones) 96.2% 95.5% 96.1% 96.0% 96.1% 95.0% 94.0% 94.0%

Timeliness of Critical Filing Season Tax Products to 

the Public4 99.1% 89.0% 92.5% 93.1% 59.6% 89.0% 85.0% 89.0%

Timeliness of Critical TE/GE & Business Tax Products 

to the Public4 98.7% 92.6% 98.0% 96.7% 100.0% 91.0% 85.0% 89.0%

Percent Individual Returns Processed Electronically2 84.1% 85.3% 86.4% 86.9% 87.2% 88.0% DISC

Percent of Business Returns Processed 

Electronically 43.1% 47.0% 50.0% 52.9% 55.6% 54.0% 58.0% 60.0%

Refund Timeliness - Individual (Paper)2 98.7% 98.8% 98.7% 98.4% 98.2% 97.0% DISC

Enterprise Self-Assistance Participation Rate3 84.7% 88.7% 89.0% 79.0% 82.0% Indicator

Taxpayers Satisfied with the IRS (based on 100 point 

scale)5, * 73 73 74 74 74 Indicator

Examination Coverage - Individual 0.9% 0.8% 0.7% 0.6% 0.6% 0.6% 0.5% 0.5%

Field Exam Nat'l Quality Review Score2 88.4% 86.7% 86.8% 85.0% 89.1% 84.4% DISC

Office Exam Nat'l Quality Review Score2 90.6% 88.3% 88.4% 87.9% 87.2% 86.7% DISC

Examination Quality - Large Business2 83.0% 86.0% 83.0% 78.0% 76.0% 90.0% DISC

Examination Coverage - Business (Assets > $10 

million) 4.3% 3.9% 3.0% 2.5% 2.2% 2.4% 2.2% 1.5%

Examination Efficiency - Individual 138 148 143 121 131 134 122 122

Automated Underreporter Efficiency2 1,935 2,209 2,196 2,188 2,205 2,133 DISC

Automated Underreporter Coverage 2.6% 2.3% 2.3% 2.2% 2.0% 1.9% 1.6% 1.7%

Time to Start Compliance Resolution5 N/A Indicator

Time to Resolve Compliance Issue After Filing5 N/A Indicator

Repeat Non-Compliance Rate5 N/A Indicator

Collection Coverage (Units) 45.9% 46.3% 43.4% 42.2% 41.6% 38.6% 40.1% 38.3%

Collection Efficiency (Units)2 2,051 2,448 2,266 2,135 2,216 2,101 DISC

Cost to Collect $100 (in cents)5 0.38 0.35 0.35 0.34 TBD Indicator

Field Collection Nat'l Quality Review Score2 81.6% 79.2% 79.2% 76.7% 79.2% 78.0% DISC

Automated Collection System Accuracy2 95.2% 95.3% 95.4% 94.7% 94.0% 95.0% DISC

Criminal Investigations Completed 4,606 4,486 3,721 3,089 3,051 3,000 2,800 2,700

Number of Convictions2 3,110 2,879 2,672 2,300 1,879 1,900 DISC

Conviction Rate 93.4% 93.2% 92.1% 91.5% 91.7% 92.0% 92.0% 92.0%

TE/GE Determination Case Closures2 136,746 111,940 99,973 102,749 98,249 94,103 DISC

Rentable Square Feet per Person (new for FY 2017) 297 301 Indicator

Percent of Aged Hardware6 56.5% 52.2% 52.3% 45.5% 53.1% 43.8% 39.0%

Percent of Major IT Investments within +/- 10% Cost 

Variance at the Investment Level7 66.7% 73.7% 76.2% 50.0% 72.2% 90.0% 90.0% 90.0%

Percent of Major IT Investments within +/- 10% 

Schedule Variance at the Investment Level7 100.0% 89.5% 85.7% 88.9% 83.3% 90.0% 90.0% 90.0%
IRS-86 

3.3 – IRS Performance Measures Table (Continued)

1 The FY 2019 level of service target was calculated at the FY 2019 Enacted level. 

2

 Discontinued (DISC) for FY 2019 

3 Starting in FY 2017, the IRS modified the Taxpayer Self Assistance Rate measure (renamed to 

Enterprise Self Assistance Participation Rate) to include additional self-service channels 

including Get Transcript and payment applications such as Direct Pay and Online Payment 

Agreements. As new self-assistance applications are provided to the public, they will be added 

to the methodology. 

4

 Modified for FY 2019 

5 New measure added for FY 2019 

6 This is a new budget level metric; the measure definition changed in FY 2018; removing 

certain asset categories (fax machines, low-end printers and scanners) that are no longer being 

actively refreshed from the calculation to more accurately define the inventory that’s reflective 

of risk to the IT environment. 

7 Starting in FY 2015, the measure includes all major investments (BSM and non-BSM).

* Based on the American Customer Satisfaction Index (ACSI) survey; the All Individual Tax

Filer score is calculated from separate ACSI Individual Paper Filer and Electronic Filer

customer satisfaction index scores; available on an annual basis at the end of January and

computed on a 100-point scale.
IRS-87 

3.3 – IRS Performance Measures Table (Continued)

Customer Service Representative (CSR) 

Level of Service

The number of toll free callers that either speak to a Customer Service Representative or receive informational 

messages divided by the total number of attempted calls.

Customer Contacts Resolved per Staff Year The number of Customer Contacts resolved in relation to staff years expended. 

Customer Accuracy – Tax Law Phones The percentage of correct answers given by a live assistor on Toll-free tax law inquiries.

Customer Accuracy – Customer Accounts 

(Phones) The percentage of correct answers given by a live assistor on Toll-free account inquiries.

Timeliness of Critical Individual Filing Season 

Tax Products to the Public

The percentage of critical individual filing season tax products (tax forms, schedules, instructions, and 

publications required by many filers to prepare a complete and accurate tax return) available to the public in a 

timely fashion.

Timeliness of Critical TE/GE & Business Tax 

Products to the Public

Percentage of critical business tax products (tax forms, schedules, instructions, and publications used by a large 

number of TE/GE and Business filers to prepare a complete and accurate return or form) available to the public 

in a timely fashion. 

Percent Individual Returns Processed 

Electronically The percentage of electronically filed individual tax returns divided by the total individual returns filed.

Percent Business Returns Processed 

Electronically The percentage of electronically filed business tax returns divided by the total business returns filed.

Refund Timeliness – Individual (Paper) The percentage of refunds resulting from processing individual master file paper returns issued within 40 days or 

less. 

Enterprise Self Assistance Participation Rate The percentage of taxpayer assistance requests resolved using self-assisted automated services.

Taxpayers Satisfied with the IRS

The percentage of taxpayers satisfied with the IRS according to the American Customer Satisfaction Index 

(ACSI) survey. The All Individual Tax Filer score is calculated from separate ACSI Individual Paper Filer and 

Electronic Filer Customer Satisfaction Index Scores. Based on a 100 point scale.

Examination Coverage – Individual (1040)

The sum of all individual 1040 returns closed by Small Business/Self Employed (SB/SE), Wage & Investment 

(W&I), Tax Exempt and Government Entities (TE/GE), and Large Business and International (LB&I) (Field Exam 

and Correspondence Exam programs) divided by the total individual return filings for the prior calendar year.

Field Exam Nat'l Quality Review Score The score awarded to a reviewed field examination case by a Quality Reviewer using the National Quality 

Review System (NQRS) quality attributes.

Office Exam Nat'l Quality Review Score The score awarded to a reviewed office examination case by a Quality Reviewer using the NQRS quality 

attributes.

Examination Quality – Large Business The average of the scores of the Large Business Return cases reviewed by LB&I Quality Review & Analysis. 

Case scores are based on the percentage of elements passed within each of the three auditing standards..

Examination Coverage – Business Assets 

>$10 Million)

The number of LB&I returns (C and S Corporations with assets over $10 million and all partnerships) examined 

and closed by LB&I during the current fiscal year divided by the number of filings for the preceding calendar 

year.

Examination Efficiency – Individual (1040)

The sum of all individual 1040 returns closed by SB/SE, W&I, TE/GE, and LB&I (Field Exam and 

Correspondence Exam programs) divided by the total Full-Time Equivalent (FTE) expended in relation to those 

individual returns.

Automated Underreporter (AUR) Efficiency The total number of W&I and SB/SE contact closures (a closure resulting from a case where we made contact) 

divided by the total FTE, including overtime.

Automated Underreporter (AUR) Coverage A percentage representing the total number of W&I and SB/SE contact closures (a closure resulting from a case 

where SBSE and W&I made contact) divided by the total return filings for the prior year.

Time to Start Compliance Resolution The percentage of all individual income tax enforcement cases started within six months of the return posting 

date.

Time to Resolve Compliance Issue After Filing The average time it takes to close all individual income tax enforcement cases in days. This is an annual 

measure based on all cases closed in a fiscal year.

Repeat Non-Compliance Rate The percentage of individual taxpayers in a fiscal year with additional non-compliance two years after the initial 

tax year that contains a filing, payment, or reporting compliance issue, compared to total taxpayers 

Collection Coverage – Units The volume of collection work disposed compared to the volume of collection work available.

Collection Efficiency – Units The volume of collection work disposed divided by total collection FTE.

Cost to Collect $100(in cents) The cost of collecting $100 is computed as total operating costs divided by gross collection divided by 100. 

Field Collection Nat'l Quality Review Score The score awarded to a reviewed collection cases by a Quality Reviewer using the NQRS quality attributes.

Automated Collection System (ACS) 

Accuracy The percent of taxpayers who receive the correct answer to their ACS question.

Criminal Investigations Completed

The total number of subject criminal investigations completed during the fiscal year, including those that resulted 

in prosecution recommendations to the Department of Justice as well as those discontinued due to a lack of 

prosecution potential. 

Number of Convictions The number of criminal convictions.

Conviction Rate The percent of adjudicated criminal cases that result in convictions.

TE/GE Determination Case Closures The number of cases closed in the Employee Plans or Exempt Organizations Determination programs, 

regardless of type of case or type of closing.

Rentable Square Feet per Person The amount of Rentable Square Feet the IRS maintains per Personnel requiring space. IRS will use this as an 

indicator for FY 2018.

Percent of Aged Hardware This measure shows the quantity of IT hardware in operation past its useful life as a percentage of total hardware 

in use. 

Percent of Major IT Investments within +/- 10% 

Cost Variance at the Investment Level 

Number of major IT investments within +/-10 percent variance between planned total cost and projected/actual 

cost within a fiscal year divided by the total number of major IT investments in that fiscal year.

Percent of Major IT Investments within +/- 10% 

Schedule Variance at the Investment Level 

Number of major IT investments within +/-10 percent variance between planned days and projected/actual days 

within a fiscal year divided by the total number of major IT investments in that fiscal year.

Budget Level Performance Measure Descriptions
IRS-88 

3.4 – Summary of FY 2018 Savings Realized 

The IRS FY 2018 Current Services level of $11.434 resulted in a shortfall of $3.1 million versus 

the FY 2018 Enacted budget of $11.431 billion.

Increase e-File Savings 

FY 2020 Projected Savings: (-$6,183,000 / -116 FTE) 

FY 2018 Actual Savings Realized: (-$2,169,600 / -48 FTE) 

The IRS realized savings of 48 FTE and $2.17 million in FY 2018 as a result of increases in 

electronically filed returns. The number of paper returns received by the IRS decreased by 

1 million from FY 2016 to FY 2017 while the number of electronically filed returns increased 

by 3.4 million over the same period. 

Rent

FY 2020 Projected Annualized Savings: (-$24,700,000) 

FY 2018 Annualized Savings: (-$10,500,000) 

Rent is one of the IRS's largest operating expenses. The IRS will complete 28 projects in 

FY 2020 to release more than 567,986 rentable square feet of space from inventory. 

. 

Dollars in Millions

Internal Revenue Service

FY 2017 Enacted $11,235.0

Changes to Base:

 Maintaining Current Levels (MCLs) $50.6

FY 2018 Current Services $11,433.7

FY 2018 Enacted $11,430.6

Current Services Shortfall -$3.1
IRS-89

Section IV – Appendix

4.1 – Appropriations Detail Table with Program Integrity Cap Adjustment

Program Integrity Cap Adjustment

In addition to the base appropriations request of $11.472 billion, the FY 2020 Budget proposes 

a $362 million cap adjustment to fund new and continuing investments in expanding and 

improving the effectiveness and efficiency of the IRS’s overall tax enforcement program. The 

proposed FY 2020 enforcement investments will yield additional revenue. The Budget also 

proposes additional cap adjustments for new investments each year through FY 2024 that are 

sustained with additional adjustments through FY 2029 to account for economic factors, such as 

inflation. The investments will generate about $47.1 billion in additional revenue over 10 years 

and will cost about $14.5 billion for an estimated savings of $32.6 billion. Notably, the return 

on investment (ROI) likely is understated because it includes only amounts directly recovered; 

it does not reflect the effect that enhanced enforcement has on deterring noncompliance. 

Dollars in thousands

Internal Revenue Service

Appropriated Resources

FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

New Appropriated Resources:

Taxpayer Services 27,871 $2,512,554 28,834 $2,571,554 26,639 $2,402,000 (2,195) ($169,554) -7.61% -6.59%

Pre-Filing Taxpayer Assistance and 

Education 4,636 640,379 4,603 634,019 4,606 634,762 3 743 0.07% 0.12%

Filing and Account Services 23,235 1,872,175 24,231 1,937,535 22,033 1,767,238 (2,198) (170,297) -9.07% -8.79%

Enforcement 34,789 $4,627,000 34,049 $4,672,000 35,757 $4,905,254 1,708 $233,254 5.02% 4.99%

Investigations 2,950 581,680 2,894 597,658 3,051 642,973 157 45,315 5.43% 7.58%

Exam and Collections 30,876 3,875,098 30,083 3,894,129 31,661 4,090,585 1,578 196,456 5.25% 5.04%

Regulatory 963 170,222 1,072 180,213 1,045 171,696 (27) (8,517) -2.52% -4.73%

Operations Support 10,389 $4,181,000 10,340 $3,834,000 10,868 $4,236,706 528 $402,706 5.11% 10.50%

Infrastructure 870,360 858,932 879,715 20,783 2.42%

Shared Services and Support 4,315 920,283 4,269 942,568 4,415 986,161 146 43,593 3.42% 4.62%

Information Services 6,074 2,390,357 6,071 2,032,500 6,453 2,370,830 382 338,330 6.29% 16.65%

Business Systems Modernization 219 $110,000 361 $110,000 441 $290,000 80 $180,000 22.16% 163.64%

Subtotal New Appropriated Resources 73,268 $11,430,554 73,584 $11,187,554 73,705 $11,833,960 121 $646,406 0.16% 5.78%

Other Resources:

Reimbursables 795 171,140 521 116,551 521 122,379 5,828 5.00%

Offsetting Collections - Non 

Reimbursables 26,069 37,719 39,605 1,886 5.00%

User Fees 14 283,267 60 563,053 71 460,900 11 (102,153) 18.33% -18.14%

Recovery from Prior Years 13,233 17,994 18,905 911 5.06%

Unobligated Balances from Prior Years 236 360,031 289 357,637 100 153,567 (189) (204,070) -65.40% -57.06%

Transfers In/Out (4,188)

Resources from Other Accounts

Subtotal Other Resources 1,045 $849,552 870 $1,092,954 692 $795,356 (178) ($297,598) -20.46% -27.23%

Total Budgetary Resources 74,313 $12,280,106 74,454 $12,280,508 74,397 $12,629,316 (57) $348,808 -0.08% 2.84%

1

FY 2018 Enacted includes $320 million in Section 115 Administrativ e Prov ision funding in the follow ing amounts: $18 million in Tax pay er Serv ices, $10 million in Enforcement, and $291 

million in Operations Support. FY 2018 Enacted also includes the actual inter-appropriation transfer of $256 million to Operations Support ($13 million from Tax pay er Serv ices and $243 

million from Enforcement), and inter-BAC transfer in accordance w ith Section 608 of the public law . FY 2018 full-time equiv alent (FTE) are actuals and reconcile to the final FY 2018 

President's Appendix . Other Resources are actuals.

2

FY 2019 Annualized Continuing Resolution (CR) includes a $200 million interappropriation transfer from Enforcement to Operations Support to cov er anticipated operations and 

maintenance requirements in FY 2019. FY 2019 Annualized CR also includes $77 million for the Section 112 Administrativ e Prov ision to implement requirements under the Tax Cuts and 

Jobs Act (Public Law 115-97). $320 million is automatically av ailable in a full y ear continuing resolution scenario under IRS Administrativ e Prov ision Section 113. Of this amount, $243 

million is ex cluded for illustrativ e purposes consistent w ith the requirements identified for implementing the Tax Cuts and Jobs Act and the FY 2019 Section 112 / Tax Reform Spending 

Plan transmitted to Congress on February 28, 2019. Additional information and a full accounting of these funds can be found in the FY 2020 President’s Budget Appendix .

% Change

FY 2018

Enacted 1

FY 2019

Annualized CR 2 

FY 2020

Request

FY 2019 to FY 2020 

Request

FY 2019 to FY 2020 

Request

Change
IRS-90 

Return on Investment (ROI) for FY 2020 Enforcement Investments

Enforcement efforts generate and protect revenue and they also encourage voluntary compliance 

for taxpayers who would otherwise seek to avoid meeting their tax obligations under the law. 

The IRS calculates a return on investment for both revenue generating and revenue protecting 

investments. Revenue generated is from compliance efforts that yield direct, measurable results 

through enforcement activities such as examination and collection returns. Protected revenue is 

revenue the IRS protects from being refunded erroneously. It is associated with activities that 

occur before issuing a taxpayer’s refund, including the identification of fraud and questionable 

returns. 

FY 2020 Revenue Generating Investments

The FY 2020 Budget includes $311.3 million in investments for traditional enforcement and 

strategic revenue programs, which are projected to generate more than $2 billion in revenue 

once the investments reach full potential in FY 2022 with an expected total ROI of $5.7 to $1. 

This request includes $118.6 million to support strategic revenue producing investments, 

including improving strengthening the Return Review Program and fighting cybercrimes, 

among other initiatives. While these investments do not have an immediately measurable ROI, 

they have clear long-term positive revenue effects. 

FY 2020 Revenue Protecting Investments

The benefits of IRS activities that prevent erroneous refunds are not captured in IRS’s ROI 

calculations above. However, the IRS estimates that investment in these activities should 

protect $675 million in revenue that otherwise would need to be recovered from downstream 

enforcement actions for an estimated ROI of $8.9 to $1 by FY 2022. These investments also 

support IRS’s Agency Priority Goal on Fraud Prevention, which is part of the Treasury 

Strategic Plan 2018-2022 to reduce the amount of unprotected identity theft tax refunds paid by 

two percent by December 21, 2019. 

Return on Investment (ROI) for IRS FY 2020 Enforcement Initiatives 

Dollars in Millions

Cost Revenue ROI Cost Revenue ROI Cost Revenue ROI

FY 2020 Revenue Producing Enforcement Initiatives $311.3 $381.9 1.2 $405.4 $1,684.2 4.2 $397.4 $2,249.4 5.7

Before Cap Adjustment Enforcement Initiatives $4.0 $0.0 0.0 $4.0 $0.0 0.0 $4.0 $0.0 0.0

Increase Audit Coverage 2.5 0.0 0.0 2.5 0.0 0.0 2.5 0.0 0.0

Increase Collection Coverage 1.5 0.0 0.0 1.5 0.0 0.0 1.5 0.0 0.0

Cap Adjustment Enforcement Initiatives $311.3 $381.9 1.2 $405.4 $1,684.2 4.2 $397.4 $2,249.4 5.7

Immediate and Directly Measurable Revenue-Producing Initiatives $192.7 $381.9 2.0 $285.8 $1,684.2 5.9 $279.2 $2,249.4 8.1

Increase Audit Coverage 121.1 251.8 2.1 181.3 911.7 5.0 176.3 1,270.6 7.2

Increase Collection Coverage 71.6 130.1 1.8 104.5 772.5 7.4 102.9 978.8 9.5

Strategic Revenue-Producing Initiatives (which do not have immediately measurable ROI, but clear

long-term revenue effects)

$118.6 $0.0 0.0 $119.6 $0.0 0.0 $118.2 $0.0 0.0

Return Review Program 52.5 0.0 0.0 52.0 0.0 0.0 52.0 0.0 0.0

Fight Cybercrimes and Counterterrorism 40.2 0.0 0.0 41.7 0.0 0.0 40.3 0.0 0.0

IT Support for Enforcement Efforts 25.9 0.0 0.0 25.9 0.0 0.0 25.9 0.0 0.0

First Year (FY 2020) Second Year (FY 2021) Full Performance (FY 2022)
IRS-91 

FY 2020 Revenue Protecting Enforcement Initiatives

Dollars in Millions

Cost Revenue ROI Cost Revenue ROI Cost Revenue ROI

Revenue Protecting Initiatives (which protect taxpayer information, prevents identity theft, and results 

in long-term revenue protection)

$50.3 $56.0 1.1 $78.4 $405.0 5.2 $75.9 $675.0 8.9

Cap Adjustment Revenue Protecting Initiative $50.3 $56.0 1.1 $78.4 $405.0 5.2 $75.9 $675.0 8.9

Increase Audit Coverage (revenue-protecting portion) 14.0 56.0 4.0 20.2 405.0 20.0 20.1 675.0 33.6

Expand Coverage in the Tax-Exempt Sector 36.3 0.0 0.0 58.2 0.0 0.0 55.8 0.0 0.0

First Year (FY 2020) Second Year (FY 2021) Full Performance (FY 2022)
IRS-92 

Cap Adjustment Program Increases...............................+$361,571,000 / +1,760 FTE

Increase Audit Coverage +$135,097,000 / +943 FTE

The IRS is requesting additional 

examination employees to reverse the 

decline in staffing. The individual 

audit coverage rate has shrunk from 

1.1 percent in FY 2010 to a target of 

0.5 percent in FY 2019, which 

increases the risk to the nation’s 

voluntary tax compliance system. 

Examination program resources will 

cover a broad range of compliance 

priorities, including earlier case 

assignment and resolution. The 

investment is projected to produce 

more than $1.3 billion in additional 

revenue annually and an ROI estimated 

at $7.2 to $1, once the new hires reach 

full potential in FY 2022. These 

resources will help to: 

• Close more than 162,000

correspondence examination

cases and 38,000 individual

field examination cases;

• Improve the individual audit coverage rate, and expand examination coverage on cases

involving employment taxes, estate and gift taxes, and Bank Secrecy Act reporting; and

• Expand the Automated Underreported (AUR) program to process more than

470,000 additional cases and other document matching programs that will process an

additional 133,000 cases (document matching of individuals decreased 36 percent from

FY 2011 to FY 2018).

Position Type/Other Costs FTE Positions $000

Examination Coverage 290.50 581 $52,973

Revenue Agent 196.00 392 38,818

Tax Technician 78.00 156 12,753

Manager/Support Staff 16.50 33 1,402

Specialty Programs 44.00 88 $9,344

Revenue Agent 34.50 69 8,091

Tax Technician 1.00 2 119

Tax Examiner 2.50 5 258

Attorney 3.50 7 590

Support Staff 2.50 5 286

Correspondence Examination 230.00 460 $22,611

Tax Technician 1.50 3 210

Tax Examiner 195.50 391 19,090

Manager/Support Staff 33.00 66 3,311

Document Matching 161.00 322 $17,262

Tax Technician 2.50 5 314

Tax Examiner 141.00 282 14,969

Support Staff 17.50 35 1,979

Other Direct Costs 218.00 350 $32,907

Revenue Agent 25.00 50 4,018

Tax Examiner 18.00 36 2,021

Appeals Officer 40.00 80 6,828

Attorney 29.50 59 5,715

Paralegal 4.00 8 486

TAS Specialist 96

Contact Representative 372

Seasonal 274

Manager/Program Analyst/Support Staff 101.50 117 13,097

Total 943.50 1,801 $135,097

$121.1

$251.8 $181.3 $176.3

$911.7

$1,270.6

$0

$200

$400

$600

$800

$1,000

$1,200

$1,400

FY 2020 FY 2021 FY 2022

in millions

Revenue Generating ROI 

Cost Enforcement Revenue

$2.1 to $1

$7.2 to $1

$5.0 to $1

$14.0

$20.2 $20.1

$0.0

$332.3

$531.5

$0

$100

$200

$300

$400

$500

$600

FY 2020 FY 2021 FY 2022

in millions

Revenue Protecting ROI 

Cost Enforcement Revenue

$26.4 to $1

$16.5 to $1
IRS-93 

Other Direct Costs 

IRS Activity Cost FTE Positions Explanation

Appeals $12,867 83.00 166

Support examination efforts on key compliance areas 

focused on improving voluntary compliance and providing a 

high level of customer service.

Chief Counsel $6,946 41.50 83

Provide support for increases in requests for legal advice, 

litigation assistance, and published guidance on issues 

raised in audits.

Human Capital 

Office $11,353 88.00 90

LR support to handle the increase in front-line positions and 

the expectation that new managerial positions will be 

created. LR support begins in the first year and continues 

throughout a manager's career, as needed. One LR 

Specialist supports 42 managers. Employment - bargaining 

unit positions require internal and external postings that 

involve various assessments and work processes. Personnel 

Security FTE are needed to handle the background and 

suitability checks of these new hires.

SB/SE Human 

Capital Office $786 4.00 8

Hiring positions will support the successful onboarding of 

new hires. Training positions will focus on developing and 

updating course material and delivering effective training 

for new hires. 

Privacy, 

Governmental 

Liaison and 

Disclosure

$195 1.50 3 Address the increase in Freedom of Information Act 

requests as result of increased compliance activity. 

Taxpayer Advocate 

Service (TAS) $96 

Ensure the IRS follows appropriate procedures and does not 

create unnecessary burdens or compromise taxpayers' 

rights.

WAGE -- Customer 

Service 

Representatives

$664 

Support examination efforts by ensuring staffing is available 

to handle downstream impact in accounts management 

operations.

Total $32,907 218.00 350

Dollars in thousands

Major Activities Protected Revenue 

($M)

Projected

Revenue ($M)

Pre-Refund 

Closures

Projected 

Closures

Field Examination 228.9 32,272 

Specialty Programs 37.1 6,347 

Correspondence Examination 531.5 216.0 120,800 41,860 

AUR 541.6 471,393 

BMF Underreporter/Document Matching 225.1 133,785 

Total $531.5 $1,248.7 120,800 685,657 
IRS-94

Increase Collection Coverage +$71,557,000 / +441 FTE

The IRS is requesting additional 

resources to improve its capacity to work 

the collection inventory and answer 

taxpayer phone calls. Increased staffing 

will address the overall collection 

coverage rate, which has declined 

16 percent from FY 2010 to FY 2017. 

This investment is expected to produce 

additional annual enforcement revenue of 

$978.8 million, an ROI of $9.5 to $1, 

once the new hires reach full potential in 

FY 2022. These resources will help the 

IRS to:

• Provide nearly 350 additional 

field collection staff to expand 

programs that address non-filing and 

underpayment of taxes to handle more than 

60,000 additional collection cases (currently 

there are more than one million cases with an 

aggregate assessed balance of more than 

$45.9 billion in the queue);

• Provide more than 220 additional Automated 

Collection System (ACS) staff to address an 

additional 358,000 ACS cases, including 

incoming calls generated by the issuance of 

levies, delinquent returns, and/or unpaid tax 

liabilities. ACS staffing has decreased by 

25 percent since the end of FY 2010, resulting in a substantial increase in unhandled 

ACS cases and a decreased level of service to taxpayers; and

• Expand several Compliance Services Collection Operations (CSCO) programs that 

address non-filing and underpayment of taxes through the notice process by more than 

350,000 notice dispositions and cases. CSCO investments will increase balance due 

work and expand the following programs: Automated Substitute for Return, Offers in 

Compromise, and Insolvency.

Major Activities Projected

Revenue ($M)

Projected 

Closures

Field Collection 330.6 63,470 

Automated Collection System 405.6 358,658 

Offers In Compromise 5.2 3,510 

Compliance Services Collection Operation 15.2 65,919 

Total $756.6 491,557 

$71.6

$104.5 $102.9 $130.1

$772.6

$978.8

$0

$200

$400

$600

$800

$1,000

$1,200

FY 2020 FY 2021 FY 2022

in millions

Revenue Generating ROI 

Cost Enforcement Revenue

$1.8 to $1

$9.5 to $1

$7.4 to $1

Position Type/Other Costs FTE Positions $000

Field Collection Coverage 172.50 335 $34,872

Revenue Officer 172.50 335 34,872

ACS & ACS Support 113.00 226 $14,253

Customer Service Representative 113.00 226 14,253

Correspondence Collection (CSCO) 32.00 64 $3,117

Tax Examiner 21.50 43 1,900

Manager/Support Staff 10.50 21 1,217

Other Direct Costs 123.00 212 $19,315

Tax Examiner - Appeals 9.00 18 1,011

Appeals Officer 52.00 104 8,877

Paralegal 2.00 4 243

Attorney 12.50 25 2,400

Program Analyst 3.50 7 456

Manager/Support Staff 9.00 18 1,375

TAS Specialist 191

Contact Representative 152

Seasonal 91

HR Specialist 35.00 36 4,519

Total 440.50 837 $71,557
IRS-95 

Other Direct Costs 

IRS Activity Cost FTE Positions Explanation

Appeals $9,887 61.00 122

Support collection efforts and provide a high level of 

customer service on key compliance areas, particularly the 

Trust Fund Recovery Penalty and Collection Due Process 

workstreams. 

Chief Counsel $3,020 18.50 37 Provide support for increases in requests for legal advice, 

litigation assistance, and collection due process.

Human Capital Office $4,519 35.00 36

LR support to handle the increase in front-line positions and 

the expectation that new managerial positions will be 

created. LR support begins in the first year and continues 

throughout a manager's career, as needed. One LR 

Specialist supports 42 managers. Employment - bargaining 

unit positions require internal and external postings that 

involve various assessments and work processes. Personnel 

Security FTE are needed to handle the background and 

suitability checks of these new hires.

SB/SE Human Capital Office $982 5.00 10

Hiring positions will support the successful onboarding of 

new hires. Training positions will focus on developing and 

updating course material and delivering effective training 

for new hires. 

Privacy, Governmental Liaison 

and Disclosure $456 3.50 7 Address the increase in Freedom of Information Act 

requests as result of increased compliance activity. 

Taxpayer Advocate Service 

(TAS) $191 

Ensure the IRS follows appropriate procedures and does not 

create unnecessary burdens or compromise taxpayers' 

rights.

WAGE -- Customer Service 

Representatives $261 

Support collection efforts by ensuring staffing is available to 

handle downstream impact in accounts management 

operations.

Total $19,315 123.00 212

Dollars in thousands
IRS-96 

Fight Cybercrimes and Counterterrorism +$40,197,000 / +87 FTE

Funding for this investment will 

strengthen cybercrimes and 

counterterrorism by enhancing 

several areas to include increasing 

Special Agent and Investigative 

Support resources to combat cybercriminals that exploit stolen taxpayer 

Personally Identifiable Information 

(PII) obtained through sophisticated data breaches and intrusions. This will allow increased 

participation in multi-agency cyber and counterterrorism task forces to target large-scale crime 

rings to maximize compliance. It will expand criminal investigations through analysis of rich 

data from Suspicious Activity Reports (SARs) and fund the build-out of CI’s cybersecurity and 

cybercrime divisions. 

Since 9/11, IRS Criminal Investigation has occupied a pivotal role in the United States’ 

counterterrorism efforts, from identifying more than $2 billion in assets embezzled by Saddam 

Hussein and repatriating $1.3 billion to participating in many prosecutions of counterterrorism 

financing investigations. Moreover, CI agents have assisted in many high-profile terrorist 

investigations, from the domestic attacks in Boston, San Bernardino, Tampa and New York, to 

the international tragedies in Paris, Brussels and Manchester. CI continues to be a powerful 

force behind disrupting and dismantling attacks against the homeland and targeting the rise of 

the violent jihadists and the Islamic State. 

The FBI’s Joint Terrorism Task Forces (JTTF) are CI’s main gateway to the national security 

community. CI staffs about half of the 104 task forces and supports the others as needed. This 

request will allow CI to increase its JTTF footprint and dedicate additional resources to national 

security investigations including counterintelligence, counterespionage and 

counter-proliferation investigations. Additionally, CI has formed a mobile counterterrorism 

Jump Team to respond to national security incidents/events as needed in support of the United 

States National Security interests. 

This funding would support the hiring of 144 Special Agents to conduct criminal investigations 

related to cyber and counterterrorism. As a result, the IRS should be able to complete about 900 

additional criminal investigations in total by FY 2025. The number of completed cases will not 

immediately materialize (probably not until at least FY 2021/2022) because of the time it takes 

to train agents and bring them up to full performance and the time it takes to complete 

investigations (300-400 days). 

The investigation of a terrorist attack is, at its core, a violent crime investigation. As with any 

violent crime, time is of the essence and the ability to rapidly identify, locate and assess 

evidence is paramount to thwarting future crimes and ensuring the prosecution of offenders. 

This axiom extends to financial crimes linked to terror attacks. CI’s ability to be present and 

working with other investigators is vital to success. The passage of time can easily result in the 

destruction or concealment of evidence, transfer of criminal proceeds used to fund future 

attacks, or even missed opportunities to identify conspirators and abettors. 

Position Type/Other Costs FTE Positions $000

Special Agents 39.00 78 $13,057

Special Agent 24.00 48 8,590

Analyst 11.00 22 1,377

IT Specialist 4.00 8 525

Contractual Services 2,565

Other Direct Costs 48.00 96 $27,140

Special Agent 48.00 96 27,140

Total 87.00 174 $40,197
IRS-97 

Imbedding CI with existing law enforcement response teams, such as the FBI response teams, 

accelerates coordination of government resources and allows for methodical, expeditious 

harvesting of financial evidence, exhaustive analysis in tracing and linking funds, and the 

increased likelihood of criminal prosecution and forfeitures for financial-related crimes. This 

request funds contractor support which will:

• Identify classes of fraud use cases, defining how they vary across the fraud actor

community, and will facilitate sharing anonymized data for analysis and identification

of fraud classes.

• Monitor tax fraud communication on the deep web to increase awareness of criminal

activity focused on undermining protection barriers and fraud filters.

• Examine the fraud lifecycle to identify steps that non-compliant taxpayers take, and the

ways CI can defend against each step.

• Determine how to build effective prevention and defense early in the fraud lifecycle.

• Develop machine-ingestible common vocabulary for fraud intelligence that allows

non-compliant characteristics and techniques to be shared efficiently in a timely way.

• Validate fraud prevention mechanisms to assess their effectiveness and maintain and

share current contact information with all partners.

Other Direct Costs 

IRS Activity Cost FTE Positions Explanation

Special Agent $27,140 48.00 96 Conduct more criminal investigations related to cyber 

and counterterrorism.

Total $27,140 48.00 96

Dollars in thousands
IRS-98 

Return Review Program +$52,466,000 / +57 FTE

This investment provides funding for 

57 FTEs, hardware, software, and 

contractual services for deployed 

Return Review Program (RRP) 

applications. RRP deployed an 

Integrated Data Warehouse, In-Line Screening engine, and Offline Prevention environment that 

enhanced the IRS's ability to detect, resolve, and prevent criminal fraud and civil tax 

non-compliance. 

Since October 2016, the Return Review Program (RRP) has been the IRS’s primary system for 

detecting tax return fraud and other anomalies in tax filings, with a current focus on individual 

tax return data. RRP has protected more than $8.9 billion in confirmed fraud and has a return 

on investment (ROI) of $18.5 to $1. 

Funding will allow the IRS to provide support for the deployed capabilities by: 

• Enhancing applications, data modeling and mining, database development, business

rules development, infrastructure support, performance engineering and testing, and

application testing;

• Providing annual maintenance fees from hardware vendors and purchases to refresh

computers, network equipment, and storage;

• Updating and maintaining the system software including operating systems, database,

data integration, and utility software; and

• Working with the business to update the rules engines and data analytics.

Other Direct Costs 

There are no other direct costs associated with the initiative.

Position Type/Other Costs FTE Positions $000

Return Review Program O&M 57.00 57 $52,466

IT Specialist 57.00 57 8,614

Contractual Services 43,852

Total 57.00 57 $52,466
IRS-99 

IT Support for Enforcement Efforts +$25,945,000 / 0 FTE

This investment will improve Information 

Technology Operations & Support activities 

related to compliance systems used by IRS 

employees. These systems support the day-today activities of about 17,000 revenue agents 

and tax examiners conducting audits, 3,000 

revenue officers collecting taxes, and 2,000 

special agents conducting criminal investigations.

Position Type/Other Costs FTE $000

IT Support for Enforcement 

Efforts 0.00 $25,945

Contractual Services 14,002

Hardw are & Softw are 11,943

Total 0.00 $25,945
IRS-100 

Expand Coverage in the Tax-Exempt Sector +$36,309,000 / +232 FTE

Funding for this investment will allow 

the IRS to use a multi-faceted datadriven approach to enhance taxpayer 

education and compliance that will help 

protect the tax-exempt status of 

associated assets and revenue. 

This investment supports the following 

efforts, which will increase taxpayer 

service and education and improve 

overall compliance and protection of 

funds. 

• Enhance enforcement coverage

of employee retirement plans,

including but not limited to

those sponsored by small

businesses, exempt

organizations, and governments,

which make up almost half of all

retirement plans in the

United States;

• Address Exempt Organizations and Tax-Exempt Bond non-compliance to ensure

adherence with complex and often confusing tax laws; and

• Increase voluntary compliance using low cost correction opportunities, to enhance

taxpayer education and compliance.

Position Type/Other Costs FTE Positions $000

Expand Protection and Coverage of Small 

Business and Tax Exempt Sponsored Plans 36.5 73 $6,225

Revenue Agent 31.5 63 5,597

Manager 2.5 5 338

Support Staff 2.5 5 290

Address EO Noncompliance with UBI 100.0 200 $17,277

Revenue Agent 84.0 168 14,927

Tax Compliance Officer 8.0 16 928

Manager 8.0 16 1,422

Enhance Up-front Compliance for Applicant for 

Tax-Exempt Status 33.5 67 $4,631

Revenue Agent 15.0 30 2,514

Tax Examiner 12.5 25 1,394

Manager 3.0 6 389

Support Staff 3.0 6 334

Increase Voluntary Compliance 58.5 117 $7,489

Revenue Agent 7.5 15 1,332

Tax Technician 22.0 44 2,726

Tax Examiner 21.0 42 2,436

Manager 3.5 7 473

Research Analyst 1.0 2 116

Support Staff 3.5 7 406

Other Direct Costs 3.5 7 $687

Attorney 3.0 6 599

Appeals Officer 0.5 1 88

Total 232.00 464 $36,309
IRS-101

4.2 – Summary of IRS FY 2020 Identity Theft Budget Request

4.3 – Summary of IRS FY 2020 ACA Budget Request

Bureau: Internal Revenue Service

Summary of FY 2020 Identity Theft Request $000 FTE $000 FTE $000 FTE $000 FTE $000 FTE

FY 2019 Annualized CR Level $129,499 1,827 $244,290 2,305 $53,209 65 $24,000 50 $450,998 4,247

Changes to Base:

Maintaining Current Levels (MCLs) $2 $233 $299 $534

Non-Pay Inflation Adjustment 2 233 299 534

Subtotal FY 2020 Changes to Base $2 $233 $299 $534

FY 2020 Current Services $129,501 1,827 $244,523 2,305 $53,508 65 $24,000 50 $451,532 4,247

Program Changes:

Program Increases:

IRS Technology Modernization Plan $11,000 11,000

Prevent Identity Theft 6,948 6,948

O&M of Critical Systems 232 232

Subtotal FY 2020 Program Increases $6,948 $232 $11,000 $18,180

Total FY 2020 Request $129,501 1,827 $251,471 2,305 $53,740 65 $35,000 50 $469,712 4,247

Dollar/FTE Change FY 2020 Request over FY 2019 Annualized CR Level $2 $7,181 $531 $26,562 $18,714 (41)

Percent Change FY 2020 Request over FY 2019 Annualized CR Level 0.00% 2.94% 1.00% 4.15% -0.97%

Cap Adjustment Program Increases

Return Review Program 6,739 20 6,739 20

Subtotal FY 2020 Cap Adjustment Investments $6,739 20 $6,739 20

Total FY 2020 Request Including Cap Adjustment $129,501 1,827 $251,471 2,305 $60,479 85 $35,000 50 $476,451 4,267

Dollar/FTE Change FY 2020 Request Including Cap Adj over FY 2019 Annualized CR Level $2 $7,181 $7,270 20 $11,000 $25,453 20

Percent Change FY 2020 Request Including Cap Adj over FY 2019 Annualized CR Level 0.00% 2.94% 31.62% 30.30% 130.36% 5.64% 0.47%

TAXPAYER 

SERVICES ENFORCEMENT OPERATIONS SUPPORT BSM TOTAL

Bureau: Internal Revenue Service

Summary of FY 2020 ACA Request $000 FTE $000 FTE $000 FTE $000 FTE

FY 2019 Annualized CR Level $111,537 1,870 $16,806 165 $73,338 208 $73,338 208

Changes to Base:

Maintaining Current Levels (MCLs) $1 $3 $3 $7

Non-Pay Inflation Adjustment 1 3 3 7

Subtotal FY 2020 Changes to Base $1 $3 $3 $3

FY 2020 Current Services $111,538 1,870 $16,809 165 $73,341 208 $73,341 208

Total FY 2020 Request $111,538 1,870 $16,809 165 $73,341 208 $73,341 208

Dollar/FTE Change FY 2020 Request over FY 2019 Annualized CR Level $1 $3 $3 $3 2

Percent Change FY 2020 Request over FY 2019 Annualized CR Level 0.00% 0.02% 0.00% 0.00% 0.96%

TAXPAYER 

SERVICES

ENFORCEMENT OPERATIONS 

SUPPORT

TOTAL
IRS-102 

4.4 – Summary of IRS FY 2020 Cyber Security Budget Request 

Bureau: Internal Revenue Service

Summary of FY 2020 Cyber Security Request $000 FTE $000 FTE $000 FTE $000 FTE $000 FTE

FY 2019 Annualized CR Level $14,000 22 $17,000 60 $235,000 438 $65,000 $331,000 520

Changes to Base:

Maintaining Current Levels (MCLs) $280 $340 $4,700 $5,320

Non-Pay Inflation Adjustment 280 340 4,700 5,320

Subtotal FY 2020 Changes to Base $280 $340 $4,700 $5,320

FY 2020 Current Services $14,280 22 $17,340 60 $239,700 438 $65,000 $336,320 520

Program Changes:

Program Increases:

O&M of Prior-year Enterprise-wide Cybersecurity Investments 6,744 6,744

Subtotal FY 2020 Program Increases $6,744 $6,744

Total FY 2020 Request $14,280 22 $17,340 60 $246,444 438 $65,000 $343,064 520

Dollar/FTE Change FY 2020 Request over FY 2019 Annualized CR Level $280 $340 $11,444 $12,064

Percent Change FY 2020 Request over FY 2019 Annualized CR Level 2.00% 2.00% 4.87% 3.64%

TAXPAYER 

SERVICES ENFORCEMENT OPERATIONS SUPPORT BSM TOTAL
IRS-103 

4.5 – Summary of IRS FY 2020 Request

Bureau: Internal Revenue Service 

Summary of FY 2020 Request $000 FTE $000 FTE $000 FTE $000 FTE $000 FTE

FY 2019 Annualized CR Level (Pre-IAT and TCJ Adjustments) $2,506,554 27,947 $4,860,000 35,327 $3,634,000 10,340 $110,000 361 $11,110,554 73,975

Planned Interappropriation Transfer (200,000) (1,346) 200,000 (1,346)

Section 112 Administrative Provision 65,000 887 12,000 68 $77,000 955

FY 2019 Annualized CR Level $2,571,554 28,834 $4,672,000 34,049 $3,834,000 10,340 $110,000 361 $11,187,554 73,584

Changes to Base:

Other Adjustments ($101,636) (1,192) $101,636 163 (1,029)

Offset to O&M for Critical IT Systems (101,636) (1,192) $101,636 163 (1,029)

Maintaining Current Levels (MCLs) $3,161 $6,249 $41,155 $50,565

Non-Pay Inflation Adjustment (2.0%) 3,161 6,249 41,155 50,565

Efficiency/Savings ($71,079) (1,003) ($13,717) (68) ($24,804) ($109,600) (1,071)

Increase e-File Savings (6,079) (116) (104) (6,183) (116)

Space Optimization (24,700) (24,700)

Reduce Contractual Services (1,717) (1,717)

Non-Recur for Section 112 Tax Reform Funding (65,000) (887) (12,000) (68) (77,000) (955)

Subtotal FY 2020 Changes to Base ($169,554) (2,195) ($7,468) (68) $117,987 163 ($59,035) (2,100)

New FY 2020 Current Services $2,402,000 26,639 $4,664,532 33,981 $3,951,987 10,503 $110,000 361 $11,128,519 71,484

Program Changes:

Program Increases: $40,836 201 $123,034 180 $180,000 80 $343,870 461

IRS Technology Modernization Plan 180,000 80 180,000 80

Data Analytics to Enhance Compliance 28,470 174 5,363 16 33,833 190

Prevent Identity Theft 12,366 27 10,122 2 22,488 29

O&M of Prior-year Enterprise-wide Cybersecurtiy Investments 6,744 6,744

O&M of Critical Systems 100,805 162 100,805 162

Subtotal FY 2020 Program Changes $40,836 201 $123,034 180 $180,000 80 $343,870 461

Total FY 2020 Request $2,402,000 26,639 $4,705,368 34,182 $4,075,021 10,683 $290,000 441 $11,472,389 71,945

Dollar/FTE Change FY 2020 Request ov er FY 2019 Annualized CR ($169,554) (2,195) $33,368 133 $241,021 343 $180,000 80 $284,835 (1,639)

Percent Change FY 2020 Request ov er FY 2019 Annualized CR -6.59% -7.61% 0.71% 0.39% 6.29% 3.32% 163.64% 22.16% 2.55% -2.23%

Cap Adjustment Program Increases

Increase Audit Coverage 92,557 854 42,540 89 135,097 943

Increase Collection Coverage 50,344 402 21,213 39 71,557 441

Fight Cybercrimes and Counterterrorism 28,927 87 11,270 40,197 87

Return Review Program 52,466 57 52,466 57

IT Support for Enforcement Efforts 25,945 25,945

Expand Coverage in the Tax-Exempt Sector 28,058 232 8,251 36,309 232

Subtotal FY 2020 Cap Adjustment Investments $199,886 1,575 $161,685 185 $361,571 1,760

Total FY 2020 Request Including Cap Adjustment $2,402,000 26,639 $4,905,254 35,757 $4,236,706 10,868 $290,000 441 $11,833,960 73,705

Dollar/FTE Change FY 2020 Request Including Cap Adj ov er FY 2019 Annualized CR ($169,554) (2,195) $233,254 1,708 $402,706 528 $180,000 80 $646,406 121

Percent Change FY 2020 Request Including Cap Adj ov er FY 2019 Annualized CR -6.59% -7.61% 4.99% 5.02% 10.50% 5.11% 163.64% 22.16% 5.78% 0.16%

TAXPAYER SERVICES ENFORCEMENT OPERATIONS SUPPORT BSM TOTAL



Department of the Treasury 

Departmental Offices

Salaries and Expenses 

Congressional Budget 

Justification and Annual 

Performance Report and Plan

FY 2020
SE - 2 

Table of Contents

Section I – Budget Request........................................................................................................... 3

A – Mission Statement................................................................................................................ 3

B – Summary of the Request ...................................................................................................... 3

1.1 – Appropriations Detail Table .............................................................................................. 3

1.2 – Budget Adjustments Table ................................................................................................. 4

C – Budget Increases and Decreases Description....................................................................... 4

1.3 – Operating Levels Table...................................................................................................... 9

D – Appropriations Language and Explanation of Changes .................................................... 10

E – Legislative Proposals.......................................................................................................... 10

Section II – Annual Performance Plan and Report................................................................. 11

A – Strategic Alignment ........................................................................................................... 11

B – Budget and Performance by Budget Activity .................................................................... 11

2.1.1 – Executive Direction Resources and Measures.............................................................. 11

Executive Direction Budget and Performance.......................................................................... 11

2.1.2 – International Affairs and Economic Policy Resources and Measures .......................... 12

International Affairs and Economic Policy Budget and Performance...................................... 12

2.1.3 – Domestic Finance and Tax Policy Resources and Measures........................................ 17

Domestic Finance and Tax Policy Budget and Performance.................................................... 17

2.1.4 – Treasury-wide Management and Programs Resources and Measures .......................... 22

Treasury-wide Management and Programs Budget and Performance ..................................... 22

Section III – Additional Information ........................................................................................ 27

A – Summary of Capital Investments....................................................................................... 27
SE - 3 

Section I – Budget Request

A – Mission Statement

Maintain a strong economy and create economic and job opportunities by promoting conditions 

that enable economic growth and stability at home and abroad and manage the U.S. 

Government’s finances and resources effectively.

B – Summary of the Request 

The FY 2020 Request proposes increases to help implement programs that bolster U.S. economic 

growth, promote financial stability, enhance national security, transform government-wide 

financial stewardship, and achieve operational excellence. Particular focuses of this request are

the Committee on Foreign Investment in the United States (CFIUS) program’s expanded 

responsibilities under the Foreign Investment Risk Review Modernization Act of 2018 

(FIRRMA), expansion of the Office of Tax Policy’s impact analyses of tax regulations, a 

significant expansion of the Office of Critical Infrastructure Protection and Compliance Policy’s 

(OCIP’s) efforts to protect the U.S. financial services sector from cyberattacks and improve 

resilience of critical infrastructure, and increased funding for additional Domestic Finance 

staffing to support Administration priorities. 

In addition to requested increases for the Treasury Departmental Offices (DO) Salaries and 

Expenses (SE) account, DO anticipates transferring in and executing $15 million of the $20 

million CFIUS Fund request, discussed separately. 

1.1 – Appropriations Detail Table

Dollars in Thousands

DO Salaries and Expenses

Appropriated Resources

New Appropriated Resources FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

Executive Direction 128 $35,940 105 $36,474 107 $36,876 2 $402 1.90% 1.10%

Domestic Finance and Tax Policy 265 $68,363 228 $74,199 264 $88,133 36 $13,934 15.79% 18.78%

International Affairs and Economic Policy 211 $50,732 177 $46,981 177 $50,467 0 $3,486 0.00% 7.42%

Treasury-w ide Management and Programs 142 $40,716 114 $41,922 116 $40,497 2 ($1,425) 1.75% -3.40%

Committee on Foreign Investment in the 

United States (CFIUS) 26 $6,000 65 $15,000 81 $20,000 16 $5,000 24.62% 33.33%

Subtotal New Appropriated Resources 772 $201,751 689 $214,576 745 $235,973 56 $21,397 8.13% 9.97%

Other Resources

 Expenditure Transfer from the CFIUS Fund 0 $0 0 $0 0 $15,000 0 $15,000 NA NA

 Reimbursables 91 $79,690 52 $12,432 52 $12,432 0 $0 0.00% 0.00%

Subtotal Other Resources 91 $79,690 52 $12,432 52 $27,432 0 $15,000 0.00% 120.66%

Total Budgetary Resources 863 $281,441 741 $227,008 797 $263,405 56 $36,397 7.56% 16.03%

Notes: FY 2018 other resources and FTE are actuals

 FY 2018 CFIUS funds were enacted in the International Affairs and Economic Policy Budget Activity. They are broken out here for comparison purposes.

FY 2018 FY 2019 FY 2019 to FY 2020

Enacted Annualized CR Request Change % Change

FY 2020
SE - 4 

1.2 – Budget Adjustments Table

C – Budget Increases and Decreases Description

Maintaining Current Levels (MCLs) ........................................................ +$1,761,000 / +0 FTE 

Non-Pay +$1,761,000 / +0 FTE 

Funds are requested for inflation adjustments in non-labor expenses such as GSA rent 

adjustments, postage, supplies, and equipment. 

Transfers ...................................................................................................... +$1,651,000 / +8 FTE

Re-align Office of Critical Infrastructure Protection and Compliance Policy’s (OCIP) 

Cybersecurity Enhancement Funding to DO SE +$1,651,000 / +8 FTE 

DO proposes to realign to the DO SE appropriation the portion of OCIP’s funding for financial 

services sector cybersecurity that is currently provided through the Cybersecurity Enhancement 

Account (CEA). This budget-neutral realignment will combine funding for OCIP under the 

single DO SE appropriation and focus CEA solely on enterprise-wide cybersecurity investments. 
SE - 5 

Efficiency Savings ........................................................................................ -$1,675,000 / +0 FTE 

Contractual Support -$1,675,000 / +0 FTE 

DO will achieve cost savings and efficiencies in contract services through more efficient 

oversight of all contracts, consolidating contracts where appropriate, and partnering with other 

agencies and DO components to leverage common technology or administrative support needs. 

Program Increases ................................................................................. +$19,660,000 / +48 FTE

Operations and Maintenance (O&M) of Prior-year Enterprise-wide Cybersecurity investments

+$2,175,000 / +0 FTE

The FY 2020 request includes funding to support operations and maintenance (O&M) for prior 

year Cybersecurity Enhancement Account investments. O&M will be funded by Treasury 

Bureaus through Treasury Franchise Fund (TFF) billing. This increase represents the bureau’s 

portion of the $17.5 million O&M total.

Committee on Foreign Investment in the United States (CFIUS) Expansion +$5,000,000 / 

+16 FTE

FIRRMA expanded the jurisdiction of CFIUS to address growing national security concerns over 

foreign exploitation of certain investment structures which traditionally have fallen outside of 

CFIUS jurisdiction. This budget request funds FTE and contract resource requirements for the 

Office of International Affairs and Office of General Counsel necessary to implement FIRRMA 

and handle the expected workload of 1,000 cases per year (compared to 238 prior to FIRRMA). 

Please refer to the CFIUS Activities Congressional Justification chapter for additional 

information. 

Impact Analyses of Tax Regulations +$1,802,000 / +6 FTE

One of the Administration’s goals is to bring clarity to the complex Internal Revenue Code and 

to provide useful guidance to taxpayers. Following enactment of the Tax Cuts and Job Act of 

2017, pursuant to a Memorandum of Agreement (MOA) between Treasury and the Office of 

Management and Budget (OMB) in April 2018, Treasury agreed to create a new framework to 

accommodate the Executive Order (EO) 12866 review of tax regulations with the objective of 

providing taxpayers with economic analysis for significant tax regulations while reducing 

regulatory burdens and providing timely tax guidance for taxpayers. To accomplish this, the 

Office of Tax Policy (OTP) requests $1.802 million and 6 FTE to conduct robust regulatory 

impact analyses of “significant” tax regulations as determined by OMB. 

The requested funding would provide the resources needed to comply with 60 potential EO 

12866 reviews in FY 2020 versus 10 regulatory reviews under current funding. These reviews 

include conducting the analyses needed to determine the significance of regulations under EO 

12866, including whether specific regulations require a regulatory impact analysis, and when 

needed, the creation of this analysis. 

OTP estimates that the Internal Revenue Service (IRS) and Treasury produce approximately 350 

regulatory projects annually. These regulatory projects will be analyzed to determine if 

regulatory impact analysis is required. OTP estimates that 50-60 projects may be deemed 

significant by OMB during a fiscal year.
SE - 6 

To conduct timely and accurate analysis, OTP will work with the IRS Office of Research, 

Analysis and Statistics (RAAS) to stand up a mirrored server at the RAAS location to provide 

OTP personnel with appropriate applications and storage in order to conduct burden estimates 

for regulatory projects.

Strengthen the Financial Services Sector’s Cybersecurity and Critical Infrastructure Protection

(OCIP) +$7,700,000 / +13 FTE

The U.S. financial services sector faces a broad range of cybersecurity vulnerabilities and 

physical hazards, both domestically and internationally. The United States’ adversaries have 

grown in technical capability, and their attacks have likewise increased in sophistication. This 

request would enable Treasury to proactively reduce risks to the sector by identifying previously 

unidentified vulnerabilities before they can be exploited. 

Vulnerability Identification +$5,300,000 / +7 FTE: 

The FY 2020 request will improve Treasury's capabilities to identify and assess vulnerabilities, 

thereby helping mitigate risks to the financial services sector’s infrastructure. This will build 

upon critical infrastructure process maps developed by OCIP in 2014. Of this request, $3.0 

million will be used to update outdated maps, identify and diagram additional processes, 

visualize linkages among major sector actors, and link to geographically-based risks. 

The remaining $2.3 million of this request will be used to study vulnerabilities at the 27 most 

critical financial institutions and conduct exercises on a broader range of financial services sector 

institutions and sub-sectors. OCIP will also work with the sector to identify and prioritize 

vulnerabilities with an emphasis on the largest financial institutions. This effort will identify 

common systemic risks within these institutions and the other infrastructures on which the sector 

relies (e.g. energy and telecommunications) to pinpoint shared vulnerabilities. 

Without the identification and assessment of these vulnerabilities, the financial system will 

remain exposed to an unacceptable level of risk. Both activities will help identify and avoid 

potential damage from malicious actors as well as natural disasters such as hurricanes and 

earthquakes. 

Early Vulnerability Mitigation/Avoidance +$2,400,000 / +6 FTE: 

To support the President's National Cyber Strategy, issued in September of 2018, OCIP seeks to 

assist the financial services sector by focusing on early detection of a broad range of 

cybersecurity vulnerabilities and developing recommended mitigation strategies. This request 

will allow Treasury and the sector to shift to a more proactive risk reduction approach by finding 

and mitigating vulnerabilities before they can cause damage, reducing the number of incidents as 

well as the cost of the recovery for those that occur. This funding will be used to research and 

understand potential risks of new technology, in particular fintech, promote international 

cybersecurity, expand OCIP's presence at Federal Cyber Centers, and increase collaboration with 

other key U.S. critical infrastructures. 
SE - 7 

Management Capacity Building to Support Program Initiatives +$885,000 / +2 FTE1

Treasury Management requests funding for the oversight and administrative support associated 

with the growth of program offices. The resources would provide funding for: 

• Two FTE within the Office of Human Resources (OHR) of the Centralized Treasury

Administrative Services (CTAS) program. OHR is charged with providing direct support for

the recruitment, staffing, onboarding, engagement, performance and retention of staff for

DO. For example, the CFIUS program office is expected to increase by 55 FTE through FY

2020. OHR’s current staffing levels will be unable to appropriately support growth in these

areas and other FY 2020 initiatives.

• Two FTE within the Office of Privacy, Transparency, and Records of the CTAS program.

There are 1,559 cases pending in FY 2019 compared to 1,259 in FY 2018. Without these

additional resources, the FOIA backlog will continue to grow by 300 cases per year. Two

additional FTE would allow PTR to process the same number of requests they receive.

• One FTE to the Treasury Management and Budget office to work to analyze bureau base

budgets and resource needs.

• One FTE to the Office of Strategic Planning and Performance Improvement to support

increased oversight requirements for the Program Management Improvement and

Accountability Act, the Foundations in Evidence Building Act, and the President’s

Management Agenda.

• The Treasury WAVES request system, which is an upgrade of the U.S. Secret Service IT

System for processing background checks for visitors seeking entrance to the Treasury

Complex (Main Treasury and the Freedman’s Bank Building). The Treasury WAVES

request system includes a customer facing application that removes the collection of PII from

the requestor to the visitors themselves. This program improves the visitor clearance process

and allows Treasury to carry out its day-to-day business in a more efficient manner.

Increase Domestic Finance Staff to Support Strategic Objectives and Priority Goals 

+$2,098,000 / +11 FTE

Between FYs 2016 and 2018, DF’s workforce declined by 50 personnel (roughly one-third) 

within the offices funded by the DO SE appropriation. After a careful review of policy priorities 

and in light of emerging initiatives, Treasury determined that it needs to increase DF staff by 11 

FTE personnel to achieve the Administration’s goals timely and effectively. 

The FY 2020 request would support achievement of the following Treasury and Administration 

strategic objectives by allowing DF to increase staffing to support the following policy 

objectives: 

Office of Assistant Secretary for Financial Markets, +4 FTE 

• Reforming housing finance;

• Monitoring and addressing fiscal issues of state and local governments, including municipal

bonds and fiscal crises;

• Implementing the Core Principles recommendations for reforming regulation of the U.S.

financial system corporate finance;

1 These FTE numbers include only the direct FTE in DO Salaries and Expenses. The initiative also funds 4 FTE in 

the Franchise Fund.
SE - 8 

• Managing the U.S. debt through securities auctions; and

• Ensuring accurate and timely fiscal projections of receipts to the government.

Office of the Assistant Secretary for Financial Institutions, +3 FTE

• Implementing the Core Principles recommendations for reforming regulation of the U.S.

financial system corporate finance.

Office of the Fiscal Assistant Secretary (OFAS), +4 FTE

• Managing the U.S. debt through securities auctions;

• Ensuring accurate and timely fiscal projections of receipts to the government;

• Effectively awarding and monitoring compliance of grants for Gulf Coast restoration;

• Improving federal government financial management; and

• Increasing data transparency about government spending.

In addition to supporting these policy objectives, the new personnel for OFAS will help to 

achieve the following Cross-Agency Priority goals: 

• Leverage Data as a Strategic Asset (DATA Act, federal financial management);

• Sharing Quality Services (overseeing the Bureau of the Fiscal Service, which reports to the

Fiscal Assistant Secretary, and leading federal financial management);

• Shifting from Low-Value to High-Value Work (federal financial management);

• Results-Oriented Accountability for Grants (RESTORE Act awards and compliance); and

• Getting Payments Right (managing the Bureau of the Fiscal Service).

Transfers .................................................................................................... +$15,000,000 / +0 FTE 

Funds transferred from CFIUS Fund +$15,000,000 / +0 FTE

This funding would be transferred from the Committee on Foreign Investment in the United 

States (CFIUS) Fund. This investment will fund development of an end-to-end IT infrastructure 

comprised of a public-facing portal and a case management system to modernize processes and 

to handle anticipated increasing caseloads for CFIUS member agencies that will promote 

efficiencies in the Committee’s processes. This investment is the first year of a multi-year 

project. Treasury will require steady funding through FY 2021 with costs expected to partially 

non-recur as the project moves into operations and maintenance starting in FY 2022. Please 

refer to the CFIUS Activities Congressional Justification chapter for additional information.
SE - 9 

1.3 – Operating Levels Table 

Dollars in Thousands

DO Salaries and Expenses FY 2018 FY 2019 FY 2020

Object Classification Enacted Annualized CR Request

11.1 - Full-time permanent 99,550 89,400 97,627

11.3 - Other than full-time permanent 1,918 1,760 1,760

11.5 - Other personnel compensation 2,385 2,535 2,535

11.9 - Personnel Compensation (Total) 103,853 93,695 101,922

12.0 - Personnel benefits 31,936 28,646 31,495

Total Personnel and Compensation Benefits $135,789 $122,341 $133,417

21.0 - Travel and transportation of persons 4,059 3,299 3,437

22.0 - Transportation of things 265 171 174

23.1 - Rental payments to GSA 618 281 281

23.2 - Rental payments to others 644 657 670

23.3 - Communications, utilities, and miscellaneous charges 294 235 517

24.0 - Printing and reproduction 97 6 6

25.1 - Advisory and assistance services 23,677 9,737 19,984

25.2 - Other services from non-Federal sources 7,736 3,682 4,008

25.3 - Other goods and services from Federal sources 19,877 67,275 72,951

25.4 - Operation and maintenance of facilities 57 0 0

25.7 - Operation and maintenance of equipment 442 227 231

26.0 - Supplies and materials 3,253 2,715 3,046

31.0 - Equipment 4,943 3,950 12,251

32.0 - Land and structures 0 0 0

Total Non-Personnel $65,962 $92,235 $117,556

New Budgetary Resources $201,751 $214,576 $250,973

FTE 772 689 745

Note: FY 2018 FTE are actuals
SE - 10 

D – Appropriations Language and Explanation of Changes

Appropriations Language Explanation of 

Changes

DEPARTMENT OF THE TREASURY

DEPARTMENTAL OFFICES

Federal Funds 

SALARIES AND EXPENSES

For necessary expenses of the Departmental Offices including operation 

and maintenance of the Treasury Building and Freedman's Bank 

Building; 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; executive direction program activities; 

international affairs and economic policy activities; domestic finance 

and tax policy activities, including technical assistance to state and local 

entities; and Treasury-wide management policies and programs 

activities, $235,973,000: Provided, That of the amount appropriated 

under this heading— 

(1) not to exceed $350,000 is for official reception and

representation expenses;

(2) 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 the 

Secretary's certificate; and

(3) not to exceed $24,000,000 shall remain available until

September 30, 2021, for— 

(A) the Treasury-wide Financial Statement Audit and

Internal Control Program; 

(B) information technology modernization requirements;

(C) the audit, oversight, and administration of the Gulf

Coast Restoration Trust Fund; 

(D) the development and implementation of programs

within the Office of Critical Infrastructure Protection and Compliance 

Policy, including entering into cooperative agreements; 

(E) operations and maintenance of facilities; and

(F) international operations.

Note.—A full-year 2019 appropriation for this account was not enacted at 

the time the budget was prepared; therefore, the budget assumes this 

account is operating under the Continuing Appropriations Act, 2019 

(Division C of P.L. 115–245, as amended). The amounts included for 

2019 reflect the annualized level provided by the continuing resolution. 

Removes the one 

time increase in 

representation funds 

provided in 

FY 2019 for the 

Financial Action 

Task Force annual 

conference.

E – Legislative Proposals 

Departmental Offices has no legislative proposals. 
SE - 11

Section II – Annual Performance Plan and Report

A – Strategic Alignment

DO is Treasury’s headquarters bureau. It provides leadership in economic and financial policy, 

financial intelligence, and general management. Treasury utilizes effective management, 

policies, and leadership to protect our national security through targeted financial actions, 

promote the stability of the nation’s financial markets, and ensure the government’s ability to 

collect revenue and fund its operations. DO aligns to all Treasury strategic goals and objectives. 

Specific alignment by budget activity is indicated below.

This request also consolidates and streamlines federal financial literacy education efforts. The 

budget proposes that federal efforts to promote financial literacy be focused on the high-impact 

areas of: basic financial capability, housing, higher education, military and veteran programs, 

and investment and retirement planning. More than 20 federal agencies have some form of 

financial education or literacy programs. Collectively, federal agencies spent an estimated $250 

million on financial literacy and education activities in 2017. Streamlining and consolidating 

programs and activities will be a multi-year effort.

B – Budget and Performance by Budget Activity

2.1.1 – Executive Direction Resources and Measures

Executive Direction Budget and Performance

($36,876,000 from direct appropriations, $3,687,000 from reimbursable resources):

The Executive Direction program area provides direction and policy formulation to DO and the 

rest of Treasury and interacts with Congress and the public on policy matters. 

No specific performance goals/measures are presented for this budget activity because the work 

of these offices is captured within the other budget activities.

Dollars in Thousands

 Resource Level FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Annualized CR Request

Appropriated Resources $34,588 $35,313 $37,778 $36,706 $35,787 $36,474 $36,876

Other Resource $15,137 $21,677 $29,632 $22,997 $25,455 $3,687 $3,687

Budget Activity Total $49,725 $56,990 $67,410 $59,703 $61,242 $40,161 $40,563

FTE 162 189 206 169 159 123 125
SE - 12 

2.1.2 – International Affairs and Economic Policy Resources and Measures

Measure FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Target Target Target

IA - Monitor Quality and Enhance 

Effectiveness of International 

Monetary Fund (IMF) Lending 

Through Review of IMF Country 

Programs

100 100 100 100 100 100 100 100

IA - Monitor Quality and Enhance 

Effectiveness of MDB Lending 

Through Review of MDB Grant and 

Loan Proposals

100 100 100 100 100 100 100 100

IA - Percentage of MDB Grant and 

Loan Proposals Containing

Satisfactory Frameworks for Results 

Measurement

93 93 89 96 97.6 95 95 95

OTA - Program Engagement 3.7 3.8 3.9 4.0 3.8 3.6 3.6 3.6

International Affairs and Economic Policy Budget and Performance 

($50,467,000 from direct appropriations, and $1,835,000 from reimbursable resources): 

The offices in this budget activity promote economic growth in the U.S. by producing technical 

economic analyses for the Secretary and advancing U.S. economic and financial policy priorities 

around the world. 

Office of International Affairs (IA)

This office supports the following strategic objectives for Strategic Goal 1, to boost U.S. 

economic growth:

• Objective 1.2 – Strong Economic Fundamentals: Spur faster economic growth by right-sizing

Treasury and other regulations and advancing domestic economic policies that boost

investment, employment, and innovation.

• Objective 1.4 – Free and Fair Trade: Advance a free and fair trade environment for U.S.

businesses through successful negotiation of trade agreements and investment policies.

This office supports the following strategic objectives for Strategic Goal 2, to promote financial 

stability: 

• Objective 2.2 – Foreign Exchange Practices: Achieve fair foreign exchange practices through

multilateral engagement with international partners.

• Objective 2.3 – Foreign Technical Assistance: Provide technical assistance to enable foreign

partner countries to better raise and manage financial resources and protect their financial

sectors.

Dollars in Thousands

 Resource Level FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Annualized CR Request

Appropriated Resources $56,265 $57,362 $59,061 $60,613 $49,677 $46,981 $50,467

Other Resource $4,891 $5,896 $14,680 $10,617 $9,795 $1,835 $1,835

Budget Activity Total $61,156 $63,258 $73,741 $71,230 $59,472 $48,816 $52,302

FTE 226 259 272 268 220 182 182
SE - 13 

This office supports the following strategic objectives for Strategic Goal 3, to enhance national 

security: 

• Objective 3.1 – Strategic Threat Disruption: Identify, dismantle, and disrupt priority threats

to the U.S. and international financial system.

• Objective 3.3 – Economic Strength and National Security: Advance American prosperity and

security through growth, investment, trade, and expanding the American industrial base

while protecting national security.

This office supports the following strategic objective for Strategic Goal 4, to transform 

government-wide financial stewardship: 

• Objective 4.1 – Financial Data Access/Use: Increase the access and use of federal financial

data to strengthen government-wide decision-making, transparency, and accountability.

This office supports the following strategic objective for Strategic Goal 5, to achieve operational 

excellence:

• Objective 5.1 – Workforce Management: Foster a culture of innovation to hire, engage,

develop, and optimize a diverse workforce with the competencies necessary to accomplish

our mission.

In FY 2018, the Office of International Affairs (IA) worked to put in place policies that achieve 

faster U.S. and global growth and higher after-tax wages for American workers. This involved 

ambitious reforms for trade, energy, financial regulation, infrastructure, and international 

relations, all of which will continue into FY 2019. 

In its role as lead for international negotiations on non-insurance financial services and transfers, 

Treasury pursued critical financial services commitments and robust transfer provisions of trade 

and investment negotiations. Treasury played a key role in the United States-Mexico-Canada 

Agreement negotiations, aimed at working toward a more balanced agreement to replace the 

North America Free Trade Agreement. Treasury also plays an important U.S. government role 

on broader trade issues such as State-owned enterprises, customs, and other trade related 

disciplines that impact Treasury equities. Treasury is playing a lead role in analyzing the 

implications for U.S. financial services firms of the United Kingdom’s exit from the European 

Union. In addition, as the U.S. lead in negotiating reductions of export finance subsidies, 

Treasury continues to press China and other major providers of export finance to agree to 

disciplines on government support, so that U.S. exporters can compete globally on a level 

playing field. These efforts serve not only to enhance U.S. competitiveness but also move export 

credit financing to a more market basis consistent with Congressional mandates.

Treasury works to address the large and persistent global imbalances and unfair currency 

practices that threaten strong and sustainable U.S. economic growth. Treasury seeks to level the 

playing field for U.S. businesses through multilateral and bilateral engagements on foreign 

exchange practices. Treasury does this via multilateral and bilateral activities working through 

the International Monetary Fund (IMF) and the Group of 20 Nations (G-20). As an example, 

Treasury continues to press for stronger exchange rate surveillance in the IMF. Treasury also 

continues to enhance its oversight of the multilateral development banks’ (MDB) policies and 

programs, particularly with respect to the expansion of their loan programs when market 
SE - 14 

financing is generally plentiful. In FY 2018, Treasury negotiated a set of transformational 

reforms with other shareholders and World Bank Management, which are designed to make the 

World Bank more financially-disciplined, focus its operations in countries that have less access 

to other sources of finance, and ensure it operates more efficiently. 

Treasury promotes economic growth by managing U.S. participation and leveraging U.S. 

leadership positions in the International Financial Institutions in order to mitigate emerging 

threats to the U.S. and global economies; support international trade and investment; and 

reinforce U.S. national security interests in key countries around the world. 

• Monitor Quality and Enhance Effectiveness of IMF Lending through Review of IMF

Country Programs: This measure tracks efforts by IA staff to monitor the quality of IMF

country programs and ensure the application of appropriately high standards for the use of

IMF resources. The target (100 percent) was met in FY 2018. In FY 2019 and FY 2020,

IA’s target for this measure remains 100 percent.

• Monitor Quality and Enhance Effectiveness of MDB Lending through Timely Review of

MDB Grant and Loan Proposals: IA reviews MDB loan and grant proposals to ensure that

funded projects meet several key goals, which include supporting long-term U.S. objectives,

having a measurable development impact, and being consistent with congressional mandates.

The target (100 percent) was met in FY 2018. In FY 2019 and FY 2020, IA aims to continue

its review of 100 percent of MDB loan and grant proposals prior to the date of the relevant

Executive Board meeting and increase its oversight of projects during implementation.

• Percentage of MDB Grant and Loan Proposals Containing Satisfactory Frameworks for

Results Measurement: This measure tracks the percentage of grant and loan project proposals

that contain a satisfactory framework for measuring project results (such as outcome

indicators, quantifiable and time-bound targets, etc.). This information is measured on an

annual basis. In FY 2018, 97.6 percent of MDB grant and loan project proposals had

excellent or satisfactory ratings for the results matrices. The FY 2019 target is 95 percent,

and the FY 2020 target is 95 percent.

Treasury’s Office of Technical Assistance (OTA) complements Treasury’s international 

economic and terrorist financing policy work. Treasury’s offices of International Affairs and 

Terrorism and Financial Intelligence advocate for improvements in economic and terrorist 

financing policies internationally. OTA helps the governments of developing and transition 

countries build the human and institutional capacity to implement such policy improvements. 

Finance ministries and central banks of developing countries that have demonstrated a strong 

commitment to reforming their financial systems or public financial management can receive 

direct assistance from OTA through its cadre of expert advisors. The technical assistance team 

leverages its funding to increase transparency and accountability, reduce corruption, and 

strengthen the development of market-based policies and practices in these economies. 

OTA support promotes more effective use of a country’s own resources and helps reduce 

dependency on foreign aid. This work also supports stabilization of financial sectors in national 

security/foreign policy priority countries (e.g., Ukraine), more transparent and accountable 
SE - 15 

financial sectors for U.S. investors overseas, and the expansion of markets for U.S. exporters, 

thus promoting jobs and economic growth at home. 

• Office of Technical Assistance (OTA) Program Engagement (Traction): Measures the

degree to which foreign counterparts are engaging proactively and constructively with OTA

advisors, at the working and policy levels. Counterpart engagement is both a key outcome of

OTA efforts to structure and execute effective technical assistance projects that support host

country ownership as well as the most crucial input to the successful achievement of the

intermediate goals and ultimate outcomes described in the project’s terms of reference and

work plan during the fiscal year – such as passage of law or regulation, an increase in

government revenues, an improvement in a government’s credit rating, or a reduction in

economic crimes. The measure is scored on a 5-point scale and averaged across all projects

to provide one overall measure of OTA’s performance. In FY 2018, the Traction score was

3.8, exceeding the target of 3.6. In FY 2019 and FY 2020, IA’s target for Traction is 3.6.

Office of Economic Policy (EP)

This office supports the following strategic objective for Strategic Goal 1, to boost U.S. 

economic growth:

• Objective 1.2 – Strong Economic Fundamentals: Spur faster economic growth by right-sizing

Treasury and other regulations and advancing domestic economic policies that boost

investment, employment, and innovation.

This office supports the following strategic objective for Strategic Goal 3, to enhance national 

security: 

• Objective 3.2 – AML/CFT Framework: Identify and reduce vulnerabilities in the U.S. and

international financial system to prevent abuse by illicit actors.

This office supports the following strategic objective for Strategic Goal 5, to achieve operational 

excellence:

• Objective 5.1 – Workforce Management: Foster a culture of innovation to hire, engage,

develop, and optimize a diverse workforce with the competencies necessary to accomplish

our mission.

During the past year, EP staff in the Office of Macroeconomic Analysis closely monitored U.S. 

economic performance. The office’s high-quality analytic updates served as DO’s main internal 

source of information on U.S. macroeconomic developments and informed a wide range of highlevel engagements and official publications, including the Bank/Fund and regional development 

bank meetings, meetings of the G-7 and G-20, the Quarterly Treasury Bulletin, the report to 

Congress titled, “Foreign Exchange Policies of Major Trading Partners of the U.S.,” the 

Economy Statement for the Treasury Borrowing Advisory Committee, and the U.S. 

Government’s Annual Financial Report. 

Economists from EP also represented the United States at Organisation for Economic Cooperation and Development (OECD) Economic Policy Committee and Working Group meetings 

on country forecasts. Finally, the office continued to deliver the High-Quality Market Corporate 

Yield Curve (a set of daily rates issued on a monthly basis) as mandated under the Pension 
SE - 16 

Protection Act and to produce a Treasury Real Coupon-Issue Yield Curve, a companion to the 

Treasury Nominal Coupon-Issue Yield Curve, and several other yield curves. These yield curve 

data are used extensively throughout the private sector and executive agencies that administer 

private and public pension programs and other future payment programs to calculate their annual 

liabilities. 

Economic Policy is responsible for implementation and ongoing management of the Social 

Impact Partnerships to Pay for Results Act (SIPPRA) program. SIPPRA, signed into law on 

February 9, 2018, appropriated $100 million in funding to implement “Social Impact Partnership 

Demonstration Projects” and feasibility studies to prepare for those projects. Program funds can 

be obligated through February 8, 2028. The SIPPRA program is intended to demonstrate a new 

model of implementing and funding projects designed to solve entrenched societal problems 

such as homelessness, recidivism and unemployment. 

SIPPRA issued its first Notice of Funding Availability (NOFA) on February 21, 2019 with the 

intent to award up to $66.29 million in funding for social impact partnership project grants with 

half of this funding intended for projects that directly benefit children. Awards are scheduled to 

be made in November 2019. 

OMB is standing up the Federal Interagency Council on Social Impact Partnerships (Council), 

which is comprised of representatives from OMB and each of the ten agencies included in 

SIPPRA. The Council is responsible for certifying, prior to award approval, that (1) applications 

contain data and research methodologies to support savings estimates; (2) applicant/independent 

evaluator agreements have been established; (3) estimated savings will be realized if project 

outcomes are achieved. Separately, the SIPPRA Commission, an advisory commission 

comprised of nine private-sector individuals nominated by the President and Congressional 

Leadership, has been established and will meet periodically to develop recommendations to the 

Secretary of the Treasury and Council and provide additional advice and assistance as requested. 

The Office of Microeconomic Analysis has been actively engaged in helping the public and 

policymakers understand important economic policy issues including economic issue briefs 

covering a wide range of economic topics, including work associated with CFIUS, the housing 

market, and infrastructure investment. Other activities included: 

• Co-chairing, with Treasury’s Federal Insurance Office, the interagency Long-Term Care

Task Force;

• Regulatory Impact Analysis for Treasury’s Alcohol and Tobacco tax and Trade Bureau on a

proposed deregulatory policy change; ongoing coordination and analysis related to the

Secretary’s role as Managing Trustee of the Social Security and Medicare Trust Funds;

• Analysis of the potential impact on economic growth of the Administration’s infrastructure

investment proposal;

• Interagency work on an Economic Policy-initiated regulatory proposal for more flexible and

less costly appliance energy efficiency regulations; and

• The office continued to lead a government-wide effort to close the skills gap in the economist

occupation in the Federal government by coordinating efforts between the economist

workforce, Office of Personnel Management, and OMB to promote better recruitment,

retention, and development of economists in the federal workforce. That effort resulted this
SE - 17 

year in new government-wide direct-hire authority for certain Scientific, Technical, 

Engineering and Mathematics (STEM) occupations, including economists. 

2.1.3 – Domestic Finance and Tax Policy Resources and Measures

Measure FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Target Target Target

DF-Variance Between 

Estimated and Actual Receipts 

(Annual Forecast) (%)

3.25 2.80 3.10 4.00 2.30 4.25 4.25 4.25

Domestic Finance and Tax Policy Budget and Performance 

($88,133,000 from direct appropriations, and $6,633,000 from reimbursable resources): 

The Offices of Domestic Finance and Tax Policy monitor policy, legislation, and regulations, 

and provide advice and assistance to the Secretary about the financial services sector and taxes, 

as well as financial markets and the regulation of financial institutions. The Office of Tax Policy 

supports the Administration’s efforts in tax reform legislative proposals and regulatory 

implementation.

Office of Domestic Finance (DF)

This office supports the following strategic objective for Strategic Goal 1, to boost U.S. 

economic growth:

• Objective 1.2 – Strong Economic Fundamentals: Spur faster economic growth by right-sizing

Treasury and other regulations and advancing domestic economic policies that boost

investment, employment, and innovation.

This office supports the following strategic objectives for Strategic Goal 2, to promote financial 

stability:

• Objective 2.1 – Housing Finance Reform: Support housing finance reform to resolve

Government-Sponsored Enterprise (GSE) conservatorships and prevent taxpayer bailouts of

public and private mortgage finance entities, while promoting consumer choice within the

mortgage market.

• Objective 2.4 – Financial Sector Critical Infrastructure and Cybersecurity: Enhance security,

improve resiliency, and reduce the risk of significant cybersecurity and other incidents to the

financial sector’s critical infrastructure, domestically and internationally.

This office supports the following strategic objectives for Strategic Goal 4, to transform 

government-wide financial stewardship: 

• Objective 4.1 – Financial Data Access/Use: Increase the access and use of federal financial

data to strengthen government-wide decision-making, transparency, and accountability.

Dollars in Thousands

 Resource Level FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Annualized CR Request

Appropriated Resources $81,783 $76,520 $79,748 $81,410 $66,123 $74,199 $88,133

Other Resource $24,997 $40,240 $55,231 $38,650 $42,042 $6,633 $6,633

Budget Activity Total $106,780 $116,760 $134,979 $120,060 $108,165 $80,832 $94,766

FTE 339 364 398 365 311 255 291
SE - 18 

• Objective 4.2 – Debt Management: Fund the Federal Government at the least cost over time.

• Objective 4.3 – Federal Financial Performance: Improve federal financial management

performance using innovative practices to support effective government.

This office supports the following strategic objective for Strategic Goal 5, to achieve operational 

excellence:

• Objective 5.1 – Workforce Management: Foster a culture of innovation to hire, engage,

develop, and optimize a diverse workforce with the competencies necessary to accomplish

our mission.

During FY 2018, DF worked to promote America’s long-term economic strength and stability 

by preserving confidence in the U.S. Treasury securities market, managing federal fiscal 

operations and the U.S. government’s debt, advising state and local governments on their 

finances, supporting small businesses, and strengthening financial institutions and markets. 

DF advanced several key Administration policies, particularly financial regulatory reform and 

cyber security.

Strong Economic Fundamentals 

For example, to promote strong economic fundamentals, Treasury continued work to improve 

the financial regulatory system and strengthen the economy consistent with the Administration’s 

“Core Principles” for regulating the U.S. financial system. These Core Principles, issued under 

Executive Order 13772, include empowering Americans to make independent financial 

decisions, save for retirement, and build individual wealth. Since issuance of the Core Principles 

EO in February 2017, Treasury has published several reports making numerous 

recommendations for administrative and statutory reforms, most of which require action by the 

regulators and/or Congress. These reforms would, among other things, discourage taxpayerfunded bailouts, promote American companies’ competitiveness, and make regulation efficient, 

effective, and appropriately tailored. 

Given the breadth of the financial system and a complex regulatory environment, Treasury

divided the review of the financial system into four reports, covering: (1) banks and credit 

unions; (2) capital markets; (3) asset management and insurance; and (4) non-bank financials, 

fintech, and innovation. 

Treasury concluded its Core Principles reporting requirements with the July 2018 release of its 

report on nonbank financials, fintech, and innovation. For this report, Treasury consulted 

extensively with a wide range of stakeholders focused on consumer financial data aggregation, 

lending, payments, credit servicing, financial technology, and innovation. Treasury’s 

recommendations are designed to facilitate U.S. firm’s innovation by streamlining and refining 

the regulatory environment. These improvements aim to enable U.S. firms to more rapidly adopt 

competitive technologies, safeguard consumer data, and operate with greater regulatory 

efficiency. 

During FYs 2019 and 2020, Treasury will continue to evaluate progress and work to support the 

implementation of the “Core Principles” recommendations for the U.S. financial system. 
SE - 19 

Housing 

Treasury retains significant investments in Fannie Mae and Freddie Mac (the government 

sponsored enterprises, or GSEs), and continues to provide capital support to the GSEs through 

the Senior Preferred Stock Purchase Agreements (PSPAs). These capital support agreements 

provide confidence to the financial markets that the GSEs will fulfill their financial obligations. 

These agreements have been amended several times since they were executed in 2008, most 

recently in FY 2018, when Treasury and the GSEs, acting through their conservator, the Federal 

Housing Finance Agency, agreed to increase the minimum capital reserve each entity was 

allowed to retain. Treasury has significant responsibilities on behalf of taxpayers to monitor the 

nearly $200 billion investment in the GSEs. In addition, advancing housing finance reform, 

including progress toward the resolution of the GSE conservatorships, is a priority for Treasury 

in FYs 2019 and 2020. 

Public Finance 

In August 2018, the Task Force on the United States Postal System, created by Executive Order 

13829 and chaired by the Secretary of the Treasury, delivered recommendations to the President 

to identify a path for the United States Postal Service (USPS) to operate under a sustainable 

business model. This model envisions USPS providing necessary mail services to citizens and 

businesses while competing fairly in commercial markets. The task force, which included the 

Office of Management and Budget and the Office of Personnel Management, conducted 

extensive outreach to stakeholders and performed in-depth research and analysis to understand 

the wide range of challenges facing USPS. In December 2018, the task force released a public 

report of its findings and recommendations. 

Financial Sector Critical Infrastructure Protection and Cybersecurity 

During FY 2018, DF also played an important role in supporting critical infrastructure protection 

and cybersecurity in the financial services sector by leading and participating in cybersecurity 

exercises involving other government and private-sector participants. The exercises explored a 

variety of threat scenarios and how the participants would respond. Participants developed afteraction reports for future improvement to reduce vulnerabilities and reduce risks. These types of 

exercises will continue in FYs 2019 and 2020. 

Also, in Treasury’s roles as chair of the Financial and Banking Information Infrastructure 

Committee and member of the Financial Services Sector Coordinating Council, OCIP continued 

sharing cybersecurity information among the member organizations. Treasury also encouraged 

private-sector firms to voluntarily share actionable cybersecurity information among firms to 

minimize the time it takes to discover, contain, and mitigate cyber incidents, whether from 

malicious or natural causes. These efforts will also continue in FYs 2019 and 2020. 

Managing the U.S. Government’s Debt

Another important DF responsibility is managing the U.S. government’s debt. The Office of 

Fiscal Projections forecasts the government’s cash and debt activity, including longer term 

projections of fiscal activity. The Office of Debt Management (ODM) seeks to fund the federal 

government at the least cost over time by working to maintain predictable issuance of Treasury 

debt, minimizing the amount of interest the government must pay, and managing debt maturity 

over time. In FY 2018, ODM determined for more than 270 auctions the amount and maturity of 
SE - 20 

debt that the Bureau of the Fiscal Service issued. These debt issuances totaled $9.9 trillion and 

raised more than $1.0 trillion in new cash to fund the U.S. government. Looking ahead, in the 

remainder of FY 2019 and carrying into FY 2020, DF ODM’s responsibility will continue to be 

critical because borrowing needs are forecast to be significant based on the fiscal outlook and 

normalization of the Federal Reserve System’s Open Market Account.

During FY 2018, ODM also successfully announced a new short-term Treasury security, the 

two-month Treasury bill. This new security was implemented with an alternative settlement 

cycle that is designed to smooth settlement amounts for both Treasury and market participants. 

Treasury also recently announced enhancements to the Treasury Inflation-Protected Securities 

program, which will be implemented during FYs 2019 and 2020. 

In addition, working with Financial Industry Regulatory Authority and the Commodity Futures 

Trading Commission, Treasury made important progress regarding data on transactions in both 

cash Treasuries and Treasury futures. ODM has been analyzing this data with the purpose of 

better understanding Treasury market dynamics and market structure. Finally, with contractor 

support, ODM also continued to improve its internal analytical modeling platform: the Data 

Analytics Visualization Engine (DAVE).

Federal Financial Management 

To support the President’s Management Agenda, DF released “The Future of Federal Financial 

Management” in April 2018. This Treasury vision focuses on how to improve financial 

interactions with the federal government within the framework of the President’s Management 

Agenda to provide modern, seamless, and secure service. The vision identifies ten initiatives in 

four key areas: (1) optimizing federal disbursing, (2) transforming federal collections, (3) 

strengthening financial reporting, and (4) expanding services available to agencies. 

In addition, during FY 2018, Treasury continued to make progress in government-wide 

implementation of the 2014 Digital Accountability and Transparency Act (DATA Act). The 

DATA Act requires the federal government to provide consistent, reliable, and useful online data 

about how it spends taxpayer dollars. In April 2018, DF fully transitioned to the new 

USAspending.gov website by sunsetting the legacy site. The new site allows taxpayers to 

examine nearly $4 trillion in annual federal spending and see how this money flows to local 

communities and businesses. The site includes a new feature, the Data Lab, which provides 

additional use cases, data visualizations, and analysis with insights into federal spending and 

trends. In FY 2018, DF reviewed data quality, and will work with OMB and federal agencies to 

drive continued improvements in FY 2019 and FY 2020. The data is compiled from federal 

agencies and published quarterly. 

DF has one performance measure:

Variance between estimated and actual receipts (annual forecast) (percent): As part of managing 

the federal government’s central operating account and cash position, the Office of Fiscal 

Projections (OFP) forecasts net cash flows (e.g., federal receipts and outlays) to ensure that 

adequate funds are available daily to cover federal payments. To determine its overall 

effectiveness, one of OFP’s metrics is to measure the variance between actual and projected 

federal receipts. A lower variance is better because that indicates a more accurate forecast. The 
SE - 21 

actual variance for FY 2018 was 2.3 percent, which is significantly lower than the 4.25 percent 

target.

The FY 2018 level was the lowest variance going back to 2007, when it was 2.1 percent. 

Because tax receipts are quite variable year-to-year and sensitive to changes in macro-economic 

conditions and legislative changes, accurate forecasts in one year do not necessarily portend 

accuracy in a subsequent year or period. The target for both FYs 2019 and 2020 is 4.25 percent.

Office of Tax Policy (OTP)

This office supports the following strategic objectives for Strategic Goal 1, to boost U.S. 

economic growth:

• Objective 1.1 – Tax Law Implementation: Administer tax law to better enable all taxpayers

to meet their obligations, while protecting the integrity of the tax system.

This office supports the following strategic objective for Strategic Goal 5, to achieve operational 

excellence:

• Objective 5.1 – Workforce Management: Foster a culture of innovation to hire, engage,

develop, and optimize a diverse workforce with the competencies necessary to accomplish

our mission.

During FY 2018, the Office of Tax Policy (OTP) worked closely with IRS in implementing 

provisions of the Tax Cuts and Jobs Act (TCJA). Together, they implemented TCJA provisions 

related to the new Section 199A pass-through deduction and promulgated proposed regulations 

under Section 170 that preserve the revenue in TCJA related to the imposition of a cap on state 

and local income tax deductions. Treasury and the IRS also implemented TCJA provisions 

related to the Section 965 one-time repatriation tax and published proposed regulations under 

Section 951A dealing with the computation of global intangible low-taxed income, including 

income by U.S. shareholders of foreign subsidiaries. In addition, the IRS established an 

extensive web page on IRS.gov to provide information to the public as it becomes available. 

OTP also provided analysis in support of tax reform implementation, including updated tax 

withholding tables and inflation-adjusted tax parameters and regulatory impact analyses. The 

office also estimated the effects of proposed and final tax reform provisions on tax revenue 

(overall and for specific types of taxpayers), to inform policymakers and to include in the 

Administration’s FY 2019 Budget. 

OTP continues to provide leadership for the OECD, the Inclusive Framework, the Global Forum, 

and the G-20, advocating for the interests of U.S. based businesses. OTP also plans to continue 

engaging in international negotiations to modernize existing treaties and to establish key new 

treaty relationships to protect the fiscal and business interests of the U.S. 

In FY 2019 – FY 2020, OTP’s primary mission will remain supporting tax reform 

implementation. This work will include regulatory guidance required to implement changes to 

the law by conducting cost-benefit analyses of many regulatory actions. The resulting 

Regulatory Impact Analyses (RIA) require detailed work. OTP received funding for FY 2019 to 
SE - 22 

start hiring FTE to work on the RIA, and in 2020, OTP hopes to continue the implementation 

with additional staff and technology funding to conduct the necessary analyses. 

2.1.4 – Treasury-wide Management and Programs Resources and Measures

Measure FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Target Target Target

EO 13771 - Number of Deregulatory 

Actions Issued * N/A N/A N/A N/A N/A I B B

EO 13771 - Number of Deregulatory 

Actions Issued that Address 

Recommendations by the Regulatory 

Reform Task Force*

N/A N/A N/A N/A N/A I B B

EO 13771 - Number of Deregulatory 

Actions Issued that Address 

Recommendations by the Regulatory 

Reform Task Force to the Agency 

Head Consistent with Applicable Law *

N/A N/A N/A N/A N/A I B B

EO 13771 - Number of Evaluations to 

Identify Potential Deregulatory Actions 

That Included Opportunity for Public 

Input and/or Peer Review *

N/A N/A N/A N/A N/A I B B 

EO 13771 - Number of Regulatory 

Actions Issued * N/A N/A N/A N/A N/A I B B

EO 13771 - Total Incremental Cost of 

All Regulatory Actions and 

Deregulatory Actions (Including Costs 

or Cost Savings Carried Over From 

Previous Fiscal Years)

N/A N/A N/A N/A N/A 0 B B

Percent of Procurement Dollars Spent 

on Small Business 36.91 35.11 36.17 35.01 42.63 35 38.5 N/A

Treasury-wide Engagement Index of 

the FEVS 66 67 67 68 68 69 69 69

Treasury-wide Footprint (Square 

Footage) 36,411 35,439 34,894 34,100 33,766 33,600 33,356 32,895

Treasury-wide Leaders Lead Index of 

the Federal Employee Viewpoint 

Survey (FEVS)

53 54 55 56 56 57 58 58

Note: I – Performance Indicator 

* Executive Order 13771 requires the repeal of two regulatory actions for each new regulatory action issued by an agency. The

Department is fulfilling this requirement by prioritizing burden-reducing, deregulatory actions. At this time Treasury does not have

targets for these measures because it is still in the process of evaluating its deregulatory and regulatory actions for FY 2018.

Treasury-wide Management and Programs Budget and Performance

($40,497,000 from direct appropriations, and $278,000 from reimbursable resources):

This budget activity includes offices that are responsible for the internal management and policy

of the Department: the Office of the Assistant Secretary for Management; the Office of the

Dollars in Thousands

 Resource Level FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Annualized CR Request

Appropriated Resources $31,802 $35,971 $41,112 $43,387 $45,693 $41,922 $40,497

Other Resource $30,858 $55,213 $3,339 $4,284 $2,398 $278 $278

Budget Activity Total $62,660 $91,184 $44,451 $47,671 $48,091 $42,200 $40,775

FTE 139 171 124 153 147 116 118
SE - 23 

Chief Information Officer; the Office of Privacy, Transparency, and Records; the Office of the 

Senior Procurement Executive; the Office of the Chief Human Capital Officer; the Office of 

Treasury Operations; the Office of the Deputy Chief Financial Officer; the Office of Civil Rights 

and Diversity; the Office of Minority and Women Inclusion; and the Office of the Deputy 

Assistant Secretary for Management and Budget. 

This office supports the following strategic objective for Strategic Goal 2, to promote financial 

stability:

• Objective 2.4 – Financial Sector Critical Infrastructure and Cybersecurity: Enhance security,

improve resiliency, and reduce the risk of significant cybersecurity and other incidents to the

financial sector’s critical infrastructure, domestically and internationally.

This office supports the following strategic objectives for Strategic Goal 5, to achieve 

operational excellence:

• Objective 5.1 – Workforce Management: Foster a culture of innovation to hire, engage,

develop, and optimize a diverse workforce with the competencies necessary to accomplish

our mission.

• Objective 5.2 – Treasury Infrastructure: Better enable mission delivery by improving the

reliability, security, and resiliency of Treasury’s infrastructure.

• Objective 5.3 – Customer Value: Improve customer value by increasing the quality and

lowering the cost of Treasury’s products and services.

Treasury-wide Management and Program’s performance metrics are: 

Treasury-wide “Engagement” Index of Federal Employee Viewpoint Survey (FEVS): Treasury’s 

strategy focused on improving employee engagement in a number of areas, thereby creating an 

opportunity to improve the effectiveness of our workforce while improving our ranking among 

other federal agencies. Strategic efforts were focused on the Overall Satisfaction Index, the 

Leaders Lead component of the Employee Satisfaction Index, and the Fairness Index under the 

Diversity and Inclusion Quotient. Treasury conducted two Treasury-wide engagement review 

sessions for high-level leadership during FY 2017 in addition to bureau-level reviews. 

Treasury’s scores for the Engagement Index increased from 67 percent to 68 percent in FY 2017, 

and held steady at 68 percent for FY 2018. Treasury’s engagement score exceeded average score 

for very large agencies by one percent, and was equal to the government-wide score in FY 2018. 

Treasury-wide “Leaders Lead” Index of Federal Employee Viewpoint Survey (FEVS): Treasury 

also set the goal to increase the “Leaders Lead” index above FY 2017 results. Treasury’s score 

for the Leaders Lead Index increased from 55 percent in FY 2016 to 56 percent in FY 2017, and 

held steady at 56 percent in FY 2018. Treasury’s score in FY 2018 was equal to the 

government-wide average and the average score for very large agencies. Targets for FYs 2019 

and 2020 are 58 percent. 

Treasury-wide Footprint (Square Footage): This goal measures the total square footage occupied 

by Treasury’s owned and leased buildings. To reduce the Department’s real property footprint 

and maximize the use of existing real property assets, the Department maximized space 

utilization by undertaking space realignments, consolidations, and improved work station 

standards. GSA is still in the process of certifying the FY 2018 square footage inventories. 
SE - 24 

Several fourth quarter space reductions were not reflected within GSA’s end of fiscal year square 

footage numbers. The Department is currently working with GSA to establish the Q4 space 

release effective dates. Once these dates have been mutually agreed upon, Treasury should be on 

target to meet the FY 2018 target of 33,600 square feet. The Department will continue targeting 

metropolitan areas with multiple posts of duty sites to pursue consolidation opportunities or 

space reductions where it makes business and financial sense. However, it should be noted that 

several Treasury programs focused on economic expansion and national security will be 

experiencing considerable growth in investments and personnel. As a result, Treasury’s out-year 

projects are expected to reflect these changes, including the possible expansion of real property 

holdings in certain geographic areas. Bureaus are currently in the process of updating their 

respective Real Property Efficiency Plans for FY 2020 – FY 2024, and Treasury will have a 

better understanding of the legislative and program changes impacts on Treasury’s real property 

footprint within a few weeks. 

Percentage of Procurement Dollars Spent on Small Business: In FY 2018, Treasury aimed to 

meet or exceed all small business contracting goals. Based on preliminary data, Treasury met 

and exceeded all small business prime contracting goals. However, Treasury may not meet all 

small business subcontracting goals. The Small Business Administration (SBA) is expected to 

calculate the data in March 2019. All Treasury bureaus were included in the goaling report, with 

no exclusions. The FY 2019 overall small business goal was set for 38.5 percent. The FY 2020 

small business goal will be set in the fall of 2019. One overarching challenge in FY 2018 and FY 

2019 is that Treasury must follow OMB’s directive to utilize Category Management principles 

and Best-in-Class (BIC) contracts to leverage use of existing government-wide contracting 

vehicles. With a Treasury BIC goal of 35 percent utilization, Treasury Office of Small and 

Disadvantaged Business Utilization issued a Category Management and BIC Small Business 

Utilization policy which is believed to have enhanced the overall small business goal 

achievement. Particularly noteworthy is that Treasury far exceeded the contracting goals for the 

following socioeconomic groups: 

• Small and Disadvantaged Business - goal five percent, achieved 11.4 percent;

• Women Owned Small Business – goal five percent, achieved 12.45 percent;

• Historically Underutilized Business zone - goal three percent, achieved 3.47 percent; and

• Service Disabled Veteran Owned Small Business - goal three percent, achieved 3.57 percent.

Office of the Chief Human Capital Officer

In FY 2018, Treasury published a strategic plan for 2018-2022 that continued the Department’s 

focus on operational excellence by including a specific goal on workforce management. A major 

element of this goal is a transformation to competency-based workforce management. 

Treasury’s focus for FY 2019 will be in solidifying the foundation to support a competencybased approach starting with the cybersecurity and human resources occupations. Additional 

efforts in FY 2019 include a continued focus on building workforce planning capabilities in 

support of federal efforts to expand the strategic management of federal human capital and to 

close skills gaps in government-wide and Treasury-specific mission-critical occupations. As a 

component of the President’s Management Agenda efforts to field a 21st Century Workforce, 

Treasury is collaborating with the Office of Personnel Management and other stakeholder 

agencies to implement an alternative pay and classification system for the Economist occupation. 

Finally, after a successful launch of the learning management module in FY 2018, Treasury will 
SE - 25 

continue implementation of an enterprise Integrated Talent Management System (ITMS) as 

bureaus begin phasing in the performance management module. When fully deployed, the ITMS 

will provide employees a single, modern system for learning, performance, and career planning; 

give leadership a consolidated view of the Department’s human capital landscape; and 

consolidate 24 stand-alone legacy systems into a single, cloud-based system.

Office of Civil Rights and Diversity (OCRD)

Treasury continued working with the bureaus on their Diversity and Inclusion Strategic Plans, 

which map to both the Treasury Strategic Plan and the Human Capital Plan. The department’s 

focus in FY 2019 and FY 2020 will be performing audits of the bureaus’ EEO Programs, 

including a critical look at diversity and inclusion programs, to determine any areas where the 

bureaus need a sharper focus, and to find and recreate “best practices.” EEO offices worked on 

Human Capital engagement teams to improve inclusion scores – this will also be a continuing 

focus in FY 2019 and FY 2020. While scores for “Fairness” continue to be a concern, efforts 

have been made to introduce “Unconscious Bias” training in the workforce and at all 

management levels to help make leaders aware of biases and to learn to put aside such biases 

when making employment decisions. In FY 2018, OCRD also developed and distributed sexual 

harassment prevention training to the workforce in DO, and shared the training with the bureaus. 

Additionally, this office continued to work with the Treasury Executive Institute to develop 

programming for executives and senior level staff in the areas of diversity and inclusion. These 

training and proactive prevention efforts will continue in FY 2019 and FY 2020. EEO 

complaints were adjudicated effectively with the Department improving in meeting EEOC 

regulatory timeframes both in issuance of decisions and days to investigate complaint. Both 

benchmarks exceed the 90 percent timeliness rate. To better manage case processing, OCRD

plans on upgrading our EEO case management system in FY 2019 and FY 2020. Our 

Alternative Dispute Resolution (ADR) participation numbers also improved; ADR provides an 

alternative to the formal complaint program and helps to resolve cases earlier in the process, 

saving both money and resources. In FY 2018, disability hiring met three out of four benchmark 

targets, and emphasis was placed on improving veterans hiring, with the acquisition in FY 2019 

of a resume data base for use in hiring veterans and disabled veterans. This will be a FY 2019 

pilot program and if successful, will be expanded to the larger disability community in FY 2020. 

Work began on procurement of a Reasonable Accommodation Management system, to better 

manage our reasonable accommodation requests, which is one of our identified risks. The goal 

is to research systems and procure a system in FY 2019 or FY 2020. In FY 2019, the office will 

conclude negotiations to implement a Blanket Purchase Agreement with a nationwide provider 

which will enable all of the Department to provide personal assistant services to severely 

disabled employees. The DO EEO program will repurpose one of its positions to a reasonable 

accommodation coordinator to better serve the needs of its employees with disabilities.

In FY 2018 considerable progress was made in improving OCRD’s external civil rights program 

policies and guidance and efforts will continue in FY 2019 and FY 2020. OCRD will continue 

to lead the efforts of the DO financial assistance programs to implement the compliance 

requirements in the recently issued Treasury civil rights regulations. The effort will include a 

review of grant making procedures with the goal of introducing compliance measures into 

existing processes. OCRD will also offer department-wide civil rights training. 
SE - 26 

Office of the Deputy Chief Financial Officer

For FY 2018, the Department received its nineteenth consecutive unmodified audit opinion on its 

Treasury-wide financial statements. Treasury anticipates unmodified audit opinions for the 

consolidated audit for FY 2019 and FY 2020. Overall, the Department has made strong progress 

in enhancing its internal control environment and remains committed to ensuring high standards 

of integrity and transparency in reporting its financial performance. 

Office of Small and Disadvantaged Business Utilization (OSDBU)

Based on preliminary data for FY 2018, Treasury is on track to meet and exceed all small 

business prime contracting goals. The consistent “A” score is a testament to the hard work and 

professionalism of the procurement and acquisition teams across Treasury’s bureaus and the 

serious commitment to utilizing small businesses that emanates from Treasury’s leadership. To 

comply with Section 15 (k), Small Business Act, the Department focused on small business 

prime and subcontracting goal achievements. 

In FY 2018, the OSDBU implemented several small business strategic policy changes, including 

small business specialists in each acquisition planning meeting, address relevant market research, 

and instituting small business program training to the Bureau Chiefs. In support of the DATA 

Act, OSDBU ensures that small business reporting data is inclusive and accurate. Also, OSDBU 

transformed the office to be more supportive to the Bureau offices. For instance, there is a 

Program Manager for Compliance and Policy, a Program Manager for Subcontracting Oversight 

and Small Business Technical Advisor, and one Program Manager for the In-reach/Out-reach 

program. This change strategically aligns with the Small Business Act and the Secretary’s 

Strategic Plan/Goals.

The OSDBU updated its Small Business Programs Policy Handbook that gives the acquisition 

workforce a “go-to” tool on small business procurements, source selection guidance, and rules 

on socio-economic concerns, among other things. 

Treasury OSDBU meets monthly with the OSDBU Leadership Council and the Small Business 

Procurement Advisory Council (SBPAC) to develop small business strategies that impact all 

federal agencies. Of note, the OSDBU leaders recommended that SBPAC send a representative 

to OMB’s Category Management Forum. By their voting membership and attendance instilled 

the importance of meeting statutory small business goals when using Category Management 

principles as outlined in the President’s Management Agenda. Treasury Secretary identified 

small business goal achievement is a key priority. 

In FY 2019, OSDBU will conduct Small Business Program Compliance and Surveillance 

Reviews on each of the Bureaus having procurement authority. The purpose of the review is to 

ascertain whether small business procurement laws, regulations, policies, and best practices are 

being followed, review roles and responsibilities, identify challenges and issues, ascertain best 

practices and lessons learned, and identify any program deficiencies and weaknesses. A small 

business program health summary will be submitted to the Deputy Secretary by June 2019. 
SE - 27 

Office of the Senior Procurement Executive (OPE)

In FY 2018, Treasury continued a comprehensive acquisition transformation strategy designed to 

facilitate innovation, strategic management, efficiency, and effective mission outcomes in 

compliance with the President’s Management Agenda. Central to the strategy is early planning 

and broad stakeholder participation as well as accelerated transition to strategic acquisition 

vehicles. In support of the Federal Information Technology Acquisition Reform Act, the 

Department has placed significant focus on IT acquisition across all procurement programs. 

In FY 2018, Treasury continued successful execution of its Major Acquisition Program (MAP) 

reviews in which primary and senior stakeholders (to include procurement, customer, program 

management, and legal representatives) jointly and periodically review procurement strategy and 

progress for critical acquisitions. These reviews provided a forum for development of effective 

acquisition strategies; early identification and resolution of problems; and sharing of experience 

and expertise among various stakeholder personnel. FY 2018 reviews mainly focused on preaward actions and were designed to facilitate successful award of critical contracts. In FY 2018, 

Treasury reviewed 53 acquisitions, valued at $8.3 billion; reviews included 19 IT acquisitions 

valued at $2.5 billion. In FY 2019 and FY 2020, the Department anticipates transitioning from 

pre-award MAP reviews to more robust Acquisition Management Reviews (AMR). An expected 

outcome of the AMR is to help ensure successful contract performance strategically aligns with 

mission outcomes by expanding emphasis on the acquisition lifecycle from the time a 

contracting office receives a complete acquisition package through contract performance, 

closeout and final payment. 

Treasury has achieved both savings and efficiencies through aggregating requirements and 

leveraging its purchasing power via enterprise-level management of common spend 

categories. By fully utilizing category management, Treasury seeks to save the Federal 

Government money through smarter purchasing and greater collaboration across stakeholder 

organizations and to achieve greater efficiency with fewer resources. Treasury FY 2018 and 

FY 2019 strategy extends and expands Treasury’s transition to the Office of Management and 

Budget’s (OMB) preferred contract vehicles, reducing the need to establish department level 

contracts and freeing associated resources for focus on other acquisition priorities. In FY 2018, 

Treasury successfully coordinated with OMB’s Category Management Program Management 

Office (PMO) to more accurately measure Treasury’s progress in achieving government-wide 

category management goals. As a result of OPE’s efforts, the Department’s utilization of OMB 

preferred contracts increased from 47 percent in FY 2016, to 54 percent in FY 2017, and 58 

percent in FY 2018. The Department anticipates a similar level of progress and collaboration in 

FY 2018 and FY 2019, bringing Treasury into compliance with the percentage goals established 

by the President’s Management Agenda. 

Section III – Additional Information

A – Summary of Capital Investments

A summary of capital investment resources, including major information technology and nontechnology investments can be found at: 

http://www.treasury.gov/about/budget-performance/Pages/summary-of-capital-investments.aspx

This website also contains a digital copy of this document.



Department of the Treasury 

Cybersecurity Enhancement 

Account 

Congressional Budget 

Justification and Annual 

Performance Report and Plan 

FY 2020
CEA - 2 

Table of Contents

Section I – Budget Request........................................................................................................... 3

A – Mission Statement................................................................................................................ 3

B – Summary of the Request ...................................................................................................... 3

1.1 – Appropriations Detail Table .............................................................................................. 3

1.2 – Budget Adjustments Table ................................................................................................. 4

C – Budget Increases and Decreases Description....................................................................... 4

1.3 – Operating Levels Table...................................................................................................... 5

D – Appropriations Language and Explanation of Changes ...................................................... 6

E – Legislative Proposals............................................................................................................ 6

Section II – Annual Performance Plan and Report................................................................... 7

A – Strategic Alignment ............................................................................................................. 7

B – Budget and Performance by Budget Activity ...................................................................... 7

2.1.1 Cybersecurity Enhancement Account Resources and Measures ....................................... 7

Section III – Additional Information .......................................................................................... 9

A – Summary of Capital Investments......................................................................................... 9
CEA - 3

Section I – Budget Request

A – Mission Statement

Bolster the Department’s cybersecurity posture. 

B – Summary of the Request 

The Department’s strategic plan guides program and budget decisions for the Cybersecurity 

Enhancement Account (CEA). The FY 2020 Budget Request supports Treasury’s FY 2018-2022 

Strategic Goal: Achieve Operational Excellence.

Trillions of dollars are accounted for and processed by the Department of the Treasury's 

information technology (IT) systems, and therefore, they are a constant target for sophisticated

threat actors. To more proactively and strategically protect Treasury systems against

cybersecurity threats, the FY 2020 budget requests $18.0 million for the CEA. The account

identifies and supports Department-wide investments for critical IT improvements, including the 

systems identified as High Value Assets (HVAs). Furthermore, the centralization of funds 

allows Treasury to more nimbly respond in the event of a cybersecurity incident as well as

leverage enterprise-wide services and capabilities across the components of the Department.

By managing CEA centrally, Treasury elevates the importance of such initiatives and provides 

Treasury leadership, OMB, and Congress with better transparency into cybersecurity activities 

across the Department. Enhanced transparency also improves Department-wide coordination of 

cybersecurity efforts and improves the Department’s response and recovery capabilities. With 

high-level support, the program provides a platform to enhance efficiency, communication, 

transparency, and accountability around the mission.

1.1 – Appropriations Detail Table

Dollars in Thousands

Cybersecurity Enhancement Account

Appropriated Resources

New Appropriated Resources FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

Cybersecurity Enhancement Account 8 $24,000 19 $24,000 11 $18,000 (8) ($6,000) -42.11% -25.00%

Total Budgetary Resources 8 $24,000 19 $24,000 11 $18,000 (8) ($6,000) -42.11% -25.00%

* FY 2018 FTE and Other Resources are Actuals. This column reflects levels appropriated in P.L. 115-141, the Consolidated Appropriations Act of 2018. For further details on the 

execution of these resources see the 2020 Budget Appendix chapter for the Department of the Treasury.

FY 2018 FY 2019 FY 2019 to FY 2020

Enacted* Annualized CR Request Change % Change

FY 2020
CEA - 4 

1.2 – Budget Adjustments Table

Dollars in Thousands

Cybersecurity Enhancement Account FTE Amount

FY 2019 Annualized CR 19 $24,000 

Changes to Base:

Non-Recurring Costs (11) ($22,349)

OCIP Re-alignment to DO SE (8) ($1,651)

Subtotal Changes to Base (19) ($24,000)

Total FY 2020 Base 0 $0

Program Changes:

Program Increases: 11 $18,000 

Improving HVA Cybersecurity 0 $3,800 

Proactive Cyber Risk and Threat Identification 0 $966 

Cybersecurity Enhancements 7 $2,407 

Enhanced Incident Response and Recovery Capabilities 2 $10,428 

Enhancements to Cybersecurity Infrastructure 2 $399 

Total FY 2020 Request 11 $18,000 

C – Budget Increases and Decreases Description

Non-Recurring Costs ................................................................................ -$24,000,000 / -19 FTE

FY 2019 Non-Recurring Investments -$22,349,000 / -11 FTE 

This amount represents non-recurring initial investments. 

OCIP Re-alignment to DO SE -$1,651,000 / -8 FTE

The Office of Critical Infrastructure Protection and Compliance Policy (OCIP) investment has 

been realigned to the Departmental Offices Salaries and Expenses account. 

Program Increases ................................................................................. +$18,000,000 / +11 FTE

Improving High Value Asset (HVA) Cybersecurity +$3,800,000 / +0 FTE 

The HVA Cybersecurity initiative builds on prior investments to secure Treasury’s top tier 

HVAs and data at rest encryption solutions for payment platforms, tax processing systems, and 

collection processing systems, as well as enhanced user authentication for these systems. It will 

deliver enhanced data assurance capabilities, minimizing accessibility of highly sensitive data in 

the event of compromises to multi-layered defenses and storage solutions. 

Proactive Cyber Risk and Threat Identification +$966,000 / +0 FTE 

This initiative significantly improves network visibility, threat identification, incident response 

time, data aggregation, and data management by Treasury’s enterprise cybersecurity operations 

center. It provides high definition monitoring of IT assets and activities, and detailed visibility 

across the enterprise and into bureau networks. This initiative will result in faster detection, 

response, and recovery time in the event of an advanced persistent threat attack, other malicious 

activities, or negligent acts. 
CEA - 5

Cybersecurity Enhancements +$2,407,000 / +7 FTE

This request improves cybersecurity situational awareness through the implementation of 

processes and automated tools that support cyber information sharing department-wide and 

eliminates organizational stovepipes that negatively impact the Department’s cybersecurity 

posture. Enhanced situational awareness will provide Department-wide awareness of breaches 

and attack information. It will increase the effectiveness of cybersecurity functions and achieve

efficiencies through the elimination of redundant efforts.

Enhanced Incident Response and Recovery Capability +$10,428,000 / +2 FTE

This initiative improves the Department’s ability to identify, respond to, and recover from cyber 

threats through the implementation of solutions that support early detection and avoidance of 

currently unknown threats. Activities include retroactive examination of network traffic; 

assessment of adversarial movement; determination of information compromise; implementation 

of mitigations and countermeasures; and reconstitution. The initiative will reduce the risk of 

incident occurrence, minimize their impact, and decrease recovery time.

Enhancements to Cybersecurity Infrastructure +$399,000 / +2 FTE

This initiative will enhance encryption, enterprise-wide identity management, and network 

monitoring and scanning. It is critical to the Department’s cyber posture due to the increases in 

volume, sophistication, frequency, impact, and brazenness of global cyber threats and recent 

privacy breaches (including financial institutions). It will result in higher level of assurance for 

data integrity and access management.

1.3 – Operating Levels Table

Dollars in Thousands

Bureau Name FY 2018 FY 2019 FY 2020

Object Classification Enacted Annualized CR Request

11.1 - Full-time permanent $2,480 $2,480 $1,447

11.5 - Other personnel compensation $38 $38 $21

11.9 - Personnel Compensation (Total) $2,518 $2,518 $1,468

12.0 - Personnel benefits $727 $727 $446

Total Personnel and Compensation Benefits $3,245 $3,245 $1,914

21.0 - Travel and transportation of persons $24 $24 $24

23.3 - Communications, utilities, and miscellaneous charges $55 $55 $55

25.1 - Advisory and assistance services $4,342 $4,342 $4,461

25.2 - Other services from non-Federal sources $1,271 $1,271 $4,546

25.3 - Other goods and services from Federal sources $1,733 $1,733 $834

25.7 - Operation and maintenance of equipment $500 $500 $916

26.0 - Supplies and materials $173 $173 $172

31.0 - Equipment $12,657 $12,657 $5,078

Total Non-Personnel $20,755 $20,755 $16,086

New Budgetary Resources $24,000 $24,000 $18,000

FTE 8 19 11

Note: FY 2018 FTE are actuals
CEA - 6 

D – Appropriations Language and Explanation of Changes

Appropriations Language Explanation of Changes

DEPARTMENT OF THE TREASURY

DEPARTMENTAL OFFICES

Federal Funds

CYBERSECURITY ENHANCEMENT ACCOUNT

(INCLUDING TRANSFER OF FUNDS) 

For salaries and expenses for enhanced cybersecurity for 

systems operated by the Department of the 

Treasury, $18,000,000, to remain available until September 

30, 2022: Provided, That amounts made available under this 

heading shall be in addition to other amounts available to 

Treasury offices and bureaus for cybersecurity. 

Note.—A full-year 2019 appropriation for this account was 

not enacted at the time the budget was prepared; therefore, the 

budget assumes this account is operating under the Continuing 

Appropriations Act, 2019 (Division C of P.L. 115–245, as 

amended). The amounts included for 2019 reflect the 

annualized level provided by the continuing resolution. 

E – Legislative Proposals 

The Cybersecurity Enhancement Account has no legislative proposals.
CEA - 7 

Section II – Annual Performance Plan and Report

A – Strategic Alignment

The projects have the common purpose of strengthening the security of Treasury’s IT assets and 

supports the following strategic objective for Strategic Goal 5, to achieve operational excellence: 

• Objective 5.2 – Treasury Infrastructure: Better enable mission delivery by improving the

reliability, security, and resiliency of Treasury’s infrastructure.

B – Budget and Performance by Budget Activity

2.1.1 Cybersecurity Enhancement Account Resources and Measures

Dollars in Thousands

Performance Measure FY 2014 

Actual

FY 2015 

Actual

FY 2016 

Actual

FY 2017 

Actual

FY 2018 

Actual

FY 2018 

Target

FY 2019 

Target

FY 2020 

Target

Number of Major Incidents N/A N/A N/A N/A 0 2 2 2

Number of Reported Incidents N/A N/A N/A N/A 225 276 280 280

Percentage of Tier I High Value 

Assets (HVA) where Risk and 

Vulnerability Assessment 

(RVA) or Security Architecture 

Review (SAR) are completed 

on time

N/A N/A N/A N/A 100% 100% 100% 100% 

Risk Management Assessment 

Overall Rating N/A N/A N/A N/A 68% 40% 60% 70% 

Cybersecurity Enhancement Account (CEA) Budget and Performance

($18,000,000 from direct appropriations):

The purpose of CEA is to strategically mitigate cybersecurity risks through a centralized 

program with Department-wide impact. Due to the increasing number and sophistication of 

cyberattacks, Treasury leadership has prioritized cybersecurity and supports the centralization of 

department-wide cybersecurity initiatives through the CEA account and budget activity. Current 

bureau-level cybersecurity spending remains in the base budgets of each bureau.

Number of Major Incidents: The number of major incidents, as defined in OMB M-19-02, 

reported by Treasury to Congress in a given fiscal year. This is a measure of how effective 

Treasury’s collective defenses are at mitigating the most damaging security threats. The 

FY 2020 performance target of two major incidents reported will be met through increased 

training, implementation of technology, interagency collaboration and customer feedback. 

Number of Reported Incidents: The number of cybersecurity incidents reported by Treasury to 

the United States Computer Emergency Readiness Team (US-CERT) in a given fiscal year. 

This is a measure of how effective Treasury’s defenses are at mitigating all security threats, as 

well as an indicator of how often Treasury is being targeted by malicious actors. If the number 

of reported incidents rises while the number of major incidents remains steady, it may indicate an 

 Resource Level FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Annualized CR Request

Appropriated Resources 0 0 0 $8,442 $26,410 $24,000 $18,000

Budget Activity Total 0 0 0 $8,442 $26,410 $24,000 $18,000

FTE 0 0 0 0 8 19 11
CEA - 8 

effective cybersecurity program. The incidence of intrusion events at Treasury has not remained 

constant over time, and our projections must be used as a baseline to measure against. As 

reflected in the Actual value column, there was an actual reduction in incidents for FY 2018 in 

comparison to those projected by Treasury. This is likely the result of changes in the reporting 

criteria applied during the course of the year. As new incident recognition investments are 

implemented within Treasury throughout FY 2019, the target goals for FY 2019 are expected to 

show an increase in recognized incidents of up to 25 percent from FY 2018 actuals, applying the 

same criteria, within the FY 2019 timeframe. Allowing for increasing preventative measures,

FY 2020 should remain flat from FY 2019 numbers. The FY 2019 and FY 2020 targets of 280 

reported incidents, representing a 25 percent increase in the visibility of incidents, will be met 

through training, implementation of technology, and interagency collaboration. 

Percentage of Tier I High Value Assets (HVA) with Risk and Vulnerability Assessment (RVA) 

or Security Architecture Review (SAR) completed on time: The percentage of Treasury’s top tier 

high value assets, which were scheduled for a third party risk assessment, for which the 

assessments were completed on time. This is a measure of the extent to which Treasury’s most 

important systems are being actively reviewed and assessed for weaknesses that could be 

exploited by an adversary. The FY 2020 performance target of 100 percent (of the current 

annual target of 5 HVA systems to be assessed) will be met through continuing current staffing 

levels and interagency collaboration. Although Treasury has been able to meet its HVA 

assessment goals thus far, additional challenges are foreseen for the short-, mid- and long-terms. 

Pending changes may result in a reduced number of Department of Homeland Security- (DHS-) 

funded RVA and SAR assessments. As a result of this change, continued success at the 100 

percentage level will require the Department to offset the DHS reduction by funding additional 

3rd party RVA/SAR assessments to meet OMB compliance requirements, ensuring that Treasury 

HVAs are appropriately identified and can be mitigated from cyber risks with potentially 

significant impacts to the Federal enterprise and/or national economy. Factors such as the likely 

greater complexity imposed in Federal requirements and mandates for assessments/reviews, as 

well as an ongoing re-evaluation of HVA systems, requires continuing investment in a wellfounded HVA management structure, which Treasury has been addressing through its 

Cybersecurity Enhancement Account (CEA) program.

Risk Management Assessment Overall Rating: This is an assessment performed by OMB to 

evaluate agencies’ overall cybersecurity risk management capabilities. It consists of a risk 

management rating and a maturity rating. The Risk Management Assessment rating is based on 

agency responses to the reporting metrics of the Federal Information Security Modernization Act 

of 2014 (FISMA). In December 2018, the Office of Management and Budget revised the 

FISMA reporting metrics, eliminating several measures that had been factored into the Risk 

Management Assessment calculus. As a result of these changes to the reporting metrics, agency 

Risk Management Assessment ratings are expected to decline. Treasury has accounted for this 

by setting a performance target for FY 2019 that is slightly below the actual rating achieved in 

FY 2018, with a rebound anticipated in FY 2020 based on cybersecurity enhancement 

investments that are planned to mature by that time. This is a measure of how well Treasury is 

managing risk across the enterprise as well as the maturity level of the program. The FY 2020 

target Risk Management Rating of 70 percent will be met through increased training, 

implementation of technology, and continued federal support. 
CEA - 9 

Section III – Additional Information

A – Summary of Capital Investments

Capital investments that support CEA are included in the Departmental Offices plan. 

A summary of capital investment resources, including major information technology and nontechnology investments can be found at: 

http://www.treasury.gov/about/budget-performance/Pages/summary-of-capital-investments.aspx

This website also contains a digital copy of this document.



Department of the Treasury 

Department-Wide Systems and 

Capital Investments Program 

Congressional Budget 

Justification and Annual 

Performance Report and Plan

FY 2020
DSCIP - 2

Table of Contents

Section I – Budget Request........................................................................................................... 3

A – Mission Statement................................................................................................................ 3

B – Summary of the Request ...................................................................................................... 3

1.1 – Appropriations Detail Table ............................................................................................. 3

1.2 – Budget Adjustments Table................................................................................................. 3

C – Budget Increases and Decreases Description....................................................................... 4

1.3 – Operating Levels Table...................................................................................................... 4

D – Appropriations Language and Explanation of Changes ...................................................... 5

E – Legislative Proposals............................................................................................................ 5

Section II – Annual Performance Plan and Report................................................................... 6

A – Strategic Alignment ............................................................................................................. 6

B – Budget and Performance by Budget Activity ...................................................................... 6

2.1.1 – DSCIP Resources and Measures..................................................................................... 6

Section III – Additional Information .......................................................................................... 6

A – Summary of Capital Investments......................................................................................... 6
DSCIP - 3 

Section I – Budget Request

A – Mission Statement

Improve infrastructure, modernize business processes, and increase efficiency through capital 

investments that support the missions of Treasury bureaus and programs. 

B – Summary of the Request 

The Department-wide Systems and Capital Investments Program (DSCIP) account provides a 

mechanism for Treasury to fund capital investments that have complex contracts with projects 

that span several fiscal years. Treasury owns and operates two historic office buildings in 

downtown Washington, D.C. – the Main Treasury Building (MT) and the Freedman’s Bank 

Building (FBB). In FY 2016, Treasury conducted an internal assessment of both buildings and 

found a range of needs that include immediate safety/health risks, capital renewal to address 

systematic and mechanical failure, and building modernization. It is estimated that it will cost 

$95.5 million to address the remaining issues identified in the report. The assessment was 

validated in FY 2017 by an external architectural and engineering firm. In addition to validating 

the identified repair needs, the report identified additional repairs and cyclic needs over the next 

20 years. The Department plans to continue to work through these accumulated needs over time. 

The FY 2020 request of $6.118 million addresses MT and FBB repair and restoration. The 

DSCIP investments support the Treasury goal to Achieve Operational Excellence.

1.1 – Appropriations Detail Table

* FY 2018 FTE and Other Resources are Actuals. This column reflects levels appropriated in P.L. 115-141, the Consolidated

Appropriations Act of 2018. For further details on the execution of these resources see the 2020 Budget Appendix chapter for the

Department of the Treasury.

1.2 – Budget Adjustments Table

Dollars in Thousands

New Appropriated Resources FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

Department-w ide Systems and Capital 

Investments Program 0 $4,426 0 $4,426 0 $6,118 $0 $1,692 NA 38.23%

Total Budgetary Resources 0 $4,426 0 $4,426 0 $6,118 0 $1,692 NA 38.23%

Change % Change

FY 2020 Department-wide Systems and Capital 

Investments Program

FY 2018 FY 2019 FY 2019 to FY 2020

Enacted Annualized CR Request
DSCIP - 4 

C – Budget Increases and Decreases Description

Non-Recurring Costs ................................................................................. -$4,426,000 / +0 FTE 

Non-Recur -$4,426,000 / +0 FTE 

These funds are for for Phase 2 of the Main Treasury roof replacement and the exterior façade 

repair and restoration of the Freedman’s Bank Building.

Program Increases ................................................................................... +$6,118,000 / +35 FTE

FBB Domestic Water Line Repair +$1,500,000 / +0 FTE

The sole domestic water supply line for the Freedman’s Bank Building is well beyond its useful 

life expectancy. Temporary repairs have been made to the piping, but its condition poses a 

significant risk for the line failing and the building losing its only domestic water supply. This 

project will replace the corroded piping from the street main into the building, install a new main 

isolation valve, and also install a code compliant water backflow assembly with a drain. 

FBB Repair and Restoration (Phase 2) +$1,500,000 / +0 FTE

The exterior façade is undergoing a comprehensive restoration due to 100 years of wear and 

pollutants. The perimeter exterior façade has open masonry joints that have been leaking for 

years as a result of systematic building failures. The masonry restoration will provide a 

watertight envelope and stabilize all the historic fabric. The scope will address repair, cleaning, 

and repointing of all masonry surfaces. 

MT Repair and Restoration (Phase 1) +$3,118,000 / +0 FTE

The exterior façade has heavy staining and open masonry joints and is in need of comprehensive 

repair and restoration to prevent further damage. Perimeter exterior walls have been leaking for 

years as a result of systematic building failures. Water infiltration creates a risk of mold 

development in office spaces and results in costly plaster and paint damage to the historic 

interiors. The masonry restoration will provide a watertight envelope and stabilize all the 

historic fabric. The scope will address repair, cleaning, and repainting of all masonry surfaces. 

1.3 – Operating Levels Table 

Dollars in Thousands

Department-w ide Systems and Capital Investments 

Program FY 2018 FY 2019 FY 2020

Object Classification Enacted Annualized CR Request

32.0 - Land and structures 4,426 4,426 6,118

Total Non-Personnel $4,426 $4,426 $6,118

New Budgetary Resources $4,426 $4,426 $6,118

FTE 0 0 0

Note: FY 2018 FTE are actuals
DSCIP - 5 

D – Appropriations Language and Explanation of Changes

Appropriations Language Explanation of Changes

DEPARTMENT OF THE TREASURY

Department-wide Systems and Capital Investments Program

Federal Funds 

For development and acquisition of automatic data processing 

equipment, software, and services and for repairs and renovations 

to buildings owned by the Department of the 

Treasury, [$4,000,000]$6,118,000, to remain available until 

September 30, [2021]2022: Provided, That these funds shall be 

transferred to accounts and in amounts as necessary to satisfy the 

requirements of the Department's offices, bureaus, and other 

organizations: Provided further, That this transfer authority shall 

be in addition to any other transfer authority provided in this 

Act: Provided further, That none of the funds appropriated under 

this heading shall be used to support or supplement "Internal 

Revenue Service, Operations Support" or "Internal Revenue 

Service, Business Systems Modernization". 

Note.—A full-year 2019 appropriation for this account was not 

enacted at the time the budget was prepared; therefore, the budget 

assumes this account is operating under the Continuing 

Appropriations Act, 2019 (Division C of P.L. 115–245, as 

amended). The amounts included for 2019 reflect the annualized 

level provided by the continuing resolution.

E – Legislative Proposals 

The Department-wide Systems and Capital Investments Program has no legislative proposals. 
DSCIP - 6 

Section II – Annual Performance Plan and Report

A – Strategic Alignment

The DSCIP account provides a mechanism for Treasury to fund capital investments that have 

complex contracts with projects that span several fiscal years. Through the DSCIP account, the 

Treasury has been able to develop a Treasury-wide human resources information technology 

solution as well as fund the continual repair and restoration of the Main Treasury Building and 

the FBB.

DSCIP projects support the following strategic objective for Strategic Goal 5, to achieve 

operational excellence: 

Objective 5.2 – Treasury Infrastructure: Better enable mission delivery by improving the 

reliability, security, and resiliency of Treasury’s infrastructure.

B – Budget and Performance by Budget Activity

2.1.1 – DSCIP Resources and Measures

Department-wide Systems and Capital Investments Program Budget and Performance

($6,118,000 from direct appropriations):

DSCIP enables the Department to make investments in capital improvements that support the 

missions of Treasury bureaus and programs. 

Treasury Building - Repairs and Renovations

MT and the FBB are owned by the Department and are Departmental Offices’ capital 

investments. MT is the oldest departmental building and the third oldest federally occupied building 

in Washington, preceded only by the Capitol and the White House. The age and historical 

significance of the buildings, considered by some to be national treasures, create special 

conditions that do not exist in many other Federal office facilities. Continual upkeep, with close 

attention to historic preservation, is necessary in order to continue occupying these buildings. 

The FY 2020 request addresses MT and FBB repair and restoration. 

Section III – Additional Information

A – Summary of Capital Investments

A summary of capital investment resources, including major information technology and nontechnology investments can be found at: 

http://www.treasury.gov/about/budget-performance/Pages/summary-of-capital-investments.aspx

This website also contains a digital copy of this document.


Department of the Treasury 

Office of Terrorism and 

Financial Intelligence 

Congressional Budget 

Justification and Annual 

Performance Report and Plan

FY 2020
TFI - 2

Table of Contents

Section I – Budget Request........................................................................................................... 3

A – Mission Statement................................................................................................................ 3

B – Summary of the Request ...................................................................................................... 3

1.1 – Appropriations Detail Table .............................................................................................. 3

1.2 – Budget Adjustments........................................................................................................... 4

C – Budget Increases and Decreases Description....................................................................... 4

1.3 – Operating Levels................................................................................................................ 8

D – Appropriations Language and Explanation of Changes ...................................................... 9

E – Legislative Proposals............................................................................................................ 9

Section II – Annual Performance Plan and Report................................................................. 10

A – Strategic Alignment ........................................................................................................... 10

B – Budget and Performance by Budget Activity .................................................................... 10

2.1.1 – Terrorism and Financial Intelligence Resources and Measures ................................... 10

Terrorism and Financial Intelligence Budget and Performance ............................................... 11

C – Changes in Performance Measures.................................................................................... 18

Section III – Additional Information ........................................................................................ 18

A – Summary of Capital Investments....................................................................................... 18
TFI - 3 

Section I – Budget Request

A – Mission Statement

Strengthen national security by using targeted financial measures to combat threats and protect 

the integrity of the financial system.

B – Summary of the Request 

The Department of the Treasury’s (Treasury) strategic plan guides program and budget decisions 

for the Office of Terrorism and Financial Intelligence (TFI). The FY 2020 Budget Request 

supports two of Treasury’s FY 2018-2022 Strategic Goals: Enhance National Security and 

Achieve Operational Excellence.

TFI requests $166.712 million, which is a $24.934 million increase from the FY 2019 

Annualized Continuing Resolution. TFI requests these additional resources to continue to invest 

in its people as well as infrastructure, systems, and automated tools, thereby ensuring that TFI 

remains agile, innovative, and strategic in responding to the most pressing U.S. national security 

concerns. The budget prioritizes funding for Treasury’s targeted financial tools that protect the 

U.S. and international financial system from abuse, as well as countering the financial networks 

that support terrorists, weapons proliferators, organized transnational crime, rogue regimes, and 

other threats. 

TFI’s economic authorities continue to play an increasingly central role in countering some of 

the nation’s most critical security threats. This Administration and Congress rely upon TFI to 

deploy non-kinetic tools at a rapid pace to proactively implement U.S. policy towards North 

Korea, Iran, Russia, ISIS and other terrorist organizations, Venezuela, human rights abusers and 

corrupt actors, narcotics traffickers, and other malign and destabilizing actors. As reliance upon 

TFI’s authorities has grown, the corresponding growth in personnel across TFI and increased 

demand placed upon secure systems requires additional investment in mission support areas. 

TFI’s infrastructure investments have been developed with careful consideration of the personnel 

increase request with the intent of developing and maintaining a collaboration network that 

facilitates our operational and policy goals. 

1.1 – Appropriations Detail Table 

Dollars in Thousands

Terrorism and Financial Intelligence

Appropriated Resources

New Appropriated Resources FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

Terrorism and Financial Intelligence 495 $141,778 495 $141,778 545 166,712 50 $24,934 10.10% 17.59%

Subtotal New Appropriated Resources 495 $141,778 495 $141,778 545 $166,712 50 $24,934 10.10% 17.59%

Other Resources

 Transfer-out to Departmental Offices S&E 0 ($31,452) 0 ($31,452) 0 0 0 $31,452 NA 11.58%

 Payments to Treasury Franchise Fund 0 $0 0 $0 0 ($35,094) 0 ($35,094) NA NA

 Reimbursables 36 $8,626 36 $8,626 36 $8,626 0 $0 0.00% 0.00%

Subtotal Other Resources 36 ($22,826) 36 ($22,826) 36 ($26,468) 0 $0 0.00% 15.96%

Total Budgetary Resources 531 $118,952 531 $118,952 581 $140,244 50 $21,292 9.42% 17.90%

FY 2018 FY 2019 FY 2019 to FY 2020

Enacted Annualized CR Request Change % Change

FY 2020

⃰FY 2018 shows actual FTE usage. This column reflects levels appropriated in P.L. 115-141 Consolidated Appropriations Act,

2018. For further details on the execution of these resources see the FY 2020 Appendix chapter for the Department of the 

Treasury.
TFI - 4

1.2 – Budget Adjustments

Terrorism and Financial Intelligence FTE Amount

FY 2019 Annualized CR 495 $141,778

Changes to Base:

Maintaining Current Levels (MCLs) 0 $1,553

Non-Pay 0 $1,553

Efficiency Savings 0 ($3,830)

Subtotal Changes to Base 0 ($2,277)

Total FY 2020 Base 495 $139,501

Program Changes:

Program Increases: 50 27,211

Operations and Maintenance (O&M) of Prior-year 

Enterprise-w ide Cybersecurity investments 0 $2,277

Terrorist Financing Targeting Center 10 $6,211

Terrorist Finance and Financial Crimes 2 $530

TFI National Security Programs 27 $6,634

Committee on Foreign Investment in the United States 3 $859

IT Infrastructure Investments 8 $10,700

Total FY 2020 Request 545 $166,712

Dollars in Thousands

C – Budget Increases and Decreases Description

Maintaining Current Levels (MCLs) ......................................................+$1,553,000 / +0 FTE

Non-Pay +$1,553,000 / +0 FTE 

Funds are requested for non-labor expenses such as travel, contracts, rent, supplies, and 

equipment.

Efficiency Savings.........................................................................................-$3,830,000 / -0 FTE

TFI Contractual Support -$3,830,000 / +0 FTE 

TFI will achieve cost savings and efficiencies in contract services through more efficient 

oversight of all TFI contracts, consolidating contracts where appropriate, and partnering with 

other agencies and DO components to leverage common technology or administrative support 

needs.

Program Increases .................................................................................+$27,211,000 / +50 FTE

O&M of Prior-Year Enterprise-wide Cybersecurity Investments +$2,277,000 / +0 FTE 

This request includes funding to support O&M for prior-year Cybersecurity Enhancement 

Account investments. O&M will be funded by Treasury Bureaus through Treasury Franchise 

Fund billing. This increase represents the TFI portion of the $17.5 million O&M total.
TFI - 5 

Terrorist Financing Targeting Center +$6,211,000 / +10 FTE 

On May 21, 2017, the United States and the six Gulf Cooperation Council countries signed an 

historic agreement announcing a joint commitment to establish the Terrorist Financing Targeting 

Center (TFTC). The TFTC’s efforts support the Administration’s priorities to fight terrorism in 

new and innovative ways through a multilateral initiative that will dramatically increase the 

ability to curb terrorist financing. The TFTC has already resulted in greater regional cooperation 

as evidenced by the sharing of intelligence, the capacity building, and the joint designations by 

the seven participating members of TFTC that targeted terrorist leaders, financiers, and 

facilitators. The TFTC will continue to disrupt the finances and operations of terrorist 

organizations by identifying, tracking, and sharing information regarding terrorist financial 

networks; coordinating joint disruptive actions, like sanctions; and offering support to countries 

in the region that need assistance building capacity to counter terrorist finance threats. 

Terrorist Finance and Financial Crimes +$530,000 / +2 FTE 

TFI requests two FTEs to develop and build global capacity to combat illicit financing in the 

international arena. These FTEs will be responsible for establishing strategies and employing 

targeted financial measures to disrupt and dismantle the financial networks that support 

terrorism, proliferation of weapons of mass destruction, and organized crime. 

TFI National Security Programs +$6,634,000 / +27 FTE 

Treasury requests additional staffing to support its ever-increasing role in the Administration's 

efforts to apply economic pressure in pursuit of national security and foreign policy goals. This 

has included the use of unilateral designations and other economic authorities, as well as 

working with other countries to increase multilateral economic pressure and continuous 

interaction with the financial and private sector through advisories and engagement to cut off 

malign actors’ access to the international financial system. As the number of sanctions programs 

continues to grow, there is a crucial need for increasing intelligence, policy, and targeting staff to 

identify and take impactful actions against the individuals, entities, and their networks 

responsible for this dangerous and malign behavior. Many of these actors have complex 

business structures that are well-integrated into the global markets, which requires additional 

analysis and post-designation support to ensure that the actions have maximum impact on malign 

activity while minimizing the collateral damage to U.S. businesses and our allies.

This requested staffing increase will address personnel needs, including Virtual Currency, Cyber, 

Iran, Russia, Human Rights/Corruption, and Counterterrorism Programs. These are high priority 

areas for the Administration and Treasury and constitute the majority of taskings and 

requirements levied upon TFI and its component offices. Below are some highlights of TFI’s 

activities.

• The use of virtual currency is expanding rapidly with instances of its use having been

identified in many key sanctions programs, including Russia, Iran, and Venezuela. This

request will help support additional intelligence, targeting, and policy expertise to ensure that

TFI and Treasury remain well positioned to stay ahead of emerging financial threats in this

space.

• TFI will increase intelligence, policy, and targeting personnel to support the Administration’s

priority in countering Iran’s malign behavior and Russia’s destabilizing activities. This
TFI - 6

includes Treasury’s ongoing efforts to implement the Countering America’s Adversaries 

Through Sanctions Act (CAATSA) targeting and reporting requirements. The 

Administration remains committed to countering the threat posed by Iran by using Treasury’s 

economic authorities to deny the regime and the Islamic Revolutionary Guard funding for 

malign activities, including its support for terrorism and regional destabilization in Yemen 

and Syria. Treasury’s Russia-related sanctions program remains a top priority as well, with 

strategic, complex actions that target key actors across the full range of Russian malign 

activity, to include malign cyber activities, interference in democratic elections, aggressive 

behavior in Ukraine, and purported illegal annexation of Crimea as well as its continued 

support for the Assad regime. 

• The December 2017 Executive Order implementing the Global Magnitsky Act highlights 

Treasury’s critical role in identifying and financially isolating those who destabilize countries 

and regions by pilfering the wealth and resources of their nation or commit human rights 

abuse and atrocities. TFI’s use of these authorities has already impacted individuals across 

the globe and changed the way regimes are operating, directly advancing objectives outlined 

in the National Security Strategy. These funds will support TFI in supporting policy, 

intelligence, and targeting efforts in this program. 

• TFI monitors and takes action against numerous terrorist entities across the globe, an effort 

that has become increasingly complex as terrorist groups continue to splinter and fracture 

into more independently operated organizations. This request will assist in supporting TFI’s 

efforts in maintaining persistent pressure to disrupt the financing of these terrorist 

organizations.

Committee on Foreign Investment in the United States +859,000 / +3 FTE

CFIUS is an inter-agency committee authorized to review transactions that could result in control 

of a U.S. business by a foreign person, in order to determine the effect of such transactions on 

the national security of the United States. Additional TFI resources are required to meet the 

increase in the CFIUS caseload. 

IT Infrastructure Investments +$10,700,000 / +8 FTE 

Treasury Financial Intelligence Network (TFIN) +$4,498,000 / +2 FTE

• IT Infrastructure upgrade. Increases bandwidth on existing infrastructure in support of the 

TFI expansion and build a more robust capability for the TFI collaborative data discovery 

initiative. Currently, TFI’s virtual desktop infrastructure is not sufficient to support the new 

demands of data analytics. Without more processing power, TFIN users will continue to lack 

the ability to query certain databases or effectively utilize analytic tools, undermining OIA’s 

ability to support TFI efforts to identify, disrupt, and dismantle threats to the United States 

and international financial system.

• TFIN Network Defense. Enhances the ability to monitor the classified Network against 

cyber threats by incorporating more comprehensive and integrated risk and threat 

management. Without enhanced network defense capabilities, Treasury’s classified network 

may potentially be vulnerable to cyber threats like network intrusions, malicious actors, or 

other vulnerable exploits. Cyber defense services are critical components to detect, monitor, 

and analyze TFIN network elements to keep our organization’s data center healthy and 

functional.
TFI - 7 

• Multi-factor Authentication (MFA). Creates a layered defense and make it more difficult

for an unauthorized person to access a target such as a physical location, computing device,

network, or database. Failure to effectively use current MFA technologies on TFIN would

result in vulnerable computing devices, networks, or databases

• Cross Domain - One Way Transfer (OWT). Implements the OWT system that provides

secure transfer of data between the unclassified domain to that of a higher security level

using proven technology that automatically scans files for viruses. Manually transferring

data is cumbersome, time consuming, and often impacts data confidentiality, integrity, and

availability. OWT systems reduce the amount of time currently required to transfer data

from lower to higher classification systems.

User Activity Monitoring (UAM) on Unclassified Bureau Networks +$3,047,000 / +4 FTE 

Rapid technological advances are allowing a broad range of foreign intelligence entities (FIEs) to 

field increasingly sophisticated capabilities and aggressively target the government, including 

Treasury. FIEs are proactive and use creative approaches—including malicious insiders 

threats—to advance their interests and gain advantage over the United States. To mitigate these 

threats, the Office of Counterintelligence (OCI) must drive innovative counterintelligence (CI) 

and insider threat solutions to include implanting more effective monitoring solutions. This 

request includes funding for UAM licenses, hardware, software, and professional services, as 

well as additional insider threat analysts and CI investigators. Treasury Order 105-20 (Revised) 

will give the OCI the authority to monitor all cleared users on unclassified networks. As 75 

percent of Treasury's cleared population is employed by the bureaus, and the exfiltration of 

sensitive information is most likely to occur on an unclassified network, this is a critical need. 

This deployment will cover over 100,000 endpoints and collect activity data on approximately 

5,000 employees. The additional analysts and investigators will support this expanded effort, as 

well as the launch of Treasury’s Insider Threat Reporting Guidelines, which will be disseminated 

Department-wide and require all Treasury employees and insider threat stakeholders to report CI 

and insider threat indicators; OCI anticipates a significant increase in CI and insider threat 

reporting due to its publication. The overall increased workload will greatly exceed levels 

manageable with current Insider Threat Program staffing. 

OFAC-wide IT Infrastructure +3,117,000 / +2 FTE

• Enhancement to the OFAC Administrative System for Investigations and Sanctions

(OASIS) to aid with TAR Processing. Further automates the Terrorist Assets Report (TAR)

to Congress by enabling the electronic upload of data from financial institutions directly into

Office of Foreign Assets Control’s (OFAC) collection system instead of having the data

manually transmitted to OFAC and being entered into the system by employees. While an

important measurement of the blocked assets of State Sponsors of Terrorism as well as

terrorist groups, OFAC’s preparation of the annual TAR remains a labor-intensive, mostly

manual process. This enhancement will allow OFAC to replicate automation gains already

implemented on some programs across additional sanctions programs.

• Secure Online Communications Tool. Completes secure bi-directional, data/ecommunication transfers with the public in order to allow financial institutions to file

information required by OFAC regulations (such as blocking reports) in a secure and

expeditious manner. This initiative will transform the public’s ability to submit and track

respective OFAC transactions, including maintaining an online account with OFAC, and
TFI - 8

improve communication with the general public. The solutions to date have either been costprohibitive or inefficient, requiring a visit to the public institution seeking to establish a 

connection. OFAC has identified a government-approved, secure, sustainable, and efficient 

bi-directional solution to solve this need, and OFAC is in the process (via prototype) of 

implementing the solution for the Banking Institution High Volume Blocking report filers. 

This request would take the prototype to a production system and will be greeted as a 

significant step forward. 

• OFAC Classified Network e-workflow and Case Management. Enhances the hardware and 

software necessary to enable case management functionality on Treasury’s classified 

networks that mirrors OFAC’s unclassified OASIS case management system. These 

enhancements will allow for the installation of the software necessary to support case 

management, TFI collaboration, and other analytical efforts on Treasury’s high and mid-side 

networks. 

• TFIN Enhancement Information Analysis Project. Complements the larger TFI-wide data 

discovery and analysis initiative by providing mature data analytics functionality on TFIN for 

disparate OFAC (and TFI) investigative data sets. With this investment, TFI would be able 

to perform maintenance on existing designees, with the expectation of a 150 percent increase 

in ISIS terrorism targets by introducing the ability to identify direct and indirect relationships 

in a way not possible without this technology and a 50 percent increase in targeting across 

other counter terrorism groups. 

1.3 – Operating Levels

Dollars in Thousands

Terrorism and Financial Intelligence FY 2018 FY 2019 FY 2020

Object Classification Enacted Annualized CR Request

11.1 - Full-time permanent 54,884 54,884 60,763

11.3 - Other than full-time permanent 243 243 556

11.5 - Other personnel compensation 971 971 1,078

11.9 - Personnel Compensation (Total) 56,098 56,098 62,397

12.0 - Personnel benefits 17,394 17,394 19,924

Total Personnel and Compensation Benefits $73,492 $73,492 $82,321

21.0 - Travel and transportation of persons 2,797 2,797 2,116

22.0 - Transportation of things 20 20 824

23.1 - Rental payments to GSA 73 73 491

23.2 - Rental payments to others 14 14 256

24.0 - Printing and reproduction 100 100 122

25.1 - Advisory and assistance services 8,125 8,125 16,546

25.2 - Other services from non-Federal sources 7,989 7,989 9,620

25.3 - Other goods and services from Federal sources 41,768 41,768 46,672

25.7 - Operation and maintenance of equipment 360 360 404

26.0 - Supplies and materials 2,000 2,000 2,302

31.0 - Equipment 1,400 1,400 3,258

32.0 - Land and structures 3,640 3,640 1,780

Total Non-Personnel $68,286 $68,286 $84,391

New Budgetary Resources $141,778 $141,778 $166,712

 ⃰FY 2018 shows actual FTE usage. This column reflects levels appropriated in P.L. 115-141 Consolidated Appropriations Act, 2018. 

 For further details on the execution of these resources see the FY 2020 Appendix chapter for the Department of the Treasury.
TFI - 9 

D – Appropriations Language and Explanation of Changes

Appropriations Language Explanation of 

Changes 

DEPARTMENT OF THE TREASURY

OFFICE OF TERRORISM AND FINANCIAL INTELLIGENCE

Federal Funds 

SALARIES AND EXPENSES

For the necessary expenses of the Office of Terrorism and 

Financial Intelligence to safeguard the financial system against 

illicit use and to combat rogue nations, terrorist facilitators, 

weapons of mass destruction proliferators, human rights 

abusers, money launderers, drug kingpins, and other national 

security threats, $166,712,000: Provided, That of the amounts 

appropriated under this heading, $10,000,000 shall remain 

available until September 30, 2021. 

Note.—A full-year 2019 appropriation for this account was not 

enacted at the time the budget was prepared; therefore, the budget 

assumes this account is operating under the Continuing 

Appropriations Act, 2019 (Division C of P.L. 115–245, as 

amended). The amounts included for 2019 reflect the annualized 

level provided by the continuing resolution.

E – Legislative Proposals 

The Office of Terrorism and Financial Intelligence has no legislative proposals.
TFI - 10 

Section II – Annual Performance Plan and Report

A – Strategic Alignment

TFI programs support the following Department of the Treasury’s Strategic Plan for FY 2018-

2022. Strategic objectives for Strategic Goal 3, to enhance national security: 

• Objective 3.1 – Strategic Threat Disruption: Identify, dismantle, and disrupt priority threats

to the U.S. and international financial system.

• Objective 3.2 – AML/CFT Framework: Identify and reduce vulnerabilities in the U.S. and

international financial system to prevent abuse by illicit actors.

• Objective 3.3 – Economic Strength and National Security: Advance American prosperity and

security through growth, investment, trade, and expanding the American industrial base

while protecting national security.

TFI programs support the following strategic objectives for Strategic Goal 5, to achieve 

operational excellence: 

• Objective 5.1 – Workforce Management: Foster a culture of innovation to hire, engage,

develop, and optimize a diverse workforce with the competencies necessary to accomplish

our mission.

• Objective 5.2 – Treasury Infrastructure: Better enable mission delivery by improving the

reliability, security, and resiliency of Treasury’s infrastructure.

B – Budget and Performance by Budget Activity

2.1.1 – g y Terrorism and Financial Intelligence Resources and Measures

Dollars in Thousands

 Resource Level FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Annualized CR Request

Appropriated Resources $101,305 $112,160 $112,754 $121,580 $109,038 $141,778 $166,712

Other Resource $31,293 $6,966 $6,329 $6,491 $8,626 $8,626 $8,626

Budget Activity Total $132,598 $119,126 $119,083 $128,071 $117,664 $150,404 $175,338

FTE 376 385 414 428 444 531 581

Performance Measure FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Target Target Target

Impact of TFI Programs and 

Activities

8.5 8.8 8.7 8.5 DISC DISC DISC DISC

New or Modifications to 

Existing Sanctions Programs

N/A N/A N/A 5 6 I I I 

Number of Designation 

Actions

N/A N/A N/A 867 725* I I I 

Analytic Intelligence Support N/A N/A N/A 385 704 I I I 

Review and Support of 

Foreign AML/CFT Laws and 

Regulations

N/A N/A N/A 49 64 I I I 

Key: I - Indicator 

*This number does not include the more than 700 individuals, entities, aircraft and vessels sanctioned on November 5, 2018, as part of the reimposition of the U.S. nuclear-related sanctions that were lifted or waived in connection with the JCPOA Although technically completed in FY 

2019, the vast majority of the work was completed in FY 2018.
TFI - 11 

Terrorism and Financial Intelligence Budget and Performance

($166,712,000 from direct appropriations, $8,626,000 from reimbursable resources): 

TFI serves a distinct role in enhancing national security by deploying Treasury’s tools and 

authorities to protect the U.S. and international system from abuse and by combating rogue 

regimes, terrorist facilitators, weapons proliferators, money launderers, drug kingpins, human 

rights abusers, cyber criminals and other illicit finance and national security threats. TFI does 

this by strategically applying the policy, law enforcement, intelligence, and regulatory tools, and 

authorities of its components in a calibrated manner to achieve maximum impact. In FY 2018, 

TFI successfully applied its diverse targeted financial measures, including financial sanctions 

and regulatory tools that address major national security challenges. These challenges include 

North Korea, Iran, Russia, Syria, Venezuela, ISIS, al-Qai’da, Hizballah, human rights violators 

and others. In an effort to identify, disrupt, and dismantle these threats, TFI was able to deny 

revenue sources to these illicit actors.

North Korea 

In the past year, TFI has supported the Administration’s goal to achieve the final, fully verified 

denuclearization of North Korea by maintaining pressure on North Korea’s finances and 

economy, thereby stemming the flow of illicit revenue to its weapons program which continues 

to pose a threat to global security. TFI deploys a variety of financial tools and authorities to curb 

the North Korean threat, including sanctions; measures for anti-money laundering and countering 

the financing of terrorism (AML/CFT); regulatory actions under Section 311 of the United and 

Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct 

Terrorism Act of 2001 (USA PATRIOT Act); foreign engagement; and private sector 

partnerships; among other actions. 

In November 2017, FinCEN issued its final ruling pursuant to Section 311 of the USA 

PATRIOT Act against the China-based Bank of Dandong for serving as a gateway for North 

Korea to access the international financial system. Along with that action, FinCEN issued an 

advisory to financial institutions across the globe with specific red flags of illicit North Korean 

schemes being used to evade U.S. and UN sanctions, launder funds, and finance the regime’s 

weapons of mass destruction and ballistic missile programs. Additionally, in February 2018, the 

OFAC issued an advisory, joined by the U.S. Department of State and the U.S. Coast Guard, to 

alert persons globally to deceptive shipping practices used by North Korea to evade sanctions. 

Overall, in FY 2018, TFI has sanctioned more than 200 individuals, entities, and vessels related

to North Korea. This economic pressure campaign has created the conditions to bring the U.S.

and North Korea to the negotiating table to finally achieve fully verifiable denuclearization with

the hope of bringing peace to the Korean peninsula. 

Iran

With respect to Iran, following the President’s announcement in May 2018 to cease participation

in the Joint Comprehensive Plan of Action (JCPOA), Treasury re-imposed U.S. sanctions on the 

Iranian regime. These measures, imposed in two phases, are designed to greatly reduce Iran’s

capacity to continue its support for terrorism, human rights abuses, ballistic missile proliferation, 

destabilizing activities, and support of militant groups. In addition, as of the end of FY 2018, 

TFI has issued 18 rounds of sanctions on 146 individuals and entities for a range of activities

related to terrorism, proliferation, and human rights abuses, and to thwart Iran’s exploitation of 
TFI - 12

the global financial system. Additionally, on November 5, OFAC issued an additional 700

designations, the preparation of which all took place in FY 2018. Sanctions have included

designations of the then-Governor of the Central Bank of Iran for conspiring with the Islamic

Revolutionary Guard Corps-Qods Force (IRGC-QF) to conceal the movement of millions of

dollars to enrich and support Hizballah; individuals and entities supporting Mahan Air, an airline

previously designated for its support to terrorism, and a currency exchange network that was

funneling millions of dollars to the IRGC-QF. 

In addition to sanctions, TFI continues to deploy other tools to achieve maximum pressure on

Iran to hold Iran accountable for its destabilizing activities. For example, FinCEN recently

issued an advisory to financial institutions detailing Iran’s efforts to deceive legitimate

businesses, including through the use of front and shell companies, to fund its malign activities. 

Likewise, Treasury officials have traveled the world in recent months, meeting with officials in

dozens of countries to warn them of Iran’s illicit activities and garner their support for our

pressure campaign. 

Russia

TFI has also undertaken a comprehensive and strategic financial pressure campaign to counter

the scale and sophistication of Russia’s malign activities. TFI has strategically deployed tools to

maximize financial pressure on the Kremlin while minimizing unintended consequences within

the international financial system. These efforts have included a robust sanctions program,

enforcement actions, foreign engagement, and private sector partnerships to deter their illicit

activity. As of the end of FY 2018, the Administration sanctioned 215 individuals or entities,

including 136 designated under Ukraine/Russia-related sanctions under the CAATSA. TFI

sanctioned powerful Russian oligarchs and many of the companies they own or control. 

Additionally, to protect the international banking system, FinCEN named Latvia-based ABLV

Bank as a primary money laundering concern under Section 311 of the USA PATRIOT Act. This

closed a key access point being exploited by illicit Russian actors to access the international

banking system.

Counter-Terrorism

TFI’s financial tools are also making an impact in the fight to combat terrorism, to include the

Islamic State of Iraq and Syria (ISIS), al-Qa’ida, Hizballah, Hamas, the Taliban and others. The

TFTC, introduced in FY 2017, was created to disrupt the financing of terror through the sharing

of intelligence and coordinated actions between the U.S. and six Gulf country partners—Saudi

Arabia, Bahrain, Qatar, Kuwait, Oman, and the United Arab Emirates—as well as through

capacity building. In FY 2018, TFTC conducted two rounds of multilateral designations, to

include the senior leadership of Hizballah’s Shura Council and leaders, financiers, and

facilitators of the ISIS in Syria and Yemen and al-Qa’ida in the Arabian Peninsula. Additionally,

TFI led discussions with Gulf partners on regional terrorist financing issues, and FinCEN led a

training session with the Financial Intelligence Units of TFTC member countries.

 

Beyond coordinated sanction actions, TFI continued targeting Hizballah and its supporters,

including leadership, operatives, facilitators, financiers, investors, and key global procurement

networks. In FY 2018, TFI conducted 26 Hizballah-related sanction designations, and saw more

designations in calendar year 2018 by the Departments of State and Treasury than in any single

year. Furthermore, in September 2018, TFI sanctioned a company with ties to the Assad regime
TFI - 13 

in Syria that facilitated the trading of fuel between Assad’s government and ISIS. The

designations disrupted this specific illicit supply chain and eliminated access to the international 

financial system.

Human Rights

The U.S. along with other international partners have applied unprecedented financial pressure 

on the Maduro regime in Venezuela in light of the recent actions and policies of the Government 

of Venezuela, including serious abuses of human rights and fundamental freedoms; the 

deepening humanitarian crisis in Venezuela; establishment of an illegitimate Constituent 

Assembly; rampant public corruption; and ongoing repression and persecution of, and violence 

toward, the political opposition. In FY 2018, TFI implemented sanctions against several senior 

government officials and former officials, along with others in Maduro’s inner circle, and issued

a FinCEN advisory to financial institutions to assist them in blocking suspected Venezuelan

public corruption funds moving through the U.S. financial system. TFI will continue to impose 

financial constraints on those responsible for Venezuela’s severe decline and the illicit financial

networks used to mask their wealth. 

TFI has also applied our tools and authorities to combat corruption and human rights abuses

through the Global Magnitsky Human Rights Accountability Act. Under this program, by the end

of FY 2018, TFI has sanctioned more than 80 individuals and entities, including a corrupt 

financier of mining and oil deals in the Democratic Republic of the Congo and individual 

officers and units of the Burmese military for their involvement in ethnic cleansing and extreme

violence against the Rohingya Muslim population and other ethnic and religious minorities. 

Moreover, FinCEN issued an advisory to U.S. financial institutions to highlight the connection 

between corrupt senior foreign political figures and their enablement of human rights abuses. In

Nicaragua, Treasury again used these tools and authorities to combat an increasingly

deteriorating corruption and human rights crisis. OFAC designated four officials pursuant to the 

Global Magnitsky authority in response to their significant involvement in corruption schemes or

human rights abuse. OFAC also issued an advisory alerting financial institutions that the 

growing instability in Nicaragua may lead to the proceeds of crime and corruption from senior 

political figures entering the United States. TFI will continue to take action against human rights

and corruption related targets around the globe, including implementing sanctions under Global 

Magnitsky and other authorities. 

FATF

TFI has also focused on improving systemic enhancements to the global financial system, 

including Treasury’s July 2018 assumption of the presidency of the Financial Action Task Force

(FATF), the AML/CFT standard setting body. TFI has set three priorities during this term: 

• Clarifying how the FATF standards on regulation and supervision apply to virtual currency

service providers to mitigate the use of virtual currencies by illicit actors;

• Maintaining the FATF’s emphasis on combating terrorist financing; and

• Enhancing FATF’s work on preventing the financing of the proliferation of weapons of mass

destruction.
TFI - 14 

During FY 2018, Treasury participated in FATF peer review processes of seven countries: 

Iceland, Bahrain, Saudi Arabia, Myanmar, Indonesia, Latvia and United Kingdom. These

comprehensive AML/CFT assessments evaluate countries against the FATF standards for both 

technical compliance and effective implementation. FATF also clarified how its standards apply 

to virtual asset service providers, which include virtual currency exchangers and administrators. 

TFI worked with the FATF to produce extensive guidance on counter proliferation financing. 

This guidance aims to help both public and private sector stakeholders understand and

implement the obligations of the United Nations Security Council resolutions, as well as how to

prevent sanctions evasion. 

In FY 2019, TFI is working with the FATF to foster improved information-sharing between

governments and between financial institutions to put both in a better position to detect, deter,

and disrupt illicit finance, one effort among many that will continue into FY 2020. 

In support of our priorities to protect the financial system from abuse by illicit actors, Treasury

launched the FinCEN Exchange to provide financial institutions with additional information

about priority issues on a more regular basis. This will allow these financial institutions to focus 

on specific illicit finance and national security threats. As part of this program, TFI convenes 

regular briefings with law enforcement and financial institutions to exchange information on 

priority illicit finance threats, including targeted information and broader typologies. This

program enables financial institutions to better identify risks and focus on high priority issues

and allows FinCEN and law enforcement to receive critical information to help them disrupt 

money laundering and other financial crimes. 

In addition, TFI resolved three civil enforcement actions against financial institutions that violate

the Bank Secrecy Act, which resulted in the assessment of civil money penalties against two

depository institutions and one casino. 

Throughout FY 2019 and FY 2020, TFI will focus heavily on strategically deploying its tools 

and authorities for maximum impact against national security and foreign policy challenges, as 

well as addressing risks to and vulnerabilities within the U.S. and international financial system. 

TFI will continue to focus on applying targeted financial measures against North Korea, Iran, 

Russia, and Venezuela, in addition to identifying, disrupting, and dismantling terrorist 

organizations, drug kingpins, transnational criminal organizations, and other threats to the U.S. 

and our international partners. 

Terrorism and Financial Intelligence Offices Supporting the AML/CFT Mission

This budget request supports three of the four components within TFI that exercise AML/CFT 

authorities and responsibilities. The fourth component, Financial Crimes Enforcement Network 

(FinCEN), reports directly to the Under Secretary for TFI but is budgeted separately as a bureau 

within the Treasury. 
TFI - 15 

TFFC

TFFC is responsible for formulating and coordinating comprehensive strategies to target national 

security and foreign policy threats and safeguard the U.S. and international financial systems 

from abuse. In performing its mission, TFFC works across TFI, as well as interagency and law 

enforcement, to ensure that Treasury’s tools are strategically applied and calibrated for 

maximum impact against global threats such as North Korea, Iran, Venezuela, Russia, ISIS and 

Hizballah, among others. TFFC also leads the development of AML/CFT regulatory and 

outreach initiatives and collaborates with Federal law enforcement on financial crime 

methodology analysis. Domestically, TFFC performs a critical role in working with key 

stakeholders to increase the security of our financial systems, leading public-private sector 

dialogues, financial experts meetings, and other strategic initiatives to identify and address 

potential vulnerabilities. TFFC also serves as the primary interlocutor with international partners 

whether on a bilateral basis or in multi-lateral fora to enhance information sharing, advance 

systemic reforms, synchronize targeted actions, and increase pressure on other countries to 

address specific illicit finance concerns in line with U.S. national security priorities. TFFC 

serves as the head of the U.S. Delegation to the Financial Action Task Force, the international 

body that sets standards and promotes effective implementation of AML/CFT legal, regulatory 

and operational measures that protect the integrity of the international financial system. TFFC is 

also leading Treasury’s efforts to operationalize the Terrorist Financing Targeting Center.

Office of Intelligence and Analysis (OIA) 

As one of 17 members of the U.S. Intelligence Community (IC), OIA is responsible for 

informing Treasury decisions with timely, relevant, and accurate intelligence and analysis of 

financial networks and illicit actors. It supports this mission by: producing all-source 

intelligence analysis that identifies threats to and vulnerabilities within the international financial 

system; driving and delivering intelligence that meets the needs of Treasury decision makers; 

and providing the security infrastructure to protect Treasury’s physical and information security 

apparatus. OIA’s efforts inform and support the Department’s ability to address illicit finance 

and national security threats, including Iran, North Korea, Russia, ISIS, al-Qaida, and illicit 

cyber actors. OIA works with the Office of the Director of National Intelligence and other IC 

agencies to help ensure the Department’s intelligence needs are met. OIA’s security office 

ensures that all necessary Treasury personnel are properly trained to safeguard information 

systems and infrastructure. OIA’s security office also maintains counterintelligence and insider 

threat programs designed to deter, detect, and mitigate foreign intelligence and insider threats to 

Treasury. 

OFAC

The Office of Foreign Assets Control (OFAC) administers and enforces economic and trade 

sanctions based on U.S. foreign policy and national security goals against over 40 targeted 

foreign countries and regimes, terrorists, international narcotics traffickers, those engaged in 

activities related to the proliferation of weapons of mass destruction, and other threats to the 

national security, foreign policy, or economy of the United States. OFAC acts under Presidential 

national emergency powers, as well as authority granted by specific legislation, to impose 

controls on transactions and freeze assets under U.S. jurisdiction. Many of the sanctions are 

based on United Nations and other international mandates, are multilateral in scope, and involve 

close cooperation with allied governments. OFAC vigorously enforces the sanctions programs it 
TFI - 16 

administers, and conducts civil enforcement investigations against U.S. and non-U.S. individuals 

and entities who threaten the integrity of its sanctions programs. OFAC’s enforcement actions 

and activities – including civil monetary penalties, non-public disruptive intervention, and public 

outreach – illuminate evasion schemes and enlist the private sector in its sanctions efforts. 

Additionally, OFAC administers a licensing program through which it reviews and then 

authorizes or denies requests to conduct certain transactions or activities that would otherwise be 

prohibited. OFAC is continually evaluating and adjusting its sanctions programs to ensure that it 

is prohibiting illicit activity, while allowing activity that is consistent with or advances U.S. 

national security and foreign policy. 

Description of TFI’s Performance: 

As described more fully above, TFI has strategically and tactically deployed all available 

economic tools and authorities to disrupt and counter key national security challenges. TFI 

focuses its resources on those actions that are most likely to create the greatest impact towards a 

stated program objective. Therefore, the number of actions taken cannot serve as a single 

determination of effectiveness, complexity, or level of resources required to complete the action. 

For instance, as TFI takes action against larger entities or individuals that are integrated into and 

impact global supply chains, the level of resources and complexity of planning for the action 

increases substantially. For every action, additional resources are required to monitor collateral 

impacts, issue required licenses, engage with the public to answer questions, participate in 

bilateral and multilateral exchanges to ensure international support for actions, timely meet 

reporting requirements, monitor for potential evasion, and execute all required regulatory 

changes, among other things. 

Impact of TFI Programs and Activities: To gauge its performance, TFI previously used a 

composite measure consisting of three program office focus areas related to its mission and 

strategic goals, including customer outreach, increasing production and dissemination of 

intelligence products, and implementing IT modernization projects. TFI discontinued this 

measure in FY 2018 but proposes four new measures with targets for FY 2019 and FY 2020. 

New or Modifications to Existing Sanctions Programs: This indicator measures new actions or 

expansion of existing sanction programs, and the data is collected by OFAC. The measure 

reflects an increase in workload requirements as any new country program or expansion in scope 

of existing programs are by and large in addition to current workload and not in lieu of already 

existing work, and therefore, cumulative. Conversely, ongoing program requirements are much 

less frequently removed. The creation or modification of sanctions programs requires a 

significant upfront dedication of policy, program, legal, and regulatory resources to ensure 

proper coordination and documentation of the changes.

Number of Designation Actions: This indicator measures number of actions taken to impose 

sanctions, and is collected by OFAC. It is important to note that “Program-Specific 

Designations” may not always represent a true reflection of TFI’s extensive efforts across 

programs or toward a particular program. From FY 2017 to FY 2018, TFI activity increased 

across a number of high priority programs. However, the FY 2018 numbers do not reflect the 

approximately 700 Iran sanctions that were implemented on November 5, 2018, in conjunction 

with the full snapback of sanctions following the President’s withdrawal of the United States 
TFI - 17 

from the JCPOA. Though these sanctions technically occurred in FY 2019, the preparation for 

the tranche was exceedingly complex and required several lines of effort over the last several 

months of FY 2018. 

Analytical Intelligence Support: TFI includes both formal analytical intelligence briefings as 

well as final analytical intelligence products that were published. The significant increase from 

FY 2017 to FY 2018 represents increased demand as well as a higher prioritization on 

production. 

Review of Foreign AML/CFT Law and Regulations: This measure tracks/includes participation

in FATF mutual evaluations (ME), which are peer evaluations of countries’ levels of 

effectiveness and implementation of the FATF AML/CFT Standards. The data is collected from 

TFFC. Participation in MEs usually requires several extended on-site visits in country, extensive 

analysis of a country’s AML/CFT system, and follow-up meetings to provide in-depth analyses 

and ratings. Additionally, the metric includes reviews and comments on reports produced by the 

nine FATF-style Regional Bodies; and, work assessing and reviewing countries as part of the 

International Cooperation Review Group, which oversees the FATF process that identifies and 

reviews jurisdictions with strategic AML/CFT deficiencies that may pose a risk to the 

international financial system and closely monitors their progress. Finally, this metric includes 

strategic support to certain high priority bilateral partners in an effort to enhance their AML/CFT 

laws, regulations, and structures. This effort may include, but is not limited to, bilateral and 

multilateral meetings, foreign travel, and reviewing draft legislation. 
TFI - 18 

C – Changes in Performance Measures 

Performance Measure or Indicator Proposed Change and Justification

1. Impact of TFI Programs and Activities

(discontinue)

We propose to stop reporting this metric in the CJ/BIB 

because this data required considerable effort to collect 

and was not indicative of TFI’s overall performance. 

2. New or Modifications to Existing

Sanctions Programs (new measure)

This indicator measures new actions or expansion of 

existing sanction programs. The creation or 

modification of sanctions programs requires a 

significant upfront dedication of policy, legal, and 

regulatory resources to ensure proper coordination and 

documentation of the changes. The data is collected by 

OFAC.

3. Number of Designation Actions (new

measure)

This indicator measures number of actions taken to 

impose sanctions. The preparation for each action is 

exceedingly complex and requires several lines of 

effort. The data is collected from OFAC.

4. Analytic Intelligence Support (new

measure)

This indicator includes both formal analytical 

intelligence briefings and final analytical intelligence 

products that were published. The data is collected 

from OIA.

5. Review and Support of Foreign

AML/CFT Laws and Regulations

(new measure)

This indicator includes participation in FATF ME, 

which are peer evaluations of countries’ levels of 

effectiveness and implementation of the FATF 

AML/CFT Standards. Additionally, the metric 

includes reviews and comments on reports produced 

by the nine FSRBs; and, work assessing and reviewing 

countries as part of the ICRG. Participation on mutual 

evaluations usually requires several extended on-site 

visits in country, extensive analysis of a country’s 

AML/CFT system. The data is collected from TFFC. 

Section III – Additional Information

A – Summary of Capital Investments

A summary of capital investment resources, including major information technology and nontechnology investments can be found at: 

http://www.treasury.gov/about/budget-performance/Pages/summary-of-capital-investments.aspx

This website also contains a digital copy of this document.


Department of the Treasury 

Committee on Foreign 

Investment in the United States 

Activities

Congressional Budget 

Justification and Annual 

Performance Report and Plan

FY 2020
CFIUS - 2 

Table of Contents

Section I – Budget Request........................................................................................................... 3

A – Mission Statement................................................................................................................ 3

B – Summary of the Request ...................................................................................................... 3

1.1 – Appropriations Detail Table .............................................................................................. 4

1.2.1 – CFIUS Fund Budget Adjustments Table ........................................................................ 4

1.2.2 – Departmental Offices Budget Adjustments Table .......................................................... 5

C – Budget Increases and Decreases Description....................................................................... 5

1.3 – Operating Levels Table...................................................................................................... 6

D – Appropriations Language and Explanation of Changes ...................................................... 7

E – Legislative Proposals............................................................................................................ 7

Section II – Annual Performance Plan and Report................................................................... 8

A – Strategic Alignment ............................................................................................................. 8

B – Budget and Performance by Budget Activity ...................................................................... 8

2.1.1 – CFIUS Fund Resources and Measures ........................................................................... 8

CFIUS Fund Budget and Performance ....................................................................................... 8

2.1.2 – Departmental Offices – Committee on Foreign Investment in the United States 

Resources and Measures............................................................................................................. 8

Committee on Foreign Investment in the United States Budget and Performance .................... 8

Section III – Additional Information .......................................................................................... 9

A – Summary of Capital Investments......................................................................................... 9
CFIUS - 3

Section I – Budget Request

A – Mission Statement

Review certain transactions involving foreign investment in the United States to determine the 

effect of such transactions on the national security of the United States and to address any 

identified national security risks. 

B – Summary of the Request 

The Committee on Foreign Investment in the United States (CFIUS) was established in 1975 

under Executive Order 11858 to monitor the impact of foreign investment in the United States, 

and to coordinate and implement federal policy on such investment. CFIUS is composed of nine 

voting member agencies, some of which have multiple subcomponents. CFIUS’ unique design 

facilitates the leveraging of skills, subject matter expertise, and integrated analysis across the 

Committee. CFIUS voting member agencies include:

• Department of the Treasury

• Department of Commerce

• Department of Defense

• Department of Energy

• Department of Homeland Security

• Department of Justice

• Department of State

• Office of Science Technology and Policy

• U.S. Trade Representative

As both Chair and member of CFIUS, Treasury is responsible for leading CFIUS in establishing 

policies, implementing processes and functions, and in its daily operations. Treasury participates 

in every aspect of the process, including reviews and investigations, mitigation and oversight, 

non-notified transaction analysis, legal support, and national security threat assessments. The 

Office of International Affairs (IA) is responsible for case management and coordination for the 

Committee in addition to representing the Committee to parties who file notices. The Office of 

General Counsel (OGC) provides legal support to IA and is responsible for certain analyses 

conducted on each notice filed with the Committee.

The Foreign Investment Risk Review Modernization Act of 2018 (FIRRMA) modernized and 

expanded the jurisdiction of the CFIUS to address growing national security concerns over 

foreign exploitation of certain investment structures which traditionally have fallen outside of the 

Committee’s jurisdiction. Additionally, FIRRMA modernized CFIUS’ processes to better enable 

timely and effective reviews of covered transactions. FIRRMA also established the CFIUS Fund

(the Fund), to be administered by the chairperson (the Secretary of the Treasury), to accept 

appropriated funds for these expanded functions and responsibilities and collect filing fees.

In recent years, CFIUS caseload has increased in volume and complexity. CFIUS handled less 

than 100 cases in calendar year (CY) 2010 compared to 238 in CY 2017. Transactions have also 

become more complex which has contributed to an increasing investigation rate. CFIUS 

generally investigates cases that require more resource intensive analysis and/or corrective 

action. In CY 2007, CFIUS investigated approximately four percent of cases compared to 
CFIUS - 4 

approximately 73 percent in CY 2017. The FY 2020 budget requests resources necessary to 

implement FIRRMA and handle an expected workload of 1,000 cases per year. 

The Administration requests $20 million for the Fund in upfront appropriations that will be offset 

by up to $10 million in offsetting collections from filing fees, which will be established in 

forthcoming regulation. $15 million is proposed for transfer to Treasury to fund long-term and 

capital investments. The remaining $5 million will be available for transfer to other CFIUS 

agencies, to facilitate, for example, interagency connectivity with Treasury’s IT and case 

management systems, and to address emerging needs. 

1.1 – Appropriations Detail Table

1.2.1 – CFIUS Fund Budget Adjustments Table

The total request for Treasury is $35 million, with requested funding increases shown in the two 

Budget Adjustment tables below.
CFIUS - 5

1.2.2 – Departmental Offices Budget Adjustments Table

C – Budget Increases and Decreases Description

Offsetting User Fees...................................................................................-$10,000,000 / +0 FTE

Offsetting User Fees -$10,000,000 / +0 FTE

Treasury and CFIUS anticipate collection of filing fees that will be credited to the Fund as 

offsetting collections.

Program Increases ...................................................................................+$20,000,000 / +0 FTE

Transfer to Treasury CFIUS Program +$15,000,000 / +0 FTE

This funding would be transferred from the Fund to Departmental Offices’ Salaries & Expense 

account. This investment will fund development of an end-to-end IT infrastructure comprised of 

a public-facing portal and a case management system to modernize processes and to handle 

anticipated increasing caseloads for CFIUS member agencies that will promote efficiencies in 

the Committee’s processes. Treasury conducted an extensive analysis of alternatives and found 

the best value for such a case management system to cost approximately $13 million. This will 

include the ability to work in both classified and unclassified environments, meeting FedRAMP 

high certification requirements. The remaining $2 million will fund expected increases in secure 

space to support Treasury’s expected CFIUS employee footprint, data subscriptions, and 

temporary contractor resources. The expanded writ of CFIUS under FIRRMA is expected to 

lead to a further increase in complex cases reviewed by the Committee, many of which will 
CFIUS - 6 

include investigating new sectors currently outside of the expertise of CFIUS staff. To address 

these expertise gaps Treasury requires an expanded set of data subscriptions and will 

complement federal staff with temporary contractor resources. This request represents the first 

year of several multi-year projects. Treasury will require steady funding with costs expected to 

partially non-recur as the IT infrastructure projects move from development into operations and 

maintenance. 

Available for Transfer to Member Agencies +$5,000,000 / +0 FTE

This funding will be available for transfer to other CFIUS agencies to facilitate, for example, 

interagency connectivity with Treasury’s IT and case management systems, and for related 

operations. 

1.3 – Operating Levels Table 
CFIUS - 7

D – Appropriations Language and Explanation of Changes

Appropriations Language Explanation of Changes

DEPARTMENT OF THE TREASURY

DEPARTMENTAL OFFICES

Federal Funds

COMMITTEE ON FOREIGN INVESTMENT IN THE UNITED 

STATES FUND

For necessary expenses of the Committee on Foreign Investment in 

the United States, $20,000,000, to remain available until 

expended: Provided, That the chairperson of the Committee may 

transfer funds provided under this heading to any department or 

agency represented on the Committee (including the Department of 

the Treasury) upon the advance notification of the Committees on 

Appropriations of the House of Representatives and the 

Senate: Provided further, That amounts so transferred shall remain 

available until expended for expenses of implementing section 721 

of the Defense Production Act of 1950, as amended (50 U.S.C. 

4565), and shall be available in addition to any other funds 

available to any department or agency: Provided further, That fees 

authorized by section 721(p) of the Defense Production Act of 1950, 

as amended, shall be credited to this appropriation as offsetting 

collections: Provided further, That the total amount appropriated 

under this heading from the general fund shall be reduced as such 

offsetting collections are received during fiscal year 2020, so as to 

result in a total appropriation from the general fund estimated at 

not more than $10,000,000.

This account was created 

by the Foreign 

Investment Risk Review 

Modernization Act of 

2018. 

E – Legislative Proposals

CFIUS has no legislative proposals.
CFIUS - 8 

Section II – Annual Performance Plan and Report

A – Strategic Alignment

Treaury’s CFIUS activities support the following strategic objective for Strategic Goal 3, to 

enhance national security: 

• Objective 3.3 – Economic Strength and National Security: Advance American prosperity and

security through growth, investment, trade, and expanding the American industrial base

while protecting national security.

B – Budget and Performance by Budget Activity

2.1.1 – CFIUS Fund Resources and Measures

CFIUS Fund Budget and Performance

($20,000,000 from direct appropriations) 

2.1.2 – Departmental Offices – Committee on Foreign Investment in the United States

Resources and Measures

Note: Prior to FY 2018, CFIUS was reflected in the International Affairs Program Resources section.

Measure FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Target Target Target

IA - Timely Review of CFIUS Cases 100 100 100 100 100 100 100 100

Committee on Foreign Investment in the United States Budget and Performance

($20,000,000 from direct appropriations, $15,000,000 from transfers):

In FY 2018 the Office of International Affairs (IA) rebalanced resource allocations to reflect 

changing mission requirements, including the increasing demands associated with chairing 

CFIUS and the passage of the FIRRMA. IA continued to redirect existing resources from other 

areas to increase its capacity to manage a rising volume of increasingly complex CFIUS cases. 

Timely Review of CFIUS Cases: This measure tracks compliance with statutory deadlines for 

completing national security reviews of transactions notified to the CFIUS to ensure that the 

CFIUS process is timely and efficient. The target (100 percent) was met in FY 2018. IA’s target 

for this measure in FY 2019 and FY 2020 is 100 percent. 

Dollars in Thousands

 Resource Level FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Annualized CR Request

Appropriated Resources 0 0 0 0 0 0 $20,000

Budget Activity Total 0 0 0 0 0 0 $20,000

FTE 0 0 0 0 0 0 0

Dollars in Thousands

 Resource Level FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Annualized CR Request

Appropriated Resources 0 0 0 0 $6,000 $15,000 $20,000

Other Resource 0 0 0 0 0 0 $15,000

Budget Activity Total 0 0 0 0 $6,000 $15,000 $35,000

FTE 0 0 0 0 26 65 81
CFIUS - 9 

Section III – Additional Information

A – Summary of Capital Investments

A summary of capital investment resources, including major information technology and nontechnology investments related to CFIUS can be found with other DO IT investments at: 

http://www.treasury.gov/about/budget-performance/Pages/summary-of-capital-investments.aspx

This website also contains a digital copy of this document.



Department of the Treasury 

Office of Inspector General 

Congressional Budget 

Justification and Annual 

Performance Report and Plan 

FY 2020 
OIG - 2

Table of Contents

Section I – Budget Request........................................................................................................... 3

A – Mission Statement................................................................................................................ 3

B – Summary of the Request ...................................................................................................... 3

1.1 – Appropriations Detail Table .............................................................................................. 4

1.2 – Budget Adjustments Table................................................................................................. 4

C – Budget Increases and Decreases Description....................................................................... 5

1.3 – Operating Levels Table...................................................................................................... 5

E – Legislative Proposals............................................................................................................ 6

Section II – Annual Performance Plan and Report................................................................... 7

A – Strategic Alignment ............................................................................................................. 7

B – Budget and Performance by Budget Activity .................................................................... 10

2.1.1 Audit Resources and Measures........................................................................................ 10

Audit Budget and Performance................................................................................................. 10

Investigations Budget and Performance ................................................................................... 12

Section III – Additional Information ........................................................................................ 13

A – Summary of Capital Investments....................................................................................... 13
OIG - 3 

Section I – Budget Request

A – Mission Statement

To promote the integrity, efficiency, and effectiveness in programs and operations within the 

Department of the Treasury (Treasury or Department) and across OIG’s jurisdictional 

boundaries. 

B – Summary of the Request 

The FY 2020 request for $37,044,000 for the OIG will be used to fund critical audit, 

investigative, and mission support activities to meet the requirements of the Inspector General 

Act of 1978, as amended, and other statutes including, but not limited to: the Cybersecurity Act 

of 2015; Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank); Federal 

Information Security Modernization Act of 2014 (FISMA); Government Management Reform 

Act; Improper Payments Elimination and Recovery Act of 2010 (IPERA); Government Charge 

Card Abuse Prevention Act of 2012; Digital Accountability and Transparency Act of 2014 

(DATA Act); Federal Deposit Insurance Act; Small Business Jobs Act of 2010; and Resources 

and Ecosystems Sustainability, Tourist Opportunities, and Revived Economies of the Gulf Coast 

States Act of 2012 (RESTORE Act). Specific mandates include (1) audits of the Department’s 

financial statements, (2) audits and/or evaluations of the Department’s information systems 

security program and practices as required by FISMA, (3) assessments of the Department’s cyber 

security information sharing, (4) audits of improper payments and recoveries under IPERA, (5) 

risk assessments and audits of charge card programs, (6) material loss reviews of failed insured 

depositary institutions regulated by the Office of the Comptroller of the Currency (OCC), and (7) 

data quality audits of spending data submitted by the Department to USASpending.gov. 

With the resources available after mandated requirements are met, the OIG will conduct audits of 

the Department’s highest risk programs and operations, and respond to stakeholder requests for 

specific work as appropriate. Some of the Department’s highest risk programs and operations 

include: (1) Operating in an Uncertain Environment (2) Cyber Threats, (3) Anti-Money 

Laundering/Terrorist Financing and Bank Secrecy Act Enforcement, and (4) Efforts to Promote 

Spending Transparency and to Prevent and Detect Improper Payments. 

The OIG will continue its investigative work to prevent, detect, and investigate complaints of 

fraud, waste, and abuse impacting Treasury programs and operations. This includes the 

detection and prevention or deterrence of employee misconduct and fraud. 

In support of Treasury’s mission, the OIG established the following strategic goals: 

• Promote the integrity, efficiency, and effectiveness of programs and operations across

Treasury OIG’s jurisdictional boundaries through audits and investigations

• Proactively support and strengthen the ability of programs across Treasury OIG’s

jurisdictional boundaries to identify challenges and manage risks

• Fully and currently inform stakeholders of Treasury OIG findings, recommendations,

investigative results, and priorities

• Enhance, support, and sustain a workforce and strengthen internal operations to achieve the

Treasury OIG mission, vision, and strategic goals
OIG - 4

Office of Inspector General’s FY 2020 Budget Request

In accordance with the requirements of Section 6(f) (1) of the Inspector General Act of 1978, as 

amended, the Treasury Inspector General submits the following information relating to the 

OIG’s requested budget for FY 2020:

• The aggregate budget request for the operations of the OIG is $46,044,000 comprised of 

$37,044,000 from direct appropriations, and $9,000,000 from reimbursable collections;

• The portion of this amount needed for OIG training is $650,000; and

• The portion of this amount estimated in support the Council of Inspectors General on 

Integrity and Efficiency (CIGIE) is $92,500.

The amount requested for training satisfies all OIG training needs for FY 2020.

“The Inspector General has determined that the office requires approximately $2,000,000 above 

the flat funding level of $37,044,000 included in the President’s Budget to maintain current 

staffing and accomplish required audit and investigative work in FY 2020, and to carry out the 

OIG’s mission to promote integrity, efficiency and effectiveness of programs and operations 

within the Department and across OIG’s jurisdictional boundaries, and to prevent fraud waste 

and abuse.”

1.1 – Appropriations Detail Table

Dollars in Thousands

* FY 2018 FTE and Other Resources are Actuals. This column reflects levels appropriated in P.L. 115-141, the Consolidated 

Appropriations Act of 2018. For further details on the execution of these resources see the 2020 Budget Appendix chapter for the 

Department of the Treasury.

1.2 – Budget Adjustments Table

Dollars in Thousands

Office of Inspector General FTE Amount

FY 2019 Annualized CR 166 $37,044 

Changes to Base:

Maintaining Current Levels (MCLs): $193 

Non-Pay 0 $193 

Subtotal Changes to Base 0 $193 

Total FY 2020 Base 166 $37,237 

Program Changes:

 Program Decreases 0 ($281)

Operating Level to Absorb Administrative Cost

Increase 0 ($281)

Program Increases 0 $88 

Operations and Maintenance (O&M) of Prioryear Enterprise-wide Cybersecurity investments 0 88

Subtotal Program Changes 0 ($193)

Total FY 2020 Request 166 $37,044 

Office of Inspector General

Appropriated Resources

New Appropriated Resources FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

Audit 119 $24,413 127 $28,524 127 $28,524 0 $0 0.00% 0.00%

Investigations 42 $11,512 39 $8,520 39 $8,520 0 $0 0.00% 0.00%

Subtotal New Appropriated Resource 161 $35,925 166 $37,044 166 $37,044 0 $0 0.00% 0.00%

Other Resources

 Reimbursables 3 $10,500 3 $9,000 3 $9,000 0 $0 0.00% 0.00%

Subtotal Other Resources 3 $10,500 3 $9,000 3 $9,000 0 $0 0.00% 0.00%

Total Budgetary Resources 164 $46,425 169 $46,044 169 $46,044 0 $0 0.00% 0.00%

FY 2018 * FY 2019 FY 2019 to FY 2020

Enacted Annualized CR Request Change % Change

FY 2020
OIG - 5 

C – Budget Increases and Decreases Description

Maintaining Current Levels (MCLs) ................................................................. 193,000 / 0 FTE

Non-Pay +$193,000 / +0 FTE 

Funds are requested for non-labor expenses such as travel, contracts, rent, supplies, and 

equipment. 

Program Decreases ..................................................................-281,000/ 0 FTE

Decrease to Meet Budget Level -$281,000/ -0 FTE

Program decrease to accommodate increased administrative costs, including rent. 

Program Increases..................................................................... $88,000/ 0 FTE 

Operations and Maintenance (O&M) of Prior-year Enterprise-wide Cybersecurity Investments 

+88,000 / +0 FTE

The FY 2020 request includes funding to support O&M for prior year Cybersecurity 

Enhancement Account investments. O&M will be funded by Treasury Bureaus through 

Treasury Franchise Fund billing. This increase represents the bureau’s portion of the $17.5 

million O&M total.

1.3 – Operating Levels Table

Dollars in Thousands

Bureau Name FY 2018 FY 2019 FY 2020

Object Classification Enacted Enacted Request

11.1 - Full-time permanent 19,232 19,285 20,000

11.3 - Other than full-time permanent 10 10 10 

11.5 - Other personnel compensation 825 700 500

11.9 - Personnel Compensation (Total) 20,067 19,995 20,510

12.0 - Personnel benefits 6,200 6,553 6,000

13.0 - Benefits for former personnel 15 10 15 

Total Personnel and Compensation Benefits $26,282 $26,558 $26,525

21.0 - Travel and transportation of persons 775 700 700 

23.1 - Rental payments to GSA 2,087 4,041 4,106 

23.3 - Communications, utilities, and miscellaneous charges 1,000 800 900 

24.0 - Printing and reproduction 5 5 10 

25.2 - Other services from non-Federal sources 3,100 2,250 2,000

25.3 - Other goods and services from Federal sources 3,100 2,215 2,200

25.6 - Medical care 75 75 75 

25.7 - Operation and maintenance of equipment 50 35 58 

26.0 - Supplies and materials 200 145 200 

31.0 – Equipment 350 200 250 

91.0 – Unvouchered 20 20 20 

99.5 - Adjustment for rounding 0 0 0 

Total Non-Personnel $10,762 $10,486 $10,519

New Budgetary Resources $37,044 $37,044 $37,044 

FTE 161 166 166

FY 2018 shows actual FTE usage. This column reflects levels appropriated in P.L. 115-141 Consolidated Appropriations Act, 2018. For further 

details on the execution of these resources see the 2020 Budget Appendix chapter for the Department of the Treasury
OIG - 6 

D – Appropriations Language and Explanation of Changes

Appropriations Language Explanation of Changes

DEPARTMENT OF THE TREASURY

OFFICE OF INSPECTOR GENERAL

Federal Funds 

SALARIES AND EXPENSES

For necessary expenses of the Office of Inspector General in 

carrying out the provisions of the Inspector General Act of 

1978, $37,044,000, including hire of passenger motor vehicles; of 

which not to exceed $100,000 shall be available for unforeseen 

emergencies of a confidential nature, to be allocated and 

expended under the direction of the Inspector General of the 

Treasury; of which up to $2,800,000 to remain available until 

September 30, 2021, shall be for audits and investigations 

conducted pursuant to section 1608 of the Resources and 

Ecosystems Sustainability, Tourist Opportunities, and Revived 

Economies of the Gulf Coast States Act of 2012 (33 U.S.C. 1321 

note); and of which not to exceed $1,000 shall be available for 

official reception and representation expenses.

Note.—A full-year 2019 appropriation for this account was not 

enacted at the time the budget was prepared; therefore, the budget 

assumes this account is operating under the Continuing 

Appropriations Act, 2019 (Division C of P.L. 115–245, as 

amended). The amounts included for 2019 reflect the annualized 

level provided by the continuing resolution.

E – Legislative Proposals 

The OIG has no legislative proposals.
OIG - 7 

Section II – Annual Performance Plan and Report

A – Strategic Alignment

Through the audit and investigative functions, the OIG supports the Department of the 

Treasury’s Strategic Plan for FY 2018-2022 including all objectives under the following goals: 

• Goal 1: Boost U.S. Economic Growth

• Goal 2: Promote Financial Stability

• Goal 3: Enhance National Security

• Goal 4: Transform Government-wide Financial Stewardship

• Goal 5: Achieve Operational Excellence

The FY 2020 requested resources will enable the OIG to perform audits and investigations of 

Treasury programs and operations under its jurisdiction, except for those of the Internal Revenue 

Service (IRS) and the Troubled Asset Relief Program (TARP), and to keep the Secretary of the 

Treasury and Congress fully informed of problems, deficiencies, and the need for corrective 

action. By statute, the OIG also performs oversight of the Gulf Coast Ecosystem Restoration 

Council, an independent Federal agency. 

Major Treasury risks and challenges include: 

Operating in an Uncertain Environment

This challenge addresses the external factors and future uncertainties that affect the Department’s 

programs and operations. Among the most notable were the proposed budget cuts and new 

requirements imposed by Executive Order 13781, Comprehensive Plan for Reorganizing the 

Executive Branch (March 13, 2017). The OIG will assess the Department’s ability to meet new 

mandates and manage challenges and risks to its programs and operations. 

Cyber Threats

Treasury has maintained steady progress in addressing the continual and on-going challenges 

that the Federal Government and private sector face, including the threat of ransomware and 

difficulty obtaining cybersecurity personnel. Cyber threats are a persistent concern as Treasury’s 

information systems are critical to the core functions of government and the Nation’s financial 

infrastructure. Attempted cyber-attacks against Federal agencies, including Treasury, and 

financial institutions continue to increase in frequency and severity, in addition to continuously 

evolving. Treasury is in the process of implementing the Federal Government-wide Continuous 

Diagnostics and Mitigation program spearheaded by the Department of Homeland Security. This 

program is aimed at providing agencies with the capabilities and tools needed to identify 

cybersecurity risks on an ongoing basis, prioritize these risks based on potential impacts, and 

enable cybersecurity personnel to mitigate the most significant problems first. 

OIG conducts audits of Treasury’s information systems and operations. As part of these audits, 

OIG conducts penetration tests of selected Treasury bureaus and offices to determine whether 

sufficient protections exist to prevent and detect unauthorized access to Treasury networks and 

systems. 
OIG - 8

Anti-Money Laundering/Terrorist Financing and Bank Secrecy Act Enforcement 

Effective coordination and collaboration and TFI’s ability to effectively gather and analyze 

intelligence information requires a stable cadre of experienced staff. The security clearance 

process has significantly impacted Treasury’s human capital management and is a systemic issue 

government-wide. Stability, experienced leadership, and coordination within TFI is imperative to 

enhance information gathering and intelligence analysis and increase efficiency. Given the 

criticality of Treasury’s mission, its role to carry out U.S. policy, and resource constraints, the 

OIG continues to consider anti-money laundering and combating terrorist financing programs 

and operations as inherently high-risk.

Through OIG’s review of TFI authorities, responsibilities and programs, OIG assesses the 

efficiency and effectiveness of TFI components including their ability to disrupt terrorist 

organizations. OIG’s review includes assessing internal control and ensuring compliance with 

laws and internal procedures. 

Efforts to Promote Spending Transparency and to Prevent and Detect Improper Payments

Given the broad implications and critical roles assigned to Treasury by the DATA Act, it is 

considered an ongoing high risk implementation project and management challenge. The DATA 

Act requires the Federal Government to provide consistent, reliable, and useful online data about 

how it spends taxpayer dollars. Given the Department’s role in the Government-wide 

implementation of the DATA Act, Treasury OIG has provided continuous oversight since 

enactment of the law. While there have been successes to date, there is still much to do.

Concurrent with the work performed by the OIG, the office leads a multi-agency IG community 

DATA Act Working Group and provides educational oversight ensuring the IG community is 

carrying out responsibilities under the DATA Act. 

The OIG continues to identify and analyze the risks of improper payments and reviews the 

controls and safeguards put in place by Treasury to prevent and recover such payments as set 

forth in IPERA.

Major challenges and risks for the Gulf Coast Ecosystem Restoration Council (Council)

Federal Statutory and Regulatory Compliance

While the Council must ensure that activities and projects funded by the RESTORE Act meet all 

environmental laws and regulations at the Federal and State level, the Council must also ensure 

its compliance with applicable laws and regulations as a Federal entity. The Council is 

challenged to follow Federal statutory and regulatory compliance requirements related to the 

DATA Act, FISMA, and IPERA. The Council still faces challenges in meeting these Federal 

statutory and regulatory compliance stemming from the need for a reliable grants management 

system among other things. The OIG will continue to focus audits on the Council’s continued

implementation and compliance with key Federal mandates.

Grant and Interagency Agreement Compliance Monitoring

Given the increase in grants and interagency agreements, the OIG continues to emphasize the 

necessity to monitor projects and award recipients of RESTORE Act funds. The OIG audits will 

focus on the Council’s monitoring controls in place to ensure projects and recipients comply with 

grant and agency agreements and funds are used as intended. 
OIG - 9 

In the Investigations operational area, OIG has established eight priorities for FY 2019: 

Criminal and Serious Employee Misconduct

The OIG Office of Investigation’s highest priority is investigating complaints involving alleged 

criminal and other serious misconduct by Treasury employees. OIG investigates allegations of: 

the general crimes enumerated in Title 18 of the U.S. Code, other federal crimes, alleged 

violations of the Ethics in Government Act, and allegations of serious misconduct prohibited by 

the Standards of Ethical Conduct for Employees of the Executive Branch. Several Treasury 

bureaus and offices have additional rules and regulations relating to ethical standards for their 

own employees, and OIG also investigates complaints of alleged violations of these rules and 

regulations. 

Fraud Involving Contracts, Grants, Guarantees, and Funds 

The OIG Office of Investigations conducts investigations into allegations of fraud and other 

crimes involving Treasury contracts, grants, loan guarantees, and federal funds, including 

investigations made in accordance with Sections 1602 and 1603 of the Recovery Act. Such 

allegations often involve contractors, entities, and individuals who are providing or seeking to 

provide goods or services to the Department. The Office of Investigations receives complaints 

alleging criminal or other misconduct from employees, contractors, members of the public, and 

the Congress. 

Financial Programs and Operations Crime 

Investigations relating to Treasury financial programs and operations that involve Treasury 

bureaus issuing licenses, providing benefits, and exercising oversight of U.S. financial 

institutions; frauds involving improper Federal payments such as those involving stolen, 

counterfeit, altered or fraudulently obtained Treasury checks and ACH payments; frauds 

involving improper Federal payments such as those involving Treasury checks and the Check 

Forgery Insurance Fund; crimes involving the improperly-redirected benefits of federal 

government payees; and false claims of any kind that generate inappropriate Federal payments, 

including federal income tax refunds, Social Security benefits, and Veterans’ Administration 

payments. These matters require prompt attention to protect the public and the integrity of the 

department.

Threats Against Treasury Employees and Facilities 

Investigative efforts into threats against Treasury employees and facilities are critical in ensuring 

safety for the Department. These matters require prompt attention and coordination with federal, 

state, and local authorities in order to protect those involved. 

Cyber Threats against Treasury Systems and Cyber Enabled Financial Crimes Fraud 

The OIG conducts investigations into Cyber intrusions of Treasury systems, the illicit removal of 

Treasury protected information from Treasury systems and Cyber enabled criminal activity 

impacting Treasury programs and operations, such as Business Email Compromise, Personal 

Email Compromise and other schemes.

Treasury Employee and Bureau Impersonation Scams 

Investigations relating to scammers who represent themselves as Treasury employees in order to 

defraud the citizens of the U.S. and other countries by the impersonation of Treasury employees 
OIG - 10 

and/or the fraudulent use of the Treasury and Bureau seals. This is a problem that has 

significantly increased in the last few years. These matters require prompt attention to protect the 

public and the integrity of the Department. 

Investigating Fraud Related to Persons Representing Themselves as “Sovereign Citizens” 

Submitting Fictitious Financial Instruments to Treasury, Financial Institutions, and Private 

Companies 

The OIG conducts investigations into criminal activity associated with individuals who attempt 

to scam the Treasury, financial institutions, private companies, and citizens by submitting 

fictitious financial instruments purporting to be issued by or drawn on the Treasury or other 

counterfeit documents to perpetrate a variety of fraud schemes. These matters have become more 

prevalent and require prompt coordination with Federal, State, and local authorities to protect the 

targets of the scams. 

Identifying and Investigating Fraud Related to the RESTORE Act 

The RESTORE Act commits 80 percent of all administrative and civil penalties related to the 

Deepwater Horizon spill to the Gulf Coast Restoration Trust Fund. It also outlines a structure for 

using the funds to restore and protect the natural resources, ecosystems, fisheries, marine and 

wildlife habitats, beaches, coastal wetlands, and economy of the Gulf Coast region. As such, the 

act assigns Treasury several roles in administering the Trust Fund, including authorizing the 

Inspector General to investigate projects, programs, and activities funded under the act. 

B – Budget and Performance by Budget Activity

2.1.1 Audit Resources and Measures

Dollars in Thousands

 Resource Level FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Annualized 

CR Request

Appropriated Resources $21,801 $24,947 $27,653 $26,014 $28,413 $28,524 $28,524 

Reimbursable $8,671 $8,525 $7,299 $6,726 $6,116 $9,000 $9,000 

Budget Activity Total $30,472 $33,472 $34,952 $32,740 $30,529 $37,490 $37,490

FTE 133 135 137 115 119 127 127

Measure FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Target Target Target

Number of Completed Audit 

Products 72 75 86 98 90 86 74 74

Percent of Statutory Audits 

Completed by the Required 

Date

100 100 100 100 100 100 100 100

Audit Budget and Performance

($28,524,000 from direct appropriations, and $9,000,000 from reimbursable resources):

The Office of Audit conducts audits intended to ensure the accountability of resources, protect 

information, and provide recommendations for improving the integrity, economy, efficiency, 
OIG - 11 

effectiveness, of programs and operations within the Department and across OIG’s jurisdictional 

boundaries, which include those of the Gulf Coast Ecosystem Restoration Council. The 

requested funding for FY 2020 is necessary to perform mandated work (including 

audits/assessments of financial statements, information systems security program and practices, 

cyber security information sharing, improper payments and recoveries, charge card programs. 

material loss reviews of failed insured depository institutions regulated by the OCC, and data 

quality audits of spending data), and to maintain an appropriate level of oversight of programs 

and operations consistent with the OIG’s responsibilities under the Inspector General Act of 

1978, amended. In FY 2020, OIG will also continue to provide oversight of Treasury’s 

government-wide role and responsibilities under the DATA Act. Reimbursable funding 

agreements support financial statement audits of Treasury and oversight of the Small Business 

Lending Fund. Reimbursable funding agreements also support Treasury financial audits for 

which Treasury OIG is the lead office in selecting and overseeing contractor selection.

Description of Performance:

The Office plans to complete 74 audit products in FY 2019, and 74 in FY 2020. The number of 

audit products was reduced beginning in FY 2018 due to the increased administrative costs. The 

same target will apply in FY 2020. In FY 2018, the Office of Audit completed 91 audit products, 

and met all statutory audit timelines. Audit products included audit reports, evaluation reports, 

the Inspector General’s Semi-Annual Reports to Congress, and the Inspector General’s annual 

memoranda to the Secretary of the Treasury and the designated Chairperson of the Gulf Coast 

Ecosystem Restoration Council, on the most significant management and performance 

challenges facing the Department and Gulf Coast Ecosystem Restoration Council, respectively. 

Audit products can also include responses to specific information requests by the Congress. By 

completing independent and timely assessments of programs and operations across its

jurisdictional boundaries, the Office of Audit supports the OIG’s mission of promoting integrity,

efficiency, effectiveness of those programs and operations. The recommendations for 

improvement in programs and operations noted through OIG’s assessments directly support both 

the Treasury Department and the Gulf Coast Ecosystem Restoration Council in achieving their 

strategic goals and meeting their respective missions. 

2.1.2 Investigations Resources and Measures

Dollars in Thousands

 Resource Level FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Annualized

CR Request

Appropriated Resources $5,451 $6,237 $6,913 $7,164 $11,512 $8,520 $8,520 

Budget Activity Total $5,451 $6,237 $6,913 $7,164 $11,512 $8,520 $8,520 

FTE 34 33 33 43 42 39 39

Performance Measure

FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Target Target Target

Percentage of All Cases 

Closed During Fiscal Year 

That Were Referred for 

Criminal/Civil/Administrative 

Action

84 87 84 84 98 80 80 80
OIG - 12 

Investigations Budget and Performance 

($8,520,000 from direct appropriations): 

The Office of Investigations prevents, detects, and investigates complaints of fraud, waste, and 

abuse impacting Treasury programs and operations. This includes the detection and prevention 

or deterrence of employee misconduct and fraud, or related financial crimes within or directed 

against Treasury. The Office of Investigations 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. 

With the increased risk of the Recovery Act grant programs for low-income housing, the Office 

of Investigations faces greater challenges and anticipated increases in grant fraud. In addition, 

with the establishment of Gulf Coast Restoration Trust Fund outreach efforts are being made in 

an effort to prepare for future investigative referrals and complaints aimed at suspected fraud 

involving the funds with this program. In addition to the grant programs listed above, the Office 

of Investigations has seen a noted increase in fraud impacting other significant Treasury 

programs and operations including leaks of Treasury information, as well as fraud impacting the 

Treasury Direct program and the Treasury payment processing service operated by the Bureau of 

Fiscal Service. Fraud impacting the Treasury Direct program includes identity theft, account 

takeover, attempts to launder money and create fraudulent accounts. In 2018 the Bureau of the 

Fiscal Service reported an over eightfold increase in some types of fraud over 2015. The Office 

of Investigations continues to see substantial increases in improper payment fraud impacting the 

Bureau of Fiscal Service, which makes 85 percent of the payments for the Federal Government. 

This fraud includes marked increases in fraud impacting the Direct Express program, including 

lost card fraud, stolen card fraud, counterfeit card fraud, “account take over” or redirected 

benefit fraud, “card not present” fraud as well as stolen, altered and counterfeit Treasury checks 

and ACH payments. Fraud impacting the Direct Express program nearly tripled in dollar terms 

from November 2015 to December 2018. Stolen card fraud more than quadrupled from April to 

October 2018. Card not present fraud increased over twenty percent from February to 

September 2018. Lost card fraud nearly doubled from February to June 2018. Counterfeit credit 

card fraud more than tripled from July to December 2018. 

Additionally, the Office of Investigations remains committed to investigating benefit, improper

payment and other monetary fraud associated with the programs and operations of the Treasury 

Department. 

Description of Performance:

In FY 2018 the Office of Investigations exceeded the Investigative Performance Measure target 

(Target – 80 percent; Actual – 98 percent), opened 113 new investigations and closed 110 

investigations. The OIG also referred 8 investigations that substantiated administrative 

violations against a Treasury employee to the appropriate regulated bureau for action. In 

addition, the OIG referred 185 investigations for criminal prosecution and 19 investigations for 

civil prosecution. In FY 2018 the Office of Investigations charged and/or indicted 102 subjects, 

54 of which have been sentenced in investigations that resulted in fines, seizures, restitution, 

penalties and settlements of more than $34 million. 
OIG - 13 

The Investigative Performance Measure is a percentage of all cases closed by the Office of 

Investigations during the fiscal year referred to Department Bureaus for administrative action or 

for criminal or civil prosecution by Federal or local prosecutors. The goal for Office of 

Investigations is that at least 80 percent of closed cases meet the aforementioned criteria of 

closed cases in the fiscal year. Meeting or exceeding this goal demonstrates that the Office of 

Investigations is responsive to allegations and complaints referred to the office and when these 

referrals require investigation, the cases are timely, thoroughly and accurately reported to assist 

the Department in maintaining the integrity of its programs and operations, subsequently 

ferreting out fraud, waste, and abuse. The office is working to meet or exceed this measure in 

both FY 2019 and FY 2020. 

With the publication of the Treasury Strategic Plan for FY 2018-2022, OIG will work this year 

to baseline its performance against the new strategic objectives. This could result in changes to 

performance measures in the FY 2021 budget. 

Section III – Additional Information

A – Summary of Capital Investments

OIG has no capital investments. Capital investments that support OIG are included in the 

Departmental Offices plan. 

A summary of capital investment resources, including major information technology and nontechnology investments can be found at: 

http://www.treasury.gov/about/budget-performance/Pages/summary-of-capital-investments.aspx

This website also contains a digital copy of this document. 



Office of the Special Inspector 

General for TARP 

(SIGTARP) 

Congressional Budget 

Justification and Annual 

Performance Report and Plan

FY 2020
SIGTARP - 2 

Table of Contents

Section I – Budget Request............................................................................................................. 3

A – Mission Statement................................................................................................................... 3

B – Summary of the Request ......................................................................................................... 3

Special Inspector General’s Comments........................................................................................ 3

1.1 – Appropriations Detail Table ............................................................................................................ 5

1.2 – Budget Adjustments Table.............................................................................................................. 6

C – Budget Increases and Decreases Description.......................................................................... 6

1.3 – Operating Levels Table................................................................................................................... 7

D – Appropriations Language and Explanation of Changes ......................................................... 8

Section II – Annual Performance Plan and Report..................................................................... 9

A – Strategic Alignment ................................................................................................................ 9

B – Budget and Performance by Budget Activity ....................................................................... 10

2.1.1 – Investigations Resources and Measures..................................................................................... 10

Investigations Budget and Performance ...................................................................................... 11

2.1.2 – Audit Resources and Measures.................................................................................................. 11

Audit Budget and Performance .................................................................................................... 11

Section III – Additional Information ........................................................................................... 11

A – Summary of Capital Investments.......................................................................................... 11
SIGTARP - 3 

Section I – Budget Request

A – Mission Statement

The Office of the Special Inspector General for the Troubled Asset Relief Program (SIGTARP) is 

a Federal law enforcement agency and an independent audit watchdog that targets financial 

institution crime, and other fraud, waste, and abuse related to TARP. Protecting Americans, 

taxpayer dollars, and TARP programs drives SIGTARP’s mission. 

B – Summary of the Request 

The FY 2020 Budget proposes $17,500,000,1 a 49 percent reduction from both the FY 2019 

Annualized CR level and the FY 2018 enacted level. The proposed budget is intended to fund the 

mandated independent oversight of TARP, which impacts all 50 states, to include the $34 billion

that has and will be spent through 2023 for TARP foreclosure prevention programs, such as the 

Making Home Affordable (MHA) and the Hardest Hit Fund (HHF) programs. Through FY 2018, 

banks, mortgage servicers, state agencies, thousands of contractors, and other recipients have 

already received $28 billion for TARP foreclosure prevention programs (nearly $3 billion that 

year), with nearly $6 billion left to spend through 2023. 

Special Inspector General’s Comments

Pursuant to section 6(f)(3)(E) of the Inspector General Act of 1978, as amended, as applied 

through the Emergency Economic Stabilization Act of 2008, I have concluded that the President’s 

FY 2020 budget request of $17.5 million would substantially inhibit the Special Inspector General 

from performing the duties of the office. The President’s budget request is a 49 percent reduction 

from the FY 2018 enacted level and a 24 percent reduction from the FY 2019 enacted level, 

despite that TARP foreclosure prevention programs continue to spend (nearly $3 billion last year), 

and carry a high risk of fraud, waste, and abuse. I independently proposed an appropriation of 

$23 million for FY 2020, which is an additional $5.5 million, and I respectfully request that 

Congress consider this amount. That level is flat with the FY 2019 enacted level, and is a 

32 percent reduction from the FY 2018 enacted level. 

The President’s budget request would substantially inhibit our oversight because it will require a 

reduction in staffing levels to cover increases in fixed mandatory operating costs paid to Treasury

and cost of living or other payroll increases. SIGTARP has experienced a recent increase in 

referrals, tips, and other information that have been used to open criminal and civil investigations 

into the open TARP programs, including MHA’s HAMP and HHF, and to audit those programs to 

prevent and detect waste and abuse. As more TARP dollars are spent in MHA and HHF, 

SIGTARP’s investigations and audits over that spending increases. Every TARP dollar spent is 

another dollar potentially subject to fraud, waste and abuse, increasing the need for and the 

number of investigations and waste-finding audits. As of September 30, 2018, TARP foreclosure 

prevention programs have spent over $28 billion with nearly $6 billion remaining to spend. When 

left unchecked, fraud, waste, and abuse in these programs can have a devastating impact on those 

the program are intended to help. There are currently 846,763 homeowners in HAMP, including 

participants from all 50 states. The Hardest Hit Fund, which Congress expanded with an additional 

1 Includes $50,000 for training and $50,000 for the Council of the Inspectors General on Integrity and Efficiency.
SIGTARP - 4 

$2 billion and extended in FY 2016, continues to assist homeowners and homebuyers, and to fund 

blight demolition. SIGTARP’s request is less than 0.1 percent to investigate and audit over $28 

billion spent in MHA & HHF (before counting future TARP spending of nearly $6 billion). 

SIGTARP investigations of TARP recipients lead to indictments, civil enforcement actions, and 

the recovery of dollars lost to fraud. SIGTARP audits identify waste and abuse that Treasury can 

recover, promote efficiency and effectiveness in TARP, and make recommendations to save costs 

and prevent future fraud, waste, and abuse. In FY 2018, more than $314 million was recovered as 

a result of SIGTARP’s investigations, exceeding a nine times annual return on investment (ROI). 

Already in FY 2019, actual dollars recovered as a result of SIGTARP’s investigations are more 

than $290 million. 

SIGTARP has demonstrated that it is a solid investment for taxpayers, as SIGTARP has provided 

the Federal government and other victims with cumulative recoveries of more than $10 billion – a 

31 times cumulative ROI from our annual budgets. This would rank SIGTARP as having the third 

highest ROI out of 18 OIGs reviewed by the Brookings Institution Center for Effective Public 

Management in its analysis of how cutting the budget of positive-revenue OIGs costs the 

government money and contributes to the Federal deficit.2

 

We appreciate strong Congressional support for our budget each year. Some of the significant 

completed and ongoing SIGTARP work over the last year includes: 

• The Special Inspector General testified before the House Oversight Committee on SIGTARP’s

audits that identified $11 million in waste and abuse by state agencies on holiday parties,

family picnics, celebrations, a Mercedes Benz car allowance, steak and seafood dinners, large

catered barbeque dinners with tiki torches, employee gifts, discrimination litigation, employee

gym memberships, cash bonuses, expenses unrelated to HHF, and more. SIGTARP continues

to audit travel and conference expenses.

• Our audit report found that most of the $9.6 billion Hardest Hit Fund program (which includes

future spending of $1.3 billion) has no Federal competition requirements for contract awards.

We reported that Treasury has not applied the Federal procurement standards, and

recommended that they apply those standards.

• We warned in an evaluation report (based on findings by the U.S. Army Corps of Engineers)

of the risk of asbestos exposure, illegal dumping, and contaminated soil in the HHF blight

demolition program given the absence of industry safeguards.

• We increased our investigations into TARP’s Hardest Hit Fund blight demolition program.

This year, the Department of Justice (DOJ) indicted an official on bribery charges related to

awarding TARP-funded demolition-related contracts. DOJ also resolved a False Claims Act

investigation against a multi-million TARP recipient – the primary HHF demolition contractor

in Fort Wayne, Indiana – for dumping construction debris in the ground, covering it with clean

dirt, and filing false claims for TARP dollars.

• SIGTARP expanded its investigations into TARP’s HAMP program. Treasury will continue to

pay more than 130 financial institutions up to $3.9 billion to administer the program. Some

institutions have enforcement records of violating the law and abusing consumers. The largest

2 Hudak, J. Wallack, G. (2015). Brookings Institution Center for Effective Public Management, Website: 

https://www.brookings.edu/wp-content/uploads/2016/06/CEPMHudakWallackOIG.pdf. 
SIGTARP - 5

recipients of these future TARP funds include Ocwen Financial, Wells Fargo, JP Morgan 

Chase, Nationstar Mortgage, SPS, CitiMortgage, and CIT/One West Bank.

• SIGTARP continues to support the DOJ in prosecuting defendants we investigated. Courts 

have convicted 359 defendants investigated by SIGTARP, including 92 bankers. Courts 

sentenced 71 bankers to prison, including in the last year: 

o A Delaware Federal court sentenced to prison for up to six years, seven bank insiders at 

$330 million TARP recipient Wilmington Trust Corp. including the president and CFO 

for a massive fraud while the bank was in TARP when Treasury was a shareholder. The 

judge called it, “the worst financial crime in Delaware in at least the last 35 years.” The 

bank collapsed and was acquired by another bank; 

o A California Federal court sentenced to prison for more than 8 years each, the president 

of TARP recipient Sonoma Valley Bank and the chief lending officer, for a fraud that 

contributed to the failure of the bank; and

o A Kansas Federal court sentenced to prison for more than 5 years, the majority 

shareholder who virtually had complete control of TARP recipient Excel Bank for a 

crime that threatened the soundness of the bank that later failed.

We continue to deliver investigative and audit results, and maintain extremely high cumulative 

and annual returns on investment. Investing in SIGTARP is one of the most effective and efficient 

ways to protect the government. The government will receive far more than our budget in 

recovered dollars lost to fraud, in addition to cost savings. Our work ensures that TARP dollars are 

used as Congress intended, and that the government does not pay more for TARP than is 

necessary.

1.1 – Appropriations Detail Table

Dollars in Thousands

Special Inspector General for TARP

Appropriated Resources

New Appropriated Resources FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

Investigations 103 $28,220 103 $28,900 75 $15,050 (28) ($13,850) -27.18% -47.92%

Audit 28 $5,780 22 $5,100 10 $2,450 (12) ($2,650) -54.55% -51.96%

Subtotal New Appropriated Resources 131 $34,000 125 $34,000 85 $17,500 (40) ($16,500) -32.00% -48.53%

Other Resources*

Unobligated Balances from Prior Years 0 $1,542 0 $0 10 $7,500 NA NA NA NA

Subtotal Other Resources 0 $1,542 0 $0 10 $7,500 NA NA NA NA

Total Budgetary Resources 131 $35,542 125 $34,000 95 $25,000 (30) ($9,000) -24.00% -26.47%

* This column reflects levels appropriated in P.L. 115-141, the Consolidated Appropriations Act of 2018. For further details on the execution of these 

resources see the 2020 Budget Appendix chapter for the Department of the Treasury.

FY 2018 * FY 2019 FY 2019 to FY 2020

Enacted Annualized CR Request Change % Change

FY 2020

ctActualual
SIGTARP - 6 

1.2 – Budget Adjustments Table

Special Inspector General for TARP FTE Amount

FY 2019 Annualized CR 125 $34,000

Changes to Base:

Maintaining Current Levels (MCLs) 0 $190

Non-Pay 0 $190

Subtotal Changes to Base 0 $190

Total FY 2020 Base 125 $34,190

Program Changes:

Program Decreases (40) ($16,832)

Technical FTE Adjustment (Workforce Management) (30) ($5,600)

Realignment from Annual to No-Year (10) ($7,500)

Efficiency Savings 0 ($3,732)

Program Increases 0 $142

Operations and Maintenance (O&M) of Prior-year 

Enterprise-wide Cybersecurity investments 0 $142

Subtotal Program Changes (40) ($16,690)

Total FY 2020 Request 85 $17,500

Dollars in Thousands

C – Budget Increases and Decreases Description 

Maintaining Current Levels (MCLs) ............................................................ +190,000 / +0 FTE

Non-Pay +$190,000 / +0 FTE 

Funds are requested for non-labor expenses such as travel, rent, contracts, supplies, and 

equipment. 

Program Decreases .................................................................................. -$16,832,000 / -40 FTE

Staff Reduction -$5,600,000 / -30 FTE

The technical adjustment reduces SIGTARP staff levels to 95 FTE. 

Realignment from Annual to No-Year -$7,500,000 / -10 FTE

SIGTARP will fund a portion of its operations from its no-year account.

Efficiency Savings -$3,732,000 / -0 FTE

SIGTARP will seek to reduce non-personnel costs.

Program Increases ........................................................................................ +$142,000 / +0 FTE

Operations and Maintenance (O&M) of Prior-year Enterprise-wide Cybersecurity Investments

+$142,000 / +0 FTE

This request includes funding to support O&M for prior-year Cybersecurity Enhancement 

Account investments. O&M will be funded by Treasury Bureaus through Treasury Franchise Fund 

billing. This increase represents SIGTARP’s portion of the O&M total.
SIGTARP - 7 

Program Decreases:

SIGTARP has been fiscally responsible in reducing costs and increasing efficiencies by utilizing 

OMB guidance to effectively examine, align, and restructure its workforce and eliminate costs. 

In FY 2018, SIGTARP created immediate and long-term cost savings by eliminating over 

50 percent of headquarter annual rent expenses; reducing senior management levels; aligning 

spending with a reduced workforce; reducing non-government spending; and utilizing government 

sources for goods and services. In FY 2020, over $6 million of the proposed budget (35 percent) 

will be spent on goods and services from the government, more than 95 percent of which will be 

paid to Treasury. 

SIGTARP coordinates with other law enforcement agencies and with other Inspectors General, 

leveraging its unique position and expertise by forming law enforcement and other partnerships to 

create operational efficiencies and realize cost savings. These savings and efficiencies are 

projected to continue through FY 2020. 

1.3 – Operating Levels Table 

Dollars in Thousands

Special Inspector General for TARP FY 2018 FY 2019 FY 2020

Object Classification Enacted Annualized CR Request

11.1 - Full-time permanent 15,889 15,079 11,684

11.3 - Other than full-time permanent 1,503 1,588 1,472

11.5 - Other personnel compensation 1,959 1,506 989

11.9 - Personnel Compensation (Total) 19,351 18,173 14,145

12.0 - Personnel benefits 5,649 5,427 3,855

Total Personnel and Compensation Benefits $25,000 $23,600 $18,000

21.0 - Travel and transportation of persons 676 400 300

23.2 - Rental payments to others 207 153 107

23.3 - Communications, utilities, and miscellaneous charges 45 41 34

25.1 - Advisory and assistance services 679 365 90

25.2 - Other services from non-Federal sources 51 44 43

25.3 - Other goods and services from Federal sources 9,243 9,071 6,164

25.6 - Medical care 60 50 45

25.7 - Operation and maintenance of equipment 44 26 0

26.0 - Supplies and materials 303 202 195

31.0 - Equipment 192 48 22

Total Non-Personnel $11,500 $10,400 $7,000

New Budgetary Resources $36,500 $34,000 $25,000

FTE 136 125 95

Note: This table includes all available resources, including SIGTARP's annual appropriation and no-year

funds. The FY 2020 request includes $17.5M (appropriated) and $7.5M (no-year). 
SIGTARP - 8 

D – Appropriations Language and Explanation of Changes

Appropriations Language Explanation of Changes

DEPARTMENT OF THE TREASURY

SPECIAL INSPECTOR GENERAL FOR THE 

TROUBLED ASSET RELIEF PROGRAM

Federal funds 

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), 

$17,500,000. 

Note.—A full-year 2019 appropriation for this account was 

not enacted at the time the budget was prepared; therefore, 

the budget assumes this account is operating under the 

Continuing Appropriations Act, 2019 (Division C of P.L. 

115–245, as amended). The amounts included for 2019 

reflect the annualized level provided by the continuing 

resolution.

E – Legislative Proposals 

PPIP Funds 

The Public-Private Investment Program (PPIP) Improvement and Oversight Act of 2009 

(12 U.S.C. § 5231a) provided $15 million in no-year appropriations to SIGTARP for the purpose 

of providing oversight to PPIP and the Term Asset-Backed Securities Loan Facility. SIGTARP 

does not plan PPIP or TALF activity in FY 2019 and FY 2020. SIGTARP is requesting that these 

PPIP funds be made available to also support SIGTARP’s oversight of ongoing TARP programs. 

This proposed language is identical to that included in the FY 2018 enacted appropriation. 

PROPOSED LANGUAGE 

Sec. 128 Notwithstanding paragraph (2) of section 402(c) of the Helping Families Save their 

Homes Act of 2009, in utilizing funds made available by paragraph (1) of section 402(c) of such 

Act, the Special Inspector General for the Troubled Asset Relief Program shall prioritize the 

performance of audits or investigations of any program that is funded in whole or in part by funds 

appropriated under the Emergency Economic Stabilization Act of 2008, to the extent that such 

priority is consistent with other aspects of the mission of the Special Inspector General.
SIGTARP - 9 

Section II – Annual Performance Plan and Report

A – Strategic Alignment

The Investigation budget activity supports SIGTARP’s priority of law enforcement of crimes 

related to TARP, and the Audit budget activity supports SIGTARP as the independent watchdog 

over TARP dollars. SIGTARP’s activities and goals of Justice, Impact, Innovation, and 

Stewardship support and complement Treasury’s FY 2018 – 2022 Strategic Plan goals: (1) boost 

U.S. economic growth; (2) promote financial stability; (3) enhance national security; (4) transform

government-wide financial stewardship; and (5) achieve operational excellence.

SIGTARP’s audit and investigation goals and priorities are driven by independently-identified 

TARP threats and findings of fraud, waste, and abuse. SIGTARP’s goals through 2023 are: 

• Justice - protect Americans through law enforcement’s fight against TARP-related crime;

• Impact - assess, understand, and counter the most serious risks, threats, and challenges to

TARP;

• Innovation - expand the use of technology, virtual information sharing, and data analytics to

increase the expedited identification of TARP-related crime, fraud, waste and abuse; and

• Stewardship - ensure TARP programs and oversight proceed responsibly and transparently.

Justice: As a law enforcement office with 85 percent of its resources focused on criminal 

investigations, SIGTARP strives to bring justice, accountability, and deterrence in the fight against 

TARP-related crimes, including major financial crimes and money laundering. This past year 

SIGTARP continued to support DOJ and state prosecutions of defendants that were investigated, 

and the law enforcement record through FY 2018 stands at 417 defendants charged with crimes, 

and law enforcement actions against 14 major corporations. Justice was achieved when, in 

FY 2018, 14 defendants that were investigated went to trial, 14 defendants pled guilty, and courts 

sentenced to prison 26 defendants that were investigated. Bankers are going to jail. For example, 

in the $330 million TARP recipient Wilmington Trust and the $8 million TARP recipient Sonoma 

Valley Bank cases, courts, after jury convictions, have recently sentenced an attorney and six top 

bank executives such as the CEO, President, CFO, and Controller to years in prison for massive 

financial frauds. These complex financial frauds impact economic stability and confidence in 

financial institutions. SIGTARP investigations have uncovered crimes that led to the failure of 

TARP banks, leaving as victims the bank, the community, and taxpayers who have lost millions 

on their TARP investments. Alignment: Treasury Goals (1), (2), (3) and (4). 

Impact: SIGTARP analyzes risks from the most serious and imminent threats to TARP, especially 

as TARP continues to evolve. Treasury continues to allow new uses of TARP and, as recently as 

May 2018, TARP can now be used for lead and asbestos remediation. SIGTARP prioritizes its 

resources and conducts confidential investigations to combat serious threats, the largest of which 

SIGTARP believes is potential wrongdoing by the more than 130 financial institutions that 

continue to receive billions of TARP dollars in the MHA program, including some of the nation’s 

largest. SIGTARP recently achieved the first law enforcement action resulting from SIGTARP’s 

investigations into wrongdoing in the HHF blight demolition subprogram, another top threat to 

TARP. A contractor who was awarded all of the demolition contracts in the HHF blight program 

in Fort Wayne, Indiana, filled excavation sites with construction debris and then falsely billed for 

clean fill dirt. The blighted excavation sites cost an additional $800,000 in remediation to remove 
SIGTARP - 10 

the construction debris and fill the area with approved dirt. SIGTARP previously assessed the 

threat of contaminated soil and warned Treasury about it in a November 2017 audit, based on the 

findings of the Army Corps of Engineers. Treasury failed to implement SIGTARP’s 

recommendations in that audit. Alignment: Treasury Goals (1), (2), and (4). 

Innovation: SIGTARP achieved an unparalleled record of criminal charges against more than 100 

bankers through innovation. SIGTARP developed an intelligence-based method to find crime in 

banks and deployed similar techniques to find crime in other industries, like the housing, 

foreclosure, and demolition industries. SIGTARP forensic audits catch waste, and have 

successfully caught millions of TARP dollars wasted by state agencies on a Mercedes Benz, 

parties, picnics, steak and seafood dinners, and more. By expanding the use of technology, virtual 

information sharing using central repositories of information, and data analytics, SIGTARP can 

expedite its identification of crime, fraud, waste, and abuse. Alignment: Treasury Goals (2), (4) 

and (5). 

Stewardship: SIGTARP stands as the independent watchdog for Americans, ensuring that TARP 

programs operate and spend responsibly. SIGTARP also requires that same standard for Treasury 

and its office. Additionally, SIGTARP seeks to recover dollars lost to fraud, waste, and abuse for 

taxpayers and other victims. SIGTARP strives not to be a burden to taxpayers. Every year, 

recoveries from SIGTARP’s work far exceed its budget, and has a 31X lifetime ROI. Recoveries 

in FY 2018 were $314 million, $294 million of which went back to the Federal government, in 

comparison to its FY 2018 $34 million appropriation. Alignment: Treasury Goals (4) and (5). 

B – Budget and Performance by Budget Activity

2.1.1 – Investigations Resources and Measures

Dollars in Thousands

FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Annualized 

CR Request

Appropriated Resources $27,382 $27,295 $32,478 $32,103 $28,855 $28,900 $15,050

Other Resources $5,656 $6,354 $376 $82 $1,311 0 $6,450

Budget Activity Total $33,038 $33,649 $32,854 $32,185 $30,166 $28,900 $21,500

119 115 103 114 106 103 81

 Resource Level

FTE

Measure FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Percentage of Cases Accepted for Consideration by Civil or 

Criminal Authorities Resulting in a Positive Final Outcome N/A N/A 77 81 79 70 70 35 

Percentage of Cases Presented to Civil or Criminal Authorities 

within Eight Months of the Case Being Opened N/A N/A 80 80 85 70 70 25 

Percentage of Cases That are Joint Agency/Task Force 

Investigations 76 70 71 75 78 70 70 70 

*The FY 2019 targets are based on an annualized CR. The FY 2019 Congressional Justification included lower targets based on the PB.

Actual Actual Actual Actual Actual Target Target* Target
SIGTARP - 11 

Investigations Budget and Performance

($15,050,000 from discretionary appropriations) 

SIGTARP exceeded all metric targets in FY 2018. The “Percentage of Cases Accepted for 

Consideration by Civil or Criminal Authorities Resulting in a Positive Final Outcome” in FY 2018 

was 79 percent, which exceeded the target of 70 percent. The “Percentage of Cases Presented to 

Civil or Criminal Authorities within Eight Months of the Case Being Opened” was 85 percent, 

which exceeded the target of 70 percent. The “Percentage of Cases That are Joint Agency/Task 

Force Investigations” with other law enforcement agencies was 78 percent, which exceeded the 

target of 70 percent. 

2.1.2 – Audit Resources and Measures

Dollars in Thousands

FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Annualized

CR Request

Appropriated Resources $7,219 $6,824 $7,618 $7,530 $5,092 $5,100 $2,450

Other Resources $1,947 $1,069 $99 0 $231 0 $1,050

Budget Activity Total $9,166 $7,893 $7,717 $7,530 $5,323 $5,100 $3,500

45 35 34 27 25 22 14

 Resource Level

FTE

Measure FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Number of completed audit products identifying 

waste, abuse, mismanagement, inefficiencies, 

or referrals to Investigations Division (Units)

N/A N/A N/A N/A 6 3 3 1

*The FY 2019 target is based on an annualized CR. The FY 2019 Congressional Justification included lower targets based on the PB.

Actual Actual Actual Actual Actual Target Target* Target

Audit Budget and Performance

($2,450,000 from discretionary appropriations) 

SIGTARP exceeded its FY 2018 audit performance target of three for the “Number of Completed 

Audit Products Identifying Waste, Abuse, Mismanagement, Inefficiencies, or Referrals to 

Investigations Division,” with six products. 

Section III – Additional Information

A – Summary of Capital Investments

SIGTARP has no capital investments. Capital investments that support SIGTARP are included in 

the Departmental Offices’ plan. 

A summary of capital investment resources can be found at:

http://www.treasury.gov/about/budget-performance/Pages/summary-of-capital-investments.aspx

This website also contains a digital copy of this document.



Department of the Treasury 

Treasury Inspector General for 

Tax Administration

Congressional Budget 

Justification and Annual 

Performance Plan and Report 

FY 2020
TIGTA - 2 

Table of Contents

Section I – Budget Request........................................................................................................... 3

A – Mission Statement................................................................................................................ 3

B – Summary of the Request ...................................................................................................... 3

1.1 – Appropriations Detail Table .............................................................................................. 4

1.2 – Budget Adjustments Table ................................................................................................. 4

C – Budget Increases and Decreases Description....................................................................... 4

1.3 – Operating Levels Table...................................................................................................... 5

D – Appropriations Language and Explanation of Changes ...................................................... 5

E – Legislative Proposals............................................................................................................ 6

Section II – Annual Performance Plan and Report................................................................... 7

A – Strategic Alignment ............................................................................................................. 7

B – Budget and Performance by Budget Activity ...................................................................... 8

2.1.1 – Audit Resources and Measures....................................................................................... 8

Audit Budget and Performance................................................................................................... 8

2.1.2 – Investigations Resources and Measures........................................................................ 11

Investigations Budget and Performance ................................................................................... 11

Key Accomplishments and Budget Savings ............................................................................. 13

Office of Inspections and Evaluations Highlights .................................................................... 14

Section III – Additional Information ........................................................................................ 15

A – Summary of Capital Investments....................................................................................... 15
TIGTA - 3 

Section I – Budget Request

A – Mission Statement

Provide quality professional audit, investigative, and inspection and evaluation services that 

promote integrity, economy, and efficiency in the administration of the Nation’s tax system. 

B – Summary of the Request

The Treasury Inspector General for Tax Administration’s (TIGTA) Fiscal Year (FY) 2020 

budget request of $166,000,000 represents a decrease of 2.1 percent below its FY 2019 

Annualized Continuing Resolution (CR) budget. Funding TIGTA’s FY 2020 budget request will 

enable TIGTA to attempt to address its expansive workload of emerging Internal Revenue 

Service (IRS) challenges and congressional requests while conducting its oversight 

responsibilities. These resources will fund critical audit, investigative, and inspection and 

evaluation services to protect the integrity of the Nation’s system of tax administration. In 

accordance with the requirements of Section 6(f)(1) of the Inspector General Act of 1978 (as 

amended),1 TIGTA submits the following information related to its FY 2020 budget request:

• The aggregate budget request for TIGTA operations is $166,000,000;

• The portion of the request needed for TIGTA training is $1,800,000; and

• The portion of the request needed to support the Council of the Inspectors General on

Integrity and Efficiency is $431,600.

TIGTA’s vision is to maintain a highly skilled, proactive, and diverse Inspector General 

organization dedicated to working in a collaborative environment with key stakeholders to foster 

and promote fair tax administration. TIGTA’s primary functions of audit, investigations, 

inspections and evaluations align with the following Department of the Treasury FY 2018 – 

FY 2022 Strategic Plan goals: 

• Goal 1: Boost U.S. Economic Growth;

• Goal 4: Transform Government-wide Financial Stewardship; and

• Goal 5: Achieve Operational Excellence.

For more on how TIGTA’s budget activities align with the Department of the Treasury goals and

objectives see Section II in this document.

TIGTA’s Strategic Goals: 

• Promote the economy, efficiency, and effectiveness of tax administration;

• Protect the integrity of tax administration from internal and external threats; and

• Sustain an inclusive work environment where employees are valued.

TIGTA’s work is focused on all aspects of activity related to the Federal tax system as 

administered by the IRS. TIGTA identifies and addresses IRS management challenges and the 

priorities of the Department of the Treasury. TIGTA protects the public’s confidence in the tax 

system. 

1 5 U.S.C. app. 3 § 6(f)(1). 
TIGTA - 4

1.1 – Appropriations Detail Table

Dollars in Thousands

Treasury Inspector General 

for Tax Administration FY 2018 * FY 2019 FY 2020 FY 2019 to FY 2020

Appropriated Resources Enacted Annualized CR Request Change % Change

New Appropriated Resources FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

Audit 318 $66,020 333 $66,020 333 $64,606 0 ($1,414) 0.00% -2.14%

Investigations 446 $103,614 467 $103,614 467 $101,394 0 ($2,220) 0.00% -2.14%

Subtotal New Appropriated 

Resources 764 $169,634 800 $169,634 800 $166,000 0 ($3,634) 0.00% -2.14%

Other Resources

 Reimbursables 2 $414 2 $600 2 $600 0 $0 0.00% 0.00%

Recovery from Prior Years $1,831 $0 $0 0 $0 NA NA

Unobligated Balances 

Brought Forward $4,300 $4,400 $5,000 0 $600 NA 13.64%

Subtotal Other Resources 2 $6,545 2 $5,000 2 $5,600 0 $0 0.00% 12.00%

Total Budgetary Resources 766 $176,179 802 $174,634 802 $171,600 0 ($3,034) 0.00% -1.74%

* FY 2018 FTE and Other Resources are Actuals. This column reflects levels appropriated in P.L. 115-141, the Consolidated 

Appropriations Act of 2018. For further details on the execution of these resources see the 2020 Budget Appendix chapter for the 

Department of the Treasury.

1.2 – Budget Adjustments Table

Dollars in Thousands

Treasury Inspector General for Tax Administration FTE Amount

FY 2019 Annualized CR 800 $169,634 

Changes to Base:

Maintaining Current Levels (MCLs): 0 $558 

Non-Pay 0 $558 

Subtotal Changes to Base 0 $558 

FY 2020 Base 800 $170,192 

Program Changes:

Program Decreases: 0 ($4,697)

Non-Personnel Reductions 0 ($4,697)

Program Increases: 0 $505 

Operation and Maintenance (O&M) of Prior-year 

Enterprise-wide Cybersecurity Investments 0 $505 

Subtotal FY 2020 Program Changes 0 (4,192)

Total FY 2020 Request 800 $166,000 

C – Budget Increases and Decreases Description

Maintaining Current Levels (MCLs) ..........................................................+$558,000 / +0 FTE

Non-Pay +$558,000 / +0 FTE

Funds are requested for non-labor expenses such as travel, contracts, rent, supplies, 

and equipment.

Program Decreases ....................................................................................-$4,697,000 / -0 FTE

Non-Personnel Reductions -$4,697,000 / +0 FTE

TIGTA will reduce program levels in order to meet its FY 2020 budget request. Reaching this 

target without impacting the quality of TIGTA’s programs will require balancing mission 

requirements and workload.
TIGTA - 5 

TIGTA will continue to look for contract efficiencies by evaluating contracts for strategic 

sourcing and by negotiating more advantageous contract terms. Additionally, TIGTA will 

continue to pursue opportunities to reduce its footprint and lower its rent costs. 

Program Increases .........................................................................................+$505,000 / +0 FTE 

O&M of Prior-year Enterprise-wide Cybersecurity Investments +$505,000 / +0 FTE 

The FY 2020 request includes funding to support O&M for prior year cybersecurity

Enhancement Account investments. O&M will be funded by Treasury Bureaus through 

Treasury Franchise Fund billing. This increase represents the bureau’s portion of the $17.5 

million O&M total. 

1.3 – Operating Levels Table

Dollars in Thousands

Treasury Inspector General for Tax Administration FY 2018 FY 2019 FY 2020

Object Classification Enacted Annualized CR Request

11.1 - Full-time permanent 86,873 86,851 86,851

11.3 - Other than full-time permanent 393 393 393

11.5 - Other personnel compensation 8,332 8,330 8,330

11.9 - Personnel Compensation (Total) 95,598 95,574 95,574

12.0 - Personnel benefits 37,662 37,652 37,652

13.0 - Benefits for former personnel 0 0 0 

Total Personnel and Compensation Benefits $133,260 $133,226 $133,226

21.0 - Travel and transportation of persons 3,794 3,798 3,794 

22.0 - Transportation of things 15 15 16 

23.1 - Rental payments to GSA 9,600 9,608 9,600 

23.2 - Rental payments to others 200 200 200 

23.3 - Communications, utilities, and miscellaneous charges 740 741 360 

24.0 - Printing and reproduction 8 8 8

25.1 - Advisory and assistance services 1,800 1,802 2,205 

25.2 - Other services from non-Federal sources 1,000 1,001 900 

25.3 - Other goods and services from Federal sources 11,090 11,100 9,300

25.4 - Operation and maintenance of facilities 16 16 17

25.7 - Operation and maintenance of equipment 2,989 2,992 1,634

26.0 - Supplies and materials 700 701 540

31.0 - Equipment 4,298 4,302 4,101

42.0 - Insurance claims and indemnities 5 5 4

91.0 - Unvouchered 119 119 95 

Total Non-Personnel $36,374 $36,408 $32,774

New Budgetary Resources $169,634 $169,634 $166,000 

FTE 764 800 800

Note: This table includes obligations against funding appropriated in that year (Enacted for FY 2018, FY 2019 Annualized CR, 

and FY 2020).
TIGTA - 6 

D – Appropriations Language and Explanation of Changes

Appropriations Language Explanation of Changes

DEPARTMENT OF THE TREASURY

TREASURY INSPECTOR GENERAL FOR TAX 

ADMINISTRATION

Federal Funds 

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 and hire of passenger 

motor vehicles (31 U.S.C. 1343(b)); and services authorized by 

5 U.S.C. 3109, at such rates as may be determined by the 

Inspector General for Tax Administration; $166,000,000, of 

which $5,000,000 shall remain available until September 30, 

2021; 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; and of which not to 

exceed $1,500 shall be available for official reception and 

representation expenses. 

Note.—A full-year 2019 appropriation for this account was not 

enacted at the time the budget was prepared; therefore, the 

budget assumes this account is operating under the Continuing 

Appropriations Act, 2019 (Division C of P.L. 115–245, as 

amended). The amounts included for 2019 reflect the annualized 

level provided by the continuing resolution.

E – Legislative Proposals 

TIGTA has no legislative proposals. 
TIGTA - 7 

Section II – Annual Performance Plan and Report

A – Strategic Alignment

TIGTA, an independent office within the Department of the Treasury, was established by 

Congress under the Internal Revenue Service Restructuring and Reform Act of 1998 (RRA 98).2 

It provides independent oversight of IRS activities by conducting independent audits, 

investigations, and inspections and evaluations necessary to prevent and detect waste, fraud, and 

abuse in IRS programs and operations. TIGTA conducts audits of the IRS’s operations and 

makes recommendations designed to improve the administration of the Federal tax system; 

conducts administrative and criminal investigations of allegations of waste, fraud, and abuse; and 

helps to ensure that the IRS protects and secures taxpayer data. TIGTA also has the unique 

responsibility of protecting the IRS and its employees. TIGTA’s role is important given the 

increased emphasis by the Administration, Congress, and the American people on the Federal 

Government’s accountability and efficient use of resources. 

TIGTA’s budget activities align with its vision and goals and with the Department of the 

Treasury’s FY 2018 – FY 2022 Strategic Plan, including objectives under the following goals: 

Goal 1: Boost U.S. Economic Growth 

Objective 1.1 – Tax Law Implementation: Administer tax law to better enable all taxpayers to 

meet their obligations, while protecting the integrity of the tax system.

TIGTA supports the Treasury strategic objective “Tax Law Implementation” under Goal 1 

through its oversight of Treasury’s efforts to implement the Tax Cuts and Jobs Act of 2017 

(TCJA) and by protecting of the integrity of Federal tax administration. Implementation of the 

sweeping changes included in TCJA necessitated TIGTA oversight to ensure the IRS timely and 

accurately addresses requirements to update tax forms, instructions and publications, as well as 

to reprogram its computer systems to ensure that tax returns are accurately processed based on 

the new legislation. This oversight is accomplished through discretionary audit coverage and by 

monitoring progress on addressing the major management and performance challenge of 

“Implementing the Tax Cuts and Jobs Act and Other Law Changes.” 

Goal 4: Transform Government-wide Financial Stewardship

Objective 4.1 – Financial Data Access/Use: Increase the access and use of Federal financial data 

to strengthen Government-wide decision-making, transparency, and accountability. 

TIGTA supports the Department of the Treasury’s Digital Accountability and Transparency Act 

efforts by implementing the related policies and requirements. Many of TIGTA’s audits include 

recommendations that, when implemented, would result in cost savings, increased or protected 

revenue, or more efficient use of resources. Additionally, TIGTA develops advanced analytics 

and innovative approaches to help prevent and detect the flow of dollars fraudulently obtained by 

criminals or IRS employees and provides the IRS with the investigative coverage and 

information necessary to mitigate domestic and foreign threats against its employees, facilities, 

and data systems. 

2 Pub. L. No. 105-206, 112 Stat. 685.
TIGTA - 8 

Goal 5: Achieve Operational Excellence 

Objective 5.1 – 5.3 Workforce Management, Treasury Infrastructure, and Customer Value. 

TIGTA hires and develops a workforce with the skills and competencies necessary to accomplish 

its mission to provide quality professional audit, investigative, and inspection and evaluation 

services related to the administration of the Nation’s tax system. TIGTA mitigates security risks 

affecting taxpayer data, tax systems, and IRS employees. It effectively improves customer value 

by protecting the IRS and its employees and responding to attempts to impersonate the IRS for 

fraudulent purposes. TIGTA prioritizes acquisition and application of human and financial 

resources to enhance its ability to detect and protect against cyber-attacks. Additionally, TIGTA 

collaborates with the IRS to share intelligence and expertise to thwart cyberthreats.

B – Budget and Performance by Budget Activity

2.1.1 – Audit Resources and Measures

Dollars in Thousands

 Resource Level FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Annualized 

CR Request

Appropriated Resources $53,763 $57,463 $59,752 $64,240 $61,099 $66,020 $64,606 

Reimbursable Resources $600 $382 $60 0 0 0 0 

Unobligated Balances Brought Forward 0 $1,808 $1,780 $1,524 $1,674 $1,712 $1,946 

Budget Activity Total $54,363 $59,653 $61,592 $65,764 $62,773 $67,732 $66,552 

FTE 309 316 329 333 318 333 333 

Performance Measure

FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Target Target Target

Percentage of Audit 

Products Delivered When 

Promised to Stakeholders

65 80 75 79 81 68 68 70

Percentage of 

Recommendations Made 

That Have Been 

Implemented

89 92 97 92 85 85 85 85

Audit Budget and Performance

($64,606,000 from direct appropriations):

TIGTA’s Office of Audit (OA), identifies opportunities to improve the administration of the 

Nation’s tax laws by completing comprehensive and independent performance and financial 

audits of IRS programs and operations. TIGTA’s audit program incorporates both statutory audit 

requirements and specific audits identified through TIGTA’s risk assessment process. TIGTA’s 

audit work is concentrated on high-risk areas and on the IRS’s progress in achieving its strategic 

goals. TIGTA strategically evaluates IRS programs, activities, and functions, so that resources 

are spent in the areas of highest vulnerability of the Nation’s system of tax administration. 

In FY 2018, OA issued 102 final audit reports, and other products, that included potential 

financial benefits totaling approximately $9.9 billion and affected approximately 2.6 million

taxpayer accounts. TIGTA’s Annual Audit Plan communicates its audit priorities to the IRS, 

Congress, and other interested parties. Many of the activities described in the Annual Audit Plan 

address the fundamental goals related to the IRS’s mission to administer its programs effectively 

and efficiently. Audits address a variety of high-risk issues, such as identity-theft detection and 

prevention, security of taxpayer data, tax compliance, tax law changes, fraudulent claims and 
TIGTA - 9

improper payments, tax systems and online services, and globalization. TIGTA’s audits and 

recommendations help:

• Promote the economy, efficiency, and effectiveness of IRS programs;

• Ensure the fair and equitable treatment of taxpayers; and

• Detect and deter waste, fraud, and abuse.

By focusing on the most critical high-risk areas, TIGTA’s recommendations not only result in 

cost savings but also have other quantifiable impacts, such as the protection of existing revenue, 

increased revenue, and reduction of the number of fraudulent refunds and improper payments.

TIGTA’s reports for FY 2018 addressed issues that included:

• Identity Theft - Since TIGTA’s first business identity-theft report in September 2015, the 

IRS has created business identity-theft filters and selection lists to identify potential business 

identity-theft returns. However, during a recent review, TIGTA found that certain types of 

business tax returns are not being evaluated for potential identity theft. In Processing Year 

2017, TIGTA identified 15,127 business tax returns with refunds totaling more than $200 

million that would have been identified as potentially fraudulent if current business identitytheft filters were applied to these tax returns. TIGTA also reported that the IRS needs to take 

actions to protect refunds associated with confirmed business identity theft from being 

erroneously released. TIGTA identified 872 business tax returns identified by the IRS as 

identity-theft returns in Processing Year 2016 for which refunds totaling more than $61 

million appear to have been released in error.

• Filing Season - TIGTA conducted a review to evaluate whether the IRS timely and 

accurately processed individual paper and electronically filed tax returns during the 2017

Filing Season. The Office of Audit found that the IRS generally developed processes to 

implement key tax provisions affecting the 2017 Filing Season. The IRS processed 5.1 

million tax returns that reported nearly $23.9 billion in Premium Tax Credits that were either 

received in advance or claimed at the time of filing. However, TIGTA found that taxpayers 

received $5.8 billion in Advance Premium Tax Credits to which they were not entitled, of 

which $3.5 billion was not required by law to be repaid. 

• Improving Tax Compliance - To enhance its enforcement actions, the IRS implemented the 

Private Debt Collection (PDC) program, to collect inactive tax receivables that the IRS 

previously could not collect. The Joint Committee on Taxation estimated that the current 

PDC program would yield approximately $2.4 billion in additional revenue through 

FY 2025. TIGTA reported as of May 31, 2018, that the PDC program generated $56.6 

million in revenue compared to $55.3 million in costs for an approximate net profit of $1.3 

million. The Private Collection Agencies (PCA) collected just 1 percent of the $4.1 billion 

assigned. Possible causes of the nominal collection yield could be the average age of the 

cases assigned (4 years), assignment of low-income taxpayers (54 percent of PDC inventory), 

lack of consequences for subsequent noncompliance, or taxpayers who willfully failed to 

pay. Other PDC program concerns include the lack of a referral unit, the reliance on PCAs to 

self-report complaints, authentication procedures that expose taxpayers to risk, and PDC 

communication strategies that differ from IRS communications regarding tax scams.

• Achieving Program Efficiencies and Cost Savings - After payroll, rent is the IRS’s largest 

operating expense, which the IRS expected to spend more than $600 million on real estate 

costs in FY 2018. Since March 2012, the IRS has taken steps to reduce its total office space 
TIGTA - 10 

by nearly 8 percent by either closing or consolidating office spaces. Although progress has 

been made, the rate of employee attrition has outpaced office space reduction efforts. The 

IRS’s workstation utilization rate was only 66 percent as of December 2017. TIGTA 

reported that changing the method by which the IRS develops and implements its space 

reduction projects to incorporate more effective workstation and office sharing could reduce 

the need for as many as 10,473 workspaces. By releasing these underutilized workspaces 

and the square footage of leased space associated with them, the IRS could achieve more 

than $80 million in rental cost savings over the next five years.

Description of Performance: 

TIGTA uses two performance measures to gauge the success of its audit program. The first 

measure indicates that TIGTA’s products are more likely to be used if they are delivered when 

needed to support congressional and IRS decisionmaking. To determine whether products are 

timely, TIGTA tracks the percentage of products that are delivered on or before the date 

promised (contract date).

The second measure assesses TIGTA’s effect on improving the IRS’s accountability, operations, 

and services. TIGTA makes recommendations designed to improve the administration of the 

Federal tax system. The IRS must implement these recommendations to realize the financial or 

non-financial benefits. Since the IRS needs time to act on recommendations, TIGTA uses the 

Department of the Treasury’s Joint Audit Management Enterprise System to track the percentage 

of four-year-old recommendations that have been implemented, rather than the results of the 

activities during the fiscal year in which the recommendations are made. TIGTA tracks 

recommendations that have not been implemented by the IRS, and it has a formal process with 

the IRS to close out unimplemented recommendations in situations in which circumstances may 

have changed or when the IRS has taken alternative corrective measures to address TIGTA’s 

audit findings. 

At the end of FY 2018, the actual Percentage of Audit Products Delivered When Promised to 

Stakeholders was 81 percent, which exceeded the full-year target of 68 percent. TIGTA 

exceeded this target as a result of ongoing supervisory monitoring of the execution of audits to 

ensure timely delivery of audit products to stakeholders. At the end of FY 2018, the actual 

Percentage of Recommendations Made That Have Been Implemented was 85 percent, which met

the full-year target of 85 percent. TIGTA met its target because of continued discussions with 

the IRS throughout the audit process concerning both the findings and the potential 

recommended solutions, to ensure that feasible alternatives were identified. 

For FY 2020, the target for Percentage of Audit Products Delivered When Promised to 

Stakeholders will increase to 70 percent. The target for Percentage of Recommendations Made 

That Have Been Implemented will remain at 85 percent. TIGTA believes that these measures 

are best attained through effective monitoring of ongoing audit work and essential 

communication with the IRS regarding findings and the most appropriate recommendations for 

corrective action. Consequently, TIGTA’s OA will continue to accentuate the importance of 

these processes with the management cadre and staff.
TIGTA - 11 

2.1.2 – Investigations Resources and Measures

Dollars in Thousands

 Resource Level FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Annualized 

CR Request

Appropriated Resources $95,748 $101,476 $108,106 $100,819 $107,501 $103,614 $101,394

Reimbursable Resources $1,100 $429 $475 $357 $414 $600 $600 

Unobligated Balances Brought 

Forward 0 $3,192 $3,220 $2,392 $2,626 $2,688 $3,054 

Budget Activity Total $96,848 $105,097 $111,801 $103,568 $110,541 $106,902 $105,048

FTE 433 442 460 469 448 469 469 

Performance Measure

FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Target Target Target

Percentage of Closed

Investigations Resulting

in a Criminal, 

Administrative, or Law 

Enforcement Action

92 93 90 90 89 79 79 81

Investigations Budget and Performance 

($101,394,000) from direct appropriations and $600,000 from reimbursable resources):

In addition to protecting the IRS’s ability to collect the majority of the revenue for the Federal 

Government’s operations, TIGTA, through its Office of Investigations (OI), has the statutory 

responsibility of protecting the integrity of tax administration, as well as the IRS’s most valuable 

resource, its employees. 

TIGTA’s investigative resources are allocated based upon a performance model that focuses on 

three primary areas of investigation: 

• Employee integrity;

• Employee and infrastructure security; and

• External attempts to corrupt tax

administration.

The performance model (Figure 1) uses a ratio 

of those investigations that have the greatest 

impact on IRS operations or the protection of 

Federal tax administration to the total number of 

investigations conducted. These performance measures guide OI’s activities and help to 

demonstrate the value of TIGTA’s investigative accomplishments to its external stakeholders.

Employee Integrity: IRS employee misconduct, real or perceived, erodes public trust and 

impedes the IRS’s ability to enforce tax laws effectively. In FY 2018, 48 percent of TIGTA’s 

body of investigative work involved alleged employee misconduct. TIGTA’s investigative 

results convey a message to IRS employees that these types of activities will not go unchecked. 

TIGTA processed 10,676 complaints, opened 2,588 investigations, and closed 2,573 

investigations in FY 2018. During this period, 151 investigations of all types were accepted for 

criminal prosecution, and TIGTA referred for IRS action 1,135 cases of employee misconduct. 

As a result of one of TIGTA’s investigations into employee misconduct, a former IRS special 

agent was sentenced to 51 months’ imprisonment for corrupt interference with the IRS, filing 

Figure 1: Investigative Performance Model
TIGTA - 12 

false tax returns, theft of Government funds, and destruction or falsification of records. In 

another case, a former IRS employee was sentenced to 52 months’ imprisonment, followed by 36 

months’ supervised release for stealing a taxpayer’s identity. 

Employee and Infrastructure Security: In FY 2018, TIGTA responded to 1,556 threat-related 

incidents. TIGTA has a statutory responsibility to identify, investigate, and respond to threats 

against IRS personnel and physical infrastructure. TIGTA also believes that, through its 

investigations of threat-related incidents, it is creating a safe and secure environment for 

taxpayers who need to conduct business with the IRS. From FY 2011 through FY 2018, TIGTA 

has processed more than 17,293 threat-related complaints and investigated more than 9,290 

threats against IRS employees. After one investigation, a man was convicted for forcibly 

assaulting an unarmed IRS revenue officer by pointing a shotgun at him and threatening to shoot 

him. 

External Attempts to Corrupt Tax Administration: TIGTA is statutorily mandated to 

investigate external attempts to corrupt tax administration, which include criminal misconduct by 

nonemployees, such as impersonation of the IRS, attempted bribery of IRS employees, 

international cybercrime and identity theft, and procurement fraud. 

Impersonation Scam: Since summer 2013, a significant part of TIGTA’s workload has 

consisted of investigating a telephone impersonation scam in which a victim receives an 

unsolicited telephone call from a person claiming to be an IRS agent. The caller, using a fake 

name, provides a “badge number” and claims the victim owes taxes and is criminally liable for 

the amount owed. The victim is threatened that if he or she fails to pay the tax immediately, the 

victim will be arrested, a suit will be filed, or some other form of adverse action will be taken. 

As of September 30, 2018, more than 2.4 million Americans have reported that they had received 

one of these calls, and more than 14,700 victims have reported that they had collectively paid 

upwards of $72.8 million to the scammers. As a direct result of TIGTA’s investigative efforts, in 

July 2018, 21 criminal participants in this telephone scam were sentenced to terms of 

imprisonment up to 20 years. In September 2018, 15 defendants and five India-based call 

centers were indicted for their alleged involvement. As of September 30, 2018, a total of 130 

individuals have been charged in Federal court for their roles in the scam.3 

International Cybercrime and Identity Theft: The increasing number of data breaches in the 

private and public sectors means more personally identifying information than ever before is 

available to unscrupulous individuals. The Office of Investigations’ highly specialized group of 

criminal investigators with technical expertise in investigating electronic crimes, including 

computer intrusions and Internet-based fraud schemes, will continue to combat cybercriminals. 

In May 2015, the IRS detected the automated exploitation of one of its portals, the “Get 

Transcript” service, which involved the suspicious use of 250,000 identities. The subsequent 

TIGTA investigation confirmed that these were stolen identities being used to secure tax return 

information so that high-quality fraudulent returns could be filed. TIGTA’s OA identified an 

additional 620,000 identities that were also likely compromised, but were not identified by the 

IRS in the initial 250,000. A breach of a second high-profile portal, the Data Retrieval Tool 

3 The facts in the summarized cases on this page come from court documents of the respective jurisdictions.
TIGTA - 13 

utilized in the Federal Student Loan process through the Department of Education, resulted in the 

identification of approximately 100,000 compromised identities in a two-month period in early 

2017. If this exploitation had continued throughout a 12-month period at the same pace, this 

would have resulted in a total of 600,000 stolen identities and related tax information. Between 

these two portals alone, there could have been approximately 1.5 million compromised taxpayer 

identities, which can be sold on the Dark Web and used to open financial accounts and file large 

volumes of fraudulent tax returns. In the last four years, OI’s Cybercrime Investigations 

Division has secured 23 criminal convictions related to attacks on IRS systems for a total of 837 

months’ imprisonment and more than $7.5 million in restitution ordered. Cyberthreats to tax 

professionals will also have an adverse effect on Federal tax administration.

Description of Performance: 

TIGTA’s OI has adopted performance measures that identify the percentage of results derived 

from investigative activities that most accurately align with the strategic goals of the 

organization and provide the greatest impact on the protection of the integrity of Federal tax 

administration. For FY 2018, OI’s total protection of dollars and financial accomplishments as a 

result of investigative activities was $198.7 million (compared to $38 million in FY 2017). At 

the end of FY 2018, the Percentage of Closed Investigations Resulting in a Criminal, 

Administrative, or Law Enforcement Action was 89 percent, which exceeded the full-year target 

of 79 percent. The Office of Investigations exceeded the FY 2018 performance measure as a 

result of the hard work of experienced executives, managers, and special agents. With the 

FY 2020 budget request, TIGTA will maintain its special agents’ skills and abilities in order to 

be able to respond to its mission requirements. 

For FY 2020, OI’s performance target is 81 percent for Percentage of Closed Investigations 

Resulting in a Criminal, Administrative, or Law Enforcement Action. The Office of 

Investigations will continue to provide the IRS with the investigative coverage and information 

necessary to improve the integrity of IRS operations and mitigate threats against its employees, 

facilities, and data systems. In addition, OI will maintain highly-trained personnel available to 

address the significant vulnerabilities of taxpayer and IRS data and effectively combat 

compromises of IRS computer systems in the expanding digital environment of Federal tax 

administration, all of which contribute to maintaining the public’s confidence in the safe, fair, 

and effective administration of the Federal tax system. Through its investigative programs, OI 

will continue to protect the IRS’s ability to process approximately 253 million tax returns, collect 

more than $3.5 trillion in annual revenue, and issue over $464 billion dollars in refunds for the 

Federal Government.4

Key Accomplishments and Budget Savings

While the scope, complexity, and magnitude of the Nation’s economy and deficit continue to 

present significant challenges, TIGTA remains one of the best investments in the Federal 

Government. In FY 2018, through targeted and vigorous oversight efforts that addressed 

congressional concerns and its own audit and investigative priorities, TIGTA generated overall

potential financial accomplishments of over $10.1 billion. 

4 IRS, Management’s Discussion & Analysis, Fiscal Year 2018. 
TIGTA - 14

During FY 2018, these potential financial accomplishments included:

• Increased and/or protected revenue in the amount of $6 billion;

• Cost savings of $3.7 billion; and

• Significant investigative accomplishments of $199 million.

The phrase “cost savings” includes questioned costs and funds put to better use.

Questioned costs are:

• Costs that cannot be reimbursed because they represent a violation of law, regulation, or 

contract;

• Expenditures that are not reasonable or necessary to accomplish the intended purpose; and

• Costs that are appropriate, but for which the vendor cannot provide proof that the cost was 

incurred.

Funds put to better use are funds that could be used more efficiently or effectively if 

management took actions to implement the recommendation(s), including but not limited to:

• Reductions in outlays;

• Avoidance of unnecessary expenditures noted in pre-award contract reviews; and

• Prevention of erroneous payment of refundable credits.

In addition to funds that could be put to better use, TIGTA’s investigative efforts resulted in over 

$124 million in court-ordered fines, penalties, and 

restitution.

Funding for TIGTA allows its oversight efforts to 

continue, and for each dollar invested over the five-year 

period covering FY 2014 – FY 2018, TIGTA has produced 

an average annual return of $94 (Figure 2). 

Office of Inspections and Evaluations Highlights

The Office of Inspections and Evaluations (I&E) identifies opportunities for improvement in IRS 

and TIGTA programs by performing inspections and evaluations that report timely, useful, and 

reliable information to decision-makers and stakeholders.

The Office of Inspections and Evaluations provides a range of specialized services and products, 

including quick reaction reviews, on-site office inspections, and in-depth evaluations of major 

functions, activities, or programs. These activities provide TIGTA with additional flexibility, 

capacity, and capability to improve tax administration. Inspections serve to:

• Provide factual and analytical information;

• Monitor compliance;

• Measure performance;

• Assess the effectiveness of programs and operations;

• Share best practices; and

• Inquire into allegations of waste, fraud, abuse, and mismanagement.

Figure 2: TIGTA’s Return on Investment
TIGTA - 15 

Evaluations often result in recommendations to streamline IRS operations, enhance data quality, 

and minimize inefficient and ineffective procedures. In FY 2018, I&E produced seven external 

reports, which included reviews of: 

• Physical Security Controls (2 different locations);

• Controls Over Pocket Commissions;

• Improved Communication With Federal Agencies Could Reduce the Number of Invalid

Retirement Benefit Statements;

• Worker Misclassification Initiative With the Department of Labor; and

• Modification to Form 1040 to Increase Earned Income Tax Credit Participation by Eligible

Tax Filers.

Section III – Additional Information

A – Summary of Capital Investments

Technology Investments – TIGTA has no major Information Technology (IT) investments; 

however, non-major investments include:

• IT Applications and Collaboration – This investment represents an enterprise view of

TIGTA's applications development that includes system design, development, testing,

deployment, and maintenance of information applications systems.

• IT Infrastructure End-User Systems and Support – This investment is an enterprise view

of TIGTA's end-user hardware, peripherals and software, and the Service Desk.

• IT Infrastructure Mainframe and Servers Services and Support – This investment

represents an enterprise view of TIGTA's servers, including hardware and software

operations, licensing, maintenance, back-up, continuity of operations, disaster recovery,

virtualization, and data center consolidation.

• IT Infrastructure Telecommunications – This investment represents an enterprise view of

TIGTA's data networks and telecommunications hardware and software operations, licenses,

maintenance, back-up, continuity of operations, and disaster recovery.

• IT Security Systems and Enterprise Architecture – This investment represents TIGTA's

IT investments responsible for enterprise architecture services.

The Office of Information Technology provides cost-effective and timely IT products and 

services that permit successful completion of TIGTA’s business goals, while at the same time 

meeting legislative and other executive mandates. The following are TIGTA’s FY 2020

prioritized information technology requirements that directly support TIGTA operations: 

• Continuous Diagnostics and Mitigation (CDM) – The CDM program is intended to

provide TIGTA with the capabilities and tools that identify cybersecurity risks on a

repeatable and recurrent basis, prioritize these risks based upon their potential impact, and

enable cybersecurity and operational personnel the opportunity to timely address the most

significant problems. While the Department of Homeland Security carried out the

acquisition and initial deployment of the various tools for Phase 1, the daily operation, annual

product licensing, and maintenance costs for the tool suite are TIGTA’s responsibility and

will continue throughout the future years as new CDM Phases are implemented.

• Network Improvement

o Increased Bandwidth – The bandwidth for TIGTA’s field offices must be upgraded

to support the increased demand for improved transmission of data, application
TIGTA - 16 

utilization, audio and video conferencing, and more. If this priority is funded, TIGTA 

plans to begin the work in FY 2019 and continue through FY 2020. 

o Network Segmentation – The enhancement of a more secure configuration will

ensure that network data and personally identifiable information will be more readily

protected against cyber-attacks and leaks. The purpose of network segmentation is to

increase TIGTA’s overall security and performance posture, which would prevent

sideways and undetected movement by would-be intruders. If this priority is funded,

TIGTA plans to begin the work in FY 2019 and continue through FY 2020.

• Research, Analysis, Forensics, and Evidence System (RAFE) – The initial deployment of

the RAFE is used by TIGTA for cyber analysis, tracking, and defense against potential

cyberthreats directed at both TIGTA and IRS as well as uncovering evidence of threats to tax

administration including seizure of hostile hardware and software and analysis of activities

(e.g., scammers). While the initial phases have been implemented, funding for the remaining

phases will greatly reduce the chances of an incident that would have a direct, negative

impact on TIGTA, and its employees.

Law Enforcement Vehicles –TIGTA acquires its vehicles by lease through the General Services 

Administration. However, TIGTA will maintain ownership of approximately seven

surveillance/communications vehicles. These vehicles will remain part of TIGTA’s capital asset 

strategy. The vehicles will be used to support TIGTA’s investigations and must meet the 

mission-critical need to conduct criminal law enforcement activities. TIGTA communications 

vehicles also are used in support of its Continuity of Operations (COOP) Plan. COOP provides a 

mechanism for the organization to recover fully operational capability following a critical 

incident, including the capability to communicate during a local or national emergency.

A summary of capital investment resources, including major IT and non-technology investments, 

can be viewed and downloaded at: 

http://www.treasury.gov/about/budget-performance/Pages/summary-of-capital-investments.aspx

This website also contains a digital copy of this document.


Department of the Treasury 

Community Development 

Financial Institutions Fund 

Congressional Budget 

Justification and Annual 

Performance Report and Plan

FY 2020
CDFI - 2

Table of Contents

Section I – Budget Request........................................................................................................... 3

A – Mission Statement................................................................................................................ 3

B – Summary of the Request ...................................................................................................... 3

1.1 – Appropriations Detail Table .............................................................................................. 4

1.3 – Operating Levels Table...................................................................................................... 4

D – Appropriations Language and Explanation of Changes ...................................................... 5

E – Legislative Proposals............................................................................................................ 5

Section II – Annual Performance Plan and Report................................................................... 6

A – Strategic Alignment ............................................................................................................. 6

B – Budget and Performance by Budget Activity ...................................................................... 7

2.1.1 – Administration- Resources and Measures ...................................................................... 7

2A – Administration ................................................................................................................... 7

2.1.2 – Community Development Financial Institutions Program Resources and Measures..... 8

2B – Community Development Financial Institutions Program................................................. 8

2.1.3 – New Markets Tax Credit Resources and Measures........................................................ 9

2C – New Markets Tax Credit Program ..................................................................................... 9

2.1.4 – Bank Enterprise Award Program Performance and Measures ..................................... 10

2D – Bank Enterprise Award Program..................................................................................... 10

2.1.5 – Native American CDFI Assistance Program Performance and Measures.................... 11

2E – Native American CDFI Assistance Program.................................................................... 11

2.1.6 – Healthy Food Financing Initiative Performance and Measures.................................... 12

2F – Healthy Food Financing Initiative .................................................................................... 12

2.1.7 – Capital Magnet Fund Program Resource Detail Table ................................................. 12

2G – Capital Magnet Fund Program......................................................................................... 12

2.1.8 – Bond Guarantee Program Resource Detail Table......................................................... 13

2.1.9 – Financing Accounts - Non-Budgetary Summary.......................................................... 13

2H – CDFI Bond Guarantee Program....................................................................................... 14

C – Changes in Performance Measures.................................................................................... 14

Section III – Additional Information ........................................................................................ 15

A – Summary of Capital Investments....................................................................................... 15
CDFI - 3 

Section I – Budget Request

A – Mission Statement

To expand economic opportunity for underserved people and communities by supporting the 

growth and capacity of a national network of community development lenders, investors and 

financial service providers.

B – Summary of the Request 

The Community Development Financial Intuitions (CDFI) Fund supports Treasury’s Strategic 

Goal 1 (Boost U.S. Economic Growth) and Strategic Goal 4 (Transform Government-wide 

Financial Stewardship). The Budget requests the following for the CDFI Fund for FY 2020: 

• $14 million in administrative funding to support:

- Management of the CDFI Bond Guarantee (GP) Program and the New Markets Tax

Credit (NMTC) Program; and

- Ongoing certification and compliance monitoring for all programs, including the Bank

Enterprise Award (BEA) Program, CDFI Program, Native American CDFI Assistance

(NACA) Program and Healthy Food Financing Initiative (HFFI).

• Cancellation of $25 million in anticipated Bank Enterprise Award program carryover balances.

• The Budget eliminates funding for the CDFI Fund’s four discretionary grant and direct loan

programs (i.e. the CDFI Program, the BEA Program, the NACA Program, and HFFI) and

includes a proposal to eliminate new funding for Capital Magnet Fund (CMF) effective in

2020. The CDFI industry has matured, and these institutions should have access to private

capital needed to build capacity, extend credit, and provide financial services to the

communities they serve.

• The Budget proposes to extend the CDFI BG Program, which offers CDFIs low-cost, longterm financing at no cost to taxpayers.

- The CDFI BG Program provides CDFIs access to capital by providing guarantees of

bonds issued by Qualified Issuers. CDFIs invest the bond proceeds into our nation’s

most distressed communities. CDFIs benefit by accessing long-term credit at belowmarket interest rates. The BG Program incentivizes and empowers CDFIs to execute

large-scale projects, including the development of charter schools, commercial real

estate, rental housing, senior living, daycare or healthcare centers, small businesses, and

rural infrastructure, among others. The program requires no credit subsidy.

- The BG Program was originally authorized in the Small Business Jobs Act of 2010 (P.L.

111–240) for a period of four years to provide a source of long-term capital in lowincome and underserved communities. The Budget continues to propose reforms such as

reducing the minimum bond size to increase participation. The Administration

encourages the Congress to adopt these and other necessary reforms to promote further

private sector participation in BG Program financing and support the growth of a selfsustaining CDFI industry.

- The Budget proposes an annual commitment authority of $500 million and program

changes to (1) reduce the minimum bond issue size from $100 million to $50 million;

and (2) correct a technical drafting error related to the calculation of the relending account

maximum.
CDFI - 4

1.1 – Appropriations Detail Table

Dollars in Thousands

Community Development Financial Institutions 

Program

Appropriated Resources

New Appropriated Resources FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

Community Development Financial Institutions 

Program 0 $160,000 0 $160,000 0 $0 0 ($160,000) NA -100.00%

Bank Enterprise Award Program * 0 $25,000 0 $25,000 0 ($25,000) 0 ($50,000) NA -200.00%

Native American CDFI Assistance Program 0 $16,000 0 $16,000 0 $0 0 ($16,000) NA -100.00%

Administration 66 $27,000 66 $27,000 42 $14,000 -24 ($13,000) -36.36% -48.15%

Healthy Food Financing Initiative 0 $22,000 0 $22,000 0 $0 0 ($22,000) NA -100.00%

Subtotal New Appropriated Resources 66 $250,000 66 $250,000 42 ($11,000) -24 ($261,000) -36.36% -104.40%

Other Resources

User Fees 0 $700 0 $1,000 0 $1,200 0 $200 NA 20.00%

Recovery from Prior Years 0 $1,015 0 $1,000 0 $1,000 0 $0 NA 0.00%

Unobligated Balances from Prior Years 0 $32,544 0 $33,000 0 $223,000 0 $190,000 NA 575.76%

Subtotal Other Resources 0 $34,259 $0 $35,000 $0 $225,200 $0 $190,200 NA 543.43%

Total Budgetary Resources 66 $284,259 66 $285,000 42 $214,200 -24 ($70,800) -36.36% -24.84%

* FY 2018 FTE and Other Resources are Actuals. This column reflects levels appropriated in P.L. 115-141, the Consolidated Appropriations Act of 2018. For 

further details on the execution of these resources see the 2020 Budget Appendix chapter for the Department of the Treasury. This request reflects authorization of 

the Bond Guarantee Program thru December 31, 2020

FY 2018 FY 2019 FY 2020 FY 2019 to FY 2020

Enacted * Annualized CR Request Change % Change

1.3 – Operating Levels Table

Dollars in Thousands

Community Development Financial Institution Fund FY 2018 FY 2019 FY 2020

Object Classification Enacted Annualized CR Request

11.1 - Full-time permanent 9,324 9,324 4,589

11.9 - Personnel Compensation (Total) 9,324 9,324 4,589

12.0 - Personnel benefits 2,812 2,812 2,064

Total Personnel and Compensation Benefits $12,136 $12,136 $6,653

21.0 - Travel and transportation of persons 82 82 15

22.0 - Transportation of things 1 1 1

24.0 - Printing and reproduction 5 5 0

25.1 - Advisory and assistance services 3,252 3,252 0

25.2 - Other services from non-Federal sources 11 11 15

25.3 - Other goods and services from Federal sources 6,908 6,908 5,351

25.7 - Operation and maintenance of equipment 3,166 3,166 1,960

26.0 - Raw Materials 62 62 5

31.0 - Equipment 1,377 1,377 0

41.0 - Grants, subsidies, and contributions 223,000 223,000 0

Total Non-Personnel $237,864 $237,864 $7,347

New Budgetary Resources $250,000 $250,000 $14,000

FTE 66 66 42

FY 2018 FTE and Other Resources are Actuals. This column reflects levels appropriated in P.L. 115-141, the Consolidated 

Appropriations Act of 2018. For further details on the execution of these resources see the 2020 Budget Appendix chapter for 

the Department of the Treasury. FY 2018 are Actual.
CDFI - 5 

D – Appropriations Language and Explanation of Changes

Appropriations Language Explanation of 

Changes

DEPARTMENT OF THE TREASURY

COMMUNITY DEVELOPMENT FINANCIAL INSTITUTIONS 

FUND

Federal Funds 

SALARIES AND EXPENSES

To carry out the Riegle Community Development and Regulatory

Improvements Act of 1994 (subtitle A of title I of Public Law 103–325), 

including services authorized by section 3109 of title 5, United States 

Code, but at rates for individuals not to exceed the per diem rate

equivalent to the rate for EX-3, $14,000,000, to be used for administrative

expenses, including administration of CDFI fund programs and the New 

Markets Tax Credit Program: Provided, That during fiscal year 2020, 

none of the funds available under this heading are available for the cost, 

as defined in section 502 of the Congressional Budget Act of 1974, of

commitments to guarantee bonds and notes under section 114A of the 

Riegle Community Development and Regulatory Improvement Act of 

1994 (12 U.S.C. 4713a): Provided further, That commitments to 

guarantee bonds and notes under such section 114A shall not exceed 

$500,000,000 through December 31, 2020: Provided further, That such 

section 114A shall remain in effect until December 31, 2020: Provided 

further, That of the unobligated balances from prior year appropriations 

available for the Community Development Financial Institutions Fund 

for the Bank Enterprise Award program under this heading, $25,000,000 

is hereby permanently cancelled: Provided further, That no amounts may 

be cancelled from amounts that were designated by the Congress as an 

emergency or disaster relief requirement pursuant to the concurrent 

resolution on the budget or the Balanced Budget and Emergency Deficit 

Control Act of 1985. 

Note.—A full-year 2019 appropriation for this account was not enacted 

at the time the budget was prepared; therefore, the budget assumes this 

account is operating under the Continuing Appropriations Act, 2019 

(Division C of P.L. 115-245, as amended). The amounts included for 

2019 reflect the annualized level provided by the continuing resolution. 

E – Legislative Proposals 

The Budget proposes to extend the CDFI Bond Guarantee Program’s authorization, with an annual 

guarantee level not to exceed $500 million. The Budget also proposes reforms to the CDFI BG

Program to increase participation and ensure credit-worthy CDFIs have access to this important 

source of capital, while continuing to maintain strong protections against credit risk. The CDFI 

BG Program will continue to operate at no budgetary cost for new issuances. The Budget requests

an extension of the BG Program through December 31, 2020 and elimination of new allocations 

into the Capital Magnet Fund effective in FY 2020. 
CDFI - 6 

Section II – Annual Performance Plan and Report

A – Strategic Alignment

The CDFI Fund’s mission is to expand economic opportunity for underserved people and 

communities by supporting the growth and capacity of a national network of community 

development lenders, investors, and financial service providers. The CDFI Fund supports the 

following the Department of the Treasury’s FY 2018-2022 strategic goals:

• Goal 1: Boost U.S. Economic Growth

- Objective 1.2 - Strong Economic Fundamentals

• Goal 4: Transform Government-wide Financial Stewardship

- Objective 4.1 - Financial Data Access and Use

The CDFI Fund’s award recipients provide loans, investments, business counseling, basic banking 

services, and financial literacy training in some of the most distressed communities in the nation. 

These are the communities where job opportunities remain stagnant and that otherwise lack access 

to more mainstream forms of capital – the places in the United States that are not progressing 

economically as other parts of our economy have improved. CDFI Fund award recipients use their 

awards to increase access to capital and help to improve the quality of life and the local economy 

in these communities

The FY 2020 Budget will advance these goals by allowing the CDFI Fund to administer and fully 

staff the CDFI Fund’s programs that are authorized by Congress but do not require appropriated 

funds to make awards, i.e., the NMTC Program and CDFI BG Program. In addition, the CDFI 

Fund will continue to conduct ongoing program compliance for prior-year award recipients for all 

programs. 

The budget request is also intended to cover the cost to administer certification of CDFIs, as 

required by the Riegle Act, as well as Community Development Entities (CDEs), as required by 

the NMTC Program. CDFI certification is a prerequisite for eligibility for the CDFI Program, the 

NACA Program, the BG Program and the Capital Magnet Fund (CMF), as well as other federal 

programs outside of the CDFI Fund. 
CDFI - 7 

B – Budget and Performance by Budget Activity

2.1.1 – Administration- Resources and Measures

Dollars in Thousands

 Resource Level FY 2014 FY 2015 FY 2016 FY 2017 FY 2019 FY 2020

Actual Actual Actual Actual Annualized 

CR Request

Appropriated Resources $24,636 $23,100 $23,600 $26,000 $27,000 $14,000

Budget Activity Total $24,636 $23,100 $23,600 $26,000 $27,000 $14,000

FTE 76 76 77 74 66 42

Measure FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Target Target Target

ALL Award Cycle Time 

(Months) 7.9 8.3 7.6 6.3 5.8 7 6.5 6.5

All - Time to Initial 

Disbursement (#Months) N/A N/A B 7.5 N/A 4.5 4.5 4.5

ALL- Number of Affordable 

Housing Units Developed or 

Produced

32,621 27,004 35,251 27,443 34,083 28,000 21,500 21,500

$26,713

66

FY 2018

Actual

$26,713

2A - Administration 

($14,000,000 from direct appropriations):

This encompasses the CDFI Fund’s operational support and management activities for each of its 

ongoing award programs. It includes, among other activities, developing notices of award 

availability and application materials; reviewing and evaluating certification and award 

applications; selecting awardees; finalizing the terms of award agreements; making disbursements; 

collecting and evaluating performance data; monitoring awardees’ compliance; and award 

closeout processes.

Description of Performance: 

The CDFI Fund’s three administrative performance measures focus on organization-wide 

efficiency. They measure how quickly awards are made and funds are disbursed. 

• The All Cycle Time measures the average time from the date when applications are received

to the date of award announcement (calculated in months as an average across all programs).

The Award Cycle Time in FY 2018 was 5.8 months, surpassing the target of 7 months. This

achievement reflects improved efficiency in making awards, which is largely a function of the

implementation of the Awards Management and Information system (AMIS). FY 2019 and

FY 2020 Targets have been lowered to 6.5 months to reflect the improved efficiencies in the

award making processes.

• The Time to Initial Disbursement indicates in months how quickly the CDFI Fund completes

award agreements and makes the first disbursement of funds or issues tax credits. The FY 2018

results for this measure are tabulated after 4.5 months have elapsed from the end of FY 2018.

The results are not yet available.

• The Number of Affordable Housing Units Developed or Produced metric measures the number

of affordable housing units developed or produced as a result of CDFI Fund awards as reported

by CDFI, NMTC, and CMF Program awardees and allocation recipients. The FY 2018 actual

result of 34,083 affordable housing units was above the target of 28,000 affordable housing
CDFI - 8

units. The FY 2020 target was lowered to 21,500 units to reflect a potential decrease in 

program funding which may reduce projected outcomes for program investments.

2.1.2 – Community Development Financial Institutions Program Resources and Measures

Dollars in Thousands

 Resource Level FY 2014 FY 2015 FY 2016 FY 2017 FY 2019 FY 2020

Actual Actual Actual Actual Annualized 

CR Request

Appropriated Resources $146,364 $152,400 $153,423 $161,500 $160,000 $0

Budget Activity Total $146,364 $152,400 $153,423 $161,500 $160,000 $0

Measure FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Target Target Target

CDFI - Percentage of Loans & 

Investments Originated in Eligible 

Distressed or Underserved 

Communities by Dollar Amount of 

Loans (Annual %)

70.8 80.1 80.9 81.2 73.7 60 60 N/A

CDFI - Percentage of Loans & 

Investments Originated in Eligible 

Distressed or Underserved 

Communities by Number of Loans

60.7 80.5 81.5 83 72.1 60 60 N/A

$164,215

FY 2018

Actual

$164,215

2B - Community Development Financial Institutions Program 

($0 from direct appropriations): 

The Community Development Financial Institutions (CDFI) Program makes Financial Assistance 

(FA) awards to CDFIs that have comprehensive business plans for creating community 

development impact and that demonstrate the ability to leverage private sector sources of 

financing, as well as Technical Assistance (TA) grants to CDFIs and entities proposing to become 

CDFIs. CDFIs use FA awards to further goals such as:

• Economic development (job creation, business development, and commercial real estate 

development); 

• Affordable housing (rental housing and homeownership); and 

• Financial services (provision of basic banking services and financial literacy training to 

underserved people and communities). 

Description of Performance: 

The CDFI Program has two measures: (1) the percentage of loans and investments originated in 

eligible distressed communities or made to underserved populations, as measured against the total 

dollar amount of loans originated by awardees; and (2) the percentage of loans and investments 

originated in eligible distressed communities or to underserved populations, as measured against 

the total number of loans originated by awardees.

Certification criteria require that all certified CDFIs originate at least 60.0 percent of their loans 

and investments in eligible distressed census tracts or to underserved populations. The target is 

set at a level that allows CDFIs to balance their mission to serve distressed communities and 

underserved populations with their safety and soundness considerations.
CDFI - 9 

In FY 2018, the CDFI Program surpassed the 60.0 percent threshold for the percentage of both the 

dollar amount (73.7 percent) and the number of CDFI loans (72.1 percent) made to eligible 

distressed communities and underserved populations. No target is set for the 2020 measures 

because no appropriation is proposed for the CDFI Program for this fiscal year. 

2.1.3 – New Markets Tax Credit Resources and Measures

Dollars in Thousands

 Resource Level FY 2014 FY 2015 FY 2016 FY 2017 FY 2019 FY 2020

Actual Actual Actual Actual Annualized 

CR Request

Appropriated Resources $0 $0 $0 $0 $0 $0

Budget Activity Total $0 $0 $0 $0 $0 $0

Measure FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Target Target Target

NMTC - Percentage of 

Loans and Investments That 

Went Into Severly 

Distressed Communities

73.8 75.2 74.5 77.5 74 75 75 75

$0

FY 2018

Actual

$0

2C - New Markets Tax Credit Program 

($0 from direct appropriations): 

The New Markets Tax Credit (NMTC) Program stimulates capital investment in low-income 

communities nationwide by permitting individual and corporate taxpayers to receive a nonrefundable tax credit against federal income taxes for making equity investments in vehicles 

known as Community Development Entities (CDEs). CDEs that receive the tax credit allocation 

authority under the program are domestic corporations or partnerships that provide loans, 

investments, or financial counseling in low-income urban and rural communities. 

On December 18, 2015, Congress extended the authorization of the NMTC Program for $3.5 

billion per year through 2019. 

Description of Performance: 

The Calendar Year 2017 NMTC allocation authority was allocated in February 2018, in which the 

NMTC Program awarded $3.5 billion in NMTC allocation authority to 73 CDEs, out of a pool of 

230 applicants requesting $16.2 billion. 

In FY 2018, CDEs reported that 74 percent of NMTC investments were made in severelydistressed communities, falling slightly below the target of 75 percent. The expectation is that the 

NMTC investments performance report for FY2019 will meet or exceed the 75 target despite the 

slight downturn for FY 2018. 
CDFI - 10 

2.1.4 – Bank Enterprise Award Program Performance and Measures

Dollars in Thousands

 Resource Level FY 2014 FY 2015 FY 2016 FY 2017 FY 2019 FY 2020

Actual Actual Actual Actual Annualized 

CR Request

Appropriated Resources $18,000 $18,000 $19,000 $23,000 $25,000 $0

Budget Activity Total $18,000 $18,000 $19,000 $23,000 $25,000 $0

Measure FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Target Target Target

BEA - Increase in 

Community Development 

Activities Over Prior Year For 

All BEA Program Applicants 

($ million)

571 460 539 523 N/A 500 500 N/A

$25,000

FY 2018

Actual

$25,000

2D - Bank Enterprise Award Program 

($0 from direct appropriations): 

The Bank Enterprise Award (BEA) Program provides monetary awards to regulated banks and 

thrifts for increasing their investments in CDFIs through grants, stock purchases, loans, deposits, 

and other forms of financial and technical assistance, and for increasing their lending, investment, 

and service activities in economically-distressed communities where at least 30 percent of 

residents have incomes less than the national poverty level and where the unemployment rate is at 

least 1.5 times the national unemployment rate.

Description of Performance: 

The BEA Program measures applicants’ increase in qualified community development activities 

over the prior year. In FY 2018, the CDFI Fund awarded $22.8 million from the FY 2017 

appropriated BEA Program funds. The award round for FY 2018 opened in July 2018, with award 

announcements expected to be made in FY 2019. 

BEA Program results for FY2018 have not yet been reported. No target is set for the FY 2020 

measure because no appropriation is proposed for the BEA Program for this fiscal year. 
CDFI - 11 

2.1.5 – Native American CDFI Assistance Program Performance and Measures

Dollars in Thousands

 Resource Level FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Annualized CR Request

Appropriated Resources $15,000 $15,000 $15,500 $15,500 $15,117 $16,000 $0

Budget Activity Total $15,000 $15,000 $15,500 $15,500 $15,117 $16,000 0

FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Target Target Target

NACA - Percentage of NACA 

Loans and Investments in Native 

Areas ($ Amount of Loans)

57.9 65 48.4 42.6 84.9 50 50 N/A

NACA - Percentage of NACA 

Loans and Investments in Native 

Areas (# of Loans)

87 95.9 94.9 94.5 94.4 50 50 N/A

Performance Measure

2E - Native American CDFI Assistance Program 

($0 from direct appropriations): 

Through the Native American CDFI Assistance (NACA) Program, the CDFI Fund assists entities 

in overcoming barriers that prevent access to credit, capital, and financial services in American 

Indian, Alaska Native, and Native Hawaiian communities. The NACA Program makes monetary 

awards to increase the number and capacity of existing or new Native CDFIs (i.e., CDFIs that 

serve Native communities). In addition, the NACA Program provides training to help strengthen 

and develop Native CDFIs. Native CDFIs lend where other mainstream financial institutions do 

not and serve the poorest individuals, families, and businesses in Native communities.

Description of Performance: 

The two measures of performance for the NACA Program are: (1) the percentage of the number 

of loans, and (2) the dollar amount of loans, made in tribal lands (based on Federal Designations 

of Tribal Areas) or to Native people. In accordance with their Financial Assistance agreements, 

NACA awardees are required to originate 50.0 percent or more of their loans and investments in 

Native areas or to Native populations. This threshold is set to allow the awardees to balance their 

mission of serving Native areas and populations with safety and soundness considerations. 

In FY 2018, NACA recipients reported outcome data for their 2017 activities, which showed that 

85 percent of loans by dollar amount and over 94 percent of the number of loans originated were 

in Native Areas or to Native borrowers. No target is set for the FY 2020 measures because no 

appropriation is proposed for the NACA Program for this fiscal year.
CDFI - 12 

2.1.6 – Healthy Food Financing Initiative Performance and Measures

2F – Healthy Food Financing Initiative 

($0 from direct appropriations): 

The Healthy Food Financing Initiative (HFFI) aims to eliminate “food deserts” – low-income 

urban and rural areas in the United States with limited access to affordable and nutritious food – 

by financing interventions that expand the supply of, and demand for, nutritious foods. The 

objectives include increasing the distribution of agricultural products, developing and equipping 

grocery stores, and strengthening producer-to-consumer relationships. 

Through the HFFI, the CDFI Fund awards CDFI Program funds to certified CDFIs to help address 

the need for healthy food in underserved and low-income communities. These organizations use 

federal grants, below market-rate loans, loan guarantees, and tax credits to attract private sector 

financing for projects that increase access to healthy food options. 

Description of Performance: 

The primary HFFI performance measure is the number of healthy food retail stores created and 

maintained in low-income areas that have been identified through detailed census tract analysis as 

having limited access to healthy food options. In FY 2018, the number of HFFI Retail outlets 

created was 26, thereby exceeding the target of 20 new retail outlets for FY 2018. 

2.1.7 – Capital Magnet Fund Program Resource Detail Table

Dollars in Thousands

 Resource Level FY 2014 FY 2015 FY 2016 FY 2017 FY 2019 FY 2020

Actual Actual Actual Actual Request

GSE Distribution N/A N/A $100,292 $119,413 $132,000 $0

Budget Activity Total N/A N/A $100,292 $119,413 $132,000 $0

FTE 0 0 0 4 4 5 6

Note: FY 2019/FY 2020 will require FTE for compliance monitoring

$144,917

FY 2018

Actual

$144,917

2G – Capital Magnet Fund Program 

($0 from direct appropriations): 

The Capital Magnet Fund (CMF) Program was authorized by the Housing and Economic Recovery 

Act of 2008, which calls for recurrent funding of the CMF through allocations from the 

Government-Sponsored Enterprises (GSEs) Fannie Mae and Freddie Mac. Through CMF, the 

Dollars in Thousands

 Resource Level FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Annualized CR Request

Appropriated Resources $ 35,000 $ 22,000 $ 22,000 $ 22,000 $22,000 $22,000 $0

Budget Activity Total $35,000 $22,000 $22,000 $22,000 $22,000 $22,000 0

FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Target Target Target

HFFI - Retail Outlets 

Created/Preserved

33 35 19 24 26 20 20 N/A

Performance Measure
CDFI - 13

CDFI Fund provides grants to CDFIs and qualified non-profit housing organizations to finance 

affordable housing, community service facilities, and economic development. Award recipients 

can use funds to create financing tools such as loan loss reserves, revolving loan funds, risk-sharing 

loans, and loan guarantees. The Budget proposes to suspend new allocations into the CMF 

effective in FY 2020.

Description of Performance: 

The primary performance measures of the CMF are the number of affordable housing units for 

which CMF funding was a source of financing, and the degree to which private funding sources 

were leveraged by CMF financing. Data are included in performance table 2.1.1.

Based on award recipients’ projections, the FY 2017 round1 of the CMF will leverage an estimated 

$3.2 billion in public and private investment. The award recipients plan to develop more than 

21,000 affordable housing units, including nearly 18,000 rental units and more than 3,000 

homeownership units. Of these:

• 91 percent of all housing units will be developed for low-income families (80 percent of the 

area median income or below).

• 89 percent of the homeownership units will be developed for low-income families (80 percent 

of the area median income or below).

• 54 percent of the rental units will be developed for very low-income and extremely low-income 

families (50 percent of the area median income or below).

2.1.8 – Bond Guarantee Program Resource Detail Table

Dollars in Thousands

 Resource Level FY 2014 FY 2015 FY 2016 FY 2017 FY 2019 FY 2020

Actual Actual Actual Actual Annualized 

CR Request

Obligations $200,000 $327,000 $265,000 $245,000 $500,000 $500,000

Loan Limitation 

Obligation Authority $750,000 $750,000 $750,000 $500,000 $500,000 $500,000 $500,000

FY 2018

Actual

$150,000

2.1.9 – Financing Accounts - Non-Budgetary Summary

Dollars in Thousands

 Resource Level FY 2014 FY 2015 FY 2016 FY 2017 FY 2019 FY 2020

Actual Actual Actual Actual Annualized 

CR Request

Obligations $200,000 $327,000 $265,000 $245,000 $500,000 $500,000

Collections* $356 $2,966 $9,377 $18,693 $39,324 $44,993

*Includes the principal and interest repayments and a 10 basis point fee for administrative expenses pursuant to Section 1134 of the Small 

Business Jobs Act of 2010. These amounts assume a zero subsidy rate with bond loan disbursement of $427 million and $438 million in 

FY 2019 and FY 2020, respectively.

$33,700

FY 2018

Actual

$150,000

 

1 Information on the 2018 round was not available at the time this document was prepared. GSE funds are 

not received until March of each year and the CMF round is not opened until funds are received.
CDFI - 14 

2H - CDFI Bond Guarantee Program 

Through the CDFI Bond Guarantee (BG) Program, Treasury provides a 100 percent guarantee of 

bonds (including principal, interest, and call premiums) issued by Qualified Issuers. Bonds issued 

through the program support CDFI lending and investment activity in underserved communities 

by providing a source of long-term capital. Qualified Issuers use bond proceeds to finance loans 

to eligible CDFIs for community and economic development purposes. 

Since the inception of the program, the total amount of bonds guaranteed is $1.512 billion. A total 

of 26 Eligible CDFIs and three Qualified Issuers participate in the CDFI Bond Guarantee Program.

Upon the closing of each bond, the eligible CDFIs have five years to lend or disburse the bond 

proceeds.

The table below provides the year-to-date (YTD) and proposed disbursement for the top eight 

asset classes:

Asset Class

YTD 

Disbursements

($ millions)

YTD 

Disbursements (%)

Proposed

Disbursements

($millions)

Proposed 

Disbursements

(%)

Charter schools $242.1 30.4% $440.0 29.1%

Rental housing $214.6 27.0% $367.7 24.3%

Commercial real estate $125.6 15.8% $270.0 17.9%

Financing Entity $ 88.3 11.1% $153.2 10.1%

Healthcare Facilities $ 49.5 6.2% $101.9 6.7%

Not-for-profits $ 36.1 4.5% $ 79.6 5.3%

Small business $ 14.6 1.8% $ 34.5 2.3%

Senior Living and Long-Term 

Care Facilities $ 13.6 1.7% $ 42.5 2.8%

Daycare centers $ 11.0 1.4% $ 22.6 1.5%

Total $795.4 100% $1,512 100%

C – Changes in Performance Measures 

With the publication of Treasury’s Strategic Plan for FY 2018-2022, the CDFI Fund will work this 

year to baseline the performance for the new strategic objectives. This could result in changes to 

performance measures in the FY 2020 budget. 
CDFI - 15 

Section III – Additional Information

A – Summary of Capital Investments

As part of its FY 2020 capital investment strategy, the CDFI Fund plans to spend approximately 

$3.40 million for operations and maintenance of its Information Technology (IT). The CDFI Fund 

has no major IT investments, nor any capital investments other than IT. 

Non-Major IT Investments: 

For FY 2020, the CDFI Fund has identified two non-major IT investments: Awards Management 

Information System (AMIS) and the CDFI Fund public website. AMIS is an enterprise-wide 

commercial, cloud-based solution that supports CDFI Fund certification, tax credit allocation, 

bond guarantee, and grant programs. The CDFI Fund programs were fully deployed in AMIS by 

September 2018. The CDFI Fund public website, another cloud-based solution, provides access 

to general information about the CDFI Fund and is used to ensure the public can obtain information 

and guidance regarding CDFI Fund programs. For FY 2020, the CDFI Fund plans to provide 

Operations and Maintenance (O&M) support for these two IT investments. 

IT Infrastructure Investments: 

A summary of capital investment resources, including major information technology and nontechnology investments can be found at: 

http://www.treasury.gov/about/budget-performance/Pages/summary-of-capital-investments.aspx

This website also contains a digital copy of this document.



Department of the Treasury 

Financial Crimes Enforcement 

Network 

Congressional Budget 

Justification and Annual 

Performance Report and Plan

FY 2020
FinCEN - 2 

Table of Contents

Section I – Budget Request........................................................................................................... 3

A – Mission Statement ................................................................................................................ 3

B – Summary of the Request ...................................................................................................... 3

1.1 – Appropriations Detail Table .............................................................................................. 4

1.2 – Budget Adjustments Table ................................................................................................. 4

C – Budget Increases and Decreases Description ....................................................................... 4

1.3 – Operating Levels Table ...................................................................................................... 8

D – Appropriations Language and Explanation of Changes ...................................................... 9

E – Legislative Proposals ............................................................................................................ 9

Section II – Annual Performance Plan and Report ................................................................. 10

A – Strategic Alignment ........................................................................................................... 10

B – Budget and Performance by Budget Activity .................................................................... 11

2.1.1 – BSA Administration and Analysis Resources and Measures ....................................... 11

BSA Administration and Analysis Budget and Performance ................................................... 12

C – Changes in Performance Measures .................................................................................... 13

Section III – Additional Information ........................................................................................ 14

A – Summary of Capital Investments ....................................................................................... 14
FinCEN - 3

Section I – Budget Request

A – Mission Statement

To safeguard the financial system from illicit use, combat money laundering, and promote 

national security through the strategic use of financial authorities and the collection, analysis, 

and dissemination of financial intelligence.

B – Summary of the Request 

Summary of the Request: The FY 2020 President’s Budget requests additional resources totaling 

$9,697,000—providing $7,411,000 for three critical program areas and $3,318,000 for two 

program areas previously included in the FY 2019 President’s Budget; and program decreases 

totaling $2,226,000. Specifically, FinCEN will enhance its national security capacity, which 

includes expanding its efforts to combat cybercrime threats; expanding Special Measures 

enforcement efforts; maintaining cyber security investments; sustaining contractor support 

related to national security intelligence analysis; and beginning the development of a non-bank 

financial institutions profile that targets compliance toward high risk institutions. 

FinCEN is a bureau in the U.S. Department of the Treasury. The Director of FinCEN reports to 

the Under Secretary for Terrorism and Financial Intelligence (TFI). FinCEN supports the 

Treasury Strategic Goal 3: Enhance National Security and Goal 5: Achieve Operational 

Excellence. In Strategic Goal 3, FinCEN supports the following Treasury Strategic Objectives: 

3.1 Strategic Threat Disruption – Identify, disrupt, and dismantle priority threats to the U.S. and 

international financial system and Treasury Strategic Objective 3.2 Anti-Money 

Laundering/Combating Financing of Terrorism (AML/CFT) Framework – Identify and reduce 

vulnerabilities in the U.S. and international financial system to prevent abuse by illicit actors.

In carrying out its mission, FinCEN has numerous statutory areas of responsibility:

• Developing and issuing regulations under the Bank Secrecy Act (BSA); 

• Enforcing compliance with the BSA in partnership with law enforcement and other 

regulatory partners; 

• Serving as the U.S. Financial Intelligence Unit (FIU) and maintaining a network of 

information sharing with FIUs in 158 partner countries; 

• Receiving millions of new financial reports each year; 

• Securing and maintaining a database of over 190 million reports; 

• Analyzing and disseminating financial intelligence to federal, state, and local law 

enforcement, federal and state regulators, foreign FIUs, and industry; and

• Bringing together the disparate interests of law enforcement, FIUs, regulatory partners, and 

industry.
FinCEN - 4 

1.1 – Appropriations Detail Table

Dollars in Thousands

Financial Crimes Enforcement Network 

Appropriated Resources

New Appropriated Resources FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

BSA Administration and Analysis 280 $115,003 332 $115,003 359 $124,700 27 $9,697 8.13% 8.43%

Subtotal New Appropriated Resources 280 $115,003 332 $115,003 359 $124,700 27 $9,697 8.13% 8.43%

Other Resources

 Reimbursables 1 $3,000 1 $3,000 1 $3,000 0 $0 0.00% 0.00%

 Recovery from Prior Years 0 $500 0 $500 0 $500 0 $0 0.00% 0.00%

Subtotal Other Resources 1 $3,500 1 $3,500 1 $3,500 0 $0 0.00% 0.00%

Total Budgetary Resources 281 $118,503 333 $118,503 360 $128,200 27 $9,697 8.11% 8.18%

* FY 2018 shows actual FTE usage. This column reflects levels appropriated in P.L. 115-141 Consolidated Appropriations Act, 2018.

For further details on the execution of these resources see the 2020 Budget Appendix chapter for the Department of the Treasury.

FY 2018 * FY 2019 FY 2019 to FY 2020

Enacted Annualized CR Request Change % Change

FY 2020

1.2 – Budget Adjustments Table

Financial Crimes Enforcement Network (FinCEN) FTE

FY 2019 Continuing Resolution 332 $115,003

Changes to Base:

Maintaining Current Levels (MCLs): 0 $1,194

Non-Pay 0 $1,194

Subtotal Changes to Base 0 $1,194

Total FY 2020 Base 332 $116,197

Program Changes:

Program Decreases 0 ($2,226)

Programmatic Contract and Equipment Reductions 0 ($2,226)

Program Increases: 27 $10,729

Enhance National Security Capacity 0 $2,118

Develop NBFI Risk Assessment Model 0 $1,200

Operations and Maintenance (O&M) of Prior-year 

Enterprise-wide Cybersecurity investments 0 $511

Expand Efforts to Combat Cybercrime Threats 13 $3,563

Expansion of Special Measures Enforcement Efforts 14 $3,337

Subtotal Program Changes 27 $8,503

Total FY 2020 Request 359 $124,700

Dollars in Thousands

C – Budget Increases and Decreases Description

Maintaining Current Levels (MCLs) ........................................................ +$1,194,000 / +0 FTE 

Non-Pay +$1,194,000 / +0 FTE 

Funds are requested for non-labor expenses such as travel, contracts, rent, supplies, and 

equipment. 
FinCEN - 5

Program Decreases. ......................................................................................-$2,226,000 / -0 FTE

Programmatic Contract and Equipment Reductions -$2,226,000 / -0 FTE

This reduction will be taken through evaluation of increases or changes in proposed acquisitions 

of contractual services and equipment. FinCEN will evaluate contracts during the renewal 

process to absorb this reduction.

Program Increases. .................................................................................+$10,729,000 / +27 FTE

Enhance National Security Capacity +$2,118,000 / +0 FTE

These funds were also included in the FY 2019 President’s Budget and are necessary to sustain 

FinCEN’s increased contractor resources needed to adequately support Treasury’s Terrorism and 

Financial Intelligence priorities. FinCEN is increasingly called upon to identify sources of 

revenue for illicit actors and their attempts to access and exploit the international financial 

system. These requests stem from the growing threats from rogue nations including the 

Democratic People’s Republic of North Korea (DPRK) and continued efforts to combat 

international organized crime, terrorism, narcotics, and proliferation. These additional funds will 

support these activities, as well as the growing analysis of and demand for FinCEN’s BSA data 

to assist in combating the emerging threats to the financial system.

Develop NBFI Risk Assessment Model +$1,200,000 / +0 FTE

These funds were also included in the FY 2019 President’s Budget and will allow FinCEN to 

begin the development of a Non-Bank Financial Institution (NBFI) Risk Assessment Model that 

will ultimately improve FinCEN’s ability to identify, detect, and examine the highest risk NBFIs 

and foster enhanced BSA compliance within the NBFI sectors. 

NBFIs encompass approximately 320,000 financial institutions – including money services 

businesses (MSBs), including virtual currency exchanges and administrators; casinos and card 

clubs; dealers in precious metals, stones, or jewels; certain insurance companies; and non-bank 

mortgage lenders and originators – and over $13 trillion in financial services. NBFIs have the 

potential to create significant vulnerabilities for the financial system that can be exploited by 

money launders, terrorist financiers, and other criminal actors. They also present inherent risks 

to the U.S. and global financial system ranging from the lack of traditional depository institution 

relationships for MSBs; the abuse of casinos and card clubs by criminal organizations; the 

relative isolation of precious metals, stones, and jewels from the financial services sector; and the 

rapidly changing technologies and customer identification challenges of virtual currency 

exchanges and administrators. 

This effort is the first step to ensure that these sectors are effectively supervised; and, it is a key 

Treasury Department priority not only to mitigate these vulnerabilities but also to protect the 

financial system from criminal abuse. This initiative will also help NBFIs continue to play their 

important role in financial inclusion and the economy, and to improve the government’s 

oversight and supervision of this industry.
FinCEN - 6 

Operations and Maintenance (O&M) of Prior-year Enterprise-wide Cybersecurity Investments 

+$511,000/ +0 FTE

This funding will support O&M for prior year Cybersecurity Enhancement Account investments. 

O&M will be funded by Treasury Bureaus through Treasury Franchise Fund billing. This 

increase represents FinCEN’s portion of the $17,500,000 million O&M total.

Expand Efforts to Combat Cybercrime and Cryptocurrency Threats +$3,563,000/+13 FTE 

This funding will allow FinCEN to expand efforts to combat cyber threats to financial 

institutions, cybercrime, and exploitation of emerging payment systems such as cryptocurrency. 

These efforts follow the money trail of virtual currencies and related financial instruments to 

identify the malicious cyber actors or networks receiving payment for conducting illicit financial 

activities or executing online scams. Through the BSA, financial institutions currently report to 

FinCEN suspicious cyber activity; this information is especially important because in many cases 

cyber actors have tested their tools on banks before deploying them elsewhere. To understand 

and utilize this information, FinCEN has developed unique expertise in cybercrime and 

cryptocurrency that is essential to understanding the evolving nature of financial crimes and their 

complex financial trails. 

FinCEN’s unique skillset related to cybercrime and cryptocurrency threats is in high demand 

with other government agencies. In the past, resource constraints have severely limited 

FinCEN’s ability to share its unique knowledge in this niche area. 

These resources will ensure the expansion of its research and analytical services on the growing 

volume of BSA data related to cyber threats received from financial institutions. This includes 

additional leads provided by the new Suspicious Activity Report (SAR) form released in July 

2018, which encourages additional reporting of cyber threat information, including indicators 

such as malware signatures, malicious domains, and command and control infrastructure. These 

additional resources are critical to ensuring that Treasury, law enforcement, and the broader U.S. 

government can take full advantage of the additional SAR detail regarding cyber threats that 

affect U.S. financial institutions and their customers. In addition, this request also includes 

staffing to enhance FinCEN’s BSA enforcement responsibilities as the sole U.S. regulator for 

virtual currency, and support for international efforts to coordinate financial fraud recovery 

related to business e-mail compromise cyber threats (referred to as “rapid response”). 

These additional resources to expand efforts to combat cybercrime and crytocrurrency threats 

will allow FinCEN to meet the expected growing demand for its products and services (e.g., an 

expected 78 percent increase in cyber cases, enforcement actions, and reports, including a 94 

percent expected increase in the number of strategic products disseminated; and a 150 percent 

expected increase in the number of cyber-related enforcement actions). The additional resources 

will also provide FinCEN the ability to increase the stolen assets recovered by the rapid response 

cases by 150 percent (from an anticipated $60M in FY 2019 to a projected $150M in FY 2022). 

Expansion of Special Measures Enforcement Efforts +$3,337,000/+14 FTE

These funds will allow FinCEN to meet the growing Special Measures workload. These 

activities focus on investigating foreign money laundering and terrorist financing threats to the 

U.S. financial system and taking administrative actions to prevent bad actors from accessing it. 
FinCEN - 7

Over the past several years, data collected through FinCEN’s Special Measures tools and 

authorities has become one of the key sources of enforcement actions against ongoing money 

laundering concerns including rogue nation states, terrorists, and other national security threats. 

FinCEN is in a unique position to utilize the vast amount of information from special collection 

authorities to identify previously unknown money laundering concerns with the unique data 

collected under its authorities. Special Measures authorities are a very effective process to 

identify bad actors within the financial system, but they require a significant infusion of human 

capital as this process is lengthy and involves extensive legal coordination. In addition, working 

with foreign partners to address these threats can have a powerful multiplier effect. For example, 

recent Section 311 actions against Bank of Dandong (China) demonstrate the major impacts that 

these actions have on reducing specific vulnerabilities in the U.S. and international financial 

system. 

This funding will allow FinCEN to expand its use of its unique authorities such as Section 311, 

the Foreign Financial Agency rule, Demand Letters, and Geographic Targeting Orders—all of 

which were previously underutilized prior to FY 2017—to increase enforcement and data 

collection efforts. With data collected under these authorities continuously increasing, there is a 

potential to receive millions of transaction records from a single series of requests. For example,

transactions obtained from Demand Letters increased from 2.6 million to 40.5 million between 

2016 and 2018. This data is being used to identify enforcement and investigative leads as well as 

strategic trends and patterns. These special collection authorities are providing data previously 

unavailable, but in order to continue this critical focus, the function needs to grow to a level 

sufficient to meet the demand. Additional funds will allow FinCEN to maximize the use of these 

authorities to combat current and future national security threats, including global money 

launderers and proliferators. 

In short, FinCEN’s Special Measures authorities have become one of the key sources of 

information used to disrupt the illicit use of the financial system and obtain special collection 

information directly from financial institutions. These resources are essential to address the 

national security threats such as DPRK, Iran, Hezbollah, Venezuela, cybercrime, fraud, and 

transnational organized crime. FinCEN anticipates an increase of 30 percent in the number of 

completed 311 actions and Geographic Targeting Order actions by FY 2022. FinCEN will also 

be able to collect more data, producing over three times the number of records collected by 

FY 2022 than in FY 2018, thus providing invaluable information for investigative leads. This 

data will lead to enhanced identification of enforcement and investigative leads as well as 

strategic trends and patterns.
FinCEN - 8 

1.3 – Operating Levels Table 

Dollars in Thousands

Financial Crimes Enforcement Network (FinCEN) FY 2018 FY 2019 FY 2020

Object Classification Enacted Annualized CR Request

11.1 - Full-time permanent 42,136 42,136 45,582

11.3 - Other than full-time permanent 408 408 408

11.5 - Other personnel compensation 205 205 205

11.9 - Personnel Compensation (Total) 42,749 42,749 46,195

12.0 - Personnel benefits 12,260 12,260 13,313

Total Personnel and Compensation Benefits $55,009 $55,009 $59,508

21.0 - Travel and transportation of persons 630 630 767

23.1 - Rental payments to GSA 4,151 4,151 4,558

23.2 - Rental payments to others 40 40 42

23.3 - Communications, utilities, and miscellaneous charges 1,705 1,705 1,739

24.0 - Printing and reproduction 162 162 153

25.1 - Advisory and assistance services 1,097 1,097 1,097

25.2 - Other services from non-Federal sources 17,278 17,278 20,916

25.3 - Other goods and services from Federal sources 9,698 9,698 9,496

25.6 - Medical care 174 174 174

25.7 - Operation and maintenance of equipment 17,811 17,811 18,429

26.0 - Raw Materials 333 333 331

31.0 - Equipment 6,915 6,915 7,489

Total Non-Personnel $59,994 $59,994 $65,192

New Budgetary Resources $115,003 $115,003 $124,700

FTE 281 333 360

FY 2018 shows actual FTE usage. This column reflects levels appropriated in P.L. 115-141 Consolidated Appropriations Act, 2018. 

For further details on the execution of these resources see the 2020 Budget Appendix chapter for the Department of the Treasury.
FinCEN - 9

D – Appropriations Language and Explanation of Changes

Appropriations Language Explanation of Changes

DEPARTMENT OF THE TREASURY

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 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; services authorized by 5 U.S.C. 3109; not to 

exceed $12,000 for official reception and representation expenses; 

and for assistance to Federal law enforcement agencies, with or 

without reimbursement, $124,700,000, of which not to exceed 

$34,335,000 shall remain available until September 30, 2022.

Note.—A full-year 2019 appropriation for this account was not 

enacted at the time the budget was prepared; therefore, the budget 

assumes this account is operating under the Continuing 

Appropriations Act, 2019 (Division C of P.L. 115–245, as 

amended). The amounts included for 2019 reflect the annualized 

level provided by the continuing resolution.

E – Legislative Proposals

FinCEN has no legislative proposals.
FinCEN - 10 

Section II – Annual Performance Plan and Report

A – Strategic Alignment

FinCEN supports the Treasury Strategic Goal 3: Enhance National Security and Goal 5: Achieve 

Operational Excellence. In Strategic Goal 3, FinCEN supports the following Treasury Strategic 

Objectives: 3.1 Strategic Threat Disruption – Identify, disrupt, and dismantle priority threats to 

the U.S. and international financial system and Treasury Strategic Objective 3.2 Anti-Money 

Laundering/Combating Financing of Terrorism (AML/CFT) Framework – Identify and reduce 

vulnerabilities in the U.S. and international financial system to prevent abuse by illicit actors.

In FY 2018, FinCEN had several noteworthy accomplishments highlighted below: 

• Resolved three civil enforcement actions against financial institutions that violated the BSA,

which resulted in the assessment of civil money penalties against two depository institutions

and one casino.

• Conducted four virtual currency exams, including the first Federal examination of the

world’s largest money transmitter.

• Issued advisories to the financial community on potential fraudulent activity related to

disaster relief efforts; on how North Korea used front and trade companies to launder funds

to finance its nuclear and ballistic missile programs; and on the results of the Financial

Action Task Force plenary, including a reminder of regulatory obligations with respect to

Iran and North Korea.

• Issued an advisory to U.S. financial institutions highlighting the connection between corrupt

senior foreign political figures and their enabling of human rights abuses.

• Issued two Patriot Act Section 311 actions—one against the China-based Bank of Dandong,

to further restrict North Korea’s access to the U. S. financial system, and the other against

ABLV, a Latvian Bank involved in international fraud and sanctions evasion activity. Issued

letters to gain greater transparency to potential threats and support investigations that resulted

in the collection of over 34 million transaction records.
FinCEN - 11 

B – Budget and Performance by Budget Activity

2.1.1 – BSA Administration and Analysis Resources and Measures

Dollars in Thousands

 Resource Level FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Annualized CR Request

Appropriated Resources $112,000 $112,000 $112,979 $115,003 $115,003 $115,003 $124,700

Reimbursables Resources $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000

Budget Activity Total $115,000 $115,000 $115,979 $118,003 $118,003 $118,003 $127,700

279 276 279 275 281 333 360

Workload Output / Activity FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 Est FY 2019 FY 2020 

Actual Actual Actual Actual Actual Estimates Request

Number of SARs filed 1,924,404 2,118,092 2,316,550 2,401,896 2,537,230 2,611,520 2,723,096

Number of total BSA reports filed 19,171,376 19,147,588 19,244,824 19,322,891 20,404,002 20,671,294 20,942,088

Number of BSA database users 11,198 10,166 10,883 11,452 11,679 12,150 12,514

Measure FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Target Target Target

Percentage of Domestic Law 

Enforcement and Foreign FIUs who 

Assert Analytic Products Used Led to 

Detection and Deterrence of Illicit 

Activity **

N/A B 95 92 95 90 95 95

Percentage of Domestic Law 

Enforcement and Regulators Who 

Assert Queried BSA Data Led to 

Detection and Deterrence of Illicit 

Activity **

80 81 83 86 85 86 86 87

Percentage of Users Satisfied with 

FinCEN Information Sharing Systems N/A 78 80 87 86 84 84 84

Percentage of Customers that Find 

Their Contact and Information Sharing 

Made a Beneficial Contribution 

Towards the Detection and 

Deterrence of Illicit Activity*

N/A 89 91 90 91 90 DISC DISC

Percent of financial regulators who 

find FinCEN’s enforcement and 

compliance efforts effective*

N/A N/A N/A 91 88 90 DISC DISC

**Performance measure names were modified from previous years to clarify the purpose of the measures. However, the method of collection and analysis remains

consistant.

FTE (Actual)

*FinCEN will discontinue this performance measure in FY 2019 due to more concentrated focus on outcome measures.
FinCEN - 12 

BSA Administration and Analysis Budget and Performance

($124,700,000 from direct appropriations, $3,000,000 from reimbursable resources): 

Description of Performance: 

FinCEN measures the percentage of domestic law enforcement and foreign FIUs who assert that 

the analytic products they used led to detection and deterrence of illicit activity. This 

performance measure looks at what the analytics products are intended to do, i.e. be useful to a 

wide range of customers and have impact, such as identify new leads or provide previously 

unknown information. In FY 2018, 95 percent found the analytic products and research had 

impact on the investigations, surpassing FY 2018 target of 90 percent. FinCEN was able to 

achieve this performance by concentrating on expanding product dissemination, increasing 

outreach to customers of its intelligence products, and improving processes to obtain feedback 

about product usefulness. The FY 2019 and FY 2020 targets are set at 95 percent. Maintaining 

this high level of performance will be a challenge due to anticipated increases in volume of BSA 

reports filed and evolving threats to the financial system. 

FinCEN monitors the percentage of domestic law enforcement and regulators who assert queried 

BSA data led to detection and deterrence of illicit activity. This performance measure looks at 

the value of BSA data, such as whether the data provided unknown information, supplemented or 

expanded known information, verified information, helped identify new leads, opened a new 

investigation or examination, supported an existing investigation or examination, or provided 

information for an investigative or examination report. In FY 2018, FinCEN narrowly missed its 

target of 86 percent with 85 percent of users finding value from the data. FinCEN will work 

toward increasing its FinCEN Portal/FinCEN Query training efforts to provide more users with 

the knowledge needed in order to better utilize both FinCEN Portal and FinCEN Query. In 

FY 2019, the target is set at 86 percent and 87 percent in FY 2020. 

FinCEN tracks the percentage of users satisfied with FinCEN information sharing systems. This 

measure is based on survey responses and represents user satisfaction with the BSA E-Filing 

System, FinCEN Query, and the Egmont Secure Web. Starting with the industry, FinCEN 

collects and maintains BSA reports filed by financial institutions and other filers. In turn, 

FinCEN provides authorized users (including Treasury and TFI) access to a query system 

containing 13 years of historical BSA data. FinCEN also provides foreign FIUs in the Egmont 

Group with a secure system for exchanging financial intelligence to combat money laundering 

and terrorist financing. This measure is meaningful because the technology allows authorized 

persons to more readily access BSA information and better enables them to conduct 

investigations more efficiently and effectively. In FY 2018, FinCEN exceeded its target of 84 

percent with 86 percent of the users satisfied with information sharing systems, which far 

exceeds the federal government benchmark of 70 percent for customer satisfaction. FinCEN 

attributes this performance to the usefulness of the data it provides, users’ increased familiarity 

with systems which are in a steady operational state, and its knowledgeable and courteous user 

support staff. In FY 2019, FinCEN will keep the target at 84 percent because it plans to make 

modest updates to its information sharing systems. FinCEN does intend to make some more 

impactful modifications in FY 2020, but will keep the target at 84 percent due to the learning 

curve associated with the changes being introduced to the user base. 
FinCEN - 13

FinCEN monitors the percentage of customers that find their contact and information sharing 

made a beneficial contribution toward the detection and deterrence of illicit activity. This 

measure was based on the survey responses of customers who have had contact with FinCEN to 

exchange information, including industry, regulators, and law enforcement, both domestic and 

foreign. This is a composite measure that consists of the following questions: whether the call 

center guidance response was understandable; rating the usefulness of the 314(a) requests that 

FinCEN processed on behalf of the customer’s agency for investigations of financial crimes or 

money laundering; level of satisfaction with the information sharing the customer has with 

FinCEN; and over the past 12 months, the customer’s satisfaction level with FinCEN. This is a 

meaningful measure as it tracks FinCEN’s efforts to share high quality financial intelligence in a 

timely manner and ongoing efforts to solicit useful feedback from key stakeholders. In FY 2018, 

FinCEN surpassed its target of 90 percent with 91 percent finding the information sharing 

helpful. FinCEN will discontinue this performance measure in FY 2019 due to more 

concentrated focus on outcome measures. 

FinCEN tracks the percentage of financial regulators who find FinCEN’s enforcement and 

compliance efforts effective. This is a survey measure of the financial regulators that have an 

information sharing agreement with FinCEN. This measure tracks the effects of FinCEN’s 

compliance and enforcement efforts. The survey tracks the impact of prior enforcement actions 

on levels of compliance and incorporate questions that gauge improved cooperation, compliance,

and consistency in the application of the BSA. For FY 2018, the percentage of financial 

regulators finding FinCEN’s enforcement and compliance efforts effective was 88 percent. This 

missed the FY 2018 target of 90 percent. FinCEN consistently scored above 90 percent in most 

individual elements, with the exceptions of “cooperation” and “compliance.” There are many 

other factors that affect compliance within the industry, in addition to the deterrent effect and the 

public narratives of enforcement actions. To improve this factor, FinCEN intends to continue its 

focus on compliance efforts in the industry, including outreach, ongoing dialogue, and 

examinations. FinCEN will discontinue this performance measure in FY 2019 due to a more 

concentrated focus on outcome measures. 

C – Changes in Performance Measures 

 Performance Measure or Indicator Proposed Change and Justification

Percentage of customers that find their 

contact and information sharing made a 

beneficial contribution toward the detection 

and deterrence of illicit activity 

(discontinue)

FinCEN proposes to stop reporting this metric 

in the CJ/BIB due to more concentrated focus 

on outcome measures.

Percent of financial regulators who find 

FinCEN’s enforcement and compliance 

efforts effective (discontinue)

FinCEN proposes to stop reporting this metric 

in the CJ/BIB due to more concentrated focus 

on outcome measures.
FinCEN - 14 

Section III – Additional Information

A – Summary of Capital Investments

As the administrator of the BSA, FinCEN receives valuable information reported and collected 

under BSA requirements, which totaled approximately 20.4 million filings in FY 2018. To 

successfully fulfill its mission, FinCEN relies on secure, advanced information technology (IT) 

to manage the collection, processing, storage, and dissemination of BSA information that 

contributes to the soundness and confidence in America’s financial system. 

FinCEN’s IT strategy takes into account the growing need for financial institutions to meet 

obligations as efficiently as possible, while ensuring that FinCEN and law enforcement agencies 

receive accurate, timely, and reliable BSA information to track money trails, identify money 

laundering, and unravel terrorist financing networks. FinCEN’s IT strategy focuses on the 

critical need to improve the quality and accessibility of its data and increase responsiveness to 

stakeholders by maintaining and building upon flexible and innovative technical solutions. The 

entire lifecycle cost of the BSA IT Modernization investment, which includes the year the 

investment started (2010) through BY+4 (2024), is $410.296 million (including FTE) and the 

FY 2020 cost is projected at $35.3 million (including FTE).

A summary of capital investment resources, including major information technology and nontechnology investments can be found at: 

http://www.treasury.gov/about/budget-performance/Pages/summary-of-capital-investments.aspx

This website also contains a digital copy of this document. 


Department of the Treasury 

Alcohol and Tobacco Tax and 

Trade Bureau 

Congressional Budget 

Justification and Annual 

Performance Report and Plan 

FY 2020 
TTB - 2

Table of Contents

Section I – Budget Request........................................................................................................... 3

A – Mission Statement................................................................................................................ 3

B – Summary of the Request ...................................................................................................... 3

1.1 – Appropriations Detail Table ............................................................................................................4

1.2 – Budget Adjustments Table ..............................................................................................................5

C – Budget Increases and Decreases Description....................................................................... 5

1.3 – Operating Levels Table ...................................................................................................................7

D – Appropriations Language and Explanation of Changes ...................................................... 8

E – Legislative Proposals............................................................................................................ 8

Section II – Annual Performance Plan and Report................................................................... 9

A – Strategic Alignment ............................................................................................................. 9

B – Budget and Performance by Budget Activity .................................................................... 11

2.1.1 Collect the Revenue Resources and Measures................................................................. 11

Collect the Revenue Budget and Performance ......................................................................... 11

2.1.2 Protect the Public Resources and Measures..................................................................... 15

Protect the Public Budget and Performance ............................................................................. 16

C – Changes in Performance Measures.................................................................................... 20

Section III – Additional Information ........................................................................................ 22

A – Summary of Capital Investments....................................................................................... 22
TTB - 3 

Section I – Budget Request

A – Mission Statement

To collect the taxes on alcohol, tobacco, firearms, and ammunition; protect the consumer by 

ensuring the integrity of alcohol products; ensure only qualified businesses enter the alcohol and 

tobacco industries; and prevent unfair and unlawful market activity for alcohol and tobacco 

products. 

B – Summary of the Request 

Supporting the nation’s economic vitality is at the core of the work performed by the Alcohol 

and Tobacco Tax and Trade Bureau (TTB). The bureau’s role in permitting, regulating, and 

taxing the alcohol, tobacco, and firearms industries facilitates a compliant and fair marketplace

for those engaged in the manufacture and trade of these commodities, and ensures that the 

Federal government has the resources needed to fund national priorities. TTB’s broad mission 

serves Treasury’s Strategic Goal 1 (Boost U.S. Economic Growth), with two strategic goals 

focused on facilitating commerce through Labeling Modernization and enhanced Business 

Qualification, and two strategic goals to support fair and effective tax administration by 

improving Tax Compliance and addressing Cross-Border Tax Risk. Further, TTB conducts its 

operations in support of Treasury’s Strategic Goal 5 (Achieve Operational Excellence), with a 

focus on building its workforce through its strategic goal of Training Revitalization. 

TTB is the third largest tax collection agency in the U.S. government, after the Internal Revenue 

Service and U.S. Customs and Border Protection (CBP), collecting nearly $21 billion in excise 

tax revenue annually. As the most efficient means of tax administration, facilitating voluntary 

compliance will remain a priority for TTB in FY 2020. To this end, and to ensure the efficient 

collection of tax revenue, TTB will make critical IT investments to modernize TTB’s tax system

with the aim of increasing electronic submissions, improving timely filings, and supporting 

taxpayer compliance. Further, in FY 2020, TTB will enhance its guidance related to Federal 

alcohol, tobacco, firearms, and ammunition laws and regulations, and explore opportunities to 

streamline regulations and requirements to reduce compliance burden. These strategies are

critical for TTB to mitigate potential performance impacts as TTB continues to prioritize its 

implementation and enforcement of the Craft Beverage Modernization and Tax Reform

provisions of P.L. 115-97. In the first year, Federal revenues have declined, with the full impact 

not yet known. TTB expects enforcement will continue to pose significant challenges, given the 

multitude of tax rates and complexity of verifying their appropriate application, and requires 

ongoing and extensive coordination with CBP to enforce with regards to imported products. 

Alcohol and tobacco diversion remain long-term tax enforcement challenges given the high 

profits to be gained from illegal activity, the relative ease of diversion, and the substantial 

revenue loss that it represents. Failure to address illicit trade not only deprives governments of 

revenue, but also gives non-compliant actors an unfair competitive advantage over their lawful 

counterparts. To improve tax enforcement outcomes, and promote a more efficient Federal 

government, the Administration is proposing the consolidation of Federal alcohol and tobacco 

tax enforcement authorities within the Department of the Treasury, including transferring 

jurisdiction for the Contraband Cigarette Trafficking Act (CCTA) from the Department of 

Justice’s (DOJ) Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) to TTB. 
TTB - 4 

The FY 2020 request supports an initial investment of $3.3 million in start-up funding for TTB 

to initiate the transfer and begin to implement this enforcement program. Upon transfer of 

CCTA authority, and once fully resourced, TTB expects that its current enforcement model, 

which uses a data-driven approach and relies on teams of agents, auditors, and investigators, as 

well as state and local law enforcement partners, will provide positive returns in terms of 

increased revenue and reduced criminal activity. 

As demand for TTB services has grown in line with the expanding alcohol industries, TTB has 

responded through updated burden-reducing policies, improved systems, and streamlined 

processes to support the timely turnaround of applications for new and existing wineries, 

breweries, and distilleries. Delays can cause financial hardships for these businesses and create a 

barrier to compliant commerce. At the FY 2020 funding level, and anticipating continued 

increases in permit, label, and formula applications, TTB will review its service standards in line 

with anticipated staffing levels. TTB will clearly communicate these standards to industry to 

manage expectations and allow appropriate operational planning. TTB will further adjust its 

strategy for systems modernization to align with resource levels, continuing to focus on clear and 

consistent guidance to industry to facilitate the submission of compliant applications. 

1.1 – Appropriations Detail Table

Dollars in Thousands

Alcohol and Tobacco Tax and Trade 

Bureau

FY 2018 FY 2019 FY 2020 FY 2019 to FY 2020

Enacted 1/ Annualized CR Request $ Change % Change

FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

New Appropriated Resources:

Collect the Revenue 207 $53,560 242 $53,560 255 $59,956 13 $6,396 5.37% 11.94%

Protect the Public 268 $57,879 265 $57,879 252 $55,471 (13) ($2,408) -4.91% -4.16%

Subtotal New Appropriated Resources 475 $111,439 507 $111,439 507 $115,427 0 $3,988 0.00% 3.58%

Other Resources:

Offsetting Collections – Reimbursables 2/ 10 $6,289 10 $6,900 10 $6,900 0 $0 0.00% 0.00%

Transfers 3/ 0 $989 0 $0 0 $0 0 $0 0.00% 0.00%

Subtotal Other Resources 10 $7,278 10 $6,900 10 $6,900 0 $0 0.00% 0.00%

Total Budgetary Resources 485 $118,717 517 $118,339 517 $122,327 0 $3,988 0.00% 3.37%

1/ FY 2018 FTE and Other Resources are Actuals. This column reflects levels appropriated in P.L. 115-141, the Consolidated 

Appropriations Act of 2018. For further details on the execution of these resources see the 2020 Budget Appendix chapter for the 

Department of the Treasury.

2/ Includes reimbursements from TEOAF Mandatory Fund and CDFI, and offsetting collections from Puerto Rico Cover-Over Program.

3/ Transfer from the TEOAF Strategic Support Fund. 
TTB - 5

1.2 – Budget Adjustments Table

Dollars in Thousands

Alcohol and Tobacco Tax and Trade Bureau FTE Amount

FY 2019 Annualized CR 507 $111,439

Changes to Base:

Maintaining Current Levels (MCLs) 0 $1,001

Non-Pay 0 $1,001

Subtotal Changes to Base 0 $1,001

Total FY 2020 Base 507 $112,440

Program Changes:

Program Decreases (13) ($3,013)

Trade Practice Enforcement (13) ($3,013)

Program Increases 13 $6,000

Consolidation of Federal Alcohol &Tobacco Tax Jurisdiction 1/ 9 $3,330

Tax System Modernization 4 $2,500

Operations and Maintenance (O&M) of Prior-year Enterprise-wide

Cybersecurity investments 0 $170

Total FY 2020 Request 507 $115,427

1/ Pending legislation to effectuate the transfer of federal alcohol and tobacco jurisdiction from the Department of Justice to the 

Department of the Treasury. 

C – Budget Increases and Decreases Description

Maintaining Current Levels (MCLs) ......................................................+$1,001,000 / +0 FTE

Non-Pay +$1,001,000 / +0 FTE 

TTB requests funds for non-labor expenses such as travel, contracts, rent, supplies, and 

equipment.

Program Decreases ....................................................................................-$3,013,000 / -13 FTE

Trade Practice Enforcement -$3,013,000 / -13 FTE

TTB will reduce its Trade Practice Enforcement program. TTB enforcement addresses unlawful 

trade practices in the marketplace and ensures a level playing field for U.S. alcohol 

manufacturers and distributors. With two-year funding provided in both FY 2017 and FY 2018, 

TTB added staffing to increase its capacity for trade practice investigations from approximately 

one each year to more than 50 active cases annually. At the FY 2020 funding level, TTB will 

work to bring most of its active trade practice investigations to closure and continue its process 

of evaluating and prioritizing the highest risk cases as part of its annual enforcement planning 

process. 

Program Increases ..................................................................................... $6,000,000 / +13 FTE

Consolidation of Federal Alcohol & Tobacco Tax Jurisdiction +$3,330,000 /+9 FTE

TTB requests start-up funding to support the Administration’s proposal to consolidate Federal 

alcohol and tobacco tax jurisdiction within the Department of the Treasury and TTB. This initial 

investment will enable TTB to begin hiring the necessary additional enforcement personnel to 

conduct the complex, multi-state investigations associated with contraband cigarette 

smuggling. The requested funding level supports 9 FTE, which will allow TTB to hire auditors, 

investigators, and other program staff. Further, TTB will hire criminal enforcement agents under 
TTB - 6 

an expansion of the existing interagency agreement with the IRS. This initial investment would 

also enable TTB to initiate any needed rulemaking and guidance as well as support initial 

research into system requirements and data analytics to improve enforcement targeting. During 

this transition period, and at the proposed staffing level, TTB will also expand its outreach to 

state law enforcement partners and work closely with DOJ on the transfer and continuation of 

existing cases. 

Tax System Modernization +$2,500,000 / +4 FTE 

TTB requests an investment of $2.5 million and 4 FTE for the first year of a multi-year effort to 

modernize its outdated tax system to support efficient filing and processing as well as facilitate 

data analytics to timely detect tax evasion, all of which is particularly important in light of recent 

tax reforms that present workload and enforcement challenges. 

The functionality of TTB’s Integrated Revenue Information System (IRIS) is substantially the 

same as in 2000 while, over the same period, the number of TTB taxpayers has increased nearly 

250 percent to approximately 25,000. Outdated and labor-intensive processes are contributing to 

low and declining tax compliance. By creating a TTB-designed external interface to support 

industry filing compliance, as well as enhancing the internal system design to streamline desk 

reviews of taxpayer accounts, TTB expects to be able to complete timely follow up and/or 

enforcement actions that will, over time, result in increased taxpayer compliance rates. 

Additionally, without a significant redesign of the legacy tax system, TTB will continue to face 

challenges in using advanced analytics for tax administration and fraud detection, a key strategy 

for Treasury and TTB to maximize the reach of limited resources. Enhanced systems and 

analytics would enable TTB to use its tax information, as well as import and export data from 

other Federal agencies, to more effectively target known tax evasion schemes. 

The IT development plan would transform IRIS incrementally, using multiple system releases to 

deliver independent modules to create the full functionality needed. The total cost includes the 

IT development team; additional tax specialist positions to backfill the experienced staff required 

to support the development effort; and analytics support to streamline work processes, improve 

non-compliance detection, and improve workload management.

Operations and Maintenance of Prior-year Enterprise-wide Cybersecurity Investments, 

+$170,400 / +0 FTE 

The FY 2020 request includes funding to support operations and maintenance (O&M) for prior 

year Cybersecurity Enhancement Account investments. O&M will be funded for Treasury 

bureaus through the Treasury Franchise Fund (TFF). This increase represents TTB’s portion of 

the $17.5 million O&M total for Treasury.
TTB - 7 

1.3 – Operating Levels Table

Dollars in Thousands

TTB FY 2018 FY 2019 FY 2020

Object Classification Enacted 1/ Annualized CR Request

11.1 - Full-time permanent $51,531 $51,531 $51,083

11.5 - Other personnel compensation $619 $619 $627

11.9 - Total personnel compensation $52,150 $52,150 $51,710

12.0 - Personnel benefits $15,671 $15,671 $15,501

13.0 - Benefits for former personnel $5 $5 $5

Total Personnel and Compensation Benefits $67,826 $67,826 $67,216

21.0 - Travel and transportation of persons $2,561 $2,561 $2,304

22.0 - Transportation of things $30 $30 $30

23.1 - Rental payments to GSA $4,276 $4,276 $4,276

23.3 - Communication, utilities, and misc charges $1,732 $1,732 $1,766

24.0 - Printing and reproduction $268 $268 $269

25.2 - Other services from non-Federal sources $24,395 $24,395 $27,577

25.3 - Other goods and services from Federal sources $7,715 $7,715 $9,239

26.0 - Supplies and materials $499 $499 $507

31.0 - Equipment $2,137 $2,137 $2,242

Total Non-Personnel $43,613 $43,613 $48,211

New Budgetary Resources $111,439 $111,439 $115,427

FTE 475 507 507

1/ FY18 Appropriated Resources are enacted and FTE are Actual. This column reflects levels appropriated in P.L. 115-141, the 

Consolidated Appropriations Act of 2018. For further details on the execution of these resources see the 2020 Budget Appendix

chapter for the Department of the Treasury.
TTB - 8 

D – Appropriations Language and Explanation of Changes

Appropriations Language Explanation of 

Changes

DEPARTMENT OF THE TREASURY

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, $115,427,000, of which $5,000,000 shall remain 

available until September 30, 2021; of which not to exceed $6,000 

shall be available for official reception and representation 

expenses; and of which not to exceed $50,000 shall be available for 

cooperative research and development programs for laboratory 

services and provision of laboratory assistance to State and local 

agencies with or without reimbursement.

Note. – A full-year 2019 appropriation for this account was not 

enacted at the time the budget was prepared; therefore, the budget 

assumes this account is operating under the Continuing 

Appropriations Act, 2019 (Division C of P.L. 115-245, as 

amended). The amounts included for 2019 reflect the annualized 

level provided by the continuing resolution.

E – Legislative Proposals 

Government Reform Initiative - Consolidation of Federal Alcohol & Tobacco Tax 

Jurisdiction

The Administration proposes to transfer primary jurisdiction over Federal tobacco and alcohol 

anti-smuggling laws from the Department of Justice and the Bureau of Alcohol, Tobacco, 

Firearms and Explosives to the Department of the Treasury and TTB. Under the proposal, TTB 

would be responsible for the administration and enforcement of the Jenkins Act of 1949 (as 

amended by the Prevent All Cigarette Trafficking Act of 2009), 15 U.S.C. Chapter 10A, the 

Contraband Cigarette Trafficking Act of 1978, 18 U.S.C. Chapter 114, and the criminal statutes 

involving Liquor Trafficking, 18 U.S.C. Chapter 59. Specific statutory language to effect the 

transfer and facilitate Federal enforcement against tobacco smuggling has been developed in 

consultation with the Secretary of the Treasury and with the Attorney General. 
TTB - 9

Section II – Annual Performance Plan and Report

A – Strategic Alignment

TTB is responsible for administering and enforcing the sections of the Internal Revenue Code of 

1986 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 

the alcohol beverage industry for the protection of U.S. consumers. In essence, TTB administers 

its jurisdiction according to five strategic goals that support economic growth and stability: 1) 

Tax Compliance; 2) Cross-Border Tax Risk; 3) Business Qualification; 4) Labeling 

Modernization; and 5) Training Revitalization. TTB’s strategic goal of Training Revitalization 

directly contributes to Treasury’s Strategic Goal 5 (Achieve Operational Excellence) through 

Strategic Objective 5.1 (Workforce Management) and underpins TTB’s performance across all 

of its goals and objectives.

TTB’s strategic goals to improve Tax Compliance and address Cross-Border Tax Risk ensure 

that the Federal government has the resources needed to fund national priorities and support 

Treasury’s Strategic Goal 1 (Boost U.S. Economic Growth) and Strategic Objective 1.1 (Tax 

Law Implementation) to administer tax laws to better enable all taxpayers to meet their 

obligations while protecting the integrity of the tax system. The FY 2020 funding level provides 

the initial investment in a multi-year tax system modernization effort. The industries TTB 

regulates have grown significantly in recent years, which present workload and enforcement 

challenges, particularly in light of recent tax reforms. Funding is required to address outdated 

tax systems to support efficient filing and processing as well as facilitate data analytics to timely 

detect tax evasion.

Additionally, in support of effective tax administration, the Administration is proposing the 

consolidation of Federal alcohol and tobacco tax jurisdiction within the Department of the 

Treasury to improve mission alignment and focus and, in turn, create tax enforcement 

efficiencies. This proposal calls for the transfer of enforcement authority for the CCTA and the 

Prevent All Cigarette Trafficking (PACT) Act from DOJ to Treasury. These Federal statutes 

were intended, among other things, to stop criminal organizations from profiting by smuggling 

cigarettes across state borders from low-tax states to high-tax states, and protect state and local 

governments from revenue losses from interstate cigarette smuggling. ATF, which currently has 

primary jurisdiction for CCTA and PACT Act enforcement, has estimated that the sale of 

contraband cigarettes costs Federal, state, and local governments close to $5 billion a year in 

revenue. The FY 2020 funding request represents the initial investment required to begin the 

transfer of these authorities, including preliminary hiring and contract actions to support 

investigations, as well as required rulemaking, IT, and data analytics efforts to support the 

program and generate leads for future investigations. The full program costs will be higher and 

will be addressed in future budgets. When fully implemented, TTB anticipates that the 

consolidation of CCTA and PACT Act enforcement with TTB’s existing tobacco enforcement 

authorities will result in increased Federal and state tobacco excise tax revenues. 

These investments will require tradeoffs in TTB’s enforcement plans. TTB conducts trade 

practice enforcement in the alcohol beverage marketplace in support of the Treasury’s Strategic 

Goal 1 (Boost U.S. Economic Growth) and Strategic Objective 1.4 (Free and Fair Trade) to 
TTB - 10 

advance a free and fair trade environment for U.S. businesses. At the FY 2020 funding level, 

TTB will need to rebalance enforcement priorities to support the successful closure of most 

active trade practice investigations and sustain a modest enforcement presence, as well as the 

effective transition of CCTA cases from ATF to TTB.

TTB’s strategic goals to enhance Business Qualification and implement Labeling Modernization 

ensure that lawful U.S. alcohol businesses are competitive and thriving in the global marketplace 

and support the Treasury’s Strategic Goal 1 (Boost U.S. Economic Growth) and Strategic 

Objective 1.3 (Trusted Currency and Services) to deliver trusted currency and services that 

enable citizens and businesses to participate in the economy. Timely service remains a priority 

for TTB and the businesses it regulates. As the demand for TTB services from these businesses 

continues to rise, and within the FY 2020 resources, TTB will review its customer service 

standards based on anticipated staffing levels. TTB will also scale down plans to modernize its 

online systems for filing permit, label, and formula applications, and instead seek to increase 

guidance to support compliant applications. These strategies will help TTB maintain timely 

service by increasing the number of first-time approvals, and reducing delays caused by 

extensive back-and-forth with industry members to correct initial applications containing errors. 
TTB - 11 

B – Budget and Performance by Budget Activity

2.1.1 Collect the Revenue Resources and Measures

Dollars in Thousands

 Resource Level FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Annualized

CR Request

Appropriated Resources $51,721 $50,976 $53,385 $53,375 $53,313 $53,560 $59,956

Reimbursables $3,506 $3,681 $3,143 $3,217 $3,923 $4,304 $4,304

Transfers In 1/ $468 0 0 $197 $902 0 0 

Budget Activity Total $55,695 $54,657 $56,528 $56,789 $58,138 $57,864 $64,260

FTE 2/ 224 223 234 223 212 255 252

1/ TEOAF Strategic Support Fund

2/ Includes 5 FTE from Puerto Rico cover-over reimbursables

Performance Measure

FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Target Target Target

Amount of Revenue 

Collected Per Program 

Dollar 1/

457 437 414 406 369 400 DISC DISC

Percent of Voluntary 

Compliance from Large 

Taxpayers in Filing 

Returns/Payments Timely 

(by filing) 2/

90 88 87 85 85 90 DISC DISC

Percent of Voluntary 

Compliance from Large 

Taxpayers in Filing Tax 

Returns/Payments Timely 

(by taxpayer) 2/

N/A N/A N/A N/A N/A N/A B 

Percent of Voluntary 

Compliance from Large 

Taxpayers in Filing 

Operational Reports Timely 

(by taxpayer) 2/

N/A N/A N/A N/A N/A N/A B 

Percent of Electronically 

Filed Tax Returns – 

Pay.gov

32 33 34 35 38 50 50 50

Percent of Electronically 

Filed Operational Reports – 

Pay.gov

37 38 39 40 42 50 50 50

1/ Beginning in FY 2019, results will be reported as an indicator rather than a performance measure; as such, no 

target is established for FY 2019.

2/ TTB is developing new measures to evaluate and monitor taxpayer compliance for FY 2019, which will calculate compliance 

rates on a taxpayer basis, rather than a per filing basis; TTB will also formally add a measure of the compliance rate for 

operational reports.

Collect the Revenue Budget and Performance

($59,956,000 from direct appropriations, $4,304,000 from reimbursable resources):

This budget activity includes all tax processing, verification, enforcement, and outreach efforts 

related to administering the Federal tax code for alcohol, tobacco, firearms, and ammunition 

products, and supports Treasury’s Strategic Objective 1.1 (Tax Law Implementation). TTB 

collects approximately $21 billion in Federal tax revenue annually from a tax base of more than 

29,000 businesses. TTB’s regulated taxpayers include distilleries, breweries, and wineries, 

which have boomed in recent years, as well as manufacturers and importers of tobacco and

firearms. TTB extends the reach of its enforcement resources through advanced analytics and 

risk-based audits and investigations. To ensure a level playing field for those engaged in the 
TTB - 12 

trade of these regulated commodities, TTB also takes appropriate enforcement action to detect 

and address diversion activity to ensure all products sold in the marketplace are properly taxpaid. 

Other Resources (Offsetting Collections/Reimbursables).................................... $4,304,000 

Other resources that fund this budget activity include reimbursement for the operating costs of 

TTB’s Puerto Rico field office, which are offset against the roughly $400 million in taxes 

collected on the alcohol beverage products that are manufactured in Puerto Rico and imported to

the United States; reimbursement from the Community Development Financial Institutions Fund 

(CDFI) for IT services provided by TTB; and funding from the Department of the Treasury’s 

Executive Office for Asset Forfeiture (TEOAF) mandatory account to cover investigative 

expenses, data systems, and training. 

Description of Performance – Collect the Revenue: 

In FY 2018, TTB met neither of its two annual targets for the performance measures under the 

Collect the Revenue budget activity. Taken together, TTB’s measures of the Amount of 

Revenue Collected per Program Dollar and the Percent of Voluntary Compliance from Large 

Taxpayers in Filing Payments Timely are intended to demonstrate the effectiveness and 

efficiency with which TTB operates its revenue collection function. TTB is proposing several 

updates to its measures for this budget activity, including adding measures of Percent of 

Electronically Filed Tax Returns and Percent of Electronically Filed Operational Reports via 

Pay.gov. These measures of electronic filing rates, combined with an update to the measure of 

Percent of Voluntary Compliance from Large Taxpayers in Tax Filings (Tax Returns, Payments, 

and Operational Reports), will inform TTB’s efforts to improve its level of taxpayer service and 

enhance tax oversight. TTB’s strategies for achieving results under its new suite of measures 

include applying technology to streamline internal and external processes and leveraging data 

sources to direct our outreach and enforcement efforts. At the FY 2020 funding level, TTB will 

initiate critical system modernization efforts to increase its effectiveness in tax administration 

and to help ensure resources are deployed to maximize the deterrent effect. 

Improve Efficiency of Tax Collection 

The Amount of Revenue Collected per Program Dollar measure uses annual collections figures 

and the actual expenditures and obligations for collection activities to quantify the efficiency of 

TTB’s tax collection program. In FY 2018, TTB achieved a return on investment of $369 for 

every program dollar spent on collection activities, below the annual performance target of $400. 

TTB set this performance target based on historical trends and other predictors that influence 

consumer behaviors. 

The year‐to‐year decline in performance represents continued declines in tobacco revenue that, 

after peaking in FY 2010 following the significant tax rate increases enacted in 2009, have 

steadily declined in line with shifts in consumption patterns, product manufacturing, and trade. 

Annual alcohol revenue also trended down, largely due to the recent tax reform legislation that 

lowered effective tax rates across all commodities and expanded eligibility for reduced rates and 

credits. In total, revenue collections were down 6 percent from FY 2017; however, as the law 

took effect in January 2018, the full impact of these provisions is not yet known. Going forward, 

TTB will continue to monitor its return on investment for its Collect the Revenue activities as a 

key indicator; however, it will be discontinued as a performance measure under which TTB 
TTB - 13

establishes an annual target, given the substantial influence of external factors on performance 

results.

Excise Tax and Other Collections by Fiscal Year

Dollars in Thousands

FAET – Firearms and Ammunition Excise Tax; SOT – Special Occupational Tax; FST – Floor Stocks Tax

In FY 2020, to maintain positive returns on its revenue mission, TTB will continue to improve 

efficiencies and results in its tax enforcement program through systems and process 

improvements related to tax verification. The FY 2020 funding level includes $2.5 million to 

initiate a multi-year effort to modernize TTB’s tax systems, which will allow TTB to increase 

automation in the detection, notification, assessment, and collection of excise taxes due while

preserving staff time for substantive tax analysis. TTB’s two new measures of Electronically 

Filed Tax Returns and Electronically Filed Operational Reports indicate that less than half of 

these required tax filings are submitted to TTB via Pay.gov, the current online system for 

electronic submissions. High rates of paper filings – with just 38 percent of returns and 42 

percent of required operational reports submitted electronically – make compliance checks and 

fraud monitoring more difficult and costly. The tax system investment will drive increases in 

electronic filing rates, which should support timelier, complete, and more accurate submissions 

as well as timely access to the data for TTB tax verification and analysis. 

System modernization efforts also support a data-driven approach to efficiently and effectively 

identify and address high-risk activity for audit and investigation. In FY 2020, TTB will 

continue to use data analytics and other intelligence to efficiently deploy its limited enforcement 

resources. A primary focus for TTB tax enforcement continues to be diversion schemes related 

to imported and exported alcohol and tobacco products given the relative ease of these schemes 

and the high profit potential. Investigations to date have identified significant tax liabilities and 

remain an enforcement priority under the Craft Beverage Modernization and Tax Reform 

provisions, effective through calendar year 2019, which include reduced rates for alcohol 

importers as well as domestic producers. 

Increase Voluntary Compliance from Taxpayers

Fostering voluntary compliance among taxpayers is a primary tax administration strategy for 

TTB. The Percent of Voluntary Compliance from Large Taxpayers in Filing Tax Payments 

Fiscal

Year Alcohol Tobacco FAET SOT FST Other Total

2009 $ 7,424,292 $ 11,548,504 $452,693 $ 272 $1,192,375 $ 970 $ 20,619,106

2010 7,476,789 15,913,479 360,813 300 8,558 180 23,760,119

2011 7,594,330 15,515,073 344,262 268 5,220 2,257 23,461,410

2012 7,856,391 15,002,616 514,622 249 5,942 61 23,379,881

2013 7,851,953 14,321,017 762,836 280 1,521 38 22,937,645

2014 7,924,951 13,552,711 768,927 332 465 2 22,247,388

2015 7,997,467 13,620,497 638,518 288 2,444 7 22,259,221

2016 8,075,476 13,274,371 749,789 258 245 505 22,100,644

2017 8,103,714 12,966,317 761,630 227 69 521 21,832,478

2018 7,877,214 12,050,283 624,802 273 7 1,006 20,553,585

Average $ 7,818,258 $ 13,776,487 $597,889 $ 275 $ 121,685 $ 555 $ 22,315,148
TTB - 14 

Timely indicates the rate of compliance by large taxpayers (i.e., those that pay more than 

$50,000 in annual taxes) in voluntarily filing their tax payments on or before the scheduled due 

date. In FY 2018, TTB achieved a compliance rate of 85 percent from its large taxpayers, which 

fell below the performance target of 90 percent. The declining compliance rate in recent years is 

due, in part, to industry growth and expansion and a corresponding increase in the number of 

industry members who qualify as “large taxpayers” because they owe more than $50,000 in 

annual taxes due. Such recent permittees may be less familiar with TTB’s statutory and 

regulatory requirements. Although TTB analysis indicates that this trend does not represent a 

significant revenue risk, non-compliance undermines the level playing field, which is especially 

critical for small producers who comprise the majority of TTB taxpayers. 

In FY 2018, TTB began developing new measures that will calculate voluntary compliance rates 

by taxpayer and incorporate additional stratifications by tax liability, resulting in the 

discontinuation of the current Percent of Voluntary Compliance from Large Taxpayers in Filing 

Tax Payments Timely measure. The new measures will also incorporate voluntary compliance 

rates for operational reports, a critical information collection that provides production 

information to support TTB tax verification efforts. TTB will baseline these new measures in 

FY 2019 and establish annual targets. By enhancing its data‐driven and risk‐based approach, 

TTB will be able to develop more targeted strategies to better align its resources to the most 

critical revenue risks and address potential underreporting or fraud. 

In FY 2020, TTB will strive to improve the voluntary compliance rate under the new metrics 

through complementary strategies that focus on promoting electronic filing options to enable 

taxpayers to file complete, accurate, and timely tax returns and payments; improving online 

guidance and industry outreach strategies, particularly for those industry members with 

expanding operations; and maintaining an enforcement presence to encourage voluntary 

compliance. Moving forward on all three fronts is required to ensure that TTB strikes the 

appropriate balance between supporting businesses in establishing compliant operations while 

ensuring adequate coverage of the high-risk activity that undermines lawful business activity. 

Further, TTB will review its enforcement plans to address potential vulnerabilities and new tax 

evasion schemes arising from both the new tax legislation and TTB’s expanded enforcement 

responsibilities in the interstate smuggling of cigarettes. The Administration has proposed 

legislative changes to consolidate Federal alcohol and tobacco tax authorities within Treasury, 

which will integrate ATF authorities into TTB’s Federal excise tax enforcement program. The 

FY 2020 budget supports an initial investment to ramp up CCTA enforcement at TTB, which 

TTB expects to result in enforcement efficiencies, increased field presence, and, over time, 

improved voluntary compliance through an increased deterrent effect. 
TTB - 15 

2.1.2 Protect the Public Resources and Measures

Dollars in Thousands

 Resource Level FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Annualized

CR Request

Appropriated Resources $47,279 $47,451 $52,709 $53,527 $56,995 $57,879 $55,471

Reimbursables $3,236 $2,451 $2,577 $2,637 $2,366 $2,596 $2,596

Transfer In 1/ $432 0 0 0 $87 0 0 

Budget Activity Total $50,947 $49,902 $55,286 $56,164 $59,448 $60,475 $58,067

FTE 2/ 246 243 246 265 273 247 245

1/ TEOAF Strategic Support Fund

2/ Includes 5 FTE from Puerto Rico cover-over reimbursables

Performance Measure

FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Target Target Target

Percentage of Permit 

Applications Processed 

within Service Standards

(75 days) 1/

58 47 32 48 71 85 85 85

Initial Error Rate for Permit 

Applications 2/ 73 77 81 83 80 25 25 25

Percent of Electronically 

Filed Permit Applications 3/ 80 84 81 84 86 87 90 90

Customer Satisfaction 

Rate with TTB Permitting 

Process 

B 76 71 80 83 80 DISC DISC

Customer Satisfaction 

Rate with eGov Systems - 

Permits Online 4/

B 64 54 68 77 80 80 80

Percentage of Alcohol 

Beverage Label and 

Formula Applications 

Processed within Service 

Standards 5/

71 80 80 62 84 85 85 85

Initial Error Rate for Label 

and Formula Applications 39 42 44 43 40 25 25 25

Percent of Electronically 

Filed Label and Formula 

Applications

93 94 97 98 98 95 95 95

Customer Satisfaction 

Rate with eGov Systems - 

COLAs Online 6/

71 71 74 82 81 80 80 80

Customer Satisfaction 

Rate with eGov Systems - 

Formulas Online 6/ 

53 48 58 70 81 80 80 80

1/ Prior year data subject to additional validations following TTB migration to new reporting platform in FY 2018.

2/ Prior year data revised due to errors in methodology related to wholesaler and importer applications.

3/ Revised actuals for fiscal years 2016 and 2017 due to error in source data.

4/ New measure of user satisfaction with TTB's Permits Online electronic filing system; replaces discontinued measure of 

satisfaction rates with permitting process.

5/ Service standards are set annually based on TTB analysis of submission volume, error rates, and resource levels. For FY 

2018, TTB established new service standards of 15 days for both labels and formulas based on a significant spike in 

submissions. In FY 2017, the service standard was 10 days for both labels and formulas. Between FY 2014 - 2016, the service 

standard was 30 days for labels and 45 days for formulas.

6/ New measures of user satisfaction with TTB’s COLAs Online and Formulas Online (FONL) electronic filing systems. Results 

for FONL represent beverage alcohol formula filers; nonbeverage alcohol formula filers are excluded.
TTB - 16

Protect the Public Budget and Performance

($55,471,000 from direct appropriations, and $2,596,000 from reimbursable resources): 

This budget activity funds the programs that ensure the integrity of the products and industry 

members in the marketplace; promote compliance with Federal laws and regulations by more 

than 90,000 businesses that TTB regulates; facilitate fair and lawful domestic and international 

trade in the alcohol and tobacco commodities; and provide full and accurate alcohol beverage 

product information to the public as a means to prevent consumer deception. These activities 

support Treasury’s Strategic Goal 1 (Boost U.S. Economic Growth) and Strategic Objective 1.3 

(Trusted Currency and Services) to deliver trusted currency and services that enable citizens and 

businesses to participate in the economy as well as Strategic Objective 1.4 (Free and Fair Trade)

to advance a free and fair trade environment for U.S. businesses. 

Other Resources (Offsetting Collections/Reimbursables).................................... $2,596,000

Other resources that support this budget activity include reimbursement for the operating costs of 

the TTB Puerto Rico field office, which are offset against the roughly $400 million in taxes 

collected on the alcohol beverage products that are manufactured in Puerto Rico and imported 

into the United States ; reimbursement by the Community Development Financial Institutions 

Fund (CDFI) for TTB’s IT services; and funding from the Department of the Treasury’s 

Executive Office for Asset Forfeiture (TEOAF) mandatory account to cover investigative 

expenses, data systems, and training.

Description of Performance – Protect the Public:

In FY 2018, TTB met two of its seven annual targets for the performance measures under its 

Protect the Public budget activity. These measures help TTB monitor the degree to which it is 

meeting the service standards it establishes for permit, label, and formula applications; its 

effectiveness in reducing error rates on applications to address processing delays caused by 

incomplete or non-compliant submissions; the impact that electronic filing initiatives are having 

on improved service delivery; and the level of satisfaction that industry members have with 

TTB’s permitting process. TTB is revising its suite of measures to discontinue its current metric 

of customer satisfaction and instead track customer satisfaction with its eGov systems for filing 

permit, label, and formula applications, as TTB continues to pursue system enhancements to 

streamline filing and processing to help manage increasing workloads. TTB’s strategies to 

achieve its performance targets for these measures include a combination of streamlining internal 

processes, implementing enhancements to online filing systems, modernizing application 

requirements, and providing clearer guidance to industry members.

Improve Efficiency and Effectiveness of Permitting Process

TTB protects consumers by screening permit applicants to ensure only qualified persons engage 

in the alcohol, tobacco, firearms, and ammunition industries. For this purpose, in FY 2018, TTB 

processed approximately 9,000 original permit applications, performing investigations into highrisk applicants to meet TTB’s business integrity objectives. TTB monitors its timeliness in 

approving permit applications through its measure of the Percentage of Permit Applications 

Processed within Service Standards. As businesses rely on accurate information related to TTB 

service delivery in their operational planning, this measure provides important data related to a 

key outcome for TTB and its stakeholders. 
TTB - 17 

Ongoing expansion of the alcohol beverage industry in recent years has increased the volume of 

permit and brewer’s notice applications, particularly for new alcohol producers. This growth in 

workload has contributed to delayed permit approvals by TTB – reaching a peak of 122 days on 

average in FY 2016 – so that new businesses often waited months to begin producing and selling 

their products while having already made significant investments in their operations. To address 

this performance challenge, in FY 2018, Treasury and TTB established a priority goal to reduce 

average approval times for alcohol and tobacco business permits by at least 20 percent (from 96 

days to 75 days) and achieve the 75-day standard for 85 percent of applicants by September 30, 

2019. 

In FY 2018, in driving toward its priority goal targets, TTB dramatically improved processing 

times, decreasing from an average of 96 days in FY 2017 to 61 days in FY 2018, exceeding the 

targeted 20 percent reduction. TTB also improved the consistency of its service, processing 71 

percent of permit applications within the 75-day standard compared to 48 percent the prior year. 

TTB achieved these gains through revised processes and policies, and strategic workforce 

management. 

At the FY 2020 funding level, TTB expects to meet its 75-day standard for 85 percent of permit 

applications through targeted industry education efforts and continued enhancements to Permits 

Online. Additionally, TTB intends to continue its modernization of its qualification 

requirements, informed by public comment, to streamline TTB’s permit applications and further 

reduce burdens related to the filing process. These changes, combined with incremental 

enhancements to TTB’s permitting system, will support TTB in reaching and sustaining its 

current service standard. At the FY 2020 funding level, TTB would postpone custom system 

development efforts and reassess the timeline for its long-term goal of reducing service times to 

60 days or less across alcohol application types. 

According to its measure of the Percent of Electronically Filed Permit Applications, which tracks 

the electronic filing rate for new business applications, TTB received approximately 87 percent 

of permit applications via Permits Online in FY 2018. This year-to-year increase is attributed to 

its regular outreach to direct applicants to the online filing system. TTB expects this trend to 

continue following the July 2018 release of the redesigned Permits Online system. The 

redesigned system includes improved guidance for first-time filers to reduce errors on 

applications that delay processing times as well as a simplified method for amending an existing 

permit that replaces the current paper-based process. These system changes, combined with 

effective outreach and training for industry, will support TTB in achieving and maintaining its 

targeted electronic filing rate of 90 percent in fiscal years 2019 and 2020. 

Given the new system features, TTB expects Customer Satisfaction Rates with eGov Systems to 

increase for Permits Online in the years ahead following a transition period for TTB and 

industry. In FY 2018, TTB discontinued its measure of the Customer Satisfaction Rate with 

TTB’s Permitting Process and replaced it with a new measure oriented toward satisfaction with 

its online permitting system. The vast majority of permit applicants file electronically, and TTB 

is focused on ensuring the system supports them in filing complete, accurate applications to 

improve its service levels. 
TTB - 18 

The Permits Online enhancements should also contribute to improved outcomes for TTB’s 

measure of the Initial Error Rate on Permit Applications, which tracks how many applications 

are submitted either incomplete or with errors. This measure is critical to timely processing, as 

the error rate significantly influences total approval time given the necessary back-and-forth with 

applicants to obtain additional documentation or complete information. In FY 2018, the error 

rate trended positively, with 80 percent of original permit applications submitted with errors

compared to 83 percent in the prior year. This rate is well above the target of 25 percent, 

however, and reflects the need for improved guidance and system validations to ensure 

applicants are able to submit correctly the first time. Following the FY 2018 system release, 

TTB expects to draw closer to its target in the year ahead, although current system limitations 

limit TTB’s ability to deploy more advanced features to support applicants in accurate and 

complete filings. Broader changes to streamline permit application requirements, most of which 

will require rulemaking to fully implement, are underway and may also be required before TTB 

can achieve its targeted performance level. 

Improve Efficiency and Effectiveness of Alcohol Beverage Label Processing

TTB protects U.S. consumers by ensuring that the alcohol beverage products sold at retail outlets 

are properly labeled and comply with Federal production standards. In FY 2018, TTB received 

nearly 195,000 Certificate of Label Approval (COLA) applications and 17,000 formula 

applications, which reflect historically high submission rates and indicate the ongoing expansion 

of the alcohol beverage industry. Given the importance of timely TTB approvals and the 

negative impact that delays have on U.S. businesses, TTB monitors its ability to provide timely 

and consistent service through its measure of the Percentage of Alcohol Beverage Label and 

Formula Applications Processed within Service Standards. TTB combines label and formula 

applications in this measure given the interdependent nature of these approvals. 

In FY 2018, TTB continued to progress toward its strategic goal to modernize its labeling 

program, making significant strides in maintaining timely service in spite of tremendous year-toyear increases in submission volume, which reached 15 percent or more for both label and 

formula applications. Based on these increases, TTB revised its service standards for labels and 

formulas from 10 days to 15 days in FY 2018. 

Through effectively managing its backlog and strategic workforce management, relying on 

additional staffing resources hired using directed funding to accelerate these approvals, TTB was 

able to respond to these challenges and sustain average processing times at or below its service 

standards, and maintained a total average review time of 30 days or less for products requiring 

lab analysis, formula approval, and label approval. Further, in terms of consistent service, TTB 

met or nearly met its target to process 85 percent of label and formula applications within the 15-

day standard, with 91 percent of formulas and 84 percent of labels turned around in 15 days or 

less. 

In the year ahead, TTB will focus its efforts on increasing voluntary compliance through 

initiatives to reduce label and formula application errors. Application errors are a key driver of 

processing times, as additional review is required for each resubmitted application. Results for 

its measure of the Initial Error Rate for Label and Formula Applications indicate that these 
TTB - 19 

updates are having a positive effect in reducing label error rates, with errors holding below 40 

percent for the first time in the second half of FY 2018. 

In FY 2020, TTB will continue to make iterative enhancements to COLAs Online and Formulas 

Online, informed by user testing and feedback, which will include additional help features and 

system-based validations to reduce application errors. According to its measure of the Percent of 

Electronically Filed Label and Formula Applications, TTB receives 98 percent of applications 

via COLAs Online and Formulas, indicating that continued focus on system validations is 

warranted and will support performance goals in increasing accurate applications and 

accelerating approval times. TTB expects that these ongoing improvements will help TTB 

continue to attract users to its online systems and maintain a submission rate above its 95 

percent target in FY 2020. 

Efforts to drive down error rates also include enhancing information on TTB.gov related to 

obtaining label and formula approval for alcohol beverage products. In FY 2018, in response to 

industry input, TTB published formula guidance with specific example applications and 

supporting documentation to clarify the requirements. TTB also released an updated web-based 

tool to assist malt beverage producers and importers in determining whether their products 

require formula approval, with the aim of bringing down filings for products that no longer 

require advance TTB approval. Additional step-by-step guidance to support industry in checking 

label and formula compliance prior to submitting applications is planned for FY 2019. 

In addition, TTB will continue its efforts to improve industry guidance through updated labeling 

regulations. In FY 2018, TTB made substantial progress on its multi-year effort to modernize 

Federal labeling regulations by consolidating, streamlining, and simplifying requirements to 

reflect current TTB policy and modern industry practices. The notice of proposed rulemaking, 

published in November 2018, also reflects proposals that are designed to reduce regulatory 

burden. 
TTB - 20

C – Changes in Performance Measures

TTB continues its work to develop and baseline performance measures to align to the new 

strategic objectives in the Treasury and TTB Strategic Plans for FY 2018-2022. This could 

result in additional changes to performance measures included in the FY 2020 budget.

Performance Measure or 

Indicator Change and Justification

1. Amount of Revenue Collected 

Per Program Dollar

(Discontinue)

TTB proposes to discontinue this measure in the CJ/BIB 

and instead report on its return on investment for its 

Collect the Revenue budget activity as an indicator, 

whereby TTB no longer establishes an annual target 

given the significant influence of external factors on the 

overall result.

2. Percent of Voluntary 

Compliance from Large 

Taxpayers in Filing 

Returns/Payments Timely (by 

filing) (Discontinue)

TTB proposes to discontinue this measure in the CJ/BIB 

and replace it with measures that report voluntary 

compliance rates by taxpayer rather than by filing. TTB 

also proposes adding a measure for the voluntary 

compliance rates for operational reports, a required 

companion filing to support tax return validation and 

verification. The new methodologies, in development in 

FY 2019, will inform targeted outreach and enforcement 

strategies.

3. Percent of Voluntary 

Compliance from Large 

Taxpayers in Filing Tax 

Returns/Payments Timely (by 

taxpayer) (New)

Percent of Voluntary Compliance from Large Taxpayers 

in Filing Returns/Payments Timely is defined as the total 

number of taxpayers with annual liabilities of $50,000 or 

greater who filed their semi-monthly tax return and 

payment on time divided by the total number of large 

taxpayers. The data source for this measure is the TTB 

Integrated Revenue Information System (IRIS). This 

measure provides actionable information to address late 

or missing returns and payments and supports effective 

outreach and enforcement strategies.

4. Percent of Voluntary 

Compliance from Large 

Taxpayers in Filing 

Operational Reports Timely 

(by taxpayer) (New)

Percent of Voluntary Compliance from Large Taxpayers 

in Filing Operational Reports Timely is defined as the 

total number of taxpayers with annual liabilities of 

$50,000 or greater who filed their monthly operational 

report on time divided by the total number of large 

taxpayers. The data source for this measure is the TTB 

Integrated Revenue Information System (IRIS). This 

measure provides actionable information to address late 
TTB - 21 

or missing reports and supports effective outreach and 

enforcement strategies.

5. Percent of Electronically Filed

Tax Returns - Pay.gov (New)

Percent of electronically filed tax returns is defined as 

the number of tax returns submitted via Pay.gov divided 

by the total number of tax returns filed. The data source 

for this measure is Pay.gov. This measure provides 

information on taxpayer use of the current online tax 

filing system and informs TTB initiatives to increase 

electronic submissions, including custom system 

development efforts. 

6. Percent of Electronically Filed

Operational Reports - Pay.gov

(New)

Percent of electronically filed operational reports is 

defined as the number of operational reports submitted 

via Pay.gov divided by the total number of operational 

reports filed. The data source for this measure is 

Pay.gov. This measure provides information on 

taxpayer use of the current online tax filing system and 

informs TTB initiatives to increase electronic 

submissions, including custom system development 

efforts.

7. Customer Satisfaction Rate

with TTB Permitting Process

(Discontinue)

TTB proposes to discontinue this metric in the CJ/BIB 

and replace it with a focused measure on customer 

satisfaction with Permits Online (see below). The 

majority of TTB permit applicants are serviced through 

this online filing system and, going forward, TTB will 

emphasize online guidance and enhanced system 

features to achieve its targets for timely service to 

prospective businesses seeking a TTB permit. 

8. Customer Satisfaction Rate

with eGov Systems – Permits

Online (New)

Customer satisfaction rate for Permits Online is defined 

as the total percentage of system users who responded 

that they are very satisfied or satisfied with TTB’s online 

permit application process. User data is derived from the 

Permits Online system, and satisfaction scores are 

collected through an email survey to system users with 

activity within the reporting period. This measure 

provides information on the areas of relative 

dissatisfaction with the permit application process and 

informs system enhancements to improve the 

completeness and accuracy of applications to support 

timely service. 
TTB - 22 

9. Customer Satisfaction Rate

with eGov Systems – COLAs

Online (New)

Customer satisfaction rate for COLAs Online is defined 

as the total percentage of system users who responded 

that they are very satisfied or satisfied with TTB’s online 

label application process. User data is derived from the 

COLAs Online system and satisfaction scores are 

collected through an email survey to system users with 

activity within the reporting period. This measure 

provides information on the areas of relative 

dissatisfaction with the label application process and 

informs system enhancements to improve the 

completeness and accuracy of applications to support 

timely service. 

10. Customer Satisfaction Rate

with eGov Systems - Formulas

Online (New)

Customer satisfaction rate for Formulas Online is 

defined as the total percentage of system users who 

responded that they are very satisfied or satisfied with 

TTB’s online formula application process. User data is 

derived from the Formulas Online system and 

satisfaction scores are collected through an email survey

to system users with activity within the reporting period. 

This measure provides information on the areas of 

relative dissatisfaction with the formula application 

process and informs system enhancements to improve 

the completeness and accuracy of applications to support 

timely service. 

Section III – Additional Information

A – Summary of Capital Investments

Information Technology 

TTB’s Strategic Plan establishes the vision and objectives for the bureau in the business context. 

TTB’s Information Technology (IT) Strategic Plan is a five-year plan based on its business 

strategy, which includes the bureau’s mission, vision, goals, and objectives from an IT 

perspective. This plan charts the course the bureau will follow in the coming years to develop 

and implement IT solutions that are aimed at streamlining the collection of data, leveraging web 

technologies, and continuing to make the internet the method of choice for the reporting and 

exchanging of information between businesses and TTB. By aligning business and technical 

strategy, TTB is able to leverage technology to enable the bureau to meet its objectives in the 

most efficient and cost-effective manner while identifying ways to minimize system redundancy. 
TTB - 23 

TTB has no major IT investments based on the OMB and the Department of Treasury criteria. 

Several non-major investments, however, directly support the mission, strategy, and day-to-day 

operations of the bureau. These include:

TTB Tax System: This investment consists of several component applications that ensure fair 

and proper collection of revenue from the industry members for alcohol, tobacco, firearms, and 

ammunition excise taxes and to ensure compliance with the excise tax regulations.

TTB Regulatory System: This investment includes applications that streamline the beverage 

and nonbeverage alcohol formula approval process and COLA issuance for tax and regulatory 

compliance.

TTB General Support Services: This investment provides TTB users with the infrastructure 

applications necessary to conduct daily business. 

TTB Enterprise Architecture: This investment supports strategic management of IT operations 

(e.g., business process redesign efforts not part of an individual investment, enterprise 

architecture development, capital planning and investment control processes, procurement 

management, and IT policy development and implementation) and costs for Chief Information 

Officer functions.

In addition to leveraging IT to support the mission, strategy, and day-to-day operations of the 

bureau, TTB supports and maintains strategy alignment with OMB and Treasury through 

enterprise-wide IT initiatives. These include: Cyber Security; IT Infrastructure; Electronic 

Identity and Access Management (HSPD-12); Enterprise-wide Contracts and Services; and 

Program Metrics and Milestones.

Scientific Equipment for Laboratories

This investment will enable TTB’s chemists to continue to provide accurate and reproducible 

scientific data and laboratory results to support regulatory compliance, tax enforcement, tax 

classification, rulemaking, and investigations for both the alcohol and tobacco commodities. 

Laboratory instruments require periodic replacement, as they have finite lifecycles due to use and 

as advances in scientific technology render older instruments obsolete. Periodic replacement of 

the existing technologies is essential for TTB laboratories to remain state-of-the-art and effective 

to support the bureau’s mission, strategy, and day-to-day operations. 

A summary of capital investment resources, including major information technology and nontechnology investments can be found at: 

http://www.treasury.gov/about/budget-performance/Pages/summary-of-capital-investments.aspx

This website also contains a digital copy of this document.



Department of the Treasury 

Bureau of the Fiscal Service 

Congressional Budget 

Justification and Annual 

Performance Report and Plan 

FY 2020 
Fiscal Service - 2 

Table of Contents

Section I – Budget Request........................................................................................................... 3

A – Mission Statement................................................................................................................ 3

B – Summary of the Request ...................................................................................................... 3

1.1 – Appropriations Detail Table .............................................................................................. 4

1.2 – Budget Adjustments Table ................................................................................................. 5

C – Budget Increases and Decreases Description....................................................................... 5

1.3 – Operating Levels Table...................................................................................................... 7

D – Appropriations Language and Explanation of Changes ...................................................... 8

1.4 – Permanent, Indefinite Appropriations Table ...................................................................... 9

E – Legislative Proposals............................................................................................................ 9

Section II – Annual Performance Report and Plan................................................................. 12

A – Strategic Alignment ........................................................................................................... 12

B – Budget and Performance by Budget Activity .................................................................... 17

2.1.1 – Accounting and Reporting Resources and Measures .................................................... 17

2.1.2 – Collections Resources and Measures............................................................................ 18

2.1.3 – Payments Resources and Measures .............................................................................. 20

2.1.4 – Retail Securities Services Resources and Measures..................................................... 23

2.1.5 – Wholesale Securities Services Resources and Measures.............................................. 24

2.1.6 – Debt Collection Resources and Measures..................................................................... 25

C – Changes in Performance Measures.................................................................................... 27

Section III – Additional Information ........................................................................................ 28

A – Summary of Capital Investments....................................................................................... 28
Fiscal Service - 3

Section I – Budget Request

A – Mission Statement

Promote the financial integrity and operational efficiency of the Department of the Treasury 

operations supporting Federal Government programs and activities through exceptional 

accounting, financing, collections, payments, and shared services.

B – Summary of the Request

The FY 2020 request for the Bureau of the Fiscal Service (Fiscal Service) is $340.3 million, 

which supports the Federal Government’s National Financial Critical Infrastructure (NFCI). 

Fiscal Service is committed to delivering strong leadership, exceptional operations, and a vision 

focused on transforming government-wide financial management and acting as the catalyst of 

change for the Federal financial community by offering increased standardization and 

automation in Treasury financial services.

Fiscal Service touches the lives of every American taxpayer and plays a critical mission support 

role in the Federal financial management community. We will continue to optimize Federal 

disbursing by advancing electronic invoicing and increasing electronic payments; transform 

Federal collections through oversight of reducing the use of lockboxes; strengthen public trust in 

Federal Government finances by making Federal financial data more accessible; and expand 

services available to agencies including offering data analytic services to reduce improper 

payments and fraud.

In addition, Fiscal Service’s FY 2020 budget request aligns with the President’s Management 

Agenda’s (PMA) three key transformation drivers: 

1. IT modernization efforts critical to securing data and transforming business processes

2. Data accountability & transparency development 

3. Workforce investments to ensure we have the right people in the right place with the right 

skills as we engage in transformation efforts

With this funding, Fiscal Service will focus on:

• Maximizing efficiencies, transparency, and accountability with the goal of improving 

government-wide financial management; 

• Revolutionizing the Federal Government’s collections and deposit systems by expanding the 

Electronic Federal Tax Payment System (EFTPS) and other electronic payment options 

available to Federal agencies and the public; 

• Modernizing and enhancing payment services by further centralizing Federal payment 

services to Federal agencies and increasing payment options available to beneficiaries, 

taxpayers, and other payees; 

• Expanding investors’ ability to buy and manage Treasury securities online by improving 

systems and customers’ ability to quickly and easily obtain on-line self-service options;

• Borrowing the money needed to operate the Federal Government by conducting auctions; 

and 

• Furthering progress in efforts to prevent, detect, and recover improper payments by 

increasing partnerships and making additional data sources available.
Fiscal Service - 4 

Fiscal Service continues to work with the Federal financial community, which includes the 

Office of Management and Budget (OMB) and Federal agency Chief Financial Officers (CFOs), 

to identify improvements to core programs and streamline operations government-wide. The 

bureau’s vision to “Transform financial management and the delivery of shared services in the 

Federal Government” and the commitment to deliver strong leadership and exceptional 

operations align with Treasury’s Strategic Goal 4 (Transform Government-wide Financial 

Stewardship) and Goal 5 (Achieve Operational Excellence). It is also consistent with Cross 

Agency Priority (CAP) Goal 5, Sharing Quality Services. As part of the 10-Year Future of 

Federal Financial Management Vision, Fiscal Service is leading the way in the Federal financial 

community by: 

• Consolidating similar functions

• Standardizing access to systems and financial management functions

• Automating appropriate manual processes

Fiscal Service has critical roles in making sure Federal obligations to the public are met, 

government-wide and agency operations are supported, and the national economy is sustained. 

Through these roles, Fiscal Service demonstrates high performance and achieves outcomes and 

results that include:

• Accounting and reporting financial activity for $22.0 trillion in public debt

• Financing Federal operations by collecting nearly $4.2 trillion in annual revenue

• Securely and timely disbursing 1.2 billion Federal payments, totaling nearly $3.5 trillion,

with 95.4 percent delivered electronically

• Making available $10.0 trillion to fund critical daily Federal Government operations by

conducting 270 auctions

• Improving the USAspending.gov website by timely addressing user feedback to enhance the

customer experience

1.1 – Appropriations Detail Table

* FY 2018 shows actual FTE usage. This column reflects levels appropriated in P.L. 115-141 Consolidated Appropriations Act, 2018.

For further details on the execution of these resources see the FY 2020 Appendix chapter for the Department of the Treasury.

Dollars in Thousands

Fiscal Service

Appropriated Resources

New Appropriated Resources FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

Accounting and Reporting 398 95,822 411 95,175 396 96,979 (15) 1,804 -3.65% 1.90%

Collections 159 38,704 172 42,166 165 38,117 (7) (4,049) -4.07% -9.60%

Payments 502 121,462 519 117,581 500 123,355 (19) 5,774 -3.66% 4.91%

Retail Securities Services 433 57,356 447 59,381 430 60,643 (17) 1,262 -3.80% 2.13%

Wholesale Securities Services 116 24,936 119 23,977 119 21,243 0 (2,734) 0.00% -11.40%

Subtotal New Appropriated Resources 1,608 $338,280 1,668 $338,280 1,610 $340,337 (58) $2,057 -3.48% 0.61%

Other Resources

Reimbursable /Offsetting Collections 399 353,761 431 387,568 431 391,529 0 3,961 0.00% 1.02%

Subtotal Other Resources 399 $353,761 431 $387,568 431 $391,529 0 $3,961 0.00% 1.02%

Total Budgetary Resources 2,007 $692,041 2,099 $725,848 2,041 $731,866 (58) $6,018 -2.76% 0.83%

FY 2019 to FY 2020

Change % Change

FY 2018

Enacted*

FY 2019

Annualized CR

FY 2020

Request
Fiscal Service - 5

1.2 – Budget Adjustments Table

Dollars in Thousands

Fiscal Service FTE Amount

FY 2019 Annualized CR 1,668 $338,280 

Changes to Base:

Maintaining Current Levels (MCLs): 0 2,239 

Non-Pay 0 2,239 

Subtotal Changes to Base 0 2,239 

Total FY 2020 Base 1,668 $340,519 

Program Changes

 Program Decreases: (58) (7,915)

 Streamline Staffing (58) (7,915)

 Program Increases: 0 7,733 

 Operations and Maintenance (O&M) of Prior-year

 Enterprise-wide Cybersecurity Investments 0 2,960 

 Cybersecurity Enhancements 0 2,367 

 Enterprise Cloud Strategy 0 2,406 

Subtotal Program Changes (58) ($182)

Total FY 2020 Request 1610 $340,337

C – Budget Increases and Decreases Description

Maintaining Current Levels (MCLs) ...................................................... +$2,239,000 / +0 FTE 

Non-Pay +$2,239,000 / +0 FTE 

Funds are requested for inflationary adjustments to non-labor costs such as travel, contracts, rent, 

supplies, and equipment.

Program Decreases................................................................-$7,915,000 / -58 FTE

Streamline Staffing -$7,915,000 / -58 FTE

Anticipated savings as a result of disciplined hiring prioritization and governance.

Program Increases ..................................................................................... +$7,733,000 / +0 FTE

Operations and Maintenance (O&M) of Prior-year Enterprise-wide Cybersecurity Investments

+$2,960,000 / +0 FTE 

This request includes funding to support O&M for prior-year Cybersecurity Enhancement 

Account investments, primarily related to the Continuous Diagnostics and Mitigation Program 

(CDM). O&M will be funded by Treasury Bureaus through Treasury Franchise Fund billing. 

This increase represents the Fiscal Service portion of the $17.5 million O&M total.

Cybersecurity Enhancements +$2,367,000 / +0 FTE 

This funding will enable the bureau to continue strengthening the Fiscal Service High Value 

Assets (HVAs) and National Financial Critical Infrastructure (NFCI) posture. Further delays 

implementing cybersecurity enhancements, such as data centric security measures, personally 

identifiable information (PII) and sensitive financial records encryption, and delays increasing 

the use of multi-factor authentication, and event monitoring, will significantly increase the risk to 
Fiscal Service - 6 

Treasury’s HVAs. More specifically, this funding will allow Fiscal Service to perform six HVA 

assessments and begin to remediate identified data encryption gaps. 

Enterprise Cloud Strategy +$2,406,000 / +0 FTE 

This request will support the start of a phased approach to transition NFCI systems currently 

hosted and developed with outdated technology that result in increased risk of security incidents 

and service interruptions, to new, more modern, cloud-based solutions that will support the 

security, resiliency, and agility needed in the 21st century. This strategy aligns with 

government-wide goals and objectives to increase utilization of cloud-based solutions and microservice/shared IT functionality, while also furthering efforts to consolidate similar functions and 

standardize access to systems and financial management functions. This effort is crucial to 

ensuring the integrity of the Federal Government's financial systems for the future. 
Fiscal Service - 7 

1.3 – Operating Levels Table

Dollars in Thousands

Note: FY 2018 shows actual FTE usage. This column reflects levels appropriated in P.L. 115-141 Consolidated Appropriations Act, 

2018. For further details on the execution of these resources see the FY 2020 Appendix chapter for the Department of the Treasury.

 

Fiscal Service

Object Classification

FY 2018

Enacted

FY 2019

Annualized CR

FY 2020

Request

11.1 - Full-time permanent 148,909 148,908 143,228

11.3 - Other than full-time permanent 339 557 350

11.5 - Other personnel compensation 4,806 6,225 5,330

11.8 - Special personal services payments 0 23,879 24,333

11.9 - Personnel Compensation (Total) 154,054 179,569 173,241

12.0 - Personnel benefits 52,428 53,346 51,834

13.0 - Benefits for former personnel 598 175 100

Total Personnel and Compensation Benefits $207,080 $233,090 $225,175

21.0 - Travel and transportation of persons 2,233 2,445 3,185

22.0 - Transportation of things 133 118 770

23.1 - Rental payments to GSA 21,143 21,505 21,049

23.2 - Rental payments to others 16 6 19

23.3 - Communications, utilities, and miscellaneous charges 13,151 12,996 9,811

24.0 - Printing and reproduction 107 139 128

25.1 - Advisory and assistance services 16,218 16,078 23,765

25.2 - Other services from non-Federal sources 13,839 11,402 13,817

25.3 - Other goods and services from Federal sources 48,115 21,202 31,572

25.4 - Operation and maintenance of facilities 2,200 858 129

25.6 - Medical care 0 0 13

25.7 - Operation and maintenance of equipment 7,000 7,439 4,110

26.0 - Supplies and materials 4,743 4,012 3,760

31.0 - Equipment 2,232 6,956 3,016

32.0 - Land and structures 70 34 19

Total Non-Personnel $131,200 $105,190 $115,162

New Budgetary Resources $338,280 $338,280 $340,337

FTE 1,608 1,668 1,610

 
Fiscal Service - 8

D – Appropriations Language and Explanation of Changes

Appropriations Language

Explanation of 

Changes

DEPARTMENT OF THE TREASURY

BUREAU OF THE FISCAL SERVICE

Federal Funds

SALARIES AND EXPENSES

For necessary expenses of operations of the Bureau of the Fiscal Service, 

$340,337,000; of which not to exceed $8,000,000, to remain available 

until September 30, 2022, is for information systems modernization 

initiatives; and of which $5,000 shall be available for official reception 

and representation expenses. 

In addition, $165,000, to be derived from the Oil Spill Liability Trust 

Fund to reimburse administrative and personnel expenses for financial 

management of the Fund, as authorized by section 1012 of Public Law 

101–380. 

Note.—A full-year 2019 appropriation for this account was not enacted at 

the time the budget was prepared; therefore, the budget assumes this 

account is operating under the Continuing Appropriations Act, 2019

(Division C of P.L. 115-245, as amended). The amounts included for 

2019 reflect the annualized level provided by the continuing resolution.

Increasing the 

amount of multiyear funding 

provides

additional 

flexibility to 

allocate available 

funding to longer 

term IT 

investments 

and/or security 

initiatives lasting 

multiple years, 

funding them 

through 

completion.

Federal Reserve Bank Permanent, Indefinite Appropriation

The Federal Reserve Banks (FRBs) act as fiscal agents of the United States when directed by the 

Secretary of the Treasury in accordance with 12 United States Code (U.S.C.) 391. Under this 

account, the FRBs support fiscal operations unrelated to the administration of the public debt and 

provide banking and financial services on behalf of the United States Treasury. Specifically, this 

account supports the accounting and reporting, collections, payments, and debt collection

programs. These, and other programs, are vital to the NFCI, Fiscal Service’s strategic goals, and 

the expansion of e-government efforts to reduce costs, improve accuracy and increase options 

available to citizens to conduct transactions with the Federal Government. Fiscal Service 

estimates that the cost of FRB services for FY 2020 will be approximately $622.8 million.

Reimbursements to the Federal Reserve Banks

Public Law (P.L.) 101-509, 104 Stat. 1389, 1394 (1990), established a permanent, indefinite 

appropriation to pay such sums as necessary to reimburse the FRBs for acting as fiscal agents. 

This account was further defined in FY 1992 to solely support those activities related to the 

administration of the public debt. Funding for FY 2020 is estimated at $170.6 million. 
Fiscal Service - 9 

Financial Agent Services Permanent, Indefinite Appropriation

Congress has given the Secretary of the Treasury authority to deposit money in financial 

institutions and obtain banking services by designating financial institutions to act/serve as 

Financial Agents (FAs) of the United States. The services support many Fiscal Service 

programs, such as accounting and reporting, collections, payments, and debt collection. The 

services provided by the FAs are authorized under numerous statutes including, but not limited 

to, 12 U.S.C. 90 and 265. 

Fiscal Service estimates that the cost of FA services for FY 2020 will be approximately 

$848.4 million, which includes $1.3 million for Government Sponsored Enterprise - Mortgage 

Backed Securities administrative costs.

Government Losses in Shipment

P. L. 103-329 established a permanent, indefinite appropriation to pay such sums as necessary to

make payments for the replacement of valuables, or the value thereof, lost, destroyed, or

damaged in the course of United States Government shipments. The Government Losses in

Shipment Act (the Act) was enacted July 8, 1937 to dispense with the necessity for insurance by

the government against loss or damage to valuables in shipment and for other purposes. The Act

was amended in 1943 to cover losses resulting from the redemption of savings bonds (for

example, stolen bonds that were fraudulently negotiated even though the paying agent followed

identification guidelines established by the Treasury). All authority of the Treasury under the

Act has been delegated to the Fiscal Service Commissioner. In FY 2020, the funding estimated

to support payments for the replacement of valuables is approximately $3.0 million.

1.4 – Permanent, Indefinite Appropriations Table

E – Legislative Proposals 

1. Give the Do Not Pay Business Center (DNP) increased authority to expand its user base

to include other Federally funded government entities, such as Federally funded state

administered programs. Estimated savings: $2.1 billion over 1 year

This proposal would give the Secretary of the Treasury (Secretary), in coordination with

OMB, the authority to work with other federally funded government entities, such as

Federally funded state administered programs, to identify, prevent, and recover their

improper payments. Such authority would permit the Secretary to work with OMB to select

Dollars in Thousands

Permanent, Indefinite Appropriation FY 2018 

Enacted

FY 2019

 Enacted

FY 2020 

Request

Federal Reserve Bank 1 $585,800 $615,169 $622,786

Reimbursements to the Federal Reserve Banks $149,480 $167,270 $170,615

Financial Agent Services 1, 2 $840,977 $831,800 $848,400

Government Losses in Shipment $1,200 $2,534 $2,983

1

 Approximately $77M is reimbursed from other government agencies and deposited into the 

General Fund each year.

2

 FY 2018 includes $2M and FY 2019 and FY 2020 include $1.3M per year for the Government 

Sponsored Enterprise - Mortgage Backed Securities administrative costs.
Fiscal Service - 10 

customers DNP determines it can successfully assist in preventing and reducing improper 

payments. 

2. Expand Treasury's authority to access the National Directory of New Hires to include

prevention, identification, and recovery of improper payments. Total increase in

improper payments identified by Treasury: $3.19 billion over 10 years (98.3 percent of the

improper payments estimated)

This proposal seeks an expansion of Treasury's authority to access the National Directory of

New Hires (NDNH) to help prevent, identify and recover improper payments. The Social

Security Act specifies which agencies may receive information from the database and the

limited purposes for which disclosures are permitted. Under the current law, the Secretary of

the Treasury has access to information in the NDNH for debt collection purposes. This

proposal would expand the Secretary's access to information in the NDNH to include the

purposes of preventing, identifying, and recovering improper payments for Federal agencies.

Such access would permit the Secretary to assist paying agencies that are currently

authorized by the Social Security Act to access NDNH, in comparing information from the

NDNH with data about persons receiving federal payments and identify individuals who are

ineligible to receive payments or who are receiving erroneous payments.

3. Allow Treasury to access the Death Master File for improper payment purposes. Total

increase in improper payments identified by Treasury: $49.5 million over 10 years (99.4

percent of improper payments estimated)

This proposal would authorize the Secretary to access the full file of death information that

the Social Security Administration maintains, which includes State-reported death data, for

purposes of administering the Do Not Pay Business Center and preventing, identifying, and

recovering improper payments for Federal agencies. Such access would permit the Secretary

to assist paying agencies in comparing information from the Full Death Master File with data

about persons receiving Federal payments and identify individuals who are ineligible to

receive payments or who are receiving erroneous payments.

4. Increase delinquent Federal non-tax debt collections by authorizing administrative

bank garnishment for non-tax debts of commercial entities. Estimated collections:

$320.0 million in commercial debts over 10 years

This proposal would allow Federal agencies to collect delinquent, non-tax debt by garnishing

the bank and other financial institution accounts of delinquent commercial debtors without a

court order, but only after providing full administrative due process. The legislation would

include appropriate limitations, such as a limitation on the amount that could be garnished on

a one-time basis, and would also provide for meaningful judicial review. It would direct the

Secretary of the Treasury to issue government-wide regulations implementing the new

garnishment authority.
Fiscal Service - 11 

Bank garnishment rules under this authority would be subject to Treasury’s rule (31 CFR 

212) protecting exempt benefit payments from garnishment. To reach income of commercial

entities and other non-wage income and funds available to commercial debtors owing

delinquent non-tax obligations to the United States, this proposal would authorize agencies to

issue garnishment orders to financial institutions without a court order. Agencies would be

required to provide debtors with appropriate due process and other protections to ensure that

debtors have had the opportunity to contest the debts and/or enter into repayment agreements

to avoid issuance of an order. The Internal Revenue Service currently has similar authority to

collect Federal tax debts.

5. Increase and streamline recovery of unclaimed assets owed to the United States by

authorizing Treasury to locate and recover assets of the United States and to retain a

portion of amounts collected to pay for the costs of recovery. Estimated recoveries:

$62 million over 10 years

The proposal would amend 31 U.S.C. § 3711 to authorize Treasury to use its resources to

recover unclaimed assets of the United States. States and other entities hold assets in the

name of the United States or in the name of departments, agencies and other subdivisions of

the Federal Government. Many agencies are not recovering these assets due to a lack of

expertise and funding. Under current authority, Treasury collects delinquent debts owed to

the United States and retains a portion of collections, which is the sole source of funding for

its debt collection operations. While unclaimed Federal assets are generally not considered

to be delinquent debts, Treasury’s debt collection operations personnel have the skills and

training to recover these assets.
Fiscal Service - 12

Section II – Annual Performance Report and Plan

A – Strategic Alignment

Everything Fiscal Service does aligns to Treasury’s Strategic Goal 4: Transform Governmentwide Financial Stewardship and Goal 5: Achieve Operational Excellence and directly supports 

the bureau’s strategic goals:

• Goal 1 - Operational Excellence: Maintain agile, efficient, and resilient programs to meet the 

financial management needs of the Federal Government

• Goal 2 - Innovation and Customer Experience: Deliver innovative financial management 

solutions that provide a modern, seamless customer experience

• Goal 3 - Our Workforce: Develop, retain, and empower the best and brightest talent to 

support Federal financial management

• Goal 4 - Data Integrity and Transparency: Increase transparency and public trust in Federal 

financial management data

• Goal 5 - Financial Management and Community: Provide the financial management 

community the financial tools and capabilities so they can further support their agencies’ 

missions

Fiscal Service fulfills its mission and vision through five annually appropriated budget activities 

(Accounting and Reporting, Collections, Payments, Retail Securities Services, and Wholesale 

Securities Services) and one mandatory budget activity (Debt Collection) funded through 

delinquent debt collection revenue. These budget activities align to two Treasury Strategic 

Goals: Transform Government-wide Financial Stewardship and Achieve Operational Excellence

as well as four CAP Goals: Data, Accountability and Transparency; Improving Customer 

Service; Sharing Quality Services; and Getting Payments Right. More specifically, Fiscal 

Service supports the following Treasury Strategic Goals and Objectives:

Treasury Strategic Goal 4: Transform Government-wide Financial Stewardship

4.1 – Financial Data Access/Use: Strengthen government-wide decision-making and 

accountability by increasing access to and use of government financial data. 

Accounting and Reporting:

• Enterprise Data Strategy: In FY 2018, Fiscal Service established goals and objectives for 

the next 5 years, including increasing the “value and availability of our Federal financial data 

to advance sound decision-making and insights.” The Fiscal Service enterprise data strategy

communicates a path to change the organization’s perception of data from a transactional 

resource to data as a strategic asset for decision-making and insights, both internally and 

externally. This strategy will be aligned to CAP Goal 2, Data, Accountability, and 

Transparency.

To handle these requests, Fiscal Service developed and will execute an overall data strategy 

for Fiscal Service’s financial management data. The plan will advance the adoption of 

Federal financial data standards within the established inter-governmental governance 

structure, promote consistent data for decision-making, and build upon and leverage 

successes from the DATA Act implementation process. The data strategy will promote 

collaboration across reporting systems, reduce duplication, help build common and shared 
Fiscal Service - 13 

solutions, improve data quality, and result in an increased focus on data analytics to make 

data more useful and consumable. 

• General Fund Audit: Fiscal Service will pursue a clean audit opinion on the Financial Report

of the U.S. Government (FR) by fully implementing the remediation plan. Key among these

remediation efforts is attaining auditability of the General Fund of the United States

Government. Achieving a clean audit opinion will increase confidence and reliance on

government-wide financial management data and improve stewardship of taxpayer resources.

In FY 2018, Fiscal Service worked towards the inaugural audit and identified key issues that

are impairing auditability. Progress in reducing intragovernmental differences continues

with a decrease of $161.0 trillion since 2014.

Additionally, through collaboration with the Government Accountability Office, OMB, and

the Federal agency CFOs, Fiscal Service will pursue a more useful FR with a centralized,

risk-based audit approach that will improve overall operational efficiency and reduce agency

audit burden across government.

• G-Invoicing Initiative: Fiscal Service is working to improve the quality and reliability of

Intragovernmental (IGT) buy/sell data through electronic government invoicing (Ginvoicing). This initiative will allow agencies to pay other agencies within the Federal

Government for services performed on their behalf electronically, rather than the current

manual, paper method. In FY 2018, G-Invoicing updates were implemented to support

enhancements to enable government-wide on-boarding for interagency agreements. In

addition, the Treasury Financial Manual was published in September 2018 mandating the use

of G-Invoicing for intragovernmental buy/sell transactions by June 30, 2021. A mandated

timeline was developed and documented to ensure successful government-wide

implementation. Fiscal Service will continue to work with the agency financial and

acquisition communities to be sure that G-Invoicing meets the business needs of both

communities.

Payments: 

• Analytics Expansion: The Do Not Pay Business Center (DNP) and the Payment Integrity

Center of Excellence (Center of Excellence) can play a significant role in helping agencies

address the government-wide problem of improper payments that result in monetary loss –

estimated at $60.0 billion in FY 2018. This effort will directly support CAP Goal 9, Getting

Payments Right. While DNP cannot address all of the root causes that contribute to improper

payments, it can do significantly more in two major ways. First, by expanding analytics

services, product offerings, and data sources to agency customers, DNP and the Center of

Excellence can help agencies detect and prevent a broader range and increased amount of

improper payments. Second, the expansion allows the bureau to increase the impact it has in

strengthening the integrity of Federal payments through the payment integrity program.

The Center of Excellence will work toward the overarching goal to improve the integrity of

Government-wide financial transactions. This will be done by providing business insight and

solutions that assist government agencies in identifying, preventing, and recovering improper

payments. This Center of Excellence, through a matrixed organizational model led by Fiscal
Fiscal Service - 14

Service, will build on the existing foundation to put the overarching goal first, while allowing 

the individual programs to continue with their missions. The Center of Excellence will work 

to expand partnerships to assist with recovery, prevention, and prosecution efforts, as well as 

enable advancements in operational activities through the use of business insights, data, 

analytics and operational systems. The Center of Excellence will work in tandem with 

Federal agencies and other partners to make payments right the first time, thereby improving 

the public trust. 

In FY 2018, DNP expanded services to offer agencies data analytics to assist them in their 

effort to more effectively identify and prevent improper payments. In FY 2018, there were 

20,336 stopped payments worth over $35.5 million. In addition, Fiscal Service ensures 

payment integrity by managing payment transactions that are misdirected or otherwise 

require intervention. In FY 2018, these transactions represented approximately $15.2 billion, 

and might have been erroneously spent if the transactions had not been recovered and/or 

corrected through robust post-payment controls. Further, using analytics and partnering with 

various stakeholders, Fiscal Service supported the investigation and prosecution of more than 

460 cases of misdirected payments caused by forgery, altered checks, multiple mobile 

deposits, deceased payee fraud, potential mail fraud and more.

4.2 – Debt Management: Fund the Federal Government at the least cost over time.

Auctions:

• Modernize Auctions Application: Fiscal Service’s auction program finances government

operations by offering Treasury securities through secure electronic systems. The auction 

program will complete the multi-year effort to modernize the auction application software in 

FY 2020 and will continue to enhance the auction application software to ensure that critical 

auction processes continue to work flawlessly, remain secure, and operate without service 

disruptions.

4.3 – Federal Financial Performance: Improve Federal financial management performance 

using innovative practices to support effective government.

All Budget Activities:

• Innovative Financial Management Solutions: Working with other members of the Federal 

financial community and in coordination with the Chief Financial Officers’ Council, Fiscal 

Service will identify and pilot emerging technologies and practices that demonstrate a 

potentially high return on investment for Federal financial management. The bureau will 

develop proofs of concepts for technologies such as distributed ledgers (e.g., blockchain), 

robotics, and artificial intelligence to better understand the degree to which these 

technologies could be used to improve Federal financial management if put into operation.

Treasury Strategic Goal 5: Achieve Operational Excellence

5.1 – Workforce Management: Foster a culture of innovation to hire, engage, develop, and 

optimize a diverse workforce with the competencies necessary to accomplish Treasury’s mission. 
Fiscal Service - 15 

All Budget Activities:

• Financial Management Talent: Fiscal Service has a goal to develop, retain, and empower the

best and brightest talent to support Federal financial management. Fiscal Service continues

to support this goal through several initiatives designed to increase leadership and operational

competencies, improve communication across the workforce, and support collaboration and

employee engagement. These efforts include: a Fiscal Service culture strategy, moving

operations to field locations, a bureau-wide position management review designed to ensure

position accuracy and consistency across all locations, a Commissioner’s Scholarship

Program, the encouragement of all employees to receive 40 hours of training per year to

reinforce the development of key competencies across the workforce, and structured

succession planning activities to establish sufficient bench strength for future leadership

opportunities.

Fiscal Service’s 2018 Federal Employee Viewpoint Survey results revealed an upward trend

in 52 of the 71 core questions asked and increases over last year in the employee

engagement, diversity and inclusion, overall satisfaction, and global satisfaction indices.

Fiscal Service will continue to identify opportunities to improve employee engagement and

develop action plans focused on these activities.

In 2018, Fiscal Service developed a workforce plan as well as a diversity and inclusion plan.

Through these efforts and other analysis, Fiscal has implemented a disciplined hiring process

that not only addresses budget constraints but allows for mission accomplishment, considers

the bureau’s priorities and initiatives, and ensures diversity and inclusion.

5.2 – Treasury Infrastructure: Better enable mission delivery by improving the reliability, 

security, and resiliency of Treasury’s infrastructure. 

All Budget Activities: 

• IT Infrastructure: Fiscal Service will increase resiliency by enhancing IT infrastructure,

technical failover capabilities, and continuity of operations processes through process

improvements and regular exercises. This will ensure the uninterrupted financial integrity,

security, and operational efficiency of mission critical systems. It also will ensure continual

enhancement of the systems and operations needed to meet critical mission functions

including auctions, revenue collections, and payments.

• Technology Modernization: Fiscal Service is undertaking a Technology Modernization

initiative to ensure an agile response capability to evolving business needs in order to best

serve the nation. This effort supports the PMA by focusing on cloud adoption. Further, the

modernization effort takes an enterprise approach to technology by leveraging a

microservices strategy to align business functions and capabilities.

Fiscal Service is adopting the mantra of “build once and disseminate broadly” to streamline

our footprint, increase resiliency, increase “cyber hygiene,” and reduce overall costs.

Additional benefits provided by this strategy include: (1) improved evaluation of IT costs and

level of service requirements to deliver value-added business solutions; (2) increased

accuracy in measuring IT portfolio performance; and (3) increased ability to meet business
Fiscal Service - 16 

requirements in a more agile manner. Fiscal Service’s objective is to utilize services and 

capabilities that are portable, reusable, scalable, and resilient, with additional capability for 

automated deployment. 

Over the past few years, Fiscal Service proactively made strategic investments in securing 

against cyber-attacks. Investments in Cyberclean have resulted in a multi-phased initiative to 

enhance our security posture and transfer the bureau cyber culture into one that is missionenabling, risk-based, and proactive with shared responsibility. 

5.3 – Customer Value: Improve customer value by increasing the quality and lowering the cost 

of Treasury’s products and services. 

Collections and Payments:

• Electronic Solutions: Fiscal Service will work to reduce the number of lockboxes used in the

Federal Government to process manual collections by streamlining and consolidating

facilities, continuing to transition paper processing to electronic solutions, and improving

manual processing efficiencies through the use of new technologies such as robotic process

automation and intelligent character recognition. By early FY 2020, Fiscal Service will

complete the transition of General Lockbox Network (GLN) cash flows which will allow us

to consolidate the GLN from four sites to two, and from three Financial Agents to one.

Fiscal Service will also continue to digitize processing across all operational areas through

the deployment of electronic solutions that streamline processes and reduce the paper

footprint. By early FY 2020, Fiscal Service plans to begin a pilot of the U.S. Citizenship and

Immigration Services document handling solution and expand on robotics process

automation in the Passport lockboxes.

• Centralize Federal Disbursing: Through this initiative, Fiscal Service will further

consolidate the disbursement of Federal payments. The Federal Government disburses over

1 billion payments annually to recipients throughout the world. Currently, Fiscal Service

disburses 87 percent of these payments, with the remaining 13 percent being disbursed by

non-Treasury disbursing offices. Further consolidating disbursement at Fiscal Service will

eliminate redundancies, streamline end-to-end payment processing, and lower governmentwide costs. Fiscal Service plans to convert the majority of Department of Defense entities to

Treasury-disbursed by the end of FY 2020.

• Common Authentication Solution and Customer-Centric Approach: Fiscal Service will

increase the capability of applications, both web and client server based, to easily honor and

accept the personal identity verification (PIV), personal identity verification-interoperable

(PIV-I), and DoD Common Access Card (CAC) credentials. These services will be available

to all of Treasury as well as Federal public key infrastructure customers.

Fiscal Service will work to optimize the user experience with a more customer-centric

approach, reduce operational inefficiencies, and ensure security while addressing evolving

standards for all consumer-facing Fiscal Service applications. In addition, expanding the use
Fiscal Service - 17 

of user-friendly mobile processes will allow the public to interact with the government how 

they prefer. 

B – Budget and Performance by Budget Activity

2.1.1 – Accounting and Reporting Resources and Measures 

2.1.1 – Accounting and Reporting Budget and Performance 

($96,979,000 from direct appropriations, and $20,869,000 from reimbursable resources): 

Fiscal Service has the critical responsibility of maintaining the Federal Government's set of 

accounts and serving as the repository of information about the financial position of the United 

States Government. The bureau closely monitors the government's monetary assets and 

liabilities at all times through its oversight of central accounting and reporting systems. Fiscal 

Service oversight responsibilities include helping Federal agencies use uniform accounting and 

reporting standards and systems and assuring the continuous exchange of financial information 

between Federal agencies, OMB, and financial institutions. The bureau also gathers and 

publishes government-wide financial information for use in establishing fiscal and debt 

management policies as well as to allow the public and private sectors to monitor the 

government's financial status. Fiscal Service is responsible for producing and maintaining 

various financial reports and information required by law on the financial condition and budget 

results of the U.S. government. The reports include: 

• The Financial Report of the United States Government (FR)

• The Combined Statement of Receipts, Outlays and Balances

• The Monthly Treasury Statement

• The Daily Treasury Statement

In FY 2018, Fiscal Service remediated five audit recommendations on the FR. Furthermore, for 

the first time, no additional recommendations were received. 

As part of the Central Accounting program, Fiscal Service: 

• Produces timely and accurate financial information by operating and overseeing the

government’s Central Accounting Reporting System and managing $111.8 billion in

daily Federal cash flows

• Generates and disseminates several reports and publications including the Daily Treasury

Statement, Monthly Treasury Statement, Monthly Statement of the Public Debt, Treasury

Bulletins, the Combined Statement of the United States Government, and the FR

• Issues the annual, audited Schedules of Federal Debt (Schedules) that report on the single

Dollars in Thousands

 Resource Level FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Enacted Annualized CR Request

Appropriated Resources 102,661 104,600 113,413 108,312 95,822 95,175 96,979

Reimbursable Resources 6,699 10,256 24,155 23,800 18,923 25,004 20,869

Budget Activity Total $109,360 $114,856 $137,568 $132,112 $114,745 $120,179 $117,848

FTE 357 374 425 381 400 413 398

Measure FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Target Target Target

Percentage of Governmentwide Accounting Reports 

Issued Timely (%)

100.0 99.5 100.0 100.0 100.0 100.0 98.0 98.0
Fiscal Service - 18

largest Federal liability in Treasury’s annual Agency Financial Report and received an 

unmodified opinion for each of the past 22 years

• Manages nearly $71.8 billion in State and Local Government Series (SLGS) securities for 

over 2,500 customers and administers flexible investment alternatives for state and local 

governments to refinance their outstanding, tax-exempt debt

• Issues, redeems and services Government Account Series (GAS) securities totaling 

nearly $6 trillion that are held in more than 160 accounts that have specific statutory 

authority to invest in these special, non-marketable Treasury securities

• Administers over 10,500 loans totaling $1.4 trillion to nearly 100 accounts held by Federal 

agencies to support programs relating to education, housing, flood relief, and agriculture

Fiscal Service delivers on Treasury’s Strategic Goal 4 (Transform Government-wide Financial 

Stewardship) by providing the public and Federal agencies with access to a greater range of 

financial data and works to improve the value, quality, and availability of Federal financial data. 

The establishment of government-wide financial data standards is the key to increasing the 

availability, accuracy, and usefulness of Federal spending information. Fiscal Service 

relaunched the USAspending.gov website with multiple download features including account 

download and database download, as well as added new features such as keyword search 

functionality and budget function filter. Fiscal Service will continue to work with Federal 

agencies and external stakeholders to enhance the capabilities and user experience of 

USAspending.gov.

Description of Performance:

Fiscal Service collects, analyzes, and publishes government-wide financial information, made 

available to both the public and private sectors, to provide transparency on the government’s 

financial status. In FY 2018, Fiscal Service timely issued government-wide accounting reports 

100 percent of the time.

Fiscal Service will meet its FY 2019 and FY 2020 performance measure targets by transforming 

the quality, effectiveness, and transparency of Federal financial management data; delivering 

value-added business process and system improvements; and expanding/enhancing relationships 

with stakeholders and customers.

2.1.2 – Collections Resources and Measures

Dollars in Thousands

 Resource Level FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Enacted Annualized CR Request

Appropriated Resources 30,469 34,982 37,394 36,197 38,704 42,166 38,117

Reimbursable Resources 0 3,898 8,265 7,028 8,042 9,287 7,997

Budget Activity Total $30,469 $38,880 $45,659 $43,225 $46,746 $51,453 $46,114

FTE 139 144 152 159 160 172 165

Measure FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Target Target Target

Percentage of Total Federal 

Government Receipts Settled 

Electronically (%)

98.0 98.0 98.2 98.3 98.0 98.0 98.0 98.0
Fiscal Service - 19 

2.1.2 – Collections Budget and Performance 

($38,117,000 from direct appropriations, and $7,997,000 from reimbursable resources):

The Collections budget activity supports the National Financial Critical Infrastructure and 

Treasury Strategic Goal 4 (Transform Government-wide Financial Stewardship) by 

administering the world's largest government funds collections systems through a network of 

Fiscal and Financial Agents. In FY 2018, the bureau collected nearly $4.2 trillion in Federal 

revenues, such as individual and corporate income tax deposits, customs duties, fees for 

government services, fines, and loan repayments. Within that, over $2.9 trillion in tax payments 

were processed through Electronic Federal Tax Payment System (EFTPS) and approximately 

200.8 million transactions worth $166.8 billion were processed through Pay.gov. The dollar 

value of the collections and number of transactions are indicators that our responsibilities are 

both significant and vital to the functioning of the economy, the inner workings of the 

government, and to the daily lives of citizens and businesses. 

By adopting eCommerce solutions and cutting-edge technology, Fiscal Service is expanding the 

suite of electronic payment options available to Federal agencies, individuals, businesses, tax 

practitioners, and financial institutions through a wide variety of alternatives, specifically, online 

bill payment, digital wallets, and mobile applications, all of which offer convenience, simplicity, 

and an enhanced customer experience. Between FY 2017 and FY 2018, online bill payments 

transactions and dollars collected increased by approximately 70 percent; digital wallets 

increased collections by 83 percent; and mobile applications increased transactions by more than 

150 percent and increased dollars collected by more than 100 percent. 

Description of Performance: 

Fiscal Service met its target of electronically settling 98 percent of all Federal Government 

receipts through a continued commitment to agency outreach efforts. Fiscal Service expects to 

maintain an annual electronic collections rate of at least 98 percent through FY 2020 by 

continuing to promote the use of electronic systems in the collections process and to assist 

agencies in converting collections from paper to electronic media with programs such as:

• EFTPS: EFTPS is a system that allows businesses, individuals, and other entities to pay

taxes electronically. There are several methods to schedule tax payments through EFTPS,

including via the Internet, phone, and third-party payroll service providers. The benefits of

EFTPS include accuracy, security, simplicity, and flexibility. The goal is to continue to

require businesses to pay their Federal taxes electronically and focus efforts on increasing the

number of individuals that pay taxes electronically. Fiscal Service will determine the

implementation/transition timeline to move from current EFTPS architecture/environment to

EFTPS Next Generation (EFTPSng). By modernizing and transitioning the system to

EFTPSng, Fiscal Service will be able to provide a better customer experience while

introducing new services and application program interfaces (APIs) to facilitate the

expansion of functionality and the adoption of cloud-based technology.

• Pay.gov: Pay.gov is a web-based government-wide collections portal. It allows users to

electronically fill out and submit forms, view bills, and make payments via Automated

Clearing House (ACH) debit, credit card, or digital wallet. The system also provides

reporting to agencies and allows individuals and businesses to make non-tax payments to

Federal agencies over the internet with a mobile-friendly user interface and enhanced

functionality in the areas of electronic billing and electronic forms.
Fiscal Service - 20

• Check Conversion and Truncation: Fiscal Service is employing strategies to reduce the 

number of paper checks it receives and to ensure that those it does receive are converted for 

electronic processing. The Over the Counter Channel Application (OTCnet) and Electronic 

Check Processing (ECP) programs provide a complete electronic record of all check images 

and related financial data that is accessible by agencies and eliminate the costly and timeconsuming need to photocopy checks, safeguard checks, or process paper.

• eCommerce Collections: Agencies using mobile applications avoid sending checks to 

lockboxes and are converting mailed-in or point-of-sale checks/cash payments to self-service 

ACH, card, and digital wallet payments. Digital wallets allow consumers the convenience of 

using their electronic wallet (card, ACH options) to pay an obligation to an agency in lieu of 

providing bank account and credit card information online or via phone while online bill 

payment allows consumers to pay Federal Government bills through their banks’ websites. 

In FY 2018, Fiscal Service increased the cumulative volume of digital wallet transactions by 

83 percent. By FY 2020, Fiscal Service will perform an analysis of the current digital wallet 

providers and conduct research on eCommerce industry trends to identify technologies to be 

implemented and to determine whether to include additional providers for digital wallet 

collections. 

2.1.3 – Payments Resources and Measures 

2.1.3 – Payments Budget and Performance

($123,355,000 from direct appropriations, and $118,316,000 from reimbursable resources):

Fiscal Service is the primary disburser of payments to individuals and businesses on behalf of 

Federal agencies. This includes Social Security, Veterans’ benefits, and income tax refunds to 

more than 100 million people as well as vendor and loan payments supporting businesses; grant 

monies; and state funding for critical infrastructure projects and state-administered programs. 

The majority of the payments are disbursed through electronic funds transfers; the remaining are 

Dollars in Thousands

 Resource Level FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Enacted Annualized CR Request

Appropriated Resources 114,650 120,769 127,943 126,685 121,462 117,581 123,355

Reimbursable Resources 78,625 81,953 111,088 111,464 117,264 120,109 118,316

Budget Activity Total $193,275 $202,722 $239,031 $238,149 $238,726 $237,690 $241,671

FTE 577 521 562 597 508 526 507

Measure FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Target Target Target

Percentage of Treasury 

Payments Made 

Electronically (%)

94.4 94.7 94.9 95.1 95.4 95.2 95.3 95.5

Count of Improper Payments 

Identified or Stopped Fiscal 

Year To Date (# in 

thousands)

N/A N/A N/A N/A 20.3 B 20 21 

Dollar Amount of Improper 

Payments Identified or 

Stopped Fiscal Year To Date 

($ Millions)

N/A N/A N/A N/A 35.5 B 33.6 35.3

Key: B - Baseline; N/A - Not in use in prior years; TBD - To Be Determined
Fiscal Service - 21 

check payments. Annually, Fiscal Service disburses more than 1.2 billion payments, with an 

associated dollar value of more than $3.5 trillion to individuals, businesses, and others around 

the world on behalf of more than 250 Federal entities. 

The Payments budget activity supports the NFCI and Treasury Strategic Goal 4 (Transform 

Government-wide Financial Stewardship) by disbursing more than 87 percent of the Federal 

Government’s payments, equating to over 1.2 billion payments worth $3.5 trillion in FY 2018. 

Fiscal Service uses the Payment Application Modernization (PAM) investment to disburse 

payments for Veterans’ Compensation and Pension, Social Security Benefits, Federal and 

Railroad Pensions, IRS tax refunds, Supplemental Security Income (SSI), etc. PAM supports the 

production and delivery of Federal payments on behalf of more than 250 Federal entities with a 

single application that generates check, ACH, International ACH Transaction (IAT), and wire 

transfer payments. PAM prevents improper payments and collects delinquent debt owed to the 

Federal Government by automatically interfacing with core Treasury systems such as DNP and 

the Treasury Offset Program (TOP). Fiscal Service continues to eliminate redundancies in the 

Federal Government by centralizing the payment activities for a large portion of DoD and other 

non-Treasury disbursing agencies. This will allow those agencies to better align mission-critical 

resources and possibly identify future savings. 

Electronic payments provide timely, accurate, and efficient disbursement of Federal Government

payments; eliminate the costs associated with postage and the re-issuance of lost or stolen 

checks; and help to protect against fraud and identity theft. In FY 2018, Fiscal Service disbursed 

98.4 percent of benefit payments electronically, supported by Direct Express®, a prepaid card 

program providing 4.5 million unbanked cardholders with a low-cost way to electronically 

receive payments and check their account balance.

The Payments budget activity also includes post payment services to settle claims against the 

United States resulting from Federal Government checks that have been forged, lost, stolen, or 

destroyed, as well as claims and reclamations of electronic funds transfer (EFT) payments. 

Fiscal Service ensures payee claims of non-receipt are processed, stale uncashed checks are 

cancelled, misdirected electronic payments are returned, monies erroneously paid to deceased 

individuals are recovered, and checks returned in the mail are properly safeguarded with funds 

redirected to the right payee or held safely in the United States Treasury. Through FY 2019, 

Fiscal Service will continue to invest in the Post Payment Services Investment, a consolidation 

of several post payment systems into a single, centralized system that will unify disparate 

business processes and eliminate data redundancy across systems. The Post Payment 

Modernization Initiative will provide Federal program agencies (FPAs) a customer portal that 

supports: payment verification and reconciliation, returns and cancellations, inquiries, claims 

processing including reclamations, funds receipt/funds management, fraud and integrity analysis, 

and reporting. 

Fiscal Service will continue to expand efforts through a government-wide program that will 

support agencies, law enforcement, and states in combatting fraud, waste, abuse, and improper 

payments. The Payment Integrity Center of Excellence will be the trusted government-wide 

partner to provide actionable business insights and solutions that transform how Federal agencies
Fiscal Service - 22

approach identifying, preventing, stopping, and recovering of improper payments and related 

fraudulent activity.

In addition, the Fiscal Service collects monies from those parties liable for fraudulent or 

otherwise improper negotiation of government checks. Support provided to the Inspector 

General, Assistant United States Attorneys, and state and local law enforcement agencies in the 

investigation and prosecution of criminals engaged in fraud related to the Treasury payment 

system resulted in 66 arrests, 33 convictions, and $12.9 million recovered through fines, 

restitution, and seizures in FY 2018.

Also, in FY 2018, Federal agencies received and processed 488,000 vendor invoices valued at 

$40.0 billion through Treasury’s electronic invoicing solution, the Invoice Processing Platform 

(IPP). As the end of FY 2018, 17 CFO Act Agencies used the IPP and 96 percent of Treasury 

invoices were processed electronically.

DNP’s mission is to protect the integrity of the Federal Government’s payment processes by 

helping agencies mitigate and eliminate improper payments in a cost-effective manner while 

safeguarding the privacy of individuals. Together with the Payment Integrity Center of 

Excellence, DNP analytics will continue to provide advanced payment analysis services to 

Federal agencies. In partnership with the Federal agencies, a variety of data analyses and 

visualizations can be conducted to help combat improper payments. In FY 2018, DNP assisted 

agencies in identifying or stopping 20,336 payments valued at over $35.5 million.

Description of Performance:

Fiscal Service continues to increase the electronic payment rate each year. In FY 2018, the 

electronic payment rate rose to 95.4 percent, with the number of electronic payments increasing 

by 17.0 million, and paper check volume decreasing by 2.3 million. Tax refund payments 

continue to total more than half of the Treasury-disbursed check volume. The processing of 

electronic invoices also realized a large increase of more than 34,000 over the FY 2017 volume

of 453,817.

The targets of 95.3 percent for FY 2019 and 95.5 percent for FY 2020 were determined by using 

historical data trends to determine the rate of increase/decrease to apply to future EFT and check 

volumes. The percentage increase/decrease differs for each of the payment types (Veterans’ 

benefits, Social Security benefits, SSI, tax refunds, etc.).

Fiscal Service will meet FY 2019 and FY 2020 targets by promoting and increasing EFT 

payments with emphasis on tax refunds, vendor payments, and benefit payments; and exploring, 

developing, and deploying innovative, customer-driven electronic payment solutions.

In FY 2019, Fiscal Service will establish two performance measures that will provide 

transparency on progress towards detecting and preventing improper payments. These 

performance measures align with the President's Management Agenda on getting payments right. 

Fiscal Service, along with other partner Federal agencies, will lead the effort to prevent and 

detect improper payments.
Fiscal Service - 23 

2.1.4 – Retail Securities Services Resources and Measures 

2.1.4 – Retail Securities Services Budget and Performance

($60,643,000 from direct appropriations, and $13,166,000 from reimbursable resources):

Retail Securities Services (RSS) provides simple, safe, and affordable ways for Americans to 

directly interact with the Department of the Treasury to save for their future by investing in 

Treasury securities. The U.S. Treasury began offering savings bonds in paper from in 1935. 

Today, electronic savings bonds and marketable securities are sold through TreasuryDirect, an 

internet-based book-entry system for purchasing, holding and conducting Treasury securities 

transactions. In FY 2018, Fiscal Service electronically issued $63.6 billion in marketable 

securities and $394.4 million in savings bonds; redeemed 22 million paper savings bonds totaling 

$10.4 billion and $890.0 million in electronic savings bonds; added 190,828 new accounts to 

TreasuryDirect; and made 2.5 million retail payments worth $19.9 billion. 

RSS continues to modernize systems to allow individual investors to purchase, view, redeem, 

and manage their investments electronically. Over the next few years, RSS will continue to 

develop customer service improvements to increase customer self-sufficiency and encourage 

more Americans to save for their future while achieving our financing mission cost effectively. 

Description of Performance: 

Cost of Customer Assisted Retail Transaction and Cost per Electronic Retail Transactions

performance measures have been discontinued due to the rigid nature of the associated fixed 

costs producing skewed results. Percent of Retail Customer Service Transactions That Are 

Unassisted is the new performance measures, which encompasses self-directed customer 

interactions for current and future retail securities. In addition, it aligns with Fiscal Service goals 

and objectives to improve customer value by increasing the quality and self-sufficiency.

Dollars in Thousands

 Resource Level FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Enacted Annualized CR Request

Appropriated Resources 95,249 76,711 71,252 62,559 57,356 59,381 60,643

Reimbursable Resources 17,400 6,006 16,026 12,642 12,100 17,854 13,166

Budget Activity Total $112,649 $82,717 $87,278 $75,201 $69,456 $77,235 $73,809

FTE 491 442 436 472 434 447 430

Measure FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Target Target Target

Cost Per Customer Assisted 

Retail Transaction ($) N/A N/A N/A B 116.24 124.78 DISC DISC

Cost Per Electronic Retail 

Transaction ($) N/A N/A N/A B 3.06 3.46 DISC DISC

Percentage of Retail Customer 

Service Transactions That Are 

Unassisted (%)

N/A N/A N/A N/A N/A N/A B TBD

Key: Disc - Discontinue; B - Baseline; N/A - Not in use in prior years; TBD - To Be Determined
Fiscal Service - 24 

2.1.5 – Wholesale Securities Services Resources and Measures 

2.1.5 – Wholesale Securities Services Budget and Performance

($21,243,000 from direct appropriations, and $4,605,000 from reimbursable resources): 

The Wholesale Securities Services (WSS) program supports the NCFI by managing a critical 

Treasury HVA that enables the Federal Government to finance daily operations through reliable, 

accurate, and secure electronic systems. The vision is to manage Treasury’s debt issuance 

operations in a manner that supports the evolving policy objectives and the needs of investors; 

leverages technology to conduct efficient, effective and reliable auctions; and collaboratively 

draws upon the strengths of all business stakeholders. Fiscal Service also supports Treasury’s 

Strategic Goal 4 (Transform Government-wide Financial Stewardship) and Treasury’s Strategic 

Objective 4.1 to better enable mission delivery by improving the reliability, security, and 

resiliency of Treasury’s infrastructure.

Fiscal Service is responsible for the announcement, auction, issuance, and settlement of 

marketable Treasury bills, notes, bonds, inflation-protected securities, and floating rate notes. 

The program also oversees the portion of the Federal infrastructure that provides for the transfer, 

custody, and redemption of all Treasury marketable securities, purchased mostly by commercial 

market participants. The overarching goal is to finance the Federal Government at the lowest 

cost over time. 

Description of Performance: 

Fiscal Service awarded $10.0 trillion in Treasury marketable securities to institutions and 

individual investors by conducting 270 auctions to fund critical daily Federal operations in FY 

2018. The Percent of Auction Results Released Accurately at 98.9 percent in FY 2018 was 

slightly below the target of 100 percent due to a technical issue that was since resolved. In FY 

2019, Fiscal Service will continue to measure its performance as it relates to the accuracy of the 

auction results. The program will also introduce a new performance measure to track the 

percentage of auctions held by the scheduled close date. This will measure the operational 

resiliency of the program and, while FY 2019 is a baseline year, the target is anticipated to be 

100 percent performance in FY 2020. 

Dollars in Thousands

 Resource Level FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Enacted Annualized CR Request

Appropriated Resources 12,840 10,676 13,848 19,304 24,936 23,977 21,243

Reimbursable Resources 2,346 927 3,115 4,214 4,613 5,505 4,605

Budget Activity Total $15,186 $11,603 $16,963 $23,518 $29,549 $29,482 $25,848

FTE 121 109 78 117 116 119 119

Measure FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Target Target Target

Percentage of Auction Results 

Released Accurately (%) 99.3 99.6 100.0 98.9 98.9 100.0 100.0 100.0

Percent of Auctions 

Successfully Completed by the 

Scheduled Close Date

N/A N/A N/A N/A N/A N/A B 100.0

Key: B - Baseline; N/A - Not in use in prior years
Fiscal Service - 25 

To achieve FY 2019 and FY 2020 performance, Fiscal Service will complete a multi-year 

initiative to modernize the system application software and technology components and will 

continue to test the secondary and tertiary backup systems. 

2.1.6 – Debt Collection Resources and Measures

2.1.6 – Debt Collection Budget and Performance

($226,576,000 from reimbursable resources) 

The Debt Collection activity supports Treasury’s Strategic Goal 4 (Transform Government-wide 

Financial Stewardship). Fiscal Service is the government's central debt collection agency, 

managing the government's delinquent debt portfolio and collecting delinquent debts owed to the 

United States, such as Federal mortgage, small business, or student loans; Federal salary or 

benefit overpayments; and fines or penalties assessed by Federal agencies. In FY 2018, Fiscal 

Service collected $7.44 billion in delinquent debt through its two debt collection programs: TOP 

and Cross-Servicing.

Through TOP, the names and taxpayer identifying numbers of debtors included in a Fiscal 

Service database are matched against the names and taxpayer identifying numbers of recipients 

of Federal payments. If there are matches, the amounts of the payments are reduced ("offset") to 

satisfy the delinquent debts. 

Through Cross-Servicing, delinquent debts referred to Fiscal Service by Federal agencies are 

collected several ways, including offsetting Federal payments, sending demand letters to debtors, 

entering into payment agreements, withholding wages administratively, referring debts to the 

Department of Justice for action, reporting to credit bureaus, and contracting for the services of 

private collection agencies. 

Fiscal Service continues to help agencies implement Section 5 of the DATA Act, which 

amended the Debt Collection Improvement Act of 1996 to require agencies to refer eligible debt 

Dollars in Thousands

 Resource Level FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Enacted Annualized CR Request

Reimbursable Resources 139,377 174,634 187,152 176,928 192,819 209,809 226,576

Budget Activity Total $139,377 $174,634 $187,152 $176,928 $192,819 $209,809 $226,576

FTE 363 406 390 417 389 422 422

Measure FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Target Target Target

Amount of Delinquent Debt 

Collected Through All 

Available Tools ($ billions)

6.91 7.28 7.41 7.61 7.44 7.56 7.67 7.80

All Delinquent Debt Collected 

FYTD as a Percentage of all 

Delinquent Debt Referred 

FYTD (%)

N/A N/A N/A N/A N/A N/A B TBD

Percentage of the active 

delinquent debt portfolio 

collected FYTD (%)

N/A N/A N/A N/A N/A N/A B TBD

Key: DISC - Discontinue; B - Baseline; TBD - To Be Determined
Fiscal Service - 26

to Fiscal Service at 120 days delinquent, rather than 180 days, and requires Treasury to report 

non-compliance to Congress. In addition, Fiscal Service continues to work with OMB and 

agencies on the new tools developed for tracking compliance, as required.

Description of Performance:

FY 2018 was the first time in five years that Fiscal Service did not exceed the amount of 

delinquent debt collected over the previous year. This decrease was due to declines in tax refund 

offsets because of the inability to refer debts to Private Collections Agencies (PCAs) for a 

majority of the fiscal year due to technical difficulties, a decline in collections from child 

support, and a drop in Unemployment Insurance Compensation collections. Tax refund offsets 

should increase in FY 2019 as Fiscal Service is referring debt again to PCAs.

Despite these challenges, projections for FY 2019 and FY 2020 show a return to modest growth 

in overall collections years. The performance targets for FY 2019 and FY 2020 are to collect 

$7.82 billion and $7.96 billion in delinquent debt, respectively. A sophisticated planning model 

using debt data and macroeconomic variables is the basis for this target forecast. The model is 

designed to take into account economic fluctuations, as well as debt referral changes, in order to 

forecast collections.

To meet FY 2019 and FY 2020 delinquent debt performance targets, Fiscal Service will continue 

to develop and implement strategies to increase automation, standardization, and overall process 

efficiencies. In addition, new payment streams and individual payments will be added to TOP 

that produce offsets and increase delinquent debt collection.
Fiscal Service - 27 

C – Changes in Performance Measures

Performance Measure or 

Indicator 

Change and Justification

1. Cost Per Electronic Retail

Transaction ($) (discontinue)

Budget Activity:

 Retail Securities Services

Discontinue. This measure is dependent on fixed costs

associated with the number of customer assisted or 

unassisted transactions 

2. Cost Per Customer Assisted

Retail Transaction ($)

(discontinue)

Budget Activity:

Retail Securities Services

Discontinue. This measure is dependent on fixed costs

associated with the number of customer assisted or 

unassisted transactions. 

3. Percentage of Retail

Securities Transactions that

are Unassisted (%) (add)

Budget Activity:

Retail Securities Services

Add. This measure drives toward all electronic 

transactions and encompasses self-directed customer 

interactions for current and future retail securities. The 

measure aligns with Treasury strategic goal 5.3 to 

improve customer value by increasing quality and selfsufficiency.

4. Count of Improper Payments

Identified or Stopped FYTD

(#) (add)

Budget Activity:

 Payments

Add. Treasury leads government efforts to understand and 

reduce improper payments. This measure tracks the 

number of payments identified as improper plus the 

payments prevented. 

5. Dollar Amount of Improper

Payments Identified or

Stopped FYTD ($ Millions)

(add)

Budget Activity:

 Payments

Add. This measure tracks the dollar amount of payments 

identified as improper plus the payments prevented.
Fiscal Service - 28 

Performance Measure or Indicator Change and Justification

6. All Delinquent Debt Collected

FYTD as a Percentage of all

Delinquent Debt Referred FYTD

(%) (add)

Budget Activity:

Debt Collection

Add. This measure complements the already 

reported measure of “total amount of delinquent 

debt”. This measure tracks Fiscal Service’s efforts 

in reducing total delinquent federal debt growth. 

7. Percentage of the Active

Delinquent Debt Portfolio

Collected FYTD (%) (add)

Budget Activity:

Debt Collection

Add. This measure tracks the total debt collected 

FYTD against the total “active” debt portfolio. The 

active portfolio is defined as any debt which 

receives at least one payment during that FY.

Section III – Additional Information

A – Summary of Capital Investments

Fiscal Service leads the way for responsible, effective government through commitment to 

cutting-edge technologies, service, efficient operations, sharing of best practices, and openness to 

change in order to meet the operating needs of the Federal Government. Fiscal Service 

systematically analyzes the demand for its services, considers effective methods for delivery, and 

identifies the broad asset implications through sound governance and investment management. 

Effective Investment Governance

Fiscal Service Governance and Capital Planning and Investment Control programs ensure the 

selection/re-selection, comparison, and prioritization of the most effective IT investments to 

support the mission and long-range plans for Fiscal Service and Treasury. These programs also 

ensure the IT investment portfolio is well managed, cost effective, and achieving intended results 

through monthly tracking and progress reports. A monthly investment health assessment of cost, 

schedule, operational performance, and risk is in place in addition to a formal TechStat process 

that engages appropriate senior level officials for insight and successful remediation of 

significant issues or risks.

Effective Project Execution

Fiscal Service has a disciplined and consistent approach to project management (PM) as 

facilitated through a bureau-wide project management program that manages PM standards, 

procedures, and training. In addition, a standing monthly project management community of 

practice is in place providing practitioners the opportunity for collaboration and continuous 

learning of creative problem-solving/solution design related to practical lessons learned. Each IT 

investment has a dedicated program manager and a fully staffed integrated program team. The 

systems that support each investment are enhanced using iterative development techniques. 
Fiscal Service - 29 

Enterprise Architecture Services

Enterprise Architecture (EA) services ensure that Fiscal Service applies a common language and 

framework to describe and analyze investments. Fiscal Service’s EA program is designed to 

facilitate cross-agency analysis of capabilities, knowledge, processes, and relationships to apply 

evidence-based techniques, identify duplicative investments, discover goals and opportunities for 

collaboration with other agencies, and establish a line-of-sight from the highest-level strategic 

goals to the infrastructure that enables the achievement of those goals. The value of EA services 

is to facilitate planning by documenting where Fiscal Service is currently and determining what 

the bureau should look like in the future in order to make plans to transition from current state to 

future state. A holistic suite of integrated services that incorporates business, data, technical, and 

security architecture perspectives enable the planning. 

Enterprise Risk Management (ERM)

The nature of Fiscal Service’s work requires effective enterprise risk management and high 

levels of performance to ensure the bureau maintains operational excellence while seeking 

innovative solutions to improve efficiencies and transform financial management and the 

delivery of shared services in the Federal Government. As such, Fiscal Service has established 

an ERM office to promote a common understanding and approach to risk management and 

strengthen organizational capabilities to recognize, assess, and address risks that could disrupt 

the successful achievement of strategic objectives. Through the development and issuance of an 

ERM framework, policies, guidance, and tools, the bureau incorporates risk management 

practices in decision-making processes such as strategic and tactical planning, workforce 

planning, capital investment planning, and budget formulation. Fiscal Service will continue to 

communicate the importance of effective risk management to all employees.

Cybersecurity

Fiscal Service has a multi-faceted mission that promotes financial integrity and operational 

efficiency across the Federal Government. As such, protecting the information and technology 

resources that support the bureau’s mission are critically important. Financial integrity and 

operational efficiency are accomplished by effective, coordinated management of security risks 

and incidents that ensure the confidentiality, integrity, and availability of the bureau’s systems 

are maintained. Fiscal Service employs an in-depth defense strategy to protect against, detect, 

and respond to anomalies in the bureau’s network and systems. In addition, Enterprise 

Cybersecurity ensures Fiscal Service information technology resources are in compliance with 

the National Institute of Standards and Technology security standards and satisfies annual 

security audit requirements. 

A summary of capital investment resources, including major IT and non-technology investments, 

can be viewed and downloaded here: 

http://www.treasury.gov/about/budget-performance/Pages/summary-of-capital-investments.aspx 

This website also contains a digital copy of this document.



Department of the Treasury 

Office of Financial Stability 

Congressional Budget 

Justification and Annual 

Performance Report and Plan 

FY 2020 
OFS - 2 

Table of Contents

Section I – Purpose........................................................................................................................ 3

A – Mission Statement ................................................................................................................ 3

1.1 - Program Account Summary ............................................................................................... 3

1.2 – Financing Account Summary ............................................................................................ 3

1.3 – Program Disbursement, Repayments, and Cost/Savings ................................................... 4

B – Vision, Priorities and Context .............................................................................................. 4

C - Credit Reform Account Description ..................................................................................... 5

1.4 – Budget Adjustments Table ................................................................................................. 7

D – Budget Increases and Decreases Description....................................................................... 7

1.5 – Operating Levels Table ...................................................................................................... 8

E – Appropriations Language and Explanation of Changes ....................................................... 8

F – Legislative Proposals ............................................................................................................ 8

Section II - Annual Performance Plan and Report.................................................................. 10

A – Strategic Alignment ........................................................................................................... 10

B – Budget and Performance by Budget Activity .................................................................... 11

C – Operational Goals ............................................................................................................... 12

Section III - Additional Information ......................................................................................... 13

A – Summary of Capital Investments ....................................................................................... 13
OFS - 3

Section I – Purpose

A – Mission Statement

A central part of the response to the 2008 financial crisis was the implementation of the Troubled 

Asset Relief Program (TARP), which was established in the fall of 2008 under the Emergency 

Economic Stabilization Act of 2008 (EESA) (P.L. 110-343) within the Office of Domestic 

Finance at the U.S. Department of the Treasury (Treasury). TARP was created to restore the 

liquidity and stability of the financial system, and it is administered by the Office of Financial 

Stability (OFS).

Since late 2010, OFS has made significant progress in winding down TARP investment 

programs and in recovering OFS’s outstanding investments. OFS continues to operate a housing 

program under TARP to help struggling families avoid foreclosure, but in 2016 began to winddown the largest TARP housing program. As of November 30, 2018, OFS has recovered more 

than 96 percent of the $440.6 billion in total program funds disbursed under TARP, as well as an 

additional $17.6 billion from Treasury’s equity in AIG. When all of Treasury’s AIG investments 

are included, the amount recovered is greater than the funds disbursed by more than $2.0 billion.

1.1 - Program Account Summary

Dollars in Thousands

FY 2018 FY 2019 FY 2020

Actual Estimated Estimated Change % Change

AMOUNT AMOUNT AMOUNT AMOUNT AMOUNT

Obligations

Equity Program Account $0 $1,073 $0 ($1,073) -100.00%

Housing Account $11 $0 $0 $0 0.00%

TARP Account $0 $0 $0 $0 0.00%

TARP Administrative Account $75,057 $61,796 $53,469 ($8,327) -13.48%

TARP Negative Downward Reestimate Receipt Account ($14,586) ($26,982) $0 $26,982 -100.00%

TARP Negative Subsidy Receipt Account $0 $0 $0 $0 0.00%

Total Obligations $60,483 $35,887 $53,469 $17,582 48.99%

Budget Authority

Equity Program Account $0 $1,073 $0 ($1,073) -100.00%

Housing Account $11 $0 $0 $0 0.00%

TARP Account $0 $0 $0 $0 0.00%

TARP Administrative Account $78,465 $61,796 $53,469 ($8,327) -13.48%

TARP Negative Downward Reestimate Receipt Account ($14,586) ($26,982) $0 $26,982 -100.00%

TARP Negative Subsidy Receipt Account $0 $0 $0 $0 0.00%

Total Budget Authority $63,890 $35,887 $53,469 $17,582 48.99%

Outlays

Equity Program Account $0 $1,073 $0 ($1,073) -100.00%

Housing Account $2,225,616 $1,723,863 $1,117,202 ($606,660) -35.19%

TARP Account $0 $0 $0 $0 0.00%

TARP Administrative Account $64,136 $101,130 $54,135 ($46,996) -46.47%

TARP Negative Downward Reestimate Receipt Account ($14,586) ($26,982) $0 $26,982 -100.00%

TARP Negative Subsidy Receipt Account $0 $0 $0 $0 0.00%

Total Outlays $2,275,166 $1,799,084 $1,171,337 ($627,747) -34.89%

FTE 32 24 20 -4 -16.67%

FY 2019 to FY 2020
OFS - 4 

1.2 – Financing Account Summary

Dollars in Thousands

1.2 – Program Disbursement, Repayments, and Cost/Savings 

Dollars in Billions

Cumulative 

Obligated 

(as of 

11/30/2018)

Cumulative 

Disbursed 

(as of 

11/30/2018)

Cumulative 

Outstanding 

(as of 

11/30/2018)

Total 

Cumulative 

Income (as 

of 

11/30/2017)

Total Cash 

Back (as of 

11/30/2018)

Total

Estimated 

Life Costs 

(as of 

11/30/2018)

Bank Support Programs 250.5 245.1 0.1 35.7 275.5 (24.3)

Credit Market Programs 19.1 19.1 0.0 4.5 23.6 (3.3)

AIG Investment Program (AIG) 67.8 67.8 0.0 1.0 55.3 15.2 * 

Automotive Industry Financing 

Program 79.7 79.7 0.0 7.4 70.5 12.1 

Treasury Housing Programs 33.4 28.9 0.0 32.8 

Total 450.5 440.6 0.1 48.6 425.0 32.5 

Additional AIG Common Shares 

Held by Treasury 0.0 0.0 0.0 17.6 17.6 (17.6) *

Total for Programs and Shares 450.5 440.6 0.1 66.2 442.6 14.9 

*If all Treasury AIG Investments are combined, we currently estimate a net gain of nearly $2.4 billion on those share

B – Vision, Priorities and Context 

TARP was created by EESA in October 2008 as part of a broad-based federal response to the 

financial crisis. The purposes of EESA were — 

(1) to immediately provide authority and facilities that the Secretary of the Treasury could use to

restore liquidity and stability to the financial system of the United States; and

(2) to ensure that such authority and facilities were provided in a manner that would —

(A) protect home values, college funds, retirement accounts, and life savings;

(B) preserve homeownership and promote jobs and economic growth;

(C) maximize overall returns to the taxpayers of the United States; and

(D) provide public accountability for the exercise of such authority.

FY 2018 FY 2019 FY 2020

Actual Estimated Estimated Change % Change

AMOUNT AMOUNT AMOUNT AMOUNT AMOUNT

TARP Direct Loans

Obligations $5,154 $13,131 $0 ($13,131) -100.00%

Collections $13,131 $0 $0 $0 0.00%

Financing Authority (net) $0 $0 $0 $0 0.00%

Financing Disbursements (net) ($7,977) $13,131 $0 ($13,131) -100.00%

Equity Purchases

Obligations $10,929 $14,693 $408 ($14,285) -97.22%

Collections $54,205 $44,618 $9,093 ($35,525) -79.62%

Financing Authority (net) ($27,700) ($42,166) ($8,653) $33,513 -79.48%

Financing Disbursements (net) ($43,276) ($29,925) ($8,685) $21,240 -70.98%

Housing

Obligations $1,740 $2,430 $1,040 ($1,390) -57.22%

Collections $53 $29 $10 ($19) -63.94%

Financing Authority (net) $0 $0 $0 $0 0.00%

Financing Disbursements (net) $1,687 $2,401 $1,029 ($1,372) -57.13%

FY 2019 to FY 2020
OFS - 5

EESA vested authority in the Secretary of the 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.” This program supports the Department’s goal of 

financial stewardship. 

As a result of improved financial conditions and careful stewardship of the program, the ultimate 

cost to taxpayers of TARP investments is estimated to be significantly lower than initially 

expected. In Fiscal Year (FY) 2009, the program was projected to cost $341 billion, but it is 

now estimated to cost only $32.5 billion (of which -$0.3 billion relates to investments and

$32.8 billion relates to housing programs that do not require repayments by recipients) as of 

November 30, 2018, lifetime costs are projected at $14.9 billion with the inclusion of receipts 

from Treasury’s sale of additional AIG common stock.

*Includes $17.6 billion in proceeds from additional Treasury AIG shares

During FY 2019 and FY 2020, OFS’s priority is to continue the responsible wind-down of all 

TARP programs.

OFS Administrative Expenses

The authority for OFS’s administrative funding is provided in section 118 of EESA. In 

FY 2019, OFS plans to obligate no more than $62 million and use no more than 24 Full-Time 

Equivalent (FTE) employees. In FY 2020, OFS plans to obligate no more than $54 million and 

20 FTE employees, a reduction of over 13 percent and 16 percent respectively from the current 

FY 2019 estimates, to fund the management, maintenance and continued wind-down of the 

TARP housing programs and the disposition of OFS’s remaining investments.

C - Credit Reform Account Description

Section 123 of EESA requires the cost of TARP programs to be calculated using the methods 

required by the Federal Credit Reform Act of 1990 (“credit reform”). In addition to the OFS 

Administrative Account, the organization manages six accounts to comply with the credit reform 

accounting requirements: (1) the TARP Equity Purchase Program Account; (2) the TARP 

Equity Purchase Financing Account (EPFA); (3) the TARP Housing Programs Account; (4) the 

$341.0

$124.1

$77.7 $57.3 $42.1 $22.7* $19.9* $19.7* $16.9* $14.7* $14.9* 0

50

100

150

200

250

300

350

400

May-2009 Sep-2010 Sep-2012 Sep-2014 Sep-2016 Nov-2018

Cost (in billions)

Date

OFS TARP Cost Estimates
OFS - 6 

TARP Housing Programs, Letter of Credit (LOC) Financing Account; (5) the TARP Program 

Account; and (6) the TARP Direct Loan Financing Account (DLFA). 

Account Descriptions

TARP Equity Purchase Program Account: The TARP Equity Purchase Program Account 

records the subsidy costs (cost to the government) associated with federal equity injections into 

qualifying financial institutions. Subsidy costs are calculated on a net present value basis. 

TARP Equity Purchase Financing Account (EPFA): The TARP EPFA is a non-budgetary 

account that records all financial transactions to and from the government resulting from equity 

purchases. The EPFA primarily tracks each cohort year’s purchase activity (dividend payments, 

the exercise of warrants, Treasury borrowings, interest paid to or received from Treasury, etc.) 

and is not included in the budget totals when calculating total government spending. 

TARP Housing Programs Account: The TARP Housing Programs Account records the subsidy 

costs and cash outlays associated with Treasury’s housing programs under TARP. The Making 

Home Affordable (MHA) and Hardest Hit Fund (HHF) housing programs are recorded on a cash 

basis, and the Federal Housing Administration (FHA) Short-Refinance Program is subject to 

credit reform accounting requirements, whereby its subsidy cost is calculated on a net present 

value basis. 

TARP Housing Programs, LOC Financing Account: The TARP Housing Programs, LOC

Financing Account is a non-budgetary account that records all financial transactions to and from 

the government resulting from OFS’s FHA Short-Refinance Program. Like other financing 

accounts, its primary purpose is the financial tracking of each cohort year’s loan activity. It is 

not included in the budget totals. 

TARP Program Account: The TARP Program Account records the subsidy costs associated with 

direct loans obligated to qualifying institutions. Subsidy costs are calculated on a net present 

value basis. 

TARP DLFA: The TARP DLFA is a non-budgetary account that records all financial 

transactions to and from the government resulting from direct loans. Like EPFA, its primary 

purpose is the financial tracking of each cohort year’s loan activity. It is not included in the 

budget totals.

OFS Administrative Account: This account provides for the administrative costs of OFS. 
OFS - 7

1.4 – Budget Adjustments Table

Dollars in Thousands

Office of Financial Stability FTE Amount

FY 2019 Estimated 24 $61,796 

Changes to Base:

Maintaining Current Levels (MCLs): - $1,155 

Non-Pay - $1,155 

Subtotal Changes to Base 0 $1,155 

Total FY 2020 Base 24 $62,951 

Program Changes:

Program Decreases: (4) ($9,482)

Housing Program Support 0 ($4,032)

Maintenance and Disposition of 

Assets: 0 ($230)

OFS Salaries and Benefits (4) ($646)

Organizational Support 0 ($4,574)

Total FY 2020 Estimated 20 $53,469 

D – Budget Increases and Decreases Description

Maintaining Current Levels (MCLs) ......................................................+$1,155,000 / +0 FTE

Non-Pay +$1,155,000 / +0 FTE 

Funds are required for non-labor costs such as travel, contracts, rent, supplies, and equipment.

Program Decreases .....................................................................................-$9,482,000 / -4 FTE

Housing Program Support -$4,032,000 / -0 FTE 

Administrative and compliance functions will continue to wind-down during FY 2019 and over 

time as programs close and no new assistance actions are provided and commitments are paid.

Maintenance and Disposition of Assets -$230,000 / -0 FTE 

During FY 2019, OFS will continue the disposition of its position in the remaining Capital 

Purchase Program (CPP) and Community Development Capital Initiative institutions (CDCI). 

In FY 2020, OFS expects its portfolio to be composed of no more than a handful of institutions, 

primarily CDCI institutions.

OFS Salaries and Benefits -$646,000 / -4 FTE 

Savings resulted from natural attrition and expiration of term appointments due to the winddown of various TARP programs.

Organizational Support -$4,574,000/ -0 FTE 

Administrative costs associated with managing OFS’s portfolio will decline over time as TARP 

winds down. However, many duties and responsibilities will remain and are not directly 

correlated to the volume of assets held by OFS. Many of these organizational support functions 

will be run in-house and relate to legislative and oversight-mandated reporting functions, as well 

as the management and maintenance of TARP’s housing programs.
OFS - 8 

1.5 – Operating Levels Table

Dollars in Thousands

Office of Financial Stability FY 2018 FY 2019 FY 2020

Object Classification Actual Estimated Estimated

11.1 - Full-time permanent $4,181 $3,039 $2,533 

11.7 - Other Personnel Compensation $1,228 $996 $862 

11.9 - Personnel Compensation (Total) $5,410 $4,035 $3,394 

12.0 - Personnel benefits $72 $30 $25 

Total Personnel and Compensation Benefits $5,482 $4,066 $3,419 

21.0 - Travel and transportation of persons $25 $36 $30 

23.0 - Rent, Communications and Utilities $3 $4 $4 

25.1 - Advisory and assistance services $11,287 $10,333 $7,826 

25.2 - Other services $45,961 $36,864 $33,615 

25.3 - Other purchases of goods & serv frm Govt accounts $12,300 $10,480 $8,560 

26.0 - Supplies and materials $0 $6 $6 

31.0 - Equipment $0 $8 $8 

Total Non-Personnel $69,575 $57,731 $50,050 

Subtotal New Budgetary Resources $75,057 $61,796 $53,469 

FTE 32 24 20 

Table includes direct FTEs

Totals may not foot due to rounding

E – Appropriations Language and Explanation of Changes

OFS does not receive discretionary appropriations from Congress. Therefore, no appropriations 

language is proposed.

F – Legislative Proposals

Treasury is seeking certain legislative changes related to OFS and TARP to reduce the frequency 

and necessity of several statutory reporting requirements that were established when TARP was 

created. Although these reporting requirements corresponded to the level of risk associated with 

a start-up entity in 2009, risk has dramatically decreased as programs have closed. OFS estimates 

that enacting the following legislative proposals would result in more than $2 million in annual 

savings in contracting cost and Government Accountability Office (GAO) reimbursements and 

would reduce OFS’s workload by four FTE employees per year. The remaining statutory 

requirements will continue to provide sufficient transparency during the wind-down of TARP. 

Replace OFS’s stand-alone financial audit performed by GAO: Since inception, OFS has been 

required to undertake a stand-alone financial audit requiring significant resources. As the 

majority of programs have closed, the need for a stand-alone audit has diminished. As such, a 

stand-alone financial audit could be replaced with an agreed-upon procedure (AUP) performed 

by GAO, or Treasury's Office of the Inspector General could audit OFS's financial operations 

under the Treasury-wide audit, similar to most other Treasury programs.

Sunset the Financial Stability Oversight Board (FinSOB): This interagency group meets 

monthly and reports quarterly. The group reviewed OFS’s program formulation and monitored
OFS - 9

program performance. The need for the board’s oversight and reporting has diminished as no 

new OFS programs can be implemented, all major investments have been disposed of, and the 

housing programs are in wind-down.

Change the frequency of the Section 105(a) report (“Congressional Monthly”): This 

performance report remains generally static from month-to-month. With most programs having 

closed, less frequent (quarterly) reporting is warranted.

Eliminate the Administrative Activity Report (“Obligation Report”): This quarterly report 

provides data on administrative obligations by OFS office and is required under the annual 

Treasury appropriations bill. OFS has been prudent in the use of administrative funds and has 

been reducing obligations by approximately 20 percent per year over the last five years. 
OFS - 10 

Section II - Annual Performance Plan and Report

A – Strategic Alignment

OFS’s continued wind-down efforts align with Treasury’s strategic goal of transforming 

government-wide financial stewardship.

Bank Support Programs 

CPP: OFS created CPP, its largest program, in October 2008. OFS provided a total of $204.9 

billion in capital to 707 institutions in 48 states. During FY 2018, OFS continued to wind-down 

remaining CPP investments through repayments by those institutions that were able to do so and 

restructuring investments in limited cases. As of November 30, 2018, CPP has generated $226.8 

billion in recoveries for taxpayers with three institutions remaining in the program, for a total of 

$23 million in investments outstanding.

CDCI: OFS created CDCI on February 3, 2010, to provide investments of capital to certified 

Community Development Financial Institutions (CDFI) banks, thrifts, and credit unions. OFS 

invested $570 million in 84 CDFIs, of which 28 institutions converted $363 million (including 

warrants) from CPP to CDCI. The initial dividend or interest rate was two percent. To 

encourage repayment, the dividend rate increased to nine percent after eight years, which 

occurred in August and September, 2018. As of November 30, 2018, CDCI has generated $579 

million in recoveries for taxpayers with eight institutions remaining in the program, for a total of 

$29 million in investments outstanding. 

Housing Programs 

OFS established several TARP housing programs, assisting millions of homeowners and 

introducing reforms for the mortgage servicing industry to facilitate mortgage modifications.

MHA: In 2009, OFS launched MHA to help homeowners prevent avoidable foreclosures and 

strengthen the housing market. The cornerstone of MHA is the Home Affordable Modification 

Program (HAMP), which provides eligible homeowners the opportunity to reduce their monthly 

mortgage payments. In accordance with provisions of the Act, MHA terminated on December 

31, 2016, except with respect to certain applications made before such date. MHA servicers 

were required to design policies and procedures to reasonably ensure that all MHA transactions 

were completed by December 1, 2017. As of November 30, 2018, OFS had disbursed $19.8 

billion out of a possible $23.8 billion under MHA. 

HHF: Established in 2010 to provide aid to homeowners in states hit hardest by the economic 

and housing market downturn. The $7.6 billion initiative encompassed 18 states and the District 

of Columbia (D.C.). In December 2015, the Consolidated Appropriations Act, 2016 (the Act) 

granted Treasury authority to make an additional $2.0 billion in commitments through the HHF. 

As of November 30, 2018, OFS had disbursed $9.1 billion out of a possible $9.6 billion under 

HHF.

FHA Short Refinance Program: OFS continues to support the FHA Short Refinance Program, 

which was intended to assist borrowers with negative equity. The program has seen limited 

participation. As such, OFS has incrementally reduced the LOC Facility supporting this program 
OFS - 11

from an initial $8.0 billion to $27 million in FY 2017, which matches OFS’s maximum liability 

for loans covered by the program as of December 31, 2016, when the program ended for new 

refinances. As of November 30, 2018, the revised lifetime cost estimate for the program was 

$15 million for outstanding refinanced loans.

Other Programs

Automotive Industry Financing Program (AIFP): OFS fully wound down AIFP during FY 2015, 

selling its remaining stake in Ally Financial. OFS disbursed $79.7 billion in loans and equity 

investments to the automotive industry through the AIFP. As of November 30, 2018, OFS had 

collected $70.5 billion through sales, repayments, dividends, interest, recoveries, and other 

income. Recoveries from the bankruptcy liquidation of Old Chrysler and Old GM remain 

possible. 

All other TARP programs closed prior to FY 2016, including the Targeted Investment Program, 

Asset Guarantee Program, Public-Private Investment Program, Term Asset-Backed Securities 

Loan Facility, Small Business Administration 7(a) Securities Purchase Program, and American 

International Group, Inc. Investment Program.

B – Office of Financial Stablity Performance

Performance Measure FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Target Target Target

Clean Audit Opinion on TARP 

Financial Statements (ensure 

transparency of operations to the 

public)

1 1 1 1 1 1 1 1

Percentage of Congressional 

Constituent Correspondence 

Responses Completed within 10 

Business Days of Receipt

92 50 66.75 87.5 100 100 100 100

Percentage of Customers Satisfied 

with FinancialStability.gov (Self 

Selected Respondents) (ensure 

transparency of operations to the 

public)

69 66.5 73 69.25 69.25 75 75 75

Percentage of FOIA Assignments 

On-Time or Less Than 30-Days 

Overdue (ensure transparency 

within the government)

15.0 13.03 56.56 85 85 80 85 85

Percentage of SIGTARP and GAO 

Oversight Recommendations 

Responded to On-Time (ensure 

transparency of operations to the 

public)

100 100 100 100 100 100 100 100

Percentage of Statutorily-Mandated 

Reports Submitted On-Time 

(ensure transparency of operations 

to the public)

99 100 94.7 96.25 100 100 100 100
OFS - 12 

The authority for OFS’s administrative funding is provided in section 118 of EESA. The 

administrative budget consists primarily of contracting and financial agent support costs 

associated with OFS’s ongoing implementation and management of the TARP housing programs 

and the management and disposition of OFS’s remaining investments. In addition, continuing 

organizational support, including information technology, facilities, legal, compliance, 

accounting, and human resources, will be needed to manage and wind-down these ongoing 

initiatives. OFS’s senior management is responsible for performance on its operational goals.

C – Operational Goals 

OFS’s strategic goal is to transform government-wide financial stewardship and the request will 

support the underlying operational goals to help OFS achieve this strategic goal. These 

operational goals include: 

1. Completing the wind-down of remaining TARP investment programs;

2. Continuing to help struggling homeowners avoid foreclosure;

3. Minimizing the cost of the TARP programs to the taxpayer; and

4. Operating with the highest standards of transparency, accountability, and integrity.

Completing the wind-down of remaining TARP investment programs 

The first Operational Goal is to complete the wind-down of the remaining TARP investment 

programs, the CPP and CDCI. OFS continues to exit CPP and CDCI by either: (i) allowing 

banks that are able to repurchase in full in the near future to do so; or (ii) restructuring and 

selling OFS’s investments in limited cases. The dividend rate step-ups for CDCI banks took 

effect in 2018, which increased the rate of bank repayments. OFS continues to work with CPP 

institutions to restructure certain investments that will allow them to exit TARP. As of 

November 30, 2018, OFS had $23 million in outstanding CPP investments and $29 million in 

outstanding CDCI investments. 

Continuing to help struggling homeowners avoid foreclosure 

OFS’s second Operational Goal is to continue helping struggling homeowners avoid foreclosure. 

The Act, signed into law on December 18, 2015, provided that the MHA program would 

terminate on December 31, 2016, except with respect to certain loan modification applications 

made before such date. As set forth in program guidelines, MHA servicers were required to 

evaluate applications submitted before the deadline and offer trial modifications to eligible 

applicants. All MHA transactions, including first and second lien permanent modifications, 

short sales or deeds-in-lieu of foreclosure, and unemployment forbearance plans, were required 

to be completed per program guidelines by December 1, 2017. Under this program, as of 

November 30, 2018, more than 1.7 million homeowners have secured permanent mortgage 

modifications. In addition, the HHF Program provides funding to 18 states and D.C. to assist 

struggling homeowners. At this late stage of the HHF program, many of the states have closed 

or expect to close their largest programs.

Minimizing the cost of the TARP programs to the taxpayer 

The third Operational Goal of OFS is to minimize the cost of the TARP programs to the 

taxpayer. OFS pursues this goal by carefully managing the timely exit of these investments to 

reduce taxpayers’ exposure, returning TARP funds to reduce the federal debt, and continuing to 

replace government assistance with private capital in the financial system. OFS also takes steps 
OFS - 13

to confirm that TARP recipients comply with any TARP-related statutory or contractual 

obligations such as executive compensation requirements and restrictions on dividend payments.

Operating with the highest standards of transparency, accountability, and integrity 

OFS’s final Operational Goal is to continue to operate with the highest standards of 

transparency, accountability, and integrity. OFS posts a variety of reports online that provide 

taxpayers with regular and comprehensive information about how TARP funds are spent, who 

received them and on what terms, and how much has been recovered to date. OFS also publishes 

the annual audited Agency Financial Report and continues to maintain productive working 

relationships with the three oversight bodies charged with auditing and reviewing TARP 

activities.

Section III - Additional Information

A – Summary of Capital Investments

OFS uses Departmental Offices’ (DO) system and is part of DO’s capital investment strategy.

A summary of capital investment resources, including major information technology and nontechnology investments, can be viewed and downloaded at 

http://www.treasury.gov/about/budget-performance/Pages/summary-of-capital-investments.aspx

This website also contains a digital copy of this document.



Department of the Treasury 

Office of Financial Research 

Congressional Budget 

Justification and Annual 

Performance Report and Plan 

FY 2020 
OFR - 2 

Table of Contents

Section I - Budget Request.................................................................................3

A – Mission Statement................................................................................................................ 3

B – Summary of the Request ...................................................................................................... 3

1.1 – Resource Detail Table........................................................................................................ 3

C – Vision, Priorities, and Context ............................................................................................. 3

1.2 – Budget Adjustments Table ................................................................................................. 6

D – Budget Increases and Decreases Description....................................................................... 6

1.3 – Operating Levels Table...................................................................................................... 7

E – Appropriations Language and Explanation of Changes ....................................................... 7

F – Legislative Proposals............................................................................................................ 7

Section II – Annual Performance Plan and Report................................................................... 8

A – Strategic Alignment ............................................................................................................. 8

B – Data Center........................................................................................................................... 8

2.1.1 – Data Center Resources and Measures............................................................................. 9

C – Technology Center ............................................................................................................... 9

2.1.2 – Technology Center Resources and Measures............................................................... 10

D – Research and Analysis Center............................................................................................ 10

2.1.3 – Research and Analysis Center Resources and Measures.............................................. 10

E – Operations and Support Services........................................................................................ 10

2.1.4 – Operations and Support Services Resources and Measures ......................................... 11
OFR - 3 

Section I - Budget Request __________

A – Mission Statement

Promote financial stability by delivering high-quality financial data, standards, and analysis for 

the Financial Stability Oversight Council (FSOC or Council) and public.

B – Summary of the Request 

The Office of Financial Research (OFR) is estimating a fiscal year (FY) 2020 funding level of 

$75.271 million, which is flat with its FY 2019 estimated funding level. To align with the 

Administration’s initiative to improve government efficiency and effectiveness, the OFR

implemented an organizational realignment effort to ensure appropriate structure for maximum 

efficiency. In addition, the Budget reflects continued reductions in OFR non-labor spending 

commensurate with the renewed fiscal discipline being applied across the Federal Government. 

The Budget also proposes to impose appropriate Congressional oversight of OFR functions by 

subjecting its activities to the annual appropriations process beginning in FY 2021. 

1.1 – Resource Detail Table

1) The OFR is financed through assessments on certain bank holding companies and nonbank financial companies. See Treasury’s

final rule and interim final rule governing the Assessments process: https://www.financialresearch.gov/strategybudget/files/final_rule_interim_final_rule.pdf

2) The funding for the first six months of operating expenses and 12 months of capital expenses are reflected in Unobligated

Balances from Prior Years. This is because the first assessment covering the fiscal year beginning October 1 is collected on

September 15 of the prior fiscal year. This makes it appear as though large amounts of unobligated balances went unused, when in

fact very little, if any, of those balances were from under execution.

C – Vision, Priorities, and Context 

The OFR, or Office, resides within the Department of the Treasury (Treasury). In carrying out 

its mission, the OFR seeks to support achievement of a transparent, efficient, and stable financial 

system. The OFR’s work contributes to the efforts of the regulatory community, the Treasury, 

and the Congress to make informed and comprehensive policies and take actions that will 

strengthen the financial system. This work is dependent on data, which the OFR obtains from 

member agencies, commercial data providers, publicly available data sources, and financial 

Dollars in Thousands

Office of Financial Research

Budgetary Resources

FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

Revenue/Offsetting Collections

Assessments1 $49,444 $62,995 $59,748 ($3,247) -5%

Interest $823 $1,175 $1,254 $79 7%

Recovery of Prior Year Paid Obligations $22 $31 $31 $0 0%

Recovery of Prior Year Unpaid Obligations $6,243 $3,727 $3,428 ($299) -8%

Restoration of Sequestration Rescission $5,394 $3,418 $3,979 $561 16%

Unobligated Balances from Prior Years $65,134 $47,728 $39,824 ($7,904) -17%

Offsetting Collections $111 $0 $0 $0 NA

Total Revenue/Offsetting Collections $127,171 $119,074 $108,264 ($10,810) -9%

Expenses/Obligations

Data Center 42 $15,967 10 $6,010 12 $6,796 2 $786 20.00% 13%

Technology Center 52 $23,530 61 $34,162 63 $32,218 2 ($1,944) 3.28% -6%

Research and Analysis Center 42 $12,302 29 $13,180 36 $14,274 7 $1,094 24.14% 8%

Operations and Support Services 49 $24,226 30 $21,919 34 $21,983 4 $64 13.33% 0%

Total Expenses/Obligations 185 $76,025 130 $75,271 145 $75,271 15 $0 11.54% 0%

Sequestration Reduction ($3,418) ($3,979) $0 $3,979 

Net Results $47,728 $39,824 $32,993 ($6,831) -17%

FY 2018 FY 2019 FY 2020 FY 2019 to FY 2020

Actual Estimated Estimated $ Change % Change
OFR - 4

companies in support, and at the direction, of the Council. The OFR obtains data from the 

financial regulators and financial companies either voluntarily, or, where necessary, using its 

rulemaking authority. It may also subpoena data. For example, the OFR has scores of 

agreements with other regulators to obtain, among other things, information about bank stress 

testing and information about risks in private funds. In addition, the OFR obtains information 

from specific firms under consideration by the Council for heightened supervision. Finally, the 

OFR recently promulgated a rule that will collect information about transactions in the securities 

repurchase agreements market. In addition, the OFR is authorized to, and does, provide certain 

data to the regulatory community, the Treasury, financial industry participants, and the general 

public to increase market transparency and facilitate monitoring of and research on the financial 

system. 

Using this data, the Office monitors the financial environment for the emergence of new 

vulnerabilities and migration of financial activity that could threaten financial stability. The 

Office takes an objective position to evaluate macroprudential policies and assess financial 

stability risks and sources of resilience, advocate for needed data standards, help the regulatory 

community enhance its peripheral vision, and produce work that may have previously been 

beyond the reach of individual regulatory agencies and other important stakeholders. In addition

to developing standards for data collection, the Office facilitates the development of standards 

for financial data so that a common language and way of describing institutions and activities in 

our markets are used globally. By law the OFR is required to create a legal entity identifier 

database, and has done so by establishing a global system that currently identifies over 1.4 

million firms. We are also working with Council member agencies and global coordinating 

bodies to develop standards for transaction identification, instrument classification, and critical 

data elements in the derivatives markets. 

In the OFR Strategic Plan for FY 2015-2019, the OFR established three strategic goals that 

reflect its primary functions in data and analysis, data standardization, and research.1

 The plan 

will continue to guide the Office’s work and will support the decisions made about resources 

needed to implement those strategies while a new OFR Strategic Plan for FY 2020-2024 is 

drafted with a targeted publication date of FY 2019 Q4. The three goals in the current OFR 

Strategic Plan are:

1. The OFR is an essential source of data and analysis for monitoring threats to financial 

stability.

Key objectives of this goal include:

• The OFR’s monitoring tools and analyses are widely used and critical to assessing 

financial stability.

• Data used to monitor financial stability are comprehensive, reliable, and accessible to 

policy makers and the public through the OFR.

 1 See the OFR Strategic Plan for FY 2015-2019: 

http://financialresearch.gov/strategy-budget/files/Office-of-Financial-Research-Strategic-Plan-2015-2019.pdf.
OFR - 5 

• Data providers and the public trust, acknowledge, and recognize that OFR data are

protected and secure.

2. Standards that improve the quality and utility of financial data are identified and

adopted.

Key objectives of this goal include:

• Recognition of the need for standards by policy makers and industry.

• The OFR is the source of expert knowledge needed to develop and implement types and

formats of data reported and collected.

• Financial data standards that create efficiencies and facilitate analysis are widely used.

3. Leading edge research improves financial stability monitoring and the scope and

quality of financial data, and informs policy and risk management.

Key objectives of this goal include:

• The OFR is the recognized center for objective, innovative research on financial stability.

• OFR research is widely cited and used to improve policy making, risk management,

financial stability, and the scope and quality of financial data.

Specific OFR priorities for FY 2019 and FY 2020 that support the three strategic goals include: 

1. Collecting data on centrally-cleared funding transactions in the U.S. repurchase

agreement (repo) market to support expanded monitoring of this market and calculation

of certain reference rates, particularly the Secured Overnight Financing Rate which is

planned as an alternative to LIBOR (USD London Interbank Offered Rate).

2. Developing and launching a short-term funding monitor, which will display the data

referenced above along with other data on the repo market, to provide the OFR, FSOC

member agencies, and the public with essential insight into this market, which is critical

to the provision of liquidity and was at the center of the financial crisis.

3. Publishing the OFR Annual Report, including the assessment of risks to financial

stability and key findings from the OFR’s research and analysis.

4. Continuing to expand and enhance the OFR’s support of the FSOC.

5. Advancing the development and use of industry-wide data standards.
OFR - 6 

1.2 – Budget Adjustments Table

Dollars in Thousands

D – Budget Increases and Decreases Description

Program Increases............................................................... +$1,633,000 / +15 FTE 

Staff Restructuring +$1,633,000 / +15 FTE 

The OFR anticipates it may take 12 to 18 months to backfill critical positions left vacant due to a 

hiring freeze and a recently completed Reduction in Force. Such positions should be backfilled 

by late FY 2019 or early FY 2020, resulting in an increase of 15 FTE from FY 2019 to FY 2020. 

The OFR anticipates near-term steady-state FTE of 145 as a result of the organizational 

realignment.

Program Efficiencies............................................................... -$1,633,000 / -0 FTE

Administrative Cost Savings -$1,633,000 / -0 FTE

With the completion of the organizational realignment, the Office will continue to realize savings 

from lower administrative costs, and reduced supplies and equipment purchases. In FY 2020, 

reduced non-labor costs will enable the OFR to backfill critical positions. See Program Increases.

Office of Financial Research FTE Amount

FY 2019 President's Budget 140 $75,271

Changes to Base:

Program Decrease (10) $0

FTE Adjustment (10) $0

Revised FY 2019 Estimated 130 $75,271

Initiative Annualization 15 $1,633

Staff Restructuring 15 $1,633

Efficiency Savings 0 ($1,633)

Administrative Cost Savings 0 ($1,633)

Subtotal Changes to Base 15 $0

FY 2020 Estimated 145 $75,271
OFR - 7 

1.3 – Operating Levels Table

Dollars in Thousands 

1) Personnel compensation and benefits include direct OFR staff members only. Object Classification 25.3,

“Other goods and services from Federal sources,” and expenditures of “Operations and Support Services” include reimbursable

support received from Treasury’s Departmental Offices; personnel benefits services from the

Office of the Comptroller of the Currency; and services from Treasury’s Bureau of the Fiscal Service Administrative Resource

Center, including human resource, procurement, travel, and financial management services.

E – Appropriations Language and Explanation of Changes

The OFR receives no appropriations from Congress. 

F – Legislative Proposals

The Budget proposes to impose appropriate Congressional oversight of OFR functions by 

subjecting its activities to the annual appropriations process beginning in FY 2021. 

Office of Financial Research FY 2018 FY 2019 FY 2020

Object Classification Actual Estimated Estimated

11.1 - Full-time permanent 31,136 20,036 21,965

11.3 - Other than full-time permanent 299 208 379

11.5 - Other personnel compensation 421 213 403

11.8 - Special personal services payments 229 120 5

11.9 - Personnel Compensation (Total) 32,085 20,577 22,752

12.0 - Personnel benefits 10,908 7,795 8,559

13.0 - Benefits for former personnel 65 1,306 0

Total Personnel and Compensation Benefits $43,058 $29,678 $31,311

21.0 - Travel and transportation of persons 147 245 265

23.3 - Communication, utilities, and misc charges 131 135 141

24.0 - Printing and reproduction 8 24 25

25.1 - Advisory and assistance services 16,964 19,725 18,875

25.2 - Other services from non-Federal sources 735 785 755

25.3 - Other goods and services from Federal sources 5,433 9,785 8,795

25.7 - Operation and maintenance of equip 3,220 3,701 3,705

26.0 - Supplies and materials 5,649 7,458 7,535

31.0 - Equipment 680 3,735 3,864

Total Non-Personnel 32,967 45,593 43,960

New Budgetary Resources $76,025 $75,271 $75,271

FTE 185 130 145
OFR - 8 

Section II – Annual Performance Plan and Report________________________

A – Strategic Alignment

The OFR seeks to promote financial stability by delivering high-quality financial data standards, 

research, and analysis to the FSOC and the public. This mission is in direct alignment with 

Treasury’s Strategic Plan for FY 2018-2022 under the following goals and objectives: 

• Goal 1 - Boost U.S. Economic Growth

o Objective 1.2 – Strong Economic Fundamentals

• Goal 2 - Promote Financial Stability

o Objective 2.4 – Financial Sector Critical Infrastructure and Cybersecurity

With the publication of the Treasury Strategic Plan for FY 2018-2022, the Treasury will work in 

FY 2019 to baseline its performance against the new strategic objectives. This could result in 

additional changes to performance measures in the 2021 Budget. 

The OFR reviews its performance measures annually and revises them, if appropriate, to ensure 

their continued usefulness for management decision-making and improved results. 

The OFR’s efforts, working with the FSOC, the Treasury, and other important stakeholders, will 

help drive toward the vision of a stable, transparent, and efficient financial system. 

Key areas of focus will be in monitoring risks to financial stability and in developing and 

introducing new tools for the OFR, FSOC members, and the public to use in monitoring those 

risks. 

Other focus areas include research and policy analysis that promote informed decision-making 

for policies that balance the need of stability with the need for efficient and effective regulation, 

supporting the Treasury’s objective of Strong Economic Fundamentals. In all of these areas, 

high quality data and strong research expertise, supported by strong information technology (IT), 

are essential. The OFR will continue its efforts to promote, identify, and implement financial 

data standards to improve the quality, scope, and accessibility of financial data. Two important 

initiatives will be the ongoing data collection covering centrally-cleared repo agreements and 

support for the Secured Overnight Financing Rate planned as an alternative to LIBOR. 

Finally, the OFR will continue to publish its statutorily-mandated Annual Report that assesses 

the state of the U.S. financial system and presents key findings from the OFR’s research. 

B – Data Center

($6,796,000 from Assessments):

Following reshaping, the Data Center seeks new ways to promote and share the OFR’s data and 

data analytic products with external stakeholders and promotes the development and use of data 

standards to improve upon the acquisition and sharing of data across the regulatory system. 

Data Standards

One of the OFR’s strategic goals is to identify and adopt standards that improve the quality and 

utility of financial data. Standards for financial data will benefit regulators and financial market 
OFR - 9 

participants by making data aggregation easier, improving analysis, and reducing data collection 

costs. The OFR monitors progress through the following key performance indicators. Note that 

these are not measures but indicators because the OFR, through mechanisms such as its 

leadership in standards and regulatory oversight bodies and providing technical guidance to other 

regulators, can influence these metrics but cannot directly control them. 

• Number of Legal Entity Identifiers (LEIs) Issued Cumulatively in the United States and

Internationally – This indicator tracks the progress over time in industry’s use of the LEI.

• Number of Times That Financial Data Standards are Incorporated in Rules and Regulations –

This data point serves as an indicator of regulators’ awareness of the importance of data 

standards and the extent to which data standards are being adopted in rules and regulations. 

2.1.1 – Data Center Resources and Measures

Dollars in Thousands

C – Technology Center

($32,218,000 from Assessments):

The Technology Center provides mission-critical analytic services to support the OFR’s work 

with complex, sensitive financial data and the Office’s research and analysis activities. A result 

of the restructuring is that the Technology Center is now also responsible for collecting, 

validating, maintaining, and disseminating all data necessary to achieve the OFR mission. In 

addition, the Technology Center is responsible for safeguarding data and systems, and 

managing all IT capabilities within the OFR. These responsibilities include computing and 

analytic platforms, software, telecommunications, client applications, and office automation 

solutions. 

The OFR has internal performance measures for this activity, however they are not public 

because the measures contain sensitive information.

FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019

Actual Actual Actual Actual Actual Estimated

Expenses/Obligations $46,940 $17,240 $16,477 $17,833 $15,967 $6,010

$46,940 $17,240 $16,477 $17,833 $15,967 $6,010

FTE 90 51 37 44 42 10 12

Budget Activity Total $6,796

 Resource Level FY 2020

Estimated

$6,796

FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Number of LEIs Issued Cumulatively in the 

United States and Internationally N/A 395,861 395,861 587,941 1,300,832 I I

Number of Times That Financial Data 

Standards are Incorporated in Rules and 

Regulations

N/A 2 9 4 1 I I

Measure Actual Actual Actual Actual Actual Target Target
OFR - 10 

2.1.2 – Technology Center Resources and Measures

Dollars in Thousands

D – Research and Analysis Center 

($14,274,000 from Assessments):

The Research and Analysis Center conducts research and analysis on systemic risk, 

macroprudential policy, and financial stability. Working closely with the FSOC, the Treasury, 

other key stakeholders, the Financial Research Advisory Council, and experts from around the 

globe, the OFR collaboratively identifies important issues that need to be addressed and focuses 

its resources on delivering impactful results in areas such as a LIBOR alternative and a multifactor approach for determining bank regulatory thresholds. 

Leading Edge Research and Monitoring Threats to Financial Stability

The Research and Analysis Center contributes to the achievement of two of the OFR’s three 

strategic goals: (1) Leading edge research improves financial stability monitoring and the scope 

and quality of financial data, and informs policy and risk management; and (2) The OFR is an 

essential source of data and analysis for monitoring threats to financial stability. Historically, the 

OFR has reported output measures, such as the numbers of publications and monitoring tools. 

However, these measures did not reflect the OFR’s progress in meeting stakeholder needs for 

research and analysis work, which is a top priority. As such, moving forward, the OFR will

discontinue public reporting of such output metrics in recognition that producing greater quantity 

does not always further the agency’s goals. The OFR has begun its next five-year strategic 

planning effort, targeted for completion in FY 2019 Q4. A key part of the planning process is 

establishing strategic goals and objectives that are both meaningful and measurable. The OFR is 

currently reviewing measurement approaches such as more sophisticated website monitoring of 

product usage and direct outreach to external stakeholders in the financial community. The OFR 

is targeting FY 2020 to introduce new measures, concurrent with the implementation of its new 

five-year strategic plan 

2.1.3 – Research and Analysis Center Resources and Measures

Dollars in Thousands

E – Operations and Support Services

($21,983,000 from Assessments):

The category “Operations and Support Services” contains the activities of the Director’s Office, 

Operations, External Affairs, and Chief Counsel. The category includes support provided 

FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019

Actual Actual Actual Actual Actual Estimated

Expenses/Obligations 0 $30,970 $32,132 $29,235 $23,530 $34,162

0 $30,970 $32,132 $29,235 $23,530 $34,162

FTE 0 51 61 63 52 61 63

 Resource Level FY 2020

Estimated

$32,218

Budget Activity Total $32,218

FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019

Actual Actual Actual Actual Actual Estimated

Expenses/Obligations $7,700 $10,396 $14,239 $15,605 $12,302 $13,180

$7,700 $10,396 $14,239 $15,605 $12,302 $13,180

FTE 33 43 54 53 42 29 36

 Resource Level FY 2020

Estimated

$14,274

Budget Activity Total $14,274
OFR - 11

through a shared services model and reimbursable arrangements with Treasury’s Departmental 

Offices; personnel benefits services from the Office of the Comptroller of the Currency; and 

services from Treasury’s Bureau of the Fiscal Service Administrative Resource Center, including 

services related to human resources, procurement, travel, and financial management. 

2.1.4 – Operations and Support Services Resources and Measures

Dollars in Thousands

The OFR has no capital investments. Capital investments that support OFR are included in the 

Departmental Offices plan. A summary of capital investment resources, including major IT and 

non-IT investments can be found at: 

http://www.treasury.gov/about/budget-performance/Pages/summary-of-capital-investments.aspx

This website contains a digital copy of this document.

FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019

Actual Actual Actual Actual Actual Estimated

Expenses/Obligations $26,626 $26,110 $32,026 $26,533 $24,226 $21,919

$26,626 $26,110 $32,026 $26,533 $24,226 $21,919

43 49 56 59 49 30

Budget Activity Total $21,983

 Resource Level FY 2020

Estimated

$21,983

FTE 34



Department of the Treasury 

Financial Stability Oversight 

Council 

Congressional Budget 

Justification and Annual 

Performance Report and Plan

FY 2020 
FSOC - 2 

Table of Contents

Section I – Budget Request............................................................................................................3

A – Mission Statement .................................................................................................................3

B – Summary of the Request .......................................................................................................3

1.1 – Resource Detail Table .........................................................................................................3

1.2 – Budget Adjustments Table ..................................................................................................5

C – Vision, Priorities, and Context ..............................................................................................5

D – Budget Increases and Decreases Description........................................................................5

1.3 – Operating Levels Table .......................................................................................................5

E – Appropriations Language and Explanation of Changes ........................................................5

F – Legislative Proposals .............................................................................................................5

Section II – Annual Performance Plan and Report ....................................................................6

A – Strategic Alignment ..............................................................................................................6

B – Financial Stability Oversight Council ...................................................................................6

2.1.1 – Financial Stability Oversight Council Resources and Measures .....................................6

C – FDIC Reimbursement ...........................................................................................................6

2.1.2 – FDIC Reimbursement Resources and Measures..............................................................6
FSOC - 3

Section I – Budget Request

A – Mission Statement

To identify risks to the financial stability of the United States, to promote market discipline, and 

to respond to emerging threats to the stability of the U.S. financial system.

B – Summary of the Request

The Financial Stability Oversight Council (FSOC or Council) is estimating a fiscal year 

(FY) 2020 funding level of $10.487 million, which is flat with its FY 2019 estimated funding 

level. This request includes $6.186 million for the FSOC Secretariat and the Office of the 

Independent Member with Insurance Expertise, and $4.301 million to reimburse the Federal 

Deposit Insurance Corporation (FDIC) for certain expenses as required by law. On March 6, 

2019, the Council approved a notice of proposed interpretive guidance and request for public 

comment regarding nonbank financial company determinations. The proposal includes changes 

to make FSOC decision-making procedures more transparent, efficient, and effective. The 

Budget also proposes to impose appropriate Congressional oversight of Council functions by 

subjecting its activities to the annual appropriations process beginning in FY 2021.

1.1 – Resource Detail Table

1) The FSOC and FDIC reimbursements are financed through assessments on certain bank holding companies and nonbank 

financial companies. See Treasury’s final rule and interim final rule governing the Assessments process: 

https://www.financialresearch.gov/strategy-budget/files/final_rule_interim_final_rule.pdf

2) The funding for the first six months of operating expenses and 12 months of capital expenses are reflected in the Unobligated 

Balances from Prior Years. This is because the first assessment covering the fiscal year beginning October 1 is collected on 

September 15 of the prior fiscal year. This makes it appear as though large amounts of unobligated balances went unused, when in 

fact very little, if any, of those balances were from under execution. 

C – Vision, Priorities, and Context

The Council is chaired by the Secretary of the Treasury and consists of 10 voting members and 

five nonvoting members who serve in an advisory capacity. The Council brings together the 

expertise of the federal financial regulators, an insurance expert appointed by the President, and 

state regulators. 

Dollars in Thousands

Financial Stability Oversight Council

Budgetary Resources

FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

Revenue/Offsetting Collections

Assessments1 $6,742 $8,590 $8,147 ($443) -5%

Interest $112 $160 $171 $11 7%

Recovery of Prior Year Paid Obligations $3 $4 $4 $0 0%

Recovery of Prior Year Unpaid Obligations $851 $508 $467 ($41) -8%

Restoration of Sequestration Rescission $735 $466 $543 $77 17%

Unobligated Balances from Prior Years $8,882 $7,731 $6,429 ($1,302) -17%

Total Revenue/Offsetting Collections $17,325 $17,459 $15,761 ($1,698) -10%

Expenses/Obligations

FSOC 13 $4,966 18 $6,186 18 $6,186 0 $0 NA NA

FDIC 0 $4,162 0 $4,301 0 $4,301 0 $0 NA NA

Total Expenses/Obligations 13 $9,128 18 $10,487 18 $10,487 0 $0 NA NA

Sequestration Reduction ($466) ($543) $0 $543 

Net Results $7,731 $6,429 $5,274 ($1,155) -18%

FY 2018 FY 2019 FY 2020 FY 2019 to FY 2020

Actual Estimated Estimated $ Change % Change
FSOC - 4 

The Council’s three statutory purposes are to: 

1) identify risks to the financial stability of the United States that could arise from the material

financial distress or failure, or ongoing activities, of large, interconnected bank holding

companies or nonbank financial companies, or that could arise outside the financial services

marketplace;

2) promote market discipline, by eliminating expectations on the part of shareholders, creditors,

and counterparties of such companies that the Government will shield them from losses in

the event of failure; and

3) respond to emerging threats to the stability of the U.S. financial system.

The Council has a statutory duty to facilitate information sharing and coordination among the 

member agencies regarding domestic financial services policy development, rulemaking, 

examinations, reporting requirements, and enforcement actions. 

Over the next year, the Council will continue to: monitor the financial system for emerging risks; 

facilitate interagency cooperation to identify and analyze emerging threats; facilitate information 

sharing and interagency coordination with respect to various regulatory initiatives; and consider 

comments it receives on its notice of proposed interpretive guidance regarding nonbank financial 

company determinations. 

Over the last year, the Council continued to identify and monitor potential risks to U.S. financial 

stability; fulfilled its statutory requirements, including transmission of its eighth annual report to 

Congress; and served as a forum for coordination among member agencies. In FY 2018, the 

Council rescinded its one remaining nonbank financial company determination. 

By law, the Council is required to convene no less than quarterly, but the Council has convened 

on a more frequent basis to share information on key financial developments, coordinate 

regulatory implementation, and monitor progress on recommendations from the Council’s annual 

reports. In FY 2018, the Council convened seven times. The Council will continue to remain 

focused on identifying near-term threats and addressing structural vulnerabilities in the financial 

system. Transparency into Council work has routinely been provided through an annual report 

to Congress, periodic Congressional testimony on Council activities and emerging threats to

financial stability, and regular communications with the public about Council activities and 

decisions. 

The Council is an executive agency and is not an office or bureau of the Department of the 

Treasury (Treasury). However, by law, the Council’s expenses (and, indirectly, FDIC 

reimbursements) are considered expenses of the Office of Financial Research, an office within 

Treasury.

FDIC Reimbursement

By law, the Council’s expenses include reimbursement of certain reasonable implementation 

expenses incurred by the FDIC in implementing Orderly Liquidation Authority. The FDIC must 

periodically submit requests for reimbursement to the Chairperson of the Council, who shall 

arrange for prompt reimbursement to the FDIC. FDIC expenses are for rule writing and 

resolution planning. 
FSOC - 5

1.2 – Budget Adjustments Table

Dollars in Thousands

Financial Stability Oversight Council FTE Amount

FY 2019 Estimated 18 $11,054 

Changes to Base:

Program Decrease: 0 ($567)

Labor Adjustment 0 ($279)

Non-labor Adjustment 0 ($288)

Revised FY 2019 Estimate 18 $10,487 

Total FY 2020 Estimated 18 $10,487 

D – Budget Increases and Decreases Description

The FSOC does not anticipate any program changes in FY 2020.

1.2 – Operating Levels Table

Dollars in Thousands

1 Object Class 25.3 includes FDIC reimbursement.

E – Appropriations Language and Explanation of Changes

The FSOC receives no appropriations from Congress.

F – Legislative Proposals

The Budget proposes to impose appropriate Congressional oversight of Council functions by 

subjecting its activities to the annual appropriations process beginning in FY 2021.

Financial Stability Oversight Council FY 2018 FY 2019 FY 2020

Object Classification Actual Estimated Estimated

11.1 - Full-time permanent 1,773 2,165 2,165

11.3 - Other than full-time permanent 173 175 175

11.5 - Other personnel compensation 33 37 37

11.9 - Personnel Compensation (Total) 1,979 2,377 2,377

12.0 - Personnel benefits 630 739 739

Total Personnel and Compensation Benefits $2,609 $3,116 $3,116

21.0 - Travel and transportation of persons 33 55 55

25.1 - Advisory and assistance services 1,998 2,332 2,332

25.2 - Other services from non-Federal sources 14 17 17

25.3 - Other goods and services from Federal sources 4,162 4,635 4,635

25.7 - Operation and maintenance of equip 0 0 0

26.0 - Supplies and materials 156 179 179

31.0 - Equipment 141 153 153

32.0 - Land and structures 10 0 0

43.0 - Interest and dividends 5 0 0

Total Non-Personnel 6,519 7,371 7,371

New Budgetary Resources $9,128 $10,487 $10,487

FTE 13 18 18
FSOC - 6 

Section II – Annual Performance Plan and Report

A – Strategic Alignment

The FSOC supports the Department of the Treasury’s Strategic Plan for FY 2018-2022 as 

follows: 

• Goal 1: Boost U.S. Economic Growth

o Objective 1.2 – Strong Economic Fundamental

• Goal 2: Promote Financial Stability

o Objective 2.4 – Financial Sector Critical Infrastructure & Cybersecurity

B – Financial Stability Oversight Council

($6,186,000 from Assessments): 

There are no measures specified for managing Council performance. The FSOC’s annual reports 

and other public documents, as well as individual Council member agencies’ performance 

documents, provide information to the public relevant to the Council’s performance. 

Information on the Council is provided on www.treasury.gov, www.fsoc.gov, and member 

agency websites to provide transparency and accountability. 

2.1.1 – Financial Stability Oversight Council Resources and Measures

C – FDIC Reimbursement

($4,301,000 from Assessments): 

Certain FDIC expenses are treated as expenses of the Council. For additional detail, see above.

2.1.2 – FDIC Reimbursement Resources and Measures

Dollars in Thousands

FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019

Actual Actual Actual Actual Actual Estimated

Expenses/Obligations $7,660 $6,236 $7,157 $5,655 $4,966 $6,186

$7,660 $6,236 $7,157 $5,655 $4,966 $6,186

23 22 22 17 13 18

Budget Activity Total $6,186

 Resource Level FY 2020

Estimated

$6,186

FTE 18

Dollars in Thousands

FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019

Actual Actual Actual Actual Actual Estimated

Expenses/Obligations $11,592 $7,628 $6,571 $5,126 $4,162 $4,301

$11,592 $7,628 $6,571 $5,126 $4,162 $4,301

0 0 0 0 0 0

Budget Activity Total $4,301

 Resource Level FY 2020

Estimated

$4,301

FTE 0


Department of the Treasury 

Treasury Franchise Fund 

Congressional Budget 

Justification and Annual 

Performance Report and Plan 

FY 2020 
TFF - 2 

Table of Contents

Section I – Budget Request........................................................................................................... 3

A – Mission Statement ............................................................................................................ 3

B – Summary of the Request ................................................................................................... 3

1.1 – Resource Detail Table .................................................................................................... 4

1.2 – Budget Adjustments Table ............................................................................................. 4

C – Budget Increases and Decreases Description ................................................................... 5

1.3 – Operating Levels Table .................................................................................................. 7

D – Appropriations Language and Explanation of Changes ................................................... 7

E – Legislative Proposals........................................................................................................ 7

Section II – Annual Performance Plan and Report................................................................... 8

A – Strategic Alignment .......................................................................................................... 8

B – Budget and Performance by Budget Activity ................................................................... 9

2.1.1 Treasury Shared Services Programs Resources and Measures.......................................9

2.1.2 Centralized Treasury Administrative Services Resources and Measures .................... 10

2.1.3 Administrative Services Resources and Measures ....................................................... 10

2.1.4 Information Technology Resources and Measures ...................................................... 13

C – Changes in Performance Measures ................................................................................. 14

Section III – Additional Information ........................................................................................ 16

A – Summary of Capital Investments ................................................................................... 16

B. Treasury Franchise Fund Program Costs ......................................................................... 17
TFF - 3 

Section I – Budget Request

A – Mission Statement

Assist customer agencies in meeting their mission by providing responsive, customer-focused, 

cost-effective administrative and information technology support services. 

B – Summary of the Request 

The Treasury Franchise Fund (TFF) supports effective administrative and information 

technology services through commitment to high quality services, efficient operations, and 

responsiveness to an ever changing federal landscape. Through use of the services of the TFF, 

federal agencies can focus on mission activities, achieve cost savings and avoidance through 

economies of scale and cost sharing opportunities, and take advantage of state-of-the art 

technologies and services provided by the Department of the Treasury to increase productivity 

and efficiency in their operations. 

The TFF providers include Departmental Offices’ Treasury Shared Services Programs (TSSP), 

Departmental Offices’ Centralized Treasury Administrative Services (CTAS), and the Bureau of 

the Fiscal Service’s Administrative Resource Center (ARC). TFF providers offer financial 

management, procurement, travel, human resources, information technology, and other 

administrative services to federal customers on a fully cost recoverable, fee-for-service basis. 

Treasury moved the Departmental Offices’ (DO) CTAS into the Treasury Franchise Fund in FY 

2019 to consolidate broad-scale administrative functions and capital investment activities into 

one account. 

ARC’s sharing of mission support (including information technology) services model is directly 

aligned with the President’s Management Agenda (PMA) - Cross Agency Priority (CAP) Goal 5 

(Expanding the use of quality shared services), the Office of Management and Budget’s (OMB) 

M-17-22 Reform Plan, and Treasury’s Future of Federal Financial Management vision. As the

only federal provider to successfully transition and support a cabinet level agency, ARC has

demonstrated shared services viability for agencies of all sizes, funding sources and missions for

over 20 years. ARC demonstrates the value of delivering quality services, containing costs,

achieving a high level of customer satisfaction and continual improvement. Through planned

initiatives, ARC will partner with agencies, OMB and the established interagency governance

processes to implement the Treasury 10 year vision and expansion of federal shared services,

including integration with CAP Goal 5. In addition, ARC will continue to expand services to

new customers and achieve high performance through:

• Optimizing efficiency and reducing costs,

• Reducing customer risk,

• Improving performance and stewardship,

• Ensuring compliance and strong internal controls, and

• Increasing the timeliness and transparency of performance data to better inform agency

decision makers.

The TFF providers will continue to be integral federal partners to customer agencies by 

providing responsive, high quality and cost effective shared services to federal agencies through 
TFF - 4 

our commitment to streamlined processes to ensure compliance and eliminate redundancy, and 

focus on maximizing cost sharing opportunities that take advantage of economies of scale. 

The Treasury Franchise Fund aligns to the following Treasury strategic goals as presented in the 

FY 2018 - 2022 strategic plan:

• Goal 4: Transform Government-wide Financial Stewardship

• Goal 5: Achieve Operational Excellence

1.1 – Resource Detail Table Dollars in Thousands

Treasury Franchise Fund

Budgetary Resources

FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

Revenue/Offsetting Collections

Treasury Shared Services Programs $236,221 $232,515 $249,436 $16,921 7.28%

Centralized Treasury Administrative 

Services NA $140,522 $166,591 $26,069 18.55%

Administrative Support Services $160,743 $155,315 $170,535 $15,220 9.80%

Information Technology Services $197,335 $185,066 $188,572 $3,506 1.89%

Recoveries from Prior Years $8,541 $19,196 $22,925 $3,729 19.43%

Unobligated Balances from Prior Years $182,961 $196,071 $211,837 $15,767 8.04%

Total Revenue/Offsetting Collections $785,801 $928,684 $1,009,897 $81,212 8.74%

Expenses/Obligations

Treasury Shared Services Programs 234 $241,845 239 $235,515 260 $274,017 21 $38,502 8.79% 16.35%

Centralized Treasury Administrative 

Services NA NA 207 $140,522 201 $166,591 (6) $26,069 -2.90% 18.55%

Administrative Support Services 933 $150,876 969 $153,375 1,058 $170,535 89 $17,160 9.18% 11.19%

Information Technology Services 476 $197,009 504 $187,435 504 $189,971 0 $2,536 0.00% 1.35%

Total Expenses/Obligations 1,643 $589,730 1,919 $716,847 2,023 $801,114 104 $84,267 5.42% 11.76%

Net Results $196,071 $211,837 $208,783 ($3,055) -1.44%

FY 2018 FY 2019 FY 2020 FY 2019 to FY 2020

Actual Estimated Estimated $ Change % Change

1.2 Budget Adjustment

Treasury Franchise Fund FTE Amount

FY 2019 Estimated 1,919 $716,847

Changes to Base:

Maintaining Current Levels (MCLs): $9,728

Non-Pay $9,728

Subtotal Changes to Base 0 $9,728

Total FY 2020 Base 1,919 $726,575

Program Changes:

Program Increases: 104 $75,604

Operations and Maintenance of Prior-year Enterprise-w ide Cybersecurity Investments 

(TSSP) 8 $8,821

Program changes/Realignment to TSSP 0 $22,415

Program changes/Realignment to CTAS 7 $28,312

Customer Grow th (ARC Admin) 89 $16,056

Program Decreases: 0 ($1,065)

Continuous Diagnostics and Mitigation Licenses (TSSP) 0 ($1,065)

Subtotal Changes to Base 104 $74,539

Total FY 2020 Estimated 2,023 $801,114

Dollars in Thousands
TFF - 5 

C – Budget Increases and Decreases Description

Maintaining Current Levels (MCLs) ................................................... + $9,728,000 / + 0 FTE

Non-Pay +$9,728,000 / +0 FTE 

Funds are required for non-labor expenses such as travel, contracts, rent, supplies, and 

equipment.

Program Increases + $75,604,000 / + 104 FTE 

Operations and Maintenance of Prior-year Enterprise-wide Cybersecurity Investments (TSSP), 

+$8,821,000, +8 FTE

The TFF requires to increase TSSP by $8,821,000 to transition operations and maintenance costs 

from the Cybersecurity Enhancement Account (CEA) to the TFF. Funding to pay these bills is 

included in the individual bureau Congressional Justifications. These bureau funds will support 

operations and maintenance of the following cybersecurity projects that were initially 

implemented with CEA funding and per Department of Homeland Security directives: 

• Continuous Mitigation and Diagnostics (CDM) Licenses Phase II

• Trusted Internet Connection (TIC) Encrypted Traffic Inspection

• Endpoint Incident Response

• Enhanced Packet Capture

• Government Security Operations Center (GSOC) Analytics and Expansion

• Malware Content Filter

Program Changes/Realignment to TSSP, +22,415,000, +0 FTE 

The TFF requires changes to TSSP to facilitate quality customer service, address the growing 

needs of agencies, and attain goals set by the Administration. Bureaus will fund changes that 

increase efficiency and manage costs while also receiving quality services attributed to the TFF. 

TSSP changes include 

• Increase of program support by $1,187,000 for anticipated shared and customer specific

needs across the shared services programs.

• Expend an additional $4,092,000 to Treasury Network (TNET) service changes for the

Internal Revenue Service (IRS) toll-free network circuits.

• Expending an estimated $3,000,000 in FY 2019 to transition from the current Networx

contract to the General Services Administrative (GSA) Enterprise Infrastructure Support

(EIS) contract. For FY 2020, The TFF requires to expend an additional $17,136,000 for

the multi-year transition project. The transition of the current contract is dependent on

timelines established by GSA and costs may be revised once the contract is awarded.

In FY 2020, the Credit Modeling and Web Solutions programs will be realigned from CTAS to 

TSSP. The shift of these programs results in a more efficient method of formulating program 

budgets and executing customer billings by consolidating these programs into TSSP. The 

transitions of these programs has a net neutral effect on FTEs and budgetary resources for TFF. 

Program changes/Realignment to CTAS, +28,312,000, +7 FTE 

The TFF requires an increase to the CTAS program to provide Departmental Offices, specifically 

for the Departmental Offices (DO) Salaries and Expenses (SE) and Terrorism Financial 

Intelligence (TFI) initiatives, with advanced capabilities in administrative support and 
TFF - 6

information security. With these programmatic changes CTAS can properly and proficiently 

provide increased administrative support within DO SE and TFI. CTAS program changes and 

realignment include:

• Expend $23,053,000 and 4 FTE increase in support of administrative costs contained 

within DO SE. This funding will support the expansion of Treasury’s implementation of 

the Committee on Foreign Investment in the United States (CFIUS) program in addition 

to initiatives in support of Critical Infrastructure Protection, Domestic Finance, and Tax 

Policy. This will include funding for the construction of secure spaces and the 

development of a case management system associated with the growth of the CFIUS 

program. Funding would also support administrative functions necessary to manage the 

increased CFIUS caseload as well as program growth in Domestic Finance and Tax 

Policy.

• Expend $1,631,000 in support of administrative costs associated with the DO Office of 

Terrorism and Financial Intelligence (TFI) initiatives contained in the DO TFI FY 2020 

Congressional Justification.

• Increase CTAS by $778,000 to transition operations and maintenance costs to the TFF for 

Communications Security (COMSEC).

• Increase CTAS by $2,850,000 and 3 FTE to transition operations and maintenance costs 

from the CEA to the TFF for Treasury Secure Data Network (TSDN).

Customer Growth (ARC Admin), +$16,056,000 +89 FTE

In FY 2018 ARC initiated shared services transitions with the four agencies listed below and 

anticipates full implementation by FY 2020. These transitions demonstrate the support of ARC 

and these agencies for the Administration’s sharing of quality services CAP Goal 5 and a 

commitment to maximizing resource allocations to mission activities. The program increase 

reflects operations and maintenance costs, and provides cost sharing and avoidance opportunities 

for both the new and current agencies supported by ARC.

• National Capital Planning Commission

• U.S. Consumer Product Safety Commission

• Corporation for National and Community Service

• National Records and Archive Administration

Program Decreases - $1,065,000 / -0 FTE

Continuous Diagnostics and Mitigation Licenses (TSSP), -$1,065,000 -0 FTE

The TFF expects a decrease in the cost of Continuous Diagnostics and Mitigation (CDM) 

licenses from the original estimates that were provided by the Department of Homeland Security. 

Treasury bureaus have requested $5,081,000 for CDM licenses in their individual bureau FY 

2020 Congressional Justifications.
TFF - 7 

1.3 Operating Levels Table 

Dollars in Thousands

Treasury Franchise Fund FY 2018 FY 2019 FY 2020

Object Classification Actual Estimated Estimated

11.1 - Full-time permanent 140,305 165,453 175,089

11.3 - Other than full-time permanent 533 844 903

11.5 - Other personnel compensation 2,229 3,184 3,293

11.6 - Overtime 2,374 2,275 2,388

11.9 - Personnel Compensation (Total) 145,441 171,756 181,673

12.0 - Personnel benefits 50,009 63,224 67,257

13.0 - Benefits for former personnel 425 0 0

Total Personnel and Compensation Benefits $195,875 $234,980 $248,930

21.0 - Travel and transportation of persons 1,400 1,644 1,790

22.0 - Transportation of things 17 38 44

23.1 - Rental payments to GSA 0 36,193 37,491

23.2 - Rental payments to others 103 320 326

23.3 - Communication, utilities, and misc charges 65,063 72,509 78,878

24.0 - Printing and reproduction 92 331 369

25.1 - Advisory and assistance services 89,970 54,005 86,391

25.2 - Other services 25,033 35,923 37,108

25.3 - Other purchases of goods & serv frm Govt ac 92,672 140,870 145,562

25.4 - Operation and maintenance of facilities 20 44 42

25.7 - Operation and maintenance of equip 84,555 87,484 103,731

26.0 - Supplies and materials 1,291 3,172 3,289

31.0 - Equipment 33,230 42,079 45,142

32.0 - Land and structures 0 7,255 12,021

44.0 - Refunds 392 0 0

91.0 - Confidential Expenditures 17 0 0

Total Non-Personnel 393,855 481,867 552,184

New Budgetary Resources $589,730 $716,847 $801,114

FTE 1,643 1,919 2,023

D – Appropriations Language and Explanation of Changes

The Treasury Franchise Fund receives no annually appropriated resources from Congress.

E – Legislative Proposals 

The Treasury Franchise Fund does not have legislative proposals.
TFF - 8 

Section II – Annual Performance Plan and Report

A – Strategic Alignment

Alignment with the Treasury Strategic Plan: 

The Treasury Franchise Fund aligns to the following Treasury strategic goals and objectives as 

presented in the FY 2018 - 2022 strategic plan:

Goal 4: Transform Government-wide Financial Stewardship

• Objective 4.3 – Federal Financial Performance – Improve federal financial management

performance using innovative practices to support effective government.

Goal 5: Achieve Operational Excellence

• Objective 5.1 – Workforce Management – Foster a culture of innovation to hire, engage,

develop, and optimize a diverse workforce with the competencies necessary to accomplish

our mission.

• Objective 5.2 – Treasury Infrastructure – Better enable mission delivery by improving the

reliability, security, and resiliency of Treasury’s infrastructure.

• Objective 5.3 – Customer Value – Improve customer value by increasing the quality and

lowering the cost of Treasury’s products and services.

With more focus on opportunities for federal agencies to share quality mission support services 

and enhance federal mission effectiveness by increasing usage of cloud-based solutions, reducing 

cybersecurity risks, and building a modern Information Technology (IT) workforce, the TFF is 

well positioned in FY 2020 to be a key federal resource. Through a standardized “build once, use 

many” service model, a proven record of high performance, and direct alignment with PMA 

CAP Goal 5 and in support of OMB’s Management Reform Plan and Treasury’s Future of 

Federal Financial Management, the TFF service providers stand ready to streamline federal 

mission support services and advance the shared services program by leading, transforming and 

delivering services that set the benchmark for federal shared services by means of: 

• Delivering high quality services at optimal efficiency,

• Achieving a high level of customer satisfaction,

• Leveraging modern, innovative solutions to increase quality and maximize resources,

• Maximizing cost sharing, savings, and avoidance through expanding customers services to

generate millions of dollars in cost avoidance resulting from use of shared financial

management systems by FY 2023, lastly

• Providing responsive and accessible IT services and solutions through modern infrastructure,

advanced cybersecurity capabilities, and implementation of enhanced technology strategies.
TFF - 9 

B – Budget and Performance by Budget Activity

2.1.1 Treasury Shared Services Programs Resources and Measures

Dollars in Thousands

Note: After collaboration with Office of Strategic Planning and Performance Improvement (OSPPI) and OMB the TFF reviewed performance metrics to 

determine best practices resulting in the discontinuing of inefficient measures. 

Treasury Shared Services Programs Budget and Performance

($274,017,000 from offsetting collections):

Treasury Shared Services Programs (TSSP) provides administrative and information technology 

services on a competitive basis, and also delivers outstanding customer service. In an effort to 

better support the goals and objectives of the current Treasury Strategic Plan; TSSP has 

undergone a review of all performance metrics in collaboration the the Office of Strategic 

Planning and Performance Improvement (OSPPI) and OMB to streamline metrics for best 

practices which resulted in the discontinuing of inefficient measures. The new measures will 

allow TSSP to focus on broader based metrics to gauge customer satisfaction, operations support 

resources, and the benefit from centralized approaches to program support and administration. 

In FY 2020, TSSP will continue to support a standardized approach to shared services by 

transitioning the operations and maintenance portion of the CEA investments to TSSP. TSSP 

will support the following cybersecurity efforts in FY 2020: 

• Continuous Mitigation and Diagnostics (CDM) Licenses Phases I and II

• Trusted Internet Connection (TIC) Encrypted Traffic Inspection

• Endpoint Incident Response

• Enhanced Packet Capture

• Government Security Operations Center (GSOC) Analytics

 Resource Level FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Estimated Request

Expenses/Obligations 165,419 225,024 229,070 235,811 241,845 235,515 274,017

Budget Activity Total $165,419 $225,024 $229,070 $235,811 $241,845 $235,515 $274,017

FTE 209 251 228 235 234 239 260

Measure FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Target Target Target

Customer Satisfaction with Financial 

Planning Staff 59.1 63.0 69.0 75.0 68.0 62.0 DISC DISC

ECM/Web Solutions Response Time 

to Resolve ECM and Web Solutions 

Non-Critical Issues/Help Desk 

Tickets within 10-15 Business Days

95.0 82.0 82.0 90.8 97.5 85.0 DISC DISC

HR Connect Customer Satisfaction 90.1 83.0 82.0 83.0 86.0 83.0 DISC DISC

HR Connect Employee Update Files - 

Transmission of Employee Update 

Fields Made to the Specified 

External Benefit Provider Within 

Established Business Timeframes

100.0 97.3 100.0 98.4 99.2 90.0 DISC DISC

HR Connect Number of Tickets 

Escalated to Tier 3 242.0 128.0 NA 173.0 238.0 200.0 DISC DISC

Average Cost per FTE N/A N/A N/A N/A N/A N/A 1,383.0 1,460.0

Annual Effective Spend Rate N/A N/A N/A N/A N/A N/A 96.0 96.0

Customer Satisfaction N/A N/A N/A N/A N/A N/A B TBD

Key: Disc - Discontinue; B - Baseline
TFF - 10 

• GSOC Facility and Contract Expansion

• Malware Content Filter

2.1.2 Centralized Treasury Administrative Services Resources and Measures

Note: After collaboration with Office of Strategic Planning and Performance Improvement (OSPPI) and OMB the TFF reviewed performance metrics to 

determine best practices resulting in the discontinuing of inefficient measures. 

Centralized Treasury Administrative Services Budget and Peformance

($166,591,000 from offsetting collections):

Centralized Treasury Administrative Services (CTAS) provides administrative support to offices 

within Treasury’s Departmental Offices. This support includes administrative functions such as 

financial management, travel, human resources, information technology, and facilities 

management. The programs formerly residing under DO SE fully transitioned to CTAS in FY 

2019. The TFF continues to partner with DO to refine CTAS costing and will adjust customer 

bills as usage methodologies are enhanced. 

In FY 2020, CTAS will support the transition of the operations and maintenance of CEA 

investments by hosting the following programs:

• Treasury Secure Data Network (TSDN)

• Communications Security (COMSEC)

2.1.3 Administrative Services Resources and Measures 

Dollars in Thousands

 Resource Level FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Estimated Request

Expenses/Obligations NA NA NA NA NA 140,522 166,591

Budget Activity Total $0 $0 $0 $0 $0 $140,522 $166,591

FTE NA NA NA NA NA 207 201

Measure FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Target Target Target

Annual Effective Spend Rate N/A N/A N/A N/A N/A N/A 96.0 96.0

Customer Satisfaction N/A N/A N/A N/A N/A N/A B TBD

Key: Disc - Discontinue; B - Baseline

Dollars in Thousands

FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Estimated Estimated 

Expenses/Obligations $128,904 $146,282 $156,869 $157,284 $150,876 $153,375 $170,535

$128,904 $146,282 $156,869 $157,284 $150,876 $153,375 $170,535

816 936 988 957 933 969 1,058

 Resource Level 

Budget Activity Total

FTE 
TFF - 11 

Note: After collaboration with Office of Strategic Planning and Performance Improvement (OSPPI) and OMB the TFF reviewed performance metrics to 

determine best practices resulting in the discontinuing of inefficient measures. 

Administrative Services Budget and Performance 

($170,535,000 from offsetting collections):

The TFF’s Administrative Services are provided by Fiscal Service’s Administrative Resource 

Center (ARC Admin) and are directly aligned with the Administration’s CAP Goal 5 and 

supports OMB’s Reform Plan and the Department of the Treasury’s shared services initiatives. 

As a critical strategic partner to OMB and Treasury, ARC supports: 

• the Financial Management Line of Business, designated Federal Shared Services

Provider by OMB,

• the Budget Formulation and Execution Line of Business, designated Federal Shared

Service Provider by OMB, and

• Treasury's Human Resources Line of Business.

ARC Admin provides high quality mission support services to 76 federal agencies in the areas of 

financial management, procurement, travel and relocation, and human resources. Service value 

is achieved as agencies focus on mission activities, cost sharing opportunities in systems’ capital 

investments and maintenance. ARC Admin’s commitment to improvement resulted in reduced 

operating costs because of services that were standardized, compliant, streamlined, high quality 

and responsive. 

ARC Admin has a history of high performance and is considered a leader in delivering high 

quality, cost effective federal shared services. ARC Admin continues to be a vehicle of success 

through new federal agency partnerships and operational excellence, meeting or exceeding 

performance measures, achieving high customer satisfaction results, and using cost effective and 

stable prices. ARC relentlessly manages a high volume of demand and advance services 

Measure FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Target Target

Customer Unmodified Audit Opinions % NA NA NA NA 100.0 100.0 100.0

Percentage of shared services service level 

agreement performance metrics met or 

exceeded (%)

NA NA NA NA NA B 94.0

Customer Satisfaction % NA NA NA NA NA B 80.0

Direct Cost as a Percentage of Award Dollars 0.4 0.1 0.2 0.2 0.3 DISC DISC

Direct Cost per AP Transaction 65.4 47.2 59.1 45.5 49.4 DISC DISC

Direct Cost per FTE in Core HR Services 976.3 963.0 1,070.3 1,118.8 1,108.7 DISC DISC

Direct Cost per System User - Oracle 18,261.0 21,724.0 16,241.0 16,356.0 13,406.0 DISC DISC

Direct Cost per Travel Voucher 24.8 21.1 19.8 7.8 8.3 DISC DISC

First Call Resolution - Oracle % 61.0 56.7 50.3 81.5 82.2 DISC DISC

Hiring Timeliness % 89.0 86.7 84.8 85.2 97.8 DISC DISC

Indirect Cost Admin Services % 27.1 27.5 22.1 21.9 20.3 DISC DISC

Timely Contract Issuance N/A N/A 89.3 89.3 90.4 DISC DISC

Travel Voucher Payments Timeliness % 99.0 99.18 99.87 99.84 99.56 DISC DISC

Unqualified Audit Opinions % 96.0 100.0 100.0 100.0 100 DISC DISC

Key: DISC - Discontinued; B - Baseline
TFF - 12 

delivered by supporting agency due diligence reviews and developing a forward looking, multiyear deployment schedules, efficient transitions of new agencies. Services continue to improve 

on delivery of customer centric solutions that enable agencies to focus on missions and avoid 

redundancies within administrative operations creating cost avoidance across government. 

In FY 2019 and FY 2020, ARC Admin will continue to provide high quality, mission support 

services through operational excellence and innovation, deployment of business intelligence/data 

analytics and accounting reconciliation and financial statement solutions. 

Description of Performance: 

ARC Admin is continually dedicated to increasing the quality of services provided to customers 

and modified metrics in order to focus on customer satisfaction. By utilizing metrics that 

concentrate on customer input ARC Admin is able to cater to the specific needs of agencies 

across government. ARC Admin’s high performance is further demonstrated by the 95 percent 

customer satisfaction rate obtained by customer surveys and meetings or exceeding 94 percent of 

agency support service measures (including 100 percent positive customer audit results) from FY 

2017 – FY 2018. ARC Admin dropped customer prices by 6 percent in FY 2019 through cost 

containment and prioritization, while continuing to ensure compliance and implementing service 

enhancements that include: 

• Expanded, improved, and implemented services and new requirements in support of

current and future customers,

• Implemented Phase 1 of the Oracle Service Oriented Architecture initiative, providing

flexibility for third party integrations and ARC’s standard solution,

• Deployed Concur’s “Skybridge” and mobile enhancements, improving travel booking

and user convenience/experience by increasing access and availability of system, also

• Successfully met new DATA Act reporting requirements for all customers, standardizing

information ensuring federal expenditures are more easily accessible and transparent for

public consumption

• During FY 2018, ARC Admin remained responsive to the changing federal landscape, as

demonstrated by meeting or exceeding 91 percent of congressional budget performance

measures. The HR service area continue to be greatly impacted by the implementation of

the federal hiring freeze and decreasing of the federal workforce yet ARC Admin only

missed a cost target by 5 percent. In FY 2019-2020, ARC Admin will continue to

strategically plan customer agencies to forecast changes, enabling resource alignment to

support changes in demand. In addition, ARC Admin is streamlining performance

measures to better align with Treasury’s Strategic Plan and PMA CAP Goal 5. The new

measures, focus on ARC Admin results related to overall service performance, including

service integrity related to audit performance, and customer satisfaction. ARC will

continue to demonstrate a commitment to meeting quality and timeliness responsibilities

for customers while also receiving and planning actions using customer perspectives of

ARC’s shared service quality, and overall value.
TFF - 13

2.1.4 Information Technology Resources and Measures

Information Technology Services Budget and Performance 

($189,911 from offsetting collections)

The TFF’s Information Technology Services are provided by Fiscal Service’s Administrative 

Resource Center (ARC IT) and are directly aligned with the President’s Management Agenda 

CAP Goal 5 and supports OMB’s Reform Plan and the Department of the Treasury’s shared 

services initiatives. 

ARC IT provides shared IT services, including hosting, software development, security and other 

support services to 10 federal agencies and end user support services to the Bureau of the Fiscal 

Service. Customer value is maximized through consolidated IT infrastructures and standardized 

IT service delivery in a modern, innovative, and secure environment.

The ARC IT has a history of high performance in providing responsive, innovative, and secure 

solutions to meet the business needs of their customers. In recent years, ARC IT has undertaken 

initiatives to strengthen the security posture of their solutions and been instrumental in 

Treasury’s overall cyber-security enhancements and modernization efforts. In FY 2019-2020, 

ARC IT has an enterprise technology modernization initiative to design measurable, agile and 

cost effective IT solutions that increase resiliency, strengthen cybersecurity controls, and ensure 

alignment with business functions and capabilities needs. In addition, ARC IT has the following 

plan to ensure IT services and capabilities delivered are portable, reusable, scalable, and resilient, 

with the additional capability for automated deployment.

Dollars in Thousands

FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Estimated Estimated 

Expenses/Obligations $149,992 $162,895 $192,877 $195,441 $197,009 $187,435 $189,971

$149,992 $162,895 $192,877 $195,441 $197,009 $187,435 $189,971

459 459 499 493 476 504 504

 Resource Level

Budget Activity Total

FTE 

Measure FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Target Target

Fiscal IT Hosting – Percentage of Time Service is 

Operational (Uptime Excluding Planned Maintenance) N/A N/A 99.8 99.0 99.8 99.0 99.0

Number of engagements in strategic sourcing, to 

include new IT customers, new scope of work for 

existing customers, or new FITARA compliant 

contracts available beyond Fiscal Service [#]

N/A N/A 1.0 2.0 1.0 2.0 2.0

Percentage of POA&Ms Scheduled for closure in last 

30 days - closed early or on time N/A N/A 69.6 90.0 91.6 DISC DISC

Key: DISC - Discontinued; B - Baseline

Note 1: "Number of Engagements in Strategic Sourcing for "Service Provider" or Other Shared Services Opportunity" renamed to "Number of engagements in strategic sourcing, to 

include new IT customers, new scope of work for existing customers, or new FITARA compliant contracts available beyond Fiscal Service [#]". 

Note 2: After collaboration with Office of Strategic Planning and Performance Improvement (OSPPI) and Office of Management and Budget (OMB) the TFF reviewed 

performance metrics to determine best practices resulting in the discontinuing of inefficient measures.”
TFF - 14 

• Expand strategies under Cloud Sprint Teams,

• Establish Cloud Orchestration & Automation Toolsets,

• Begin building micro-services, and

• Complete the IT Modernization Plan (Phase 3-Modernization Roadmap).

Description of Performance: 

ARC IT services has a long history of high performance, including maintaining a high standard 

of hosting availability (99 percent) through a highly skilled workforce with sufficient depth to 

cover a 24/7 operation and a commitment to infrastructure replacement that minimizes 

technology and cybersecurity risks. In addition, with alignment to the PMA, ARC IT continues 

to emphasize and measure performance in executing IT acquisition strategies that leverage or 

negotiate procurement awards maximizing federal buying power in order to reduce costs and to 

achieve increased service levels, and has continued focus on remediating and mitigating. 

In FY 2018, ARC IT continued to achieve high performance as demonstrated through meeting or 

exceeding two of the budgetary performance measures. The remaining performance measure 

was not met due to increased priority to other key initiatives, including IT modernization 

planning and strengthening of IT services cybersecurity posture. Looking forward, in FY 2019-

2020, ARC IT is streamlining performance measures to demonstrate our commitment and 

alignment with customer support priorities and the Administration’s focus areas. 

C – Changes in Performance Measures

Performance Measure or Indicator Proposed Change and Justification

1. Customer Satisfaction with Financial

Planning Staff (TSSP)

Discontinue – Replaced by new comprehensive 

measures.

2. ECM/Web Solutions Response Time to

Resolve ECM and Web Solutions NonCritical Issues/Help Desk Tickets within

10-15 Business Days (TSSP)

Discontinue – Replaced by new comprehensive 

measures.

3. HR Connect Customer Satisfaction

(TSSP)

Discontinue – Replaced by new comprehensive 

measures.

4. HR Connect Employee Update Files –

Transmission of Employee Update

Fields Made to the Specified External

Benefit Provider Within Established

Business Timeframes (TSSP)

Discontinue – Replaced by new comprehensive 

measures.
TFF - 15 

5. HR Connect Number of Tickets

Escalated to Tier 3 (TSSP)

Discontinue – Replaced by new comprehensive 

measures.

6. Customer Satisfaction (TSSP) Add – This target measures the general 

satisfaction of Treasury and non-Treasury 

customers with the services provided by TSSP 

programs. TSSP will survey customers and 

provide the percentage of customers who 

provide a response of 4 or 5 on a 5 point scale.

7. Customer Satisfaction (CTAS) Add – This target measures the general 

satisfaction of Treasury customers with the 

services provided by CTAS programs. CTAS 

will survey customers and provide the 

percentage of customers who provide a response 

of 4 or 5 on a 5 point scale.

8. Customer Unmodified Audit Opinions

(ARC Admin)

Modify – Previous measure was titled 

“Unqualified Audit Opinions”. Renamed to 

clarify the performance measured.

9. Percentage of Shared Services Service

Level Agreement Performance Metrics

Met or Exceeded (ARC Admin)

Add – This measure tracks service level 

agreements (SLA) performance metrics that met 

or exceeded service level targets compared to 

the total number of SLA metric targets across all 

ARC clients (4 service lines with combined 83 

operational metrics meeting each individual 

operational metric target).

10. Customer Satisfaction (ARC Admin) Add – This measure tracks the customer’s 

satisfaction level with ARC’s services looking at 

the organization’s overall performance.

11. Direct Cost as a Percentage of Award

Dollars (ARC Admin)

Discontinue – Replaced by aggregate level 

measure. 

12. Direct Cost per AP Transaction (ARC

Admin)

Discontinue – Replaced by aggregate level 

measure. 

13. Direct Cost per FTE in Core HR

Services (ARC Admin)

Discontinue – Replaced by aggregate level 

measure. 

14. Direct Cost per System User – Oracle

(ARC Admin)

Discontinue – Replaced by aggregate level 

measure. 

15. Direct Cost per Travel Voucher (ARC

Admin)

Discontinue – Replaced by aggregate level 

measure. 
TFF - 16 

16. First Call Resolution – Oracle (ARC

Admin)

Discontinue – Replaced by aggregate level 

measure. 

17. Hiring Timeliness (ARC Admin) Discontinue – Replaced by aggregate level 

measure. 

18. Indirect Cost Admininstrative Services

(ARC Admin)

Discontinue – Replaced by aggregate level 

measure. 

19. Timely Contract Issuance (ARC Admin) Discontinue – Replaced by aggregate level 

measure. 

20. Travel Voucher Payments Timeliness

(ARC Admin)

Discontinue – Replaced by aggregate level 

measure. 

21. Number of Engagements in Strategc

Sourcing, to Include New IT Customers,

New Scope of Work for Existing

Customers, or New FITARA Compliant

Contracts Available Beyond Fiscal

Service (ARC IT)

Modify – Previous measure was “Number of 

Engagements in Strategic Sourcing or ‘Service 

Provider’ or Other Shared Services Opportunity. 

Measure reflects the ARC IT commitment to the 

President’s Management Agenda by reporting 

on opportunities to provide services to new 

customers, expand service scope, or realize 

economies of scale by sponsoring contracts used 

across government (supports the Federal IT 

Acquisition Reform Act).

22. Percentage of POA&Ms Scheduled for

Closure in Last 30 Days – Closed Early

or On Time

Discontinue – It was determined that this 

measure is specific to a business line and should 

not be reported at the Treasury departmental 

level.

Section III – Additional Information

A – Summary of Capital Investments

The TFF’s planned investments enhance the capabilities and capacity of our financial 

management shared services. Investing in service oriented architecture will allow customers to 

streamline application connections resulting in benefits that include reducing development time, 

using industry development best practices for coding efforts, allowing real time processing of 

transactional data between systems, and independent communication between systems. This 

effort will also reduce redundancy, providing more flexible and efficient interfaces with 

customers' third-party applications. 

The TFF plans to expand the use of an enterprise-wide financial statement reporting tool and 

update operational (transactional) reporting and analytical tools in order to provide a more 
TFF - 17 

efficient interpretation of large volumes of data, long-term stability, and improved presentation 

and distribution capabilities.

A summary of capital investment resources, including major information technology and nontechnology investments can be found at: 

http://www.treasury.gov/about/budget-performance/Pages/summary-of-capital-investments.aspx

This website also contains a digital copy of this document. 

The Administrative Resource Center capital investments are contained within the Fiscal Service 

capital investment summary. The Treasury Shared Service Programs capital investments are 

contained within the Departmental Offices capital investment summary.

B. Treasury Franchise Fund Program Costs

This information is provided to fulfill requirements of Section 124 of the FY 2018Financial

Services and General Government approprations bill.
TFF - 18

Treasury Franchise Fund – Treasury Shared Services Programs, FY 2018 Total Charges 

by Customer

2018 TSSP Customers

Enterprise Business 

Solutions

Infrastructure 

Operations Cybersecurity

IT Strategy and 

Technology 

Management

Non-Information 

Technology Services Total

Alcohol Tobacco Tax and Trade Bureau $ 307,498 $ 618,380 $ 60,806 $ 24,645 $ 410,650 $ 1,421,980

Bureau of Printing and Engraving $ 1,065,043 $ 3,721,488 $ 215,298 $ 90,071 $ 796,851 $ 5,888,753

Bureau of the Fiscal Service $ 3,561,598 $ 766,993 $ 265,880 $ 103,665 $ 1,670,316 $ 6,368,452

Consumer Financial Protection $ 1,213,111 $ 3,338 $ - $ - $ 186,533 $ 1,402,982

DHS Office of Inspector General $ - $ - $ - $ - $ 5,854 $ 5,854

DHS Customs and Immigration Service $ - $ - $ - $ - $ 50,736 $ 50,736

DHS Headquarters $ - $ - $ - $ - $ 118,951 $ 118,951

DHS U.S. Secret Service $ 1,429,374 $ 12,786 $ - $ - $ 58,880 $ 1,501,040

Community Development Financial Institutions 

Fund $ 355,563 $ 20,232 $ 8,661 $ 3,765 $ 107,587 $ 495,808

DC Pensions $ 31,052 $ 89,044 $ 2,688 $ 1,076 $ 56,843 $ 180,702

Federal Financing Bank $ 30,281 $ 136,467 $ 3,909 $ 1,565 $ 71,517 $ 243,738

Financial Stability Oversight Council $ 352,358 $ 128,873 $ 2,810 $ 1,125 $ 69,002 $ 554,167

Treasury Office of Financial Research $ 266,537 $ 5,488,695 $ 211,022 $ 10,904 $ 365,390 $ 6,342,548

Treasury Office of Financial Stability $ 1,063,184 $ 294,539 $ 6,475 $ 2,592 $ 221,500 $ 1,588,289

Treasury Office of Technical Assistance $ 19,333 $ 73,984 $ 1,466 $ 587 $ 121,547 $ 216,918

Small Business Lending Fund Administration $ 8,033 $ 52,497 $ 855 $ 342 $ 36,462 $ 98,189

Treasury Departmental Offices $ 4,517,114 $ 9,180,875 $ 601,833 $ 69,436 $ 3,138,171 $ 17,507,429

State Small Business Credit Initiative 

Administration $ - $ - $ - $ - $ - $ -

Treasury Executive Office of Asset Forfeiture $ 1,714,961 $ 156,568 $ 3,054 $ 1,222 $ 109,385 $ 1,985,190

Treasury Terrorism Risk Insurance Program $ 5,742 $ 42,512 $ 1,221 $ 489 $ 28,674 $ 78,638

Department of Commerce $ 10,368,216 $ 94,106 $ - $ - $ 457,200 $ 10,919,523

DOC ITA $ - $ - $ - $ - $ 24,877 $ 24,877

DOD - U.S. Air Force $ - $ - $ - $ - $ 187,572 $ 187,572

Department of Energy $ - $ - $ - $ - $ 2,929 $ 2,929

Department of Interior $ 92,711 $ - $ - $ - $ 3,584 $ 96,296

DOJ - Drug Enforcement Agency $ - $ - $ - $ - $ 64,204 $ 64,204

DOJ - Executive Office of Immigration Review $ - $ - $ - $ - $ 19,780 $ 19,780

DOJ - U.S. Marshal Service $ - $ - $ - $ - $ 39,329 $ 39,329

DOJ Alcohol Tobacco Firearms and Explosives $ 1,448,716 $ 16,205 $ - $ - $ 110,207 $ 1,575,128

Department of Labor $ 5,245,685 $ 30,330 $ 19,801 $ - $ 201,690 $ 5,497,506

DOL - Bureau of Labor Statistics $ - $ - $ - $ - $ 22,071 $ 22,071

DOL - Office of the Inspector General $ - $ - $ - $ - $ 8,242 $ 8,242

DOT- Federal Transit Agency $ - $ - $ - $ - $ 16,189 $ 16,189

Department of Education $ - $ - $ - $ - $ 71,802 $ 71,802

Export Import Bank-Office of the Inspector 

General $ - $ - $ - $ - $ 3,377 $ 3,377

Farm Credit Administration $ - $ - $ - $ - $ 1,674 $ 1,674

Federal Communications Commission $ 43,761 $ - $ - $ - $ 1,779 $ 45,539

Federal Deposit Insurance Corporation $ 96,000 $ - $ - $ - $ 8,644 $ 104,644
TFF - 19 

Federal Deposit Insurance Corporation -Office of 

the Inspector General $ - $ - $ - $ - $ 6,835 $ 6,835

Federal Emergency Management Agency $ 410,364 $ - $ - $ - $ 79,716 $ 490,080

Federal Housing Finance Agency $ - $ - $ - $ - $ 42,253 $ 42,253

Financial Crimes Enforcement Network $ 182,888 $ 1,210,707 $ 41,464 $ 16,577 $ 269,179 $ 1,720,815

Federal Reserve Board $ - $ - $ - $ - $ 3,347 $ 3,347

Government Accountability Office $ 597,129 $ 6,043 $ - $ - $ 25,183 $ 628,355

General Service Administration $ - $ - $ - $ - $ 40,166 $ 40,166

HHS - Agency for Healthcare Research and 

Quality $ - $ - $ - $ - $ 1,672 $ 1,672

Housing and Urban Development $ 3,216,039 $ 15,562 $ - $ - $ 230,235 $ 3,461,836

HUD - Office of Inspector General $ 81,426 $ - $ - $ - $ 6,713 $ 88,138

Internal Revenue Service $ 46,669,657 $ 67,560,706 $ 9,367,162 $ 3,799,854 $ 14,301,986 $ 141,699,364

Millennium Challenge Corporation $ - $ - $ - $ - $ 20,750 $ 20,750

U.S. Mint $ 1,513,305 $ 1,623,531 $ 212,411 $ 88,066 $ 1,070,071 $ 4,507,384

National Records and Archives Administration $ - $ - $ - $ - $ 31,318 $ 31,318

Office of the Comptroller of the Currency $ 2,502,096 $ 1,159,930 $ 444,139 $ 192,562 $ 986,967 $ 5,285,694

Office of Government Ethics $ - $ - $ - $ - $ 4,262 $ 4,262

Treasury Office of Inspector General $ 177,671 $ 439,821 $ 25,852 $ 10,415 $ 124,785 $ 778,544

Overseas Private Investment Corporation $ - $ - $ - $ - $ 15,156 $ 15,156

Peace Corps $ 116,338 $ - $ - $ - $ 5,367 $ 121,706

Small Business Administration $ 213,970 $ - $ - $ - $ 23,373 $ 237,342

Special Inspector General for TARP $ 242,329 $ 1,044,098 $ 23,455 $ 9,389 $ 167,332 $ 1,486,604

National Gallery of Art $ - $ - $ - $ - $ 20,423 $ 20,423

TFF - Administrative Resources Center $ 1,489,372 $ 3,078,526 $ 172,039 $ 74,766 $ 417,164 $ 5,231,866

Treasury Inspector General for Tax 

Administration $ 627,596 $ 2,443,460 $ 112,074 $ 42,102 $ 441,094 $ 3,666,325

USAID $ 1,800,765 $ 9,317 $ - $ - $ 106,886 $ 1,916,968

Veterans Affairs $ - $ - $ - $ - $ 54,113 $ 54,113

Total $ 93,076,817 $ 99,519,614 $ 11,804,374 $ 4,545,214 $ 27,366,346 $ 236,312,364

Note: The small variance in the following tables are due to transaction posting timing. The 1.1 table represents BFY 2018 revenue and the appendix table reflects customers actuals during 2018.

Collections may be posted outside of the fiscal year, October 1st through September 30th timeframe.
TFF - 20 

Treasury Franchise Fund – Administrative Resource Center, FY 2018 Total Charges by 

Customer

FY 2018 ARC Customers

Financial 

Management 

Services

FMLoB FEES

Human 

Resource 

Services

Procurement 

Services Travel Services

Information 

Technology 

Services

Total

ACCESS BOARD $ 264,966 $ - $ 102,547 $ 63,378 $ 25,038 $ - $ 455,929

ADMIN OFFICES OF THE US COURTS $ 75,106 $ - $ - $ - $ - $ - $ 75,106

ADMINISTRATION FOR CHILDREN AND FAMILIES $ 104,433 $ - $ - $ - $ 6,778 $ - $ 111,211

AFRICAN DEVELOPMENT FOUNDATION $ 898,198 $ - $ - $ 384,897 $ 28,495 $ - $ 1,311,590

AGENCY FOR INTERNATIONAL DEVELOPMENT $ 75,702 $ 95,819 $ - $ - $ - $ - $ 171,521

AGENCY FOR INTERNATIONAL DEVELOPMENT - OIG $ 93,374 $ - $ - $ - $ - $ - $ 93,374

ALCOHOL AND TOBACCO TAX AND TRADE BUREAU $ 815,120 $ - $ 1,054,209 $ 843,871 $ 202,516 $ - $ 2,915,716

ALCOHOL TOBACCO FIREARMS AND EXPLOSIVES $ - $ - $ - $ - $ 942,212 $ - $ 942,212

ARMED FORCES RETIREMENT HOME $ 929,472 $ - $ 1,162,214 $ 499,893 $ 16,739 $ - $ 2,608,318

BUREAU OF ENGRAVING AND PRINTING $ - $ - $ 2,804,057 $ - $ 147,511 $ - $ 2,951,568

BUREAU OF THE FISCAL SERVICE $ 15,434,060 $ - $ 5,462,887 $ 3,976,664 $ 514,990 $ 159,303,575 $ 184,692,176

CDFI PROGRAM FUND $ 1,006,149 $ - $ 169,702 $ 212,995 $ 19,731 $ - $ 1,408,577

CENTER FOR DISEASE CONTROL $ - $ - $ - $ - $ 1,737,730 $ - $ 1,737,730

CHEMICAL SAFETY AND HAZARD BOARD $ 297,355 $ - $ - $ 18,396 $ 27,839 $ - $ 343,590

COMPTROLLER OF THE CURRENCY $ - $ - $ - $ 99,699 $ - $ - $ 99,699

CONSUMER FINANCIAL PROTECTION BUREAU $ 1,446,432 $ - $ 3,648,679 $ 1,620,260 $ 1,250,878 $ - $ 7,966,249

CONSUMER PRODUCT SAFETY COMMISSION $ 136,500 $ - $ - $ 63,000 $ 10,500 $ - $ 210,000

CORPORATION FOR NATIONAL AND COMMUNITY SERV $ 75,609 $ - $ - $ - $ 9,300 $ - $ 84,909

DC PENSIONS PROJECT OFFICE $ 2,192,434 $ - $ 36,575 $ 31,034 $ 1,581 $ 1,628,083 $ 3,889,707

DEFENSE HEALTH AGENCY $ - $ - $ - $ - $ 65,627 $ - $ 65,627

DEFENSE LOGISTICS AGENCY $ 531,256 $ - $ - $ - $ - $ - $ 531,256

DENALI COMMISSION $ 923,057 $ - $ 97,698 $ 81,161 $ 18,366 $ - $ 1,120,282

DEPARTMENT OF AGRICULTURE $ - $ 167,510 $ - $ - $ - $ - $ 167,510

DEPARTMENT OF COMMERCE $ - $ 95,819 $ - $ - $ - $ - $ 95,819

DEPARTMENT OF DEFENSE $ - $ 187,342 $ - $ - $ - $ - $ 187,342

DEPARTMENT OF EDUCATION $ - $ 230,616 $ - $ - $ - $ - $ 230,616

DEPARTMENT OF ENERGY $ 148,424 $ 124,236 $ - $ - $ - $ - $ 272,660

DEPARTMENT OF HEALTH & HUMAN SERVICES $ - $ 230,616 $ - $ - $ 62,377 $ - $ 292,993

DEPARTMENT OF HOMELAND SECURITY $ 490,474 $ 374,684 $ - $ - $ - $ 559,111 $ 1,424,269

DEPARTMENT OF HOMELAND SECURITY - CIS $ - $ - $ - $ - $ 561,028 $ - $ 561,028

DEPARTMENT OF HOMELAND SECURITY - OIG $ 686,590 $ - $ 86,019 $ 451,886 $ 287,614 $ - $ 1,512,109

DEPARTMENT OF HOUSING AND URBAN DEVELOPMEN $ 18,040,108 $ 230,616 $ 14,185,176 $ 2,178,612 $ 2,788,136 $ - $ 37,422,648

DEPARTMENT OF JUSTICE $ 125,056 $ - $ - $ - $ - $ - $ 125,056

DEPARTMENT OF LABOR $ 195,016 $ - $ - $ - $ - $ - $ 195,016

DEPARTMENT OF STATE $ 260,836 $ - $ - $ - $ - $ - $ 260,836

DEPARTMENT OF THE INTERIOR $ 955,085 $ 124,236 $ - $ - $ - $ - $ 1,079,321

DEPARTMENT OF TRANSPORTATION $ - $ 230,616 $ - $ - $ - $ - $ 230,616

DEPARTMENT OF VETERANS AFFAIRS $ - $ 158,998 $ - $ - $ 2,661 $ - $ 161,659

DEPARTMENT OF VETERANS AFFAIRS - OIG $ - $ - $ 2,361,842 $ - $ - $ - $ 2,361,842

DEPARTMENT OF VETERANS AFFAIRS - TAC $ 149,824 $ - $ - $ - $ - $ 823,078 $ 972,902

ELECTION ASSISTANCE COMMISSION $ 377,712 $ - $ - $ 153,983 $ 59,060 $ - $ 590,755

ENVIRONMENTAL PROTECTION AGENCY $ - $ 95,819 $ - $ - $ - $ - $ 95,819

EXECUTIVE OFFICE OF THE PRESIDENT $ 1,224,740 $ - $ - $ 237,255 $ 347,253 $ - $ 1,809,248

FARM CREDIT ADMINISTRATION $ 430,295 $ - $ - $ 48,373 $ 214,143 $ - $ 692,811
TFF - 21 

FARM CREDIT SYSTEM INSURANCE CORPORATION $ 208,282 $ - $ - $ 1,691 $ 5,075 $ - $ 215,048

FEDERAL EMERGENCY MANAGEMENT AGENCY $ - $ - $ - $ - $ 25,851 $ - $ 25,851

FEDERAL HOUSING FINANCE AGENCY $ 969,566 $ - $ - $ 171,533 $ 232,244 $ - $ 1,373,343

FEDERAL HOUSING FINANCE AGENCY - OIG $ 394,424 $ - $ 322,224 $ 260,832 $ 81,289 $ - $ 1,058,769

FEDERAL LABOR RELATIONS AUTHORITY $ 512,002 $ - $ - $ 47,662 $ 89,591 $ - $ 649,255

FEDERAL MARITIME COMMISSION $ 361,266 $ - $ - $ 61,989 $ 29,068 $ - $ 452,323

FEDERAL MEDIATION & CONCILIATION SERVICE $ 41,250 $ - $ - $ 10,000 $ 3,750 $ - $ 55,000

FEDERAL MINE SAFETY AND HEALTH REVIEW COMMISS $ 431,448 $ - $ 175,795 $ 17,080 $ 35,176 $ - $ 659,499

FEDERAL TRADE COMMISSION $ 48,900 $ - $ - $ 15,775 $ 5,525 $ - $ 70,200

FINANCIAL CRIMES ENFORCEMENT NETWORK $ 614,372 $ - $ 226,618 $ 749,316 $ 71,557 $ 1,975,807 $ 3,637,671

FOOD AND DRUG ADMINISTRATION $ - $ - $ - $ - $ 579,925 $ - $ 579,925

GENERAL SERVICE ADMINISTRATION $ - $ 41,332 $ - $ - $ - $ - $ 41,332

GULF COAST ECOSYSTEM RESTORATION COUNCIL $ 291,280 $ - $ 152,990 $ 25,140 $ 18,007 $ - $ 487,417

INTER AMERICAN FOUNDATION $ 727,270 $ - $ - $ 551,996 $ 30,407 $ - $ 1,309,673

INTERNAL REVENUE SERVICE $ - $ - $ 1,039,452 $ - $ - $ - $ 1,039,452

MERIT SYSTEMS PROTECTION BOARD $ 417,907 $ - $ - $ 22,270 $ 57,852 $ - $ 498,029

NATIONAL AERONAUTICS AND SPACE ADMINISTRATIO $ 148,341 $ 124,236 $ - $ - $ - $ 469,361 $ 741,938

NATIONAL ARCHIVES & RECORDS ADMINISTRATION $ 3,988,553 $ - $ 1,035,550 $ 487,309 $ 284,744 $ - $ 5,796,156

NATIONAL CAPTIAL PLANNING COMMISSION $ 76,583 $ - $ - $ - $ - $ - $ 76,583

NATIONAL MEDIATION BOARD $ 325,419 $ - $ - $ 195,920 $ 58,585 $ - $ 579,924

NATIONAL SCIENCE FOUNDATION $ - $ 139,094 $ - $ - $ 63,075 $ - $ 202,169

NUCLEAR REGULATORY COMMISSION $ 1,349,783 $ 41,332 $ - $ - $ 222,825 $ - $ 1,613,940

OCCUPATIONAL SAFETY AND HEALTH REVIEW COMMIS $ 259,110 $ - $ - $ 12,444 $ 24,588 $ - $ 296,142

OFFICE OF FINANCIAL STABILITY $ 276,538 $ - $ 151,168 $ 64,449 $ 15,778 $ - $ 507,933

OFFICE OF GOVERNMENT ETHICS $ 359,813 $ - $ 246,588 $ 199,372 $ 11,873 $ - $ 817,646

OFFICE OF PERSONNEL MANAGEMENT $ - $ 41,342 $ - $ - $ - $ - $ 41,342

OFFICE OF TECHNICAL ASSISTANCE $ 724,942 $ - $ 25,729 $ 26,490 $ 90,443 $ - $ 867,604

OFFICE OF THE INSPECTOR GENERAL $ 360,081 $ - $ 512,266 $ 127,164 $ 66,550 $ - $ 1,066,061

RAILROAD RETIREMENT BOARD $ - $ - $ - $ - $ 1,837 $ - $ 1,837

SECURITIES AND EXCHANGE COMMISSION $ 387,007 $ - $ - $ - $ - $ - $ 387,007

SMALL BUSINESS ADMINISTRATION $ - $ 67,475 $ 187,010 $ - $ - $ - $ 254,485

SOCIAL SECURITY ADMINISTRATION $ - $ 67,475 $ - $ - $ - $ 658,319 $ 725,794

SPECIAL INSPECTOR GENERAL - TARP $ 360,007 $ - $ 493,459 $ 217,612 $ 89,832 $ 22,589 $ 1,183,499

TREASURY DEPARTMENTAL OFFICES $ 3,272,740 $ - $ 4,809,548 $ 1,168,439 $ 636,344 $ 10,034,416 $ 19,921,487

TREASURY FRANCHISE FUND/ADMINISTRATIVE SERVIC $ - $ - $ - $ - $ - $ 14,586,180 $ 14,586,180

TREASURY FRANCHISE FUND/INFORMATION TECHNOLO$ 1,067,735 $ - $ 1,213,134 $ 1,375,767 $ 123,141 $ - $ 3,779,777

TREASURY FRANCHISE FUND/SHARED SERVICES PROGR $ 441,027 $ 95,892 $ 1,410,233 $ 263,494 $ 16,772 $ 6,052,292 $ 8,279,710

TREASURY INSPECTOR GENERAL FOR TAX ADMINISTRAT $ 611,638 $ - $ 1,790,076 $ 758,277 $ 460,581 $ - $ 3,620,572

TRUST FUND - BLACK LUNG DISABILITY $ 141,706 $ - $ - $ - $ - $ - $ 141,706
TFF - 22 

TRUST FUND - FEDERAL DISABILITY $ 367,130 $ - $ - $ - $ - $ - $ 367,130

TRUST FUND - FEDERAL HOSPITAL INSURANCE $ 411,128 $ - $ - $ - $ - $ - $ 411,128

TRUST FUND - FEDERAL OLD AGE & SURVIVORS $ 367,130 $ - $ - $ - $ - $ - $ 367,130

TRUST FUND - FEDERAL SUPPLEMENT INSURANCE $ 416,516 $ - $ - $ - $ - $ - $ 416,516

TRUST FUND - OIL SPILL LIABILITY $ 96,859 $ - $ - $ - $ - $ - $ 96,859

TRUST FUND - UNEMPLOYMENT $ 576,406 $ - $ - $ - $ - $ - $ 576,406

UNITED STATES MINT $ 8,412,927 $ - $ 3,199,802 $ 1,793,417 $ 217,879 $ - $ 13,624,025

US COURT OF APPEALS FOR VETERANS $ 268,821 $ - $ - $ 6,761 $ 12,655 $ - $ 288,237

USDA FOOD AND NUTRITION $ - $ - $ - $ - $ - $ 891,243 $ 891,243

USDA FOREST SERVICE $ 120,264 $ - $ - $ - $ - $ - $ 120,264

USDA OCIO INTERNATIONAL TECHNOLOGY SERVICES $ - $ - $ 1,297,067 $ - $ - $ - $ 1,297,067

USDA OFFICE OF INSPECTOR GENERAL $ - $ - $ 145,022 $ - $ - $ - $ 145,022

Total $ 78,589,554 $ 2,965,105 $ 49,605,335 $ 19,597,557 $ 13,010,922 $ 197,004,054 $ 360,772,527

1/ ARC bills all customers for services, including ARC Admin, ARC IT, and SSP. Costs are initially billed and collected from ARC Admin, ARC IT, and SSP customers.

Note: The small variance in the following tables is due to transaction posting timing. The 1.1 table represents BFY 2018 revenue and the appendix table reflects 

customers actuals during 2018. Collections may be posted outside of the fiscal year, October 1st through September 30th timeframe.


Department of the Treasury 

Treasury Executive Office of 

Asset Forfeiture 

Congressional Budget 

Justification and Annual 

Performance Report and Plan

FY 2020
TEOAF - 2 

Table of Contents

Section I – Purpose........................................................................................................................ 3

A – Mission Statement................................................................................................................ 3

B – Summary of the Request ...................................................................................................... 3

1.1 – Appropriations Detail Table ............................................................................................... 7

1.2 – Obligation Detail Table...................................................................................................... 8

1.3 – Operating Levels Table...................................................................................................... 8

E – Legislative Proposals............................................................................................................ 8

Section II – Annual Performance Plan and Report................................................................... 9

A – Strategic Alignment ............................................................................................................. 9

B – Budget and Performance by Budget Activity ...................................................................... 9

2.1.1 Treasury Forfeiture Fund Resources and Measures ........................................................... 9
TEOAF - 3

Section I – Purpose

A – Mission Statement

To affirmatively influence the consistent and strategic use of asset forfeiture by law enforcement 

bureaus that participate in the Treasury Forfeiture Fund (the Fund) to disrupt and dismantle 

criminal enterprises.

B – Summary of the Request 

The Treasury Executive Office for Asset Forfeiture (TEOAF) administers the Fund, which is the 

receipt account for deposit of non-tax forfeitures made pursuant to laws enforced or administered 

by participating Treasury and Department of Homeland Security (DHS) bureaus. Principal 

revenue-producing bureaus include U.S. Customs and Border Protection (CBP), U.S. 

Immigration and Customs Enforcement (ICE), the Internal Revenue Service (IRS), the U.S. 

Secret Service (USSS), the U.S. Coast Guards (USCG), and Alcohol and Tobacco Tax and Trade 

Bureau (TTB), among others. The Fund is a special fund, defined as a Federal fund account for 

receipts earmarked for specific purposes and the expenditure of those receipts. The law (31 

U.S.C. 9705) allows TEOAF to use the funds for payment of all proper expenses of seizure or 

the proceedings of forfeiture and sale.

Revenues deposited in the Fund can be allocated and used as the result of a permanent indefinite 

appropriation provided by Congress. A forfeiture process begins once currency or property is 

seized. Seized currency is deposited into a suspense account (holding account) until forfeited. At 

that time, the forfeited amount is transferred (deposited) to the Fund as revenue. Forfeited 

properties are usually sold, and the proceeds are also deposited into the Fund as revenue. This 

revenue represents budget authority for meeting obligations and expenses of the program.

Expenses of the Fund are set in a relative priority so that operating costs are met first and may 

not exceed revenues.

• Mandatory expenses represent operating costs of the Fund, including storing and 

maintaining seized and forfeited assets, valid liens and mortgages, investigative expenses 

incurred in pursuing a seizure, information and inventory systems, remissions, victim 

restoration, and certain costs of local police agencies incurred in joint law enforcement 

operations. Following seizure, equitable shares may be paid to state and local law 

enforcement agencies that contributed to the seizure activity at a level proportionate to their 

involvement. 

• Secretary’s Enforcement Fund (SEF) expenses are funded from revenue from equitable 

shares received from Department of Justice (DOJ) or U.S. Postal Service (USPS) forfeitures. 

These shares are proportionate to Treasury’s participation in the overall investigative effort 

that led to a DOJ or USPS forfeiture. SEF revenue is available for federal law enforcementrelated purposes of any bureau participating in the Fund. 

• Strategic Support authority, established by Congress in 31 U.S.C. 9705(g)(4)(B), allows 

TEOAF to fund priority federal law enforcement initiatives with remaining unobligated 

balances at the close of the fiscal year, after an amount is reserved for the next fiscal year’s 

operations.
TEOAF - 4 

FY 2018 Case Highlights: The following case highlights are intended to provide examples of 

the types of investigative cases worked by the Fund’s law enforcement bureaus during FY 2018 

that resulted in the seizure and forfeiture of assets. Such cases as those profiled below are 

consistent with the strategic mission and vision of the Fund, which is to use high-impact asset 

forfeiture in investigative cases to disrupt and dismantle criminal enterprises.

• Rabobank Forfeits $318,701,259 as Part of Guilty Plea

Rabobank National Association (Rabobank) pleaded guilty to a felony conspiracy charge for

impairing, impeding and obstructing its primary regulator, the Department of the Treasury’s

Office of the Comptroller of the Currency (the OCC) by concealing deficiencies in its anti-money

laundering (AML) program and for obstructing the OCC’s examination of Rabobank. The

investigation was conducted by ICE Homeland Security Initiative (HSI), IRS Criminal

Investigation (CI), and the Financial Investigations and Border Crimes Task Force, a multiagency

Task Force based in San Diego and Imperial County. The investigation was funded by the

TEOAF and occurred parallel to regulatory investigations by the OCC, IRS’ Office of General

Counsel, and FinCEN’s Enforcement Division.

• New York Man Sentenced to 87 Months and Forfeits $1,624,172 for Multi-State

Biodiesel Fraud Scheme

Andre Bernard, of Mount Kisco, New York, pleaded guilty for his participation in a multistate scheme to defraud biodiesel buyers and U.S. taxpayers by fraudulently selling biodiesel

credits and fraudulently claiming tax credits. The IRS-CI was joined in this case by the USSS

and the Environmental Protection Agency’s Criminal Investigation Division.

• Minnesota Man who defrauded Hmong Community is Sentenced to 87 Months in

Prison, Forfeits $1,612,451

The St. Paul Police Department contacted the USSS Minneapolis Field Office requesting

assistance regarding the investigation of a large scale nationwide wire fraud scheme targeting

a Southeast Asian ethnic group known as the Hmong people living in approximately 18

known states in the U.S. Seng Xiong promoted his scheme in the Hmong language to solicit

elderly members of the Hmong community to invest money in monthly payments to bank

accounts in the name of Seng Xiong. Seng Xiong was convicted of wire fraud and mail fraud.

The final order of forfeiture for $1,612,451 will be used for victim restitution.

• Coast Guard Cutter Offloads Over 41.5 Tons of Cocaine

In San Diego on January 25, 2018, the USGC Cutter Stratton offloaded more than 47,000

pounds of cocaine worth over $721 million. U.S. and Canadian forces operating in

international waters off the coast of Central and South America seized the cocaine in 23

separate interdictions in the eastern Pacific Ocean. On March 20, 2018, the USCG offloaded

approximately 36,000 pounds of cocaine, with an estimated value of $500 million. The

seized narcotics were the result of 17 interdictions of suspected smuggling vessels off the

coasts of Central and South America between early February and early March of 2018.

Priorities: In FY 2020, TEOAF will continue to support the investigations and activities of the 

participating law enforcement bureaus. The bulk of TEOAF expenses include supporting 

seizures and forfeitures to protect the health and safety of U.S. citizens and the commercial 

interests of U.S. businesses from pernicious criminal activity. Funds are expended for seizure, 

storage, maintenance, disposition, and destruction and all costs associated with those activities. 
TEOAF - 5 

TEOAF focuses on supporting cases and investigations that meet the mission of disrupting and 

dismantling criminal enterprises. To this end, TEOAF prioritizes major case1 initiatives when 

allocating funding to member agencies, including the purchase of evidence and information, joint 

operations expenses, investigative expenses leading to seizure, and asset identification and 

removal teams. Major case initiatives are aligned directly to the National Money Laundering and 

Southwest Border strategies. 

TEOAF support for complex financial investigations initiated by the participating agencies 

reveals assets available for forfeiture. Many of these assets are the proceeds and result of 

fraudulent criminal enterprises that have victims. Significant resources are required to obtain a 

successful prosecution and forfeiture with the resulting revenue used to compensate the victims 

of the criminal activity.

Participating agencies also combat emerging patterns and practices that threaten our Nation’s 

financial stability. Funds are used to support anti-money laundering/combating financing of 

terrorism (AML/CFT) investigations and activities. To be effective, analysis of large data caches 

and cryptocurrency-related crime requires large investments in advanced information technology 

hardware, software, training, and other capabilities. These investments buttress the AML/CFT 

strategy of the Departments of Homeland Security and the Treasury. 

Challenges: Recently-enacted large rescissions have had a severe negative impact on the 

participating member agencies’ investigations. Insufficient and inconsistent funding support, 

uncertainty about future funding, investigations disrupted by cash flow problems, and inability to 

obtain necessary technology/infrastructure all undermine both current and future financial 

investigations and forfeitures. The Fund relies on base revenue (revenue from non-major 

forfeitures) to cover basic mandatory costs of the forfeiture program. Total FY 2018 base

revenue was $364 million, as compared to $349 million in FY 2017, $419 million in FY 2016, 

$387 million in FY 2015, and $410 million in FY 2014. 

The table below reflects forfeiture revenue from all sources including revenue, reverse asset 

sharing, and interest earned.

1 A major case refers to a case where the forfeiture results in a deposit greater than $5 million, or a case that disrupts, 

dismantles, or interrupts money laundering networks or other financial activities that threaten the financial stability, 

financial system, or financial interests of the United States.
TEOAF - 6

*FY 2015 data does not include the BNP Paribas S.A. forfeiture in the amount of $3,839 million. Of that amount, $3,800 million was 

permanently rescinded and transferred to the newly-created U.S. Victims of State Sponsored Terrorism Fund (USVSST) as directed by Congress 

under the Consolidated Appropriations Act of 2016, Pub. L. 114-113, Div. O, Tit. IV, §404(e) and §405(b). The remainder has been returned to 

the General Fund in FY 2018.

Participating agencies are seeing reluctance in the field to undertake complex major 

investigations due to the lack of assurance that their efforts would receive continuous support.

Strategic Support funding is especially critical as a strategic investment in the agencies’ 

operational capabilities and infrastructure supporting major cases. It provides law enforcement 

much-needed flexibility to respond in real time to unanticipated critical needs, such as those 

driven by technology advancements or emerging criminal threats. It often serves as seed funding 

for innovations that need to be tested and refined prior to full-scale implementation.

It is precisely the most important, high-impact2 financial investigations that TEOAF must 

continue to support due to resource needs and ultimate disposition of the forfeited assets. 

Undermining these major financial investigations will directly impact the ability of Treasury and 

DHS to respond to priority threats and to protect the integrity of the U.S. financial system.

In addition, TEOAF tracks future remission payments to third parties as contingent liabilities. 

However, these amounts are not recorded as obligations from the Fund until the Department of 

Justice grants the petition for remission. The third parties are predominantly victims of crimes 

that triggered the forfeiture (e.g., Ponzi scheme or kleptocracy victims). Amounts recorded are 

significant because remission payments from multiple years are recorded and carried forward.

The amounts change constantly as payments are made and amounts for new remission cases are 

added. TEOAF considers the amounts recorded as contingent liabilities as unavailable and 

believes that consideration of contingent liabilities provides a more accurate representation of the 

financial position of the Fund.

 2 A high-impact case refers to a case resulting in a cash forfeiture deposit equal to or greater than $100,000. 

$579 $556 

$1,143 

$931 

$524 

$1,715 

$785 $795 $884 

$516 

$1,279 

FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015* FY 2016 FY 2017 FY 2018

$0

$500

$1,000

$1,500

$2,000

Millions

FORFEITURE REVENUE FROM ALL SOURCES
TEOAF - 7 

1.1 – Appropriations Detail Table

Dollars in Thousands

1 FY 2019 estimates are based on approved financial plan and exclude additional anticipated forfeitures of $359 million that may come in FY 

2019. 2 The Treasury Forfeiture Fund is staffed by Departmental Offices employees and positions are funded via reimbursable agreement. The FTE are 

shown here for clarity, but are also reflected in the Departmental Offices chapter in the reimbursable FTE total. 3 In February 2019, Treasury submitted a strategic support plan to the committees including two tranches. The first tranche of up to $242 million 

will be available for obligation 15 days after Treasury's plan was submitted. The second tranche of $359 million will be available for obligation 

after that date subject to the receipt of additional anticipated forfeitures. 4 The FY 2019 sequestration would increase by $22 million if the additional anticipated forfeitures of $359 million are finalized in FY 2019. 

Treasury will compute the FY 2020 sequestration reduction once the OMB Report to Congress on the Joint Committee Sequestration for Fiscal 

Year 2020 is released. 

Treasury Forfeiture Fund

Budgetary Resources

FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

Revenue/Offsetting Collections

Interest 0 $47,560 0 $31,000 0 $31,309 0 $309 NA 1%

Restored Prior Year Rescission 0 $988,000 0 $0 0 $0 0 $0 NA NA

Restored Prior Year Sequestration Reduction 0 $35,606 0 $84,405 0 $32,742 0 ($51,663) NA -61%

Restored Prior Year Sequestration of Restored 

Rescission 0 $60,444 0 $65,208 0 $0 0 ($65,208) NA -100%

Forfeited Revenue 0 $1,231,301 0 $497,096 0 $507,038 0 $9,942 NA 2%

Recovery from Prior Years 0 $16,933 0 $18,000 0 $18,000 0 $0 NA 0%

Unobligated Balances from Prior Years 0 $668,529 0 $825,172 0 $134,460 0 ($690,712) NA -84%

Total Revenue/Offsetting Collections $3,048,373 $1,520,881 $723,549 0 ($797,331) NA -52%

Expenses/Obligations

Mandatory Obligations2 26 $919,464 27 $527,772 27 $538,327 0 $10,555 0.00% 2%

Secretary's Enfrocement 0 $38,383 0 $22,316 0 $22,762 0 $446 NA 2%

Strategic Support 0 $49,579 0 $601,000 0 $0 0 ($601,000) NA -100%

First Tranche 3 0 $0 0 $242,000 0 $0 0 $0 NA NA

Second Tranche 3 0 $0 0 $359,000 0 $0 0 $0 NA NA

FY 2018 Strategic Support obligated in FY 2019 0 $0 0 $2,590 0 $0 0 ($2,590) NA -100%

Total Expenses/Obligations 26 $1,007,426 27 $1,153,678 27 $561,090 0 ($592,589) 0.00% -51%

Rescissions/Cancellations

Sequestration Reduction 4 0 ($149,613) ($32,742) TBD NA NA NA

Permanent Cancellation 0 ($1,066,162) ($200,000) $0 $200,000 NA -100%

Total Rescission/Cancellations ($1,215,775) ($232,742) $0 $200,000 NA -100%

Net Results $825,172 $134,460 $162,459 ($204,743) NA 21%

Contingent Liabilities $407,460 $400,000 $400,000 $0 NA 0%

FY 2018 FY 2019 FY 2020 FY 2019 to FY 2020

Actual Estimated1 Estimated $ Change % Change
TEOAF - 8 

1.2 – Obligations Detail Table

Dollars in Thousands

1 Funding availability is based on actual receipts. TEOAF will reassess the funding availability in late FY 2019. 2 IRS’ FY 2018 Mandatory obligations included a large victim refund of $453 million. 3 This represents IRS’ FY 2018 Strategic Support funding obligated in FY 2019

1.3 – Operating Levels Table

Dollars in Thousands

E – Legislative Proposals 

TEOAF has no legislative proposals. 

Treasury Forfeiture Fund % Change

Obligations FY 2019 to 

FY 2020

CBP $64,161 $41,622 $42,454 2%

ICE $105,323 $199,988 $203,987 2%

IRS 2 $620,107 $150,485 $153,495 2%

USSS $31,796 $31,893 $32,531 2%

USCG $1,400 $1,400 $1,428 2%

TEOAF $79,251 $82,277 $83,923 2%

TTB $588 $600 $612 2%

DOJ $16,837 $19,506 $19,896 2%

Total Mandatory $919,464 $527,771 $538,327 2%

CBP $5,422 $4,000 $4,080 2%

ICE $14,963 $7,185 $7,329 2%

IRS $12,821 $7,050 $7,191 2%

USSS $5,177 $4,081 $4,163 2%

Total SEF $38,383 $22,316 $22,762 2%

CBP $9,925 $601,000 TBD NA

ICE $16,321 $0 TBD NA

IRS 3 $13,410 $2,590 TBD NA

USSS $6,500 $0 TBD NA

USCG $2,423 $0 TBD NA

TTB $1,000 $0 TBD NA

Total Strategic Support $49,579 $603,590 TBD NA

Total Expenses/Obligations $1,007,426 $1,153,678 561,090 $ -51%

FY 2019 

Estimated

FY 2020 

Estimated 1

Mandatory

SEF

Strategic Support

FY 2018

 Actual

Treasury Forfeiture Fund FY 2018 FY 2019 FY 2020

Object Classification Actual Estimated Estimated

25.2 - Other services 58,598 60,496 61,000

25.3 - Other purchases of goods & serv frm Govt accounts 177,215 730,496 132,000

26.0 - Supplies and materials 15 138 25

41.0 - Grants, subsidies, and contributions 161,025 167,492 170,000

43.0 - Interest and dividends 56 59 65

44.0 - Refunds 522,556 103,499 105,000

94.0 - Financial Transfers 87,961 91,498 93,000

Total Non-Personnel 1,007,426 1,153,678 561,090

New Budgetary Resources $1,007,426 $1,153,678 $561,090

Budget Activities:

 Asset Forfeiture Fund $1,007,426 $1,153,678 $561,090

FTE 26 27 27
TEOAF - 9

Section II – Annual Performance Plan and Report

A – Strategic Alignment

The purpose of the Fund is to ensure resources are managed to cover the costs of an effective

asset seizure and forfeiture program, including the costs of seizure or the proceedings of

forfeiture and sale, including the expenses of detention, inventory, security, maintenance,

advertisement, or disposal of the property. Additionally, the Fund is used to support law

enforcement priorities, financial investigative capabilities, and the seizure of physical and

financial resources to disrupt and dismantle criminal enterprises. TEOAF supports the following

Department of the Treasury strategic goal and associated objectives:

• Goal 3: Enhance National Security:

o 3.1 Strategic Threat Disruption

o 3.2 AML/CFT Framework

B – Budget and Performance by Budget Activity

2.1.1 Treasury Forfeiture Fund Resources and Measures

Dollars in Thousands

Treasury Forfeiture Fund Budget and Performance

($561,090,000 in obligations from revenue/offsetting collections): 

The Fund continues to measure the performance of the participating law enforcement bureaus 

through the “percent of forfeited cash proceeds resulting from high-impact cases, “which are 

cases that yield a cash forfeiture deposit equal to or greater than $100,000.

Focusing on strategic cases and investigations that result in high-impact forfeitures will help to 

impede criminal organizations while accomplishing the ultimate objective, which is to disrupt 

and dismantle criminal enterprises. Member law enforcement bureaus participating in the Fund 

have met or exceeded the performance target since FY 2014. However; the performance declined 

to 81.79 percent in FY 2017 due to the inability of TEOAF to offer support for high-impact cases 

in prior years. The performance increased to 94.19 percent in FY 2018 because one major case 

resulted in $453 million which was used to compensate victims entirely. For FY 2019 and 

FY 2020, the target will remain at 80 percent. The Fund maintains a target of 80 percent because 

some cases may be important to pursue, even if they are not high-impact cases and result in 

deposits of less than $100,000.

FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Estimated Estimated

Expenses/Obligations $787,849 $4,323,908 $508,746 $526,228 $1,007,426 $1,153,678 $561,090

$787,849 $4,323,908 $508,746 $526,228 $1,007,426 $1,153,678 $561,090

 25 25 25 25 26 27 27

Measure FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Target Target

 98.25 89.09 81.79 80.00 94.19 80.00 80.00 

Budget Activity Total

 Resource Level

FTE

Percent of Forfeited Cash Proceeds 

Resulting from High-Impact Cases



Department of the Treasury 

Bureau of Engraving and 

Printing

Congressional Budget 

Justification and Annual 

Performance Report and Plan 

FY 2020 
BEP - 2

Table of Contents

Section I – Purpose........................................................................................................................ 3

A – Mission Statement ............................................................................................................... 3

B – Summary of the Request...................................................................................................... 3

1.1 – Resource Detail Table ....................................................................................................... 4

1.2 – Budget Adjustments Table ................................................................................................ 5

C – Budget Increases and Decreases Description ...................................................................... 5

1.3 – Operating Levels Table ..................................................................................................... 7

D – Appropriations Language and Explanation of Changes...................................................... 7

E – Legislative Proposals........................................................................................................... 7

Section II – Annual Performance Plan and Report................................................................... 8

A – Strategic Alignment............................................................................................................. 8

B – Budget and Performance by Budget Activity...................................................................... 8

2.1 – Manufacturing Resources and Measures........................................................................... 8

C – Change in Performance Meausres....................................................................................... 9

Section III – Additional Information ........................................................................................ 10

A – Summary of Capital Investments ...................................................................................... 10
BEP - 3 

Section I – Purpose

A – Mission Statement

To develop and produce United States currency notes trusted worldwide. 

B – Summary of the Request 

The Bureau of Engraving and Printing (BEP) produces and delivers U.S. currency notes for the 

Federal Reserve System ordered by the Board of Governors of the Federal Reserve (FRB) and 

other security products for the Federal Government. BEP began printing currency in 1862 and 

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 established in 1950 in accordance with Public Law 81-656. The fund is 

reimbursed for direct and indirect costs of operations, including administrative expenses, through 

product sales. In 1977, Public Law 95-81 authorized BEP to include an amount sufficient to 

fund capital investment and to meet working capital requirements in the prices charged for 

products, eliminating the need for annual discretionary appropriations. 

BEP provides technical assistance, advice, and some production services to other federal 

agencies in the development of security documents that require counterfeit deterrent features due 

to their innate value or other characteristics. Other activities at BEP 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 customer requirements. BEP 

supports Treasury’s Strategic Goal 1: Boost U.S. Economic Growth and Strategic Goal 5: 

Achieve Operational Excellence. 

BEP’s FY 2020 request funds the following projects: 

Replacement Production Facility: BEP’s current Washington, D.C. facility has an aging and 

outdated infrastructure which drives up costs and adversely impacts quality of the currency. 

BEP’s FY 2020 Congressional Justification displays expenditures for planning and design 

services for a new, smaller, more efficient currency production facility. A new facility will save 

an estimated $579 million over 10 years as compared to the cost of the renovation of the existing 

facility. In addition, BEP will be able to reduce its space by 28 percent and reduce its annual 

operating costs by at least $38 million. In 2019 and 2020 the budget includes costs associated 

with initial planning as well as the cost for the preliminary analysis by the Army Corps of 

Engineers for compliance with the National Environmental Policy Act (NEPA) and the cost of 

site surveys. 1

1. Western Currency Facility Expansion: Producing the next family of updated notes

requires that BEP purchase and install new production equipment to support the new designs.

The expansion will provide the space and infrastructure necessary to successfully meet the

1 The final 2019 appropriations bill provided BEP with the necessary authority to purchase land and construct a new 

production facility. In addition, the Agriculture Improvement Act of 2018 included a provision that authorizes the 

Secretary of Agriculture to transfer to the Secretary of the Treasury administrative jurisdiction of a 100-acre parcel 

of property at the Beltsville Agriculture Research Center (BARC) for establishing a BEP production facility. 

Treasury and USDA plan to enter into a Memorandum of Agreement to implement the property transfer.
BEP - 4 

production requirements of the next family of U.S. currency banknotes that focus on the 

integration of strong, new security features. 

2. Banknote Design and Development: In FY 2020, BEP will continue working with the

Federal Government’s Advanced Counterfeit Deterrent (ACD) Steering Committee to

research and develop improved security features for the next family of updated notes. The

updated notes will focus on innovative banknote security and anti-counterfeit technology that

will enhance and ensure the security and integrity of U.S. currency. The ACD Committee is

an inter-agency group established to monitor and explore existing and emerging technologies

to deter the counterfeiting of U.S. currency. It includes representatives from BEP, the

Department of the Treasury, the U.S. Secret Service, and the FRB. While many factors are

taken into consideration when updating currency, the primary purpose for updating notes is

to improve the security of U.S. banknotes and ensure they maintain their position as being

trusted worldwide.

3. Retooling: BEP is conducting a multi-year effort to retool its manufacturing processes with

state-of-the-art intaglio printing presses, electronic inspection systems, and finishing

equipment. To ensure that BEP will meet the annual currency order, the FRB and BEP

developed and established short, medium, and long-term strategic equipment replacement

plans for the U.S. Currency Program. Successful implementation of advanced technology

improves productivity, reduces environmental impact, and enhances counterfeit deterrence of

U.S. currency notes.

4. Talent Management: BEP will continue its designated talent management initiatives, while

filling personnel gaps in needed STEM and cybersecurity skill sets. Throughout FY 2020,

BEP will continue to develop, execute, and communicate the results of Employee

Engagement Plans and the annual Federal Employee Viewpoint Survey (FEVS) results.

1.1 – Resource Detail Table
BEP - 5 

1.2 – Budget Adjustments Table

*The 2020 President’s Budget continues to include the proposal to give BEP the authority to purchase land and construct a new

facility as a legislative proposal, rather than enacted law, due to the timing of the enactment of the final 2019 appropriations bill. This

table assumes enactment of the proposal in 2019.

C – Budget Increases and Decreases Description

FY 2019 Revised Estimate 

Program Decrease ....................................................................................... -$30,820,000 / -0 FTE

Washington D.C. New Facility -$30,820,000 / -0 FTE 

This is an adjustment to the original estimate to reflect when the new facility work will begin. 

Program Increases ................................................................................... +$15,591, 000 / +0 FTE

Mint/BEP OMS II Consolidation Costs +294,000 / +0 FTE 

One time consolidation costs to the Mint’s E-Commerce infrastructure and services platform. 

Washington D.C. Facility Building Upgrades +$15,297,000/ +0 FTE

These building and supporting system upgrades (i.e. HVAC, freight elevators) are necessary to 

maintain the existing facility until the new production facility is complete.

FY 2020 Maintaining Current Levels (MCLs) ......................................... +$7,275,000 / +0 FTE

Non-Pay +$7,275,000 / +0 FTE 

Funds are required for non-labor costs such as travel, contracts, rent, supplies, and equipment. 

Efficiency Savings ......................................................................................... -$3,000,000 / -0 FTE

Productivity Improvements & Overtime Reduction -$3,000,000 / -0 FTE 

By employing new production technologies, BEP plans for increased operational efficiencies that 

require less overtime.
BEP - 6

Program Decreases .....................................................................................-$18,960,000 / -0 FTE

Washington D.C. Building Renovations -$18,960,000 / -0 FTE

This adjustment reflects a transition from renovation costs to new facility costs. 

Program Increases..................................................................................+$20,371,000 / +27 FTE

Operations and Maintenance (O&M) of Prior-year Enterprise-wide Cybersecurity Investments

+$371,000 / +0 FTE 

The request includes funding to support O&M for prior year Cybersecurity Enhancement 

Account investments. O&M will be funded by Treasury Bureaus through Treasury Franchise 

Fund (TFF) billing. This increase represents the bureau’s portion of the $17.5 million O&M 

total. 

Security Feature Equipment +$15,000,000 / +0 FTE

Funds are needed for the award of a contract for production equipment needed to print new 

currency features.

Workforce Planning Hiring Efforts (STEM) +$5,000,000 / +27 FTE

Includes personnel costs for BEP’s STEM hiring program to meet its critical mission and cyber 

security requirements. 
BEP - 7 

1.3 – Operating Levels Table

D – Appropriations Language and Explanation of Changes

The BEP does not need annual appropriations language.

E – Legislative Proposals2

As in FY 2019, BEP requests the authority to print security documents such as birth, marriage, 

and death certificates for state governments. Many states are unable to find an American printing 

firm to produce the documents. These states are turning to foreign companies or lowering their 

security standards.

2 The 2020 President’s Budget continues to include the proposal to give BEP the authority to purchase land and 

construct a new facility as a legislative proposal, rather than enacted law, due to the timing of the enactment of the 

final 2019 appropriations bill. 
BEP - 8 

Section II – Annual Performance Plan and Report

A – Strategic Alignment

BEP's vision is to be the world’s standard securities printer providing its customers and the 

public with superior products through excellence in manufacturing and innovation. BEP 

supports the following Department of the Treasury FY 2018-2022 strategic goals: 

• Goal 1: Boost U.S. Economic Growth

o 1.3 Trusted Currency and Services

• Goal 5: Achieve Operational Excellence

o 5.1 Workforce Management

o 5.2 Treasury Infrastructure

o 5.3 Delivering Customer Value

U.S. currency is used globally and as its manufacturer, BEP needs to achieve and maintain bestin-class practices for U.S. currency to be accepted worldwide. Working closely with its partners 

in the U.S. Currency Program, BEP looks forward to updating the next series of secure notes. 

BEP continues to make every effort to meet its mission to manufacture sophisticated and 

technologically advanced notes that are dependable in commerce. This achievement requires the 

focus and determination of the entire agency, since BEP faces challenges and is committed to 

stay ahead of increasingly sophisticated counterfeiters. 

B – Budget and Performance by Budget Activity

2.1 Manufacturing Resources and Measures

Key: DISC- Discontinued; B- Baseline

Manufacturing Budget and Performance

($886,887,000 from reimbursable resources):

The BEP has one budget activity: Manufacturing. This budget activity supports all of BEP’s 

strategic goals as well as supporting Treasury’s Strategic Goals Boosting U.S. Economic Growth 

and Achieving Operational Excellence. 

Manufacturing Costs for Currency (dollar cost per 1,000 notes produced) is an indicator of 

manufacturing efficiency and effectiveness of program management. The measure is based on 

contracted price factors, productivity improvements, and the mix of denominations ordered. 

Actual performance against standard costs depends on BEP’s ability to meet spoilage, efficiency, 
BEP - 9

and capacity utilization goals. In FY 2018, the cost of manufacturing was lower than anticipated

due to the success of the $100 Single Note Inspection program, which enables BEP to reclaim 

notes which would previously have been destroyed. The 2018 cost was $47.41 per 1,000 notes 

produced, compared to a target of $48.00. Due to the mix of denominations ordered in FY 

2019, BEP’s target for this performance metric in FY 2019 and FY 2020 is set at $50.00 per 

1,000 notes produced.

Currency Notes Returned Due to Defects (parts per million (ppm)) is an indicator of BEP’s 

ability to provide a quality product. The target for this performance metric is <1 ppm, BEP was 

able to exceed the established target in FY 2018 with an actual result of 0.0031ppm notes 

returned due to a defect. BEP’s target for this performance metric will be held constant at <1

ppm for FY 2019 and FY 2020.

The Federal Employees Viewpoint Survey (FEVS) allows employees to share their opinion on 

what matters most to them. Based on the results of the survey , BEP can target areas for 

improvement or additional employee engagement. The measure uses the Department’s standard 

FEVS engagement index with a target of 65 percent. In FY 2019 and 2020, BEP will continue to 

strive for improvements in overall employee satisfaction. 

The Lost Time Accident Rate per 100 employees measures the BEP’s ability to reduce injuries 

and illnesses in the workplace. BEP’s FY 2018 Lost Time Accident rate was at 0.90 cases per 

100 employees, 50 percent lower than the target of 1.80 cases per 100 employees. Both plants 

ended the year below the target, the best safety performance in a decade. This performance 

resulted from increased focus on following safe work practices, avoiding hazards, and being a 

Director’s priority. For FY 2020, BEP remains committed to maintaining and improving the 

safety of its employees. BEP will continue to perform analysis to determine the root causes of 

any injury and to identify best practices in safety. BEP’s target will be held at 1.80 cases per 100 

employees for FY 2019 and FY 2020. 

C – Change in Performance Measures

Performance Measure or Indicator Change and Justification

1. Best Place to Work in the Federal 

Government Rankingdiscontinued

BEP will replace this indicator with Improved 

FEVS satisfaction in order to align with the 

department’s standard of measurement using FEVS 

engagement index. 

2. Improved FEVS satisfaction -

new 

This is an improved measure to Best Place to Work 

in the Federal Government Ranking. This measure

provides leadership with BEP employee perceptions 

of job satisfaction, engagement, and workforce 

management. This measure uses the department’s 

FEVS engagement index. 

3. Yearly currency order (percent of 

order completed versus planned) -

new

This measure tracks the percent of the yearly 

currency order completed against the yearly ordered 

planned. The target for this measure is 10 percent.
BEP - 10 

Section III – Additional Information

A – Summary of Capital Investments

BEP capital investment strategy is comprised of several broad investment categories with more 

specific smaller projects in each category. 

BEP’s mission to develop and produce U.S. currency notes trusted worldwide demands that BEP 

continually update and improve its manufacturing processes by investing in new technologies 

and innovations. BEP’s retooling project replaces older, fully depreciated production equipment. 

Replacing out of date equipment allows BEP to be more quality driven, cost effective, and 

efficient in meeting customer requirements for the production of currency notes. In addition, as 

part of its meaningful access program, BEP is pursuing development of a tactile feature. This 

may require the purchase of additional capital equipment. 

BEP participates as a partner in significant Treasury-wide, enterprise-level investments such as 

Treasury Enterprise Identity, Credential and Access Management, HRConnect (a Human 

Resources Line of Business service provider), and the Integrated Talent Management (ITM) 

System. 

BEP’s IT portfolio includes a “cloud first” approach to implementing business systems. The 

Oracle eBusiness Suite is an integrated manufacturing suite, which runs at the Oracle 

Corporation’s “Federal on Demand” Shared Service Center in Austin, Texas.

A summary of FY 2019 capital investment resources, including major information technology 

and non-technology investments, can be found at: 

http://www.treasury.gov/about/budget-performance/Pages/summary-of-capital-investments.aspx

This website also contains a digital copy of this document. 


Department of the Treasury 

United States Mint

Congressional Budget 

Justification and Annual 

Performance Report and Plan

FY 2020
Mint - 2

Table of Contents

Section I – Budget Request........................................................................................................... 3

A – Mission Statement................................................................................................................ 3

B – Summary of the Request ...................................................................................................... 3

1.1 – Resource Detail Table........................................................................................................ 4

1.2 – Budget Adjustments Table................................................................................................. 5

C – Budget Increases and Decreases Description....................................................................... 5

1.3 – Operating Levels Table...................................................................................................... 6

D – Appropriations Language and Explanation of Changes ...................................................... 7

E – Legislative Proposals............................................................................................................ 7

Section II – Annual Performance Plan and Report................................................................... 8

A – Strategic Alignment ............................................................................................................. 8

B – Budget and Performance by Budget Activity ...................................................................... 9

2.1.1 – Manufacturing Resources and Measures........................................................................ 9

Section III – Additional Information ........................................................................................ 11

A – Summary of Capital Investments....................................................................................... 11
Mint - 3 

Section I – Budget Request

A – Mission Statement

The United States Mint (Mint) enables America’s economic growth and stability by protecting 

assets entrusted to us and manufacturing coins and medals to facilitate national commerce.

B – Summary of the Request 

In Fiscal Year (FY) 2020, the Mint’s total estimated budgetary requirements for operations, 

metal, and capital investments are $2.73 billion. This budget will support the production of 14

billion circulating coins, as well as the production of bullion and other numismatic products 

sufficient to meet customer demand. The Mint has one budget activity: manufacturing, which 

encompasses the bureau’s two major programs, circulating coinage and numismatic products 

(including bullion coins, collector coins, and national medals). 

To maintain its reputation as one of the finest mints in the world, the Mint is committed to 

operating according to the core values of service, quality, and integrity. The Mint has three 

strategic goals to help fulfill its mission and values: 1) foster a safe, flexible, diverse, and 

engaged workforce; 2) improve mission critical activities and governance; and 3) integrate 

technology into operations and support lines. These goals align with Treasury Strategic Goal 1: 

Boost U.S. Economic Growth and Goal 5: Achieve Operational Excellence. 

Mint operations are funded through the Mint Public Enterprise Fund (PEF), 31 U.S.C. § 5136. 

The Mint generates revenue through the sale of circulating coins to the Federal Reserve Banks 

(FRB), numismatic products to the public, and bullion coins to authorized purchasers. All 

circulating and numismatic operating expenses, along with capital investments incurred for the 

Mint’s operations and programs, are paid out of the PEF. By law, all funds in the PEF are 

available without fiscal year limitation. Revenues determined to be in excess of the amount 

required by the PEF are transferred to the United States Treasury General Fund. 

Circulating

Circulating coin production projections are based on current economic data and forecasts of FRB 

coin orders. Circulating coin production for FY 2019 and FY 2020 is forecasted at 14.0 billion 

coins for each year. This level reflects a two percent increase for FY 2019 and FY 2020 in 

shipments of all coin denominations as compared to 13.7 billion in FY 2018. Circulating 

financial performance continues to be adversely affected by rising production costs. FY 2018 

unit costs increased for all denominations compared to the prior year. The unit cost for both 

pennies (2.06 cents) and nickels (7.53 cents) remained above face value for the thirteenth 

consecutive fiscal year.

Numismatic Program

The numismatic program, which includes bullion coins, is designed to prepare and distribute 

premium products to collectors and those who desire quality versions of coinage. Numismatic 

products are priced to cover metal and production costs. 
Mint - 4

Bullion Coins 

The bullion coin program provides the public a means to acquire precious metal coins as part of 

an investment portfolio. In FY 2018, bullion demand declined to 15.3 million ounces from the 

24.7 million ounces sold in FY 2017. Demand for bullion is forecasted at 29.6 million ounces in 

FY 2019 and 31.7 million ounces in FY 2020. Bullion revenue is forecasted to be $2.0 billion in 

both FY 2019 and FY 2020.

Numismatic (Collector Coins and Medals)

The numismatic program provides high-quality versions of circulating coinage, precious metal 

coins, commemorative coins, and national medals for sale to the public. Numismatic revenue 

decreased by 24 percent from $388 million in FY 2017 to $293 million in FY 2018. The 

decrease was driven primarily by lower customer demand for numismatic products. Total units 

decreased by 14 percent from 3.9 million in FY 2017 down to 3.3 million in FY 2018. FY 2019

and FY 2020 numismatic revenues are projected to be $286 million and $229 million, 

respectively, based on projected demand for numismatic products of 3.9 million in FY 2019 and 

3.0 million in FY 2020.

1.1 – Resource Detail Table 
Mint - 5 

1.2 – Budget Adjustments Table

C – Budget Increases and Decreases Description

FY 2019 Revised Estimated Resources.....................................-$349,706,000 / -0 FTE

Metals Due to Forecasted Increase in Circulating Coin Metal Prices +$40,000,000 / +0 FTE

FY 2019 forecasted circulating coin production has decreased by 4 percent (from 14.5 billion to 

14.0 billion); however, metal prices are forecasted to increase from originally- planned levels 

(zinc +20 percent; copper +16 percent; nickel +5 percent). The net result is an overall increase 

to the circulating coin program cost.

Metals Due to Forecasted Decrease in Bullion/Numismatic Production -$390,000,000 / -0 FTE 

FY 2019 forecasted demand for the numismatic and bullion coin programs has decreased by -5 

percent and -20 percent, respectively.

Mint/BEP OMS II Consolidation +$294,000 / +0 FTE

Mint will streamline its E-Commerce infrastructure and services platform to migrate BEP’s 

online numismatic sales and marketing presence.

FY 2020 Budget Increases and Decreases Description......................-$2,818,000 / -0 FTE

Maintaining Current Levels (MCLs) – Non-Pay +$4,571,000 / +0 FTE 

Funds are required for non-labor expenses such as travel, rent, contracts, supplies, and 

equipment. 

Operating Efficiencies -$7,389,000 / -0 FTE 

The Mint will reduce its operating budget by continuing to monitor costs and implement various 

savings strategies. 
Mint - 6 

Program Decreases .................................................................-$30,000,000 / -0 FTE

Metal due to forecasted decrease in numismatic production -$30,000,000 / -0 FTE

Demand for the numismatic coin program is forecasted to decrease from FY 2019 to FY 2020 

(3.6 to 2.7 million units). 

Program Increases ........................................................+$140,416,000 / +0 FTE

Metal due to forecasted increase in bullion production +$140,000,000/ +0 FTE

Forecasted demand for the bullion coins will increase slightly from FY 2019 to FY 2020 (29.6 to 

31.7 million ounces). This increase, coupled with forecasted increases in metal prices, will result 

in an increase in overall production costs for the bullion coin program. 

Operations and Maintenance (O&M) of Prior-year Enterprise-wide Cybersecurity Investments

+$416,000 / +0 FTE 

The request includes funding to support O&M for prior year Cybersecurity Enhancement 

Account investments. O&M will be funded by Treasury Bureaus through Treasury Franchise 

Fund billing. This increase represents the bureau’s portion of the $17.5 million O&M total. 

1.3 – Operating Levels Table 
Mint - 7

D – Appropriations Language and Explanation of Changes

Appropriations Language Explanation of Changes

DEPARTMENT OF THE TREASURY

United States Mint

Federal Funds

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: Provided, That the aggregate amount of new 

liabilities and obligations incurred during fiscal year 2020 under 

such section 5136 for circulating coinage and protective service 

capital investments of the United States Mint shall not exceed 

$30,000,000.

Note.—A full-year 2019 appropriation for this account was not 

enacted at the time the budget was prepared; therefore, the budget 

assumes this account is operating under the Continuing 

Appropriations Act, 2019 (Division C of P.L. 115–245, as 

amended). The amounts included for 2019 reflect the annualized 

level provided by the continuing resolution.

E – Legislative Proposals

Alternative Metal Composition

This proposal would give the Secretary the authority to prescribe the compositions of the 5-cent, 

dime, and quarter-dollar coins, provided that the new metal compositions do not affect the 

Electromagnetic Signature (EMS), the color, and weight of the coins. By authorizing the 

Secretary the flexibility and agility to implement small changes to the copper-nickel circulating 

coin metal compositions, the Mint could realize incremental material savings with little or no 

impact to the vending industry and general public.
Mint - 8 

Section II – Annual Performance Plan and Report

A – Strategic Alignment

The Mint aligns with the following Department of the Treasury FY 2018-2022 strategic plan 

goals: 

• Goal 1: Boost U.S. Economic Growth

o Objective 1.3 Trusted Currency and Services: Deliver trusted currency and services

that enable citizens and businesses to participate in the economy.

• Goal 5: Achieve Operational Excellence

o Objective 5.1 Workforce Management: Deliver trusted currency and services that

enable citizens and businesses to participate in the economy.

o Objective 5.2 Treasury Infrastructure: Better enable mission delivery by improving the

reliability, security, and resiliency of Treasury’s infrastructure.

o Objective 5.3 Delivering customer value: Improve customer value by increasing the

quality and lowering the cost of Treasury’s products and services.

Circulating Coinage Program 

Circulating coinage includes the minting and issuing of pennies, 5-cents, dimes, and quarterdollars. The Mint delivers circulating coinage to the FRBs in quantities to support their service 

to commercial banks and other financial institutions. These financial institutions then meet the 

coinage needs of retailers and the public. The Mint recognizes revenues from the sale of 

circulating coins at face value when they are shipped to the FRBs.

The Mint will continue to mint and issue circulating quarter-dollar coins honoring America’s 

national parks and other national sites, in accordance with the America the Beautiful National 

Parks Quarter Dollar Coin Act of 2008 (Public Law 110-456). In 2019, the Mint will release 

quarters honoring Lowell National Historical Park (Massachusetts), American Memorial Park 

(Commonwealth of the Northern Mariana Islands), War in the Pacific National Historical Park 

(Guam), San Antonio Missions National Historical Park (Texas), and Frank Church River of No 

Return Wilderness (Idaho). In 2020, the Mint will release quarters honoring National Park of 

American Samoa (American Samoa), Weir Farm National Historic Site (Connecticut), Salt River 

Bay National Historical Park and Ecological Preserve (U.S. Virgin Islands), Marsh-BillingsRockefeller National Historical Park (Vermont), and Tallgrass Prairie National Preserve 

(Kansas). In 2021, the program will end with one final quarter honoring Tuskegee Airmen 

National Historic Site (Alabama). 

Numismatic Program

Bullion Coins 

The Mint produces and issues gold, silver, platinum, and palladium bullion coins to authorized 

purchasers through the American Eagle, American Buffalo, and America the Beautiful Silver 

Bullion Coin Programs. The authorized purchasers agree to maintain an open, two-way market 

for these coins, ensuring their availability for consumers who desire them for investment 

portfolios. Demand for bullion coins is greatly influenced by the performance of other 

investment options, such as equities or currency markets, and therefore is highly unpredictable. 

The content and purity of the precious metal in the bullion coins are backed by the United States 

Government. 
Mint - 9

Other Numismatic Products 

The Mint’s numismatic program provides high-quality versions of circulating coinage, precious 

metal coins, commemorative coins, and national medals for sale directly to the public. For some 

numismatic products, authorizing legislation specifies program requirements, such as design 

theme, mintage level, and duration of product availability. Other programs are structured by law 

to grant the Secretary of the Treasury discretion in determining product specifications. 

The Mint will continue to mint and issue $1 coins commemorating the important contributions 

made by Indian tribes and individual Native Americans to the development and history of the 

United States in accordance with the Native American $1 Coin Act (Public Law 110-82). In 

addition, the American Innovation $1 Coin Program (Public Law 115-197) will begin in 2019. 

This is a multi-year $1 coin series to honor innovation and innovators for each of the 50 states, 

the District of Columbia and the five U. S. territories – Puerto Rico, Guam, American Samoa, the 

U.S. Virgin Islands, and the Northern Mariana Islands. Four new $1 coins with distinctive 

reverse designs will be released each year through 2032, in the order the states ratified the 

Constitution of the United States or were admitted to the Union. Once a coin is issued for each 

state, coins will be released for the District of Columbia and the territories. 

Commemorative coins are authorized by law to recognize and honor people, places, events, 

institutions, and other subjects of historic or national significance. Each coin is minted and 

issued by the Mint in a limited quantity and is available only for a limited time. Included in the 

price is a surcharge that is authorized to be paid to the designated recipient organizations, 

assuming all legal requirements have been met. Recipient organizations must use the proceeds 

for the purposes specified in the enabling legislation. In 2019, the Mint has authorization to mint 

commemorative coins for two programs: the Apollo 11 50th Anniversary Commemorative Coin 

(Public Law 114-282) and the American Legion 100th Anniversary Commemorative Coin 

(Public Law 115-65).

B – Budget and Performance by Budget Activity

2.1.1 – Manufacturing Resources and Measures

Manufacturing Budget and Performance

($2,728,168,000 from offsetting collections) The Mint will mint and issue circulating coins and 

produce numismatic products, including bullion, to meet demand.
Mint - 10 

Description of Performance: 

Several key performance measures are used to gauge the bureau’s progress in achieving its 

strategic goals and to assess its Manufacturing Budget Activity performance.

Customer Satisfaction Index (CSI)

The Mint conducts a quarterly survey of a random sample of active numismatic customers. The 

survey is intended to capture customer satisfaction with the Mint’s service performance as a coin 

products supplier and with the quality of specific products. The CSI metric is a quantitative 

score summarizing the survey’s results into one consolidated value. This metric gauges 

performance results in the effort to achieve the Mint’s internal strategic plan goal, “Improve 

mission critical activities and governance,” and the Mint’s internal strategic objective linked to 

this goal, “Drive a customer-centric organization.” This also aligns with the Treasury 

Department strategic objective linked to this goal, “5.3 Customer Value.”

In FY 2018, the CSI was 93.6 percent, exceeding its 90.0 percent target. The Mint anticipates

that the CSI will remain steady and thus, has set the target at 90.0 percent for both FY 2019 and 

FY 2020. 

Numismatic Sales Units

The numismatic sales unit metric measures public demand for coin products sold from 

numismatic operations. This metric also measures performance results achieving the Mint’s 

internal strategic plan goal, “Improve mission critical activities and governance” and the Mint’s 

internal strategic objective linked to this goal, “Drive a customer-centric organization.” This 

also aligns with the Treasury Department strategic objective linked to this goal, “5.3 Customer 

Value.”

Numismatics product sales for FY 2018 totaled 3.3 million units, falling short of the 3.5 million 

target. The greatest contributors to the decline in sales were lower American Eagle product sales

and lower-than-anticipated demand for the Breast Cancer Commemorative Coin. Continuing 

weakness in core product sales and the discontinuation of the Presidential Coin sets also 

contributed to the decline in sales, but which were somewhat mitigated by strong demand for 

special products. The performance target for numismatic sales units is 3.9 for FY 2019 and 3.0 

for FY 2020. To meet these targets, the Mint will continue to provide high-quality products and 

maintain outstanding customer service, and deepen engagement with coincollectors. 

Safety Incident Recordable Rate

The safety incident recordable rate is the number of injuries and illnesses meeting the 

Occupational Safety and Health Administration recording criteria per 100 full-time workers. It 

measures the occurrence of work-related incidents involving death, lost-time and restricted work, 

loss of consciousness, or medical treatment. The safety incident recordable rate indicates 

performance results in the effort to achieve the Mint’s internal strategic plan goal, “Foster a safe, 

flexible, diverse, and engaged workforce,” and the corresponding Mint internal strategic 

objective linked to this goal, “Continue to cultivate a safe working environment.” These also 

align with the Treasury Strategic Goal “5.1 Workforce Management.”
Mint - 11

In FY 2018, the total recordable case rate reached 1.90, well below the Mint’s 2.46 FY 2018 

target, and significantly below the most recent industry average rate of 5.2 published in 2015 by 

the U.S. Bureau of Labor Statistics for the Non-Automotive Metal Stamping industry. During 

FY 2018, the Mint continued implementing and updating risk management guidelines to 

prioritize resources, mitigating risks in advance of injuries or catastrophic events at each plant. 

Mint facility leadership and employees continue to interact on a daily basis on the importance of 

safety. The performance targets for the safety incident recordable rate are 2.39 for FY 2019 and 

2.32 for FY 2020.

Seigniorage per Dollar Issued

Seigniorage per Dollar Issued is the financial return on circulating operations, calculated as 

seigniorage divided by the total face value of circulating coins shipped to the FRBs. Seigniorage 

is the difference between the face value and cost of producing circulating coinage. It measures 

the cost effectiveness of minting and issuing the United States’ circulating coinage. It also 

measures performance results achieving the Mint’s internal strategic plan goal, “Improve mission 

critical activities and governance,” as well as the Mint’s internal strategic objective linked to the 

goal, “Improve mission critical activities and goverence.” This also aligns with the Treasury 

Strategic Goal “1.3 Trusted Currency and Services.”

At the end of FY 2018, Seigniorage per Dollar Issued was $0.37, below the FY 2018 

performance target of $0.43. The FY 2018 shortfall resulted from a 2.8 percent decrease in 

circulating shipment volumes combined with a 24.5 percent increase in the cost of metal.

The United States Mint expects production volumes to remain steady and per-unit metal prices to 

increase as market prices are expected to escalate in FY 2019. The Seigniorage per Dollar 

Issued performance targets are set at $0.36 for both FY 2019 and FY 2020.

Section III – Additional Information

A – Summary of Capital Investments

The Mint’s capital investment requirements are predominantly for manufacturing-type 

equipment. Capital investments, along with its operating expenses, are paid out of the Mint’s

PEF. Legislation caps the aggregate amount of new liabilities and obligations incurred during a

fiscal year for capital investments in circulating coinage operations and protective service. 

The Mint's manufacturing capital investment projects focus on safety, equipment replacement, 

protection, and facility improvements.

In addition, the Mint’s capital investments encompass a robust information technology (IT) 

portfolio of investments and programs that modernize and secure the bureau’s infrastructure. 

The bureau’s governance structures ensure that the IT portfolio is managed in accordance with 

cost, schedule, risk, and performance goals, and that expected results and benefits are achieved. 

Enterprise architecture reviews assess and reinforce alignment to the bureau’s strategic plan and 

the strategic enterprise direction of the Department of the Treasury.
Mint - 12 

In accordance with the Statement of Federal Financial Accounting Standard (SFFAS) No. 6, the 

Condition Index and the Deferred Maintenance assessments for purposes of Federal Real 

Property Profile, the Mint has no deferred maintenance for its equipment. Maintenance is 

scheduled and performed regularly to keep the manufacturing equipment operating at optimal 

levels. 

A summary of capital investment resources, including major information technology and nontechnology investments can be found at: 

http://www.treasury.gov/about/budget-performance/Pages/summary-of-capital-investments.aspx

This website also contains a digital copy of this document.


Department of Treasury 

Office of the Comptroller of the 

Currency 

Congressional Budget 

Justification and Annual 

Performance Report and Plan 

FY 2020 
OCC - 2

Table of Contents

Section I – Purpose........................................................................................................................ 3

A – Mission Statement................................................................................................................ 3

B – Summary of the Request ...................................................................................................... 3

1.1 – Resource Detail Table........................................................................................................ 5

1.3 – Operating Levels Table...................................................................................................... 6

D – Appropriations Language and Explanation of Changes ...................................................... 6

E – Legislative Proposals............................................................................................................ 6

Section II – Annual Performance Plan and Report................................................................... 7

A - Strategic Alignment.............................................................................................................. 7

B – Budget and Performance by Budget Activity ...................................................................... 8

2.1.1 - Supervise Resources and Measures................................................................................. 8

2.1.2 – Regulate Resources and Measure Table ....................................................................... 11

2.1.3 – Charter Budget and Performance Plan.......................................................................... 12

Section III – Additional Information ........................................................................................ 13

A - Summary of Capital Investments........................................................................................ 13
OCC - 3 

Section I – Purpose

A – Mission Statement

To ensure that national banks and federal savings associations operate in a safe and sound 

manner, provide fair access to financial services, treat customers fairly, and comply with 

applicable laws and regulations. 

B – Summary of the Request

The Office of the Comptroller of the Currency (OCC) was created by Congress in 1863 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. Effective on July 21, 2011, Title III of the DoddFrank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act), transferred to the 

OCC the responsibility for the supervision of federal savings associations and rulemaking 

authority for all federal savings associations. 

As of September 30, 2018, the OCC supervised 891 national bank charters and 57 federal 

branches of foreign banks in the United States with total assets of approximately $11.8 trillion, 

and 316 federal savings associations with total assets of approximately $749 billion. In total, the 

OCC supervises approximately $12.5 trillion in financial institution assets.

Goals: 

The OCC has established three goals to affirm its mission: 1) The OCC fosters a safe, sound, and 

fair system of national banks, federal savings associations and federal branches of foreign banks 

and agencies of foreign banks that is a source of economic strength and opportunity that meets 

the evolving needs of consumers, businesses, and communities; 2) OCC employees are engaged, 

prepared, and empowered to meet its mission; 3) The OCC operates efficiently and effectively. 

To achieve its goals and objectives, the OCC organizes its programs under three activities: 1) 

Supervise, 2) Regulate, and 3) Charter. Effective supervision and a comprehensive regulatory 

framework are the key tools that the OCC uses to ensure that national banks and federal savings 

associations operate in a safe and sound manner and that they provide fair access to financial 

services and fair treatment of their customers. A robust chartering program allows new entrants 

into the financial services sector while ensuring that they have the necessary capital, managerial, 

and risk management processes to conduct activities in a safe and sound manner. 

The OCC’s priorities focus on strengthening the resiliency of the institutions subject to its 

jurisdiction through its supervisory and regulatory programs and activities. A stronger and more 

resilient banking system directly supports four out of five Department of the Treasury’s 

(Treasury) FY 2018-2022 strategic goals: Boost U.S. Economic Growth, Promote Financial 

Stability; Enhance National Security, and Goal 5) Achieve Operational Excellence.

Operations are funded primarily (approximately 97 percent) from semiannual assessments levied 

on 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 - 4

FY 2019 and 2020 Priorities

A major focus of the OCC’s supervisory, regulatory, and charter programs for FY 2019 and 

forward involve reviews of existing regulations to consider changes consistent with safety and 

soundness and fair treatment of bank customers, with the goal of enhanced regulatory 

coordination, reducing unnecessary regulatory burden, and increasing examination efficiency.

The OCC is observing signs that credit risk is increasing because of accumulated risk in loan 

portfolios from successive years of incremental easing in underwriting, risk layering, 

concentrations, and rising potential impact from external factors. The potential impacts from 

external factors include responding to intense competition by easing underwriting or policy 

exceptions. Therefore, the OCC will continue to closely evaluate current underwriting standards 

by conducting targeted underwriting examinations and using the credit underwriting assessment 

tool. The OCC will be working to implement its strategic initiatives to make the OCC a stronger 

and more effective organization. 

The OCC will conduct examinations based on the risk profile of individual national banks and 

federal savings associations to ensure they are safe and sound, sufficiently capitalized, and 

comply with applicable laws and regulations. Priorities and activities will include supervisory 

reviews related to corporate governance and oversight, credit underwriting, consumer 

compliance – related change management processes, fair access, cyber threats, operational risk, 

Bank Secrecy Act/Anti Money Laundering (BSA/AML), under both OCC’s general bank 

supervisory authority and delegated authority from Treasury’s Financial Crimes Enforcement

Network (FinCEN) and utilizing Federal Financial Institutions Examination Council (FFIEC) 

examination procedures. Examiners will work to resolve problem national bank and federal 

savings association situations effectively by identifying problems at the earliest possible stage, 

clearly communicating concerns and expectations to bank management through appropriate 

enforcement actions, and ensuring timely follow-up on needed corrective actions. An additional 

priority for the OCC involves revisiting the Community Reinvestment Act in conjunction with 

other Federal banking regulators for the purposes of modernizing the regulations to reflect the 

evolution of the banking industry and ensure that the Act’s original intent - to encourage insured 

depository institutions to serve the credit needs of the entire communities in which they operate –

continues to be achieved.
OCC - 5 

1.1 – Resource Detail Table

Dollars in Thousands

Office of the Comptroller of the 

Currency FY 2018 FY 2019 FY 2020 FY 2019 to FY 2020

Budgetary Resources Actual Estimated Estimated $ Change % Change

FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

Revenue/Offsetting 

Collections/Balances

Assessments $1,220,099 $1,148,800 $1,151,800 $3,000 0.26%

Interest $23,998 $27,000 $27,000 $0 0.00%

Other Income $10,591 $16,500 $16,500 $0 0.00%

Unobligated Balances from Prior 

Years and Recoveries $1,522,624 $1,541,000 $1,643,000 $102,000 6.62%

Total Revenue/Offsetting 

Collections $2,777,312 $2,733,300 $2,838,300 $105,000 3.84%

Expenses/Obligations

Supervise 3,434 $1,105,022 3,387 $975,457 3,387 $975,457 0 $0 0.00% 0.00%

Regulate 331 $106,649 327 $94,144 327 $94,144 0 $0 0.00% 0.00%

Charter 75 $24,033 74 $21,215 74 $21,215 0 $0 0.00% 0.00%

Total Expenses/Obligations 3,840 $1,235,704 3,788 $1,090,816 3,788 $1,090,816 0 $0 0.00% 0.00%

Net Results $1,541,608 $1,642,484 $1,747,484 $105,000 6.39%

Notes:

• The FY 2018 increase is attributable to an additional contribution payment to the Pentegra Defined Benefit Plan, a legacy

retirement plan that covers staff inherited from the Office of Thrift Supervision.

• The Comptroller may impose and collect assessments, fees or other charges as necessary or appropriate to carry out his

responsibilities and to meet the expenses of the OCC. 12 U.S.C. 482. At September 30, 2018, the net position of the OCC was

$1.39 billion and its financial reserves were $1.32 billion. In FY 2018, the OCC established a receivership contingency fund of

$86.6 million within its financial reserves to facilitate the conduct of receiverships of uninsured federal branches or agencies of

a foreign banking organization. In FY 2017, the OCC established a receivership contingency fund of $100 million within its

financial reserves to support receiverships of uninsured national trust banks.

• The Comptroller has sole authority to determine how OCC funds are obligated and its expenses incurred and paid. 12 U.S.C.

16.

• OCC funds are not appropriated funds or government monies. 12 U.S.C. 481.

• As part of its annual budget formulation process, the OCC re‐evaluates the size of the reserve based on a disciplined analysis

of the impact of material events on its ability to fund operations.
OCC - 6 

1.3 – Operating Levels Table

Dollars in Thousands

Office of the Comptroller of the Currency FY 2018 * FY 2019 FY 2020

Object Classification Actual Estimated Estimated

11.1 - Full-time permanent 546,263 558,442 558,442 

11.3 - Other than full-time permanent 6,668 3,629 3,629 

11.5 - Other personnel compensation 2,649 2,943 2,943 

11.9 - Personnel Compensation (Total) 555,579 565,014 565,014 

12.0 - Personnel benefits 380,044 242,165 242,165 

13.0 - Benefits for former personnel 475 120 120 

Total Personnel and Compensation Benefits $936,098 $807,299 $807,299

21.0 - Travel and transportation of persons 53,669 48,555 48,555 

22.0 - Transportation of things 2,360 2,101 2,101 

23.1 - Rental payments to GSA 58 57 57 

23.2 - Rental payments to others 71,498 67,616 67,616 

23.3 - Communication, utilities, and misc. charges 18,197 17,423 17,423 

24.0 - Printing and reproduction 365 558 558 

25.1 - Advisory and assistance services 25,959 17,436 17,436 

25.2 - Other services 26,460 28,389 28,389 

25.3 - Other purchases of goods & serv frm Govt accounts 8,276 8,754 8,754 

25.4 - Operation and maintenance of facilities 6,267 6,923 6,923 

25.7 - Operation and maintenance of equip 61,630 59,764 59,764 

26.0 - Supplies and materials 6,502 7,221 7,221 

31.0 – Equipment 17,493 18,332 18,332 

32.0 - Land and structures 29 0 0 

42.0 - Insurance claims and indemnities 841 388 388

Total Non-Personnel $299,606 $283,517 $283,517

Total Budgetary Resources $1,235,704 $1,090,816 $1,090,816

FTE 3,840 3,788 3,788

*The FY 2018 increase is attributable to an additional contribution payment to the Pentegra Defined Benefit Plan,

a legacy retirement plan that covers staff inherited from the Office of Thrift Supervision.

D – Appropriations Language and Explanation of Changes

The OCC receives no appropriations from Congress. 

E – Legislative Proposals 

The OCC has no legislative proposals.
OCC - 7 

Section II – Annual Performance Plan and Report

A - Strategic Alignment

For FY 2018 and FY 2019, the OCC’s bank supervision program specifically supports the 

following Department of the Treasury’s FY 2018 - 2022 strategic goals: 

• Goal 1) Boost U.S. Economic Growth

o 1.2 – Strong Economic Fundamentals

• Goal 2) Promote Financial Stability

o 2.4 – Financial Sector Critical Infrastructure and Cybersecurity

• Goal 3) Enhance National Security

o 3.1 – Strategic Threat Disruption

o 3.2 – AML/CFT Framework

• Goal 5) Achieve Operational Excellence

o 5.1 – Workforce Management

o 5.2 – Treasury Infrastructure

o 5.3 – Customer Value

As such, the OCC’s nationwide staff of bank examiners conducts on-site reviews of banks and 

provides sustained supervision of these institutions’ operations. Examiners analyze asset quality, 

capital adequacy, earnings, liquidity, and sensitivity to market risk for all banks, and assess 

compliance with federal consumer protection laws and regulations. Examiners also evaluate 

management’s ability to identify and control risk, and assess banks’ performance in meeting the 

credit needs of the communities in which they operate, pursuant to the Community Reinvestment 

Act (CRA).

In addition, under the bank supervision program, the OCC will also: 

• Approve or deny applications for new charters, branches, capital, or other changes in

corporate or banking structure;

• Take supervisory and enforcement actions against banks that do not comply with laws and

regulations or that otherwise engage in unsafe or unsound practices;

• Remove and prohibit officers and directors, negotiate agreements—both formal (i.e., public)

and informal (i.e., non-public)—to change banking practices, and issue cease-and-desist

orders as well as Civil Money Penalties; and

• Issue rules and regulations, legal interpretations, supervisory guidance, and corporate

decisions governing investments, lending, and other practices.

The OCC published in September of 2018 its FY 2019 – FY 2023 Strategic Plan. The OCC’s 

annual performance plan will be updated for FY 2020 and beyond to reflect any new and 

relevant priorities.
OCC - 8 

B – Budget and Performance by Budget Activity

2.1.1 - Supervise Resources and Measures

Dollars in Thousands

Resource Level FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Estimated Estimated

 Expenses/Obligations $889,111 $873,414 $975,477 $993,680 $1,105,022 $975,457 $975,457

Budget Activity Total $889,111 $873,414 $975,477 $993,680 $1,105,022 $975,457 $975,457

Measure FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Target Target Target

Percentage of National Banks and 

Federal Savings Associations with 

Composite CAMELS Rating 1 or 2

87.0 91.0 93.0 94.0 96.0 90.0 90.0 90.0

Percentage of National Banks and 

Federal Savings Associations That 

Are Categorized As Well 

Capitalized 

93.0 95.0 96.0 97.0 95.0 95.0 95.0 97.0

Percentage of National Banks and 

Federal Savings Associations With 

Consumer Compliance Rating of 1 

or 2

95.0 96.0 98.0 97.0 98.0 94.0 94.0 94.0

Rehabilitated National Banks and

Federal Savings Associations As A 

Percentage Of Problem National 

Banks One Year Ago (CAMEL 3,4, 

or 5)

39.0 39.0 43.0 40.0 44.0 40.0 40.0 40.0

Total OCC Costs Relative To 

Every $100,000 in Bank and 

Federal Savings Associations 

Assets Regulated ($)

9.75 9.37 9.65 9.49 9.12 11.00 8.50 8.50

Supervise Budget and Performance

($975,457,000 from revenue/offsetting collections/balances):

An effective supervision program is the cornerstone of the OCC’s activities that support its 

strategic goals. Specifically, the Supervise Program consists of ongoing supervision and 

enforcement activities that directly support the OCC’s strategic goal to foster a safe, sound, 

and fair system of national banks, federal savings associations and federal branches of foreign 

banks and agencies of foreign banks that is a source of economic strength and opportunity that 

meets the evolving needs of consumers, businesses, and communities. Assessing the condition 

and risk management practices of national banks and federal savings associations, and 

requiring corrective actions when weaknesses are found, directly supports Treasury’s goal to 

promote financial stability. In FY 2018, the OCC took a number of enforcement actions, 

including imposition of Civil Money Penalties (CMPs) to address violations of the Bank 

Secrecy Act and Anti-Money Laundering requirements. The agency also imposed a 

significant CMP and ordered restitution for customers harmed by unsafe or unsound practices 

in violation of the Federal Trade Commission Act, citing a bank’s failure to develop and 

implement an effective enterprise compliance risk management program. 
OCC - 9 

Description of Performance: 

Percentage of National Banks and Federal Savings Associations with Composite CAMELS 

Rating of 1 or 2: 

The composite Capital Adequacy, Asset Quality, Management, Earnings, Liquidity, and 

Sensitivity (CAMELS) rating reflects the overall condition of a national bank or federal 

savings association. 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 national bank or federal savings association. 

The rating scale is 1 through 5 of which 1 is the highest rating granted. These CAMELS 

ratings are assigned at the completion of every supervisory cycle or when there is a significant 

event leading to a change in CAMELS. 

The OCC established a target outcome measure that 90 percent of the institutions under its 

supervision have a composite CAMELS rating of 1 or 2. Such a rating is consistent with the 

strategic goal of a safe and sound banking system, that banks maintain adequate capital and 

liquidity and have strong risk management practices. As of September 30, 2018, 96 percent of 

national banks and federal savings associations earned composite CAMELS ratings of either 1 

or 2. Degradation in CAMELS can reflect weaknesses in risk management systems that need 

corrective action. The OCC, consistent with Treasury’s goals of boosting U.S. economic 

growth and promoting financial stability, has instructed bank examiners to identify and seek 

corrective action at an earlier stage to address potential problems or weaknesses. The OCC’s 

primary focus is to ensure that CAMELS ratings are an accurate reflection of each institution's 

current financial position, and thus the OCC would not take action to prematurely restore a 

favorable CAMELS rating.

Percentage of National Banks and Federal Savings Associations that are Considered WellCapitalized: 

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. The OCC established a target outcome measure that 95 percent of 

national banks and federal savings associations will meet or exceed the well-capitalized 

threshold. 

The OCC works closely with problem national banks and federal savings associations to 

develop rehabilitation plans. Such plans typically include directives to improve or restore 

capital levels. These efforts, combined with a more stable operating environment, have 

resulted in improvement in this performance measure since FY 2009. As of September 30, 

2018, 97 percent of national banks and federal savings associations were classified as well 

capitalized.

Percentage of National Banks and Federal Savings Associations with Consumer Compliance 

Rating of 1 or 2: 

To ensure fair access to financial services and fair treatment of national bank and federal 

savings association customers, the OCC evaluates an institution’s compliance with consumer 
OCC - 10

laws and regulations. Bank regulatory agencies use the Uniform Financial Institutions Rating 

System, Interagency Consumer Compliance Rating, to provide a general framework for 

evaluating significant consumer compliance factors inherent in an institution. Each institution 

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 of which 1 is the highest rating granted. The target for FY 2019 remains unchanged 

at 94 percent. As of September 30, 2018, national banks and federal savings associations 

continue to show strong compliance with consumer protection regulations with 98 percent 

earning a consumer compliance rating of either 1 or 2. Under the Dodd-Frank Act, the OCC 

has enforcement and supervisory authority for those institutions with total assets of no more 

than $10 billion. 

Rehabilitated National Banks and Federal Savings Associations as a Percentage of Problem 

National Banks and Federal Savings Associations One Year Ago:

The OCC’s early identification and intervention with problem financial institutions can lead to 

a successful rehabilitation. As of September 30, 2018, 44 percent of national banks and 

federal savings associations with composite CAMELS ratings of 3, 4, or 5 one year ago have 

improved their ratings to either 1 or 2 this year. This is aligns with the target of 40 percent for 

FY 2018 and FY 2019. The OCC continues to focus on the early identification and 

rehabilitation of problem institutions. 

As previously noted, the OCC continuously takes steps through its Supervise and Regulate 

programs to make national banks and federal savings associations more resilient to financial 

stresses and to identify and obtain corrective action at an earlier stage, when problems can be 

addressed most successfully. These efforts include heightened capital and liquidity standards 

and increased emphasis on the need for stress testing, designed to provide financial institutions 

with stronger capital buffers to withstand unforeseen events. These are multi-year efforts that 

will continue in FY 2019 and beyond. 

Total OCC Costs Relative to Every $100,000 in National Bank and Federal Savings

Association Assets Regulated:

The OCC measures the efficiency of its operations while meeting the increasing supervisory 

demands of a growing and more complex national banking system.

The OCC costs are those reported as total program costs on the annual audited Statement of 

Net Cost. National bank and federal savings association assets are those reported quarterly by 

national banks and federal savings associations on the Reports of Condition and Income. 

Total national bank and federal savings association assets represent the growth and complexity 

of the financial institutions under the jurisdiction of the OCC. This measure supports the 

OCC’s strategic goal of efficient use of agency resources. The OCC’s ability to control its 

costs while ensuring the safety and soundness of national banks and federal savings 

associations benefits all national bank and federal savings association customers. As of 

September 30, 2018, total OCC cost relative to every $100,000 in assets regulated was $9.12 

compared to the FY 2018 target of $11.00. The OCC continues to meet its efforts to ensure 

that resources are used prudently and that programs are carried out in a cost effective manner.
OCC - 11 

2.1.2 – Regulate Resources and Measure Table

Dollars in Thousands

Resource Level FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Estimated Estimated

 Expenses/Obligations $105,436 $103,574 $90,463 $92,151 $106,649 $94,144 $94,144

Regulate Budget and Performance

($94,144,000 from revenue/offsetting collections/balances):

The Regulate Program supports the OCC’s strategic goal of a vibrant and diverse system of 

national banks and federal savings associations that supports a robust U.S. economy. 

Specifically, 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 and federal savings associations. These regulations, policies, and interpretations 

may establish system-wide standards, define acceptable national banking and federal savings 

association practices, provide guidance on risks and responsibilities facing national banks and 

federal savings associations, or prohibit (or restrict) national banking or federal savings 

association practices deemed to be imprudent or unsafe. They also establish standards for 

ensuring fair access to financial services and fair treatment of national bank and federal savings 

association customers. This program includes establishing examination policies and handbooks; 

interpreting administrative, judicial, and congressional proceedings; and establishing the 

applicable legal and supervisory framework for new financial services and products. 

Description of Performance: 

The OCC has recently undertaken a number of activities to reduce regulatory burden on and 

expand economic opportunity, including supporting responsible innovation by regulated 

institutions. OCC rescinded previous guidance on deposit advance products and issued Bulletin 

2018-14 to OCC-supervised institutions encouraging banks to offer responsible short-term, small 

dollar installment loans. The OCC, with the Board of Governors of the Federal Reserve (Federal 

Reserve) and the Federal Deposit Insurance Corporation (FDIC) made requirements for Home 

Mortgage Disclosure Act submissions from banks more efficient and less burdensome, issued a 

rule to increase the threshold for commercial real estate transactions requiring an appraisal, and 

proposed changes to regulatory capital rules to better reflect current financial markets and 

banking organization size and structure. In addition, the OCC, jointly with the Federal Reserve 

and FDIC, issued an interim final rule expanding the number of institutions eligible for an 

extended 18 month examination cycle, pursuant to the Economic Growth, Regulatory Relief and 

Consumer Protection Act (P.L. 115-174) or EGRRCPA. 

OCC continued progress, in conjunction with other Federal financial regulators, including the 

Federal Reserve and the FDIC, to implement provisions the Economic Growth Act, to reduce 

regulatory burden on community banks, including requesting public comment on simplification 

of the Volcker Rule, which contains restrictions on proprietary trading and ownership or control 

of hedge funds or private equity funds. The agency also asked for public comment on 

modernizing the Community Reinvestment Act, and, pursuant to the EGRRCPA, proposed a rule 

to provide more business flexibility to federal savings associations. 
OCC - 12 

OCC continued to support responsible industry innovation by implementing a program Office 

Hours and Listening Sessions, sponsored by its recently established Office of Innovation, and 

announced that it would begin accepting applications for uninsured national bank charters from 

nondepository financial technology (fintech) companies engaged in the business of banking. 

The OCC continued to support operations of the Financial Stability Oversight Council, and 

participate in the Federal Financial Institutions Examination Council and other national and 

international financial service regulation and policy bodies. 

2.1.3 – Charter Budget and Performance Plan

Dollars in Thousands

Resource Level FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Estimated Estimated

 Expenses/Obligations $19,262 $18,922 $23,978 $24,426 $24,033 $21,215 $21,215

 Budget Activity Total $19,262 $18,922 $23,978 $24,426 $24,033 $21,215 $21,215

Measure FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2018 FY 2019 FY 2020

Actual Actual Actual Actual Actual Target Target Target

Percentage of Licensing Applications 

and Notices Completed within 

Established Timeframes

98.0 97.0 98.0 96.0 97.0 95.0 95.0 95.0

Charter

($21,215,000 from revenue/offsetting collections/balances): 

The Charter Program consists of ongoing activities that result in the chartering of national banks 

and federal savings associations and the evaluation of the permissibility of structures and 

activities of national banks and federal savings associations and their subsidiaries. This includes 

the review and approval of new national bank and federal savings association charters, federal 

branches and agencies, mergers, acquisitions, conversions, business combinations, corporate 

reorganizations, changes in control, operating subsidiaries, branches, relocations, and 

subordinated debt issuances. By supporting the entry of new products and institutions into the 

financial system with a national charter in a manner consistent with safety and soundness, the 

Charter Program supports the OCC’s strategic goals of assuring safety and soundness while 

allowing national banks and federal savings associations to offer a full competitive array of 

financial services. 

Description of Performance: 

Percentage of Licensing Applications and Notices Completed within Established Time Frames: 

The OCC’s timely and effective approval of corporate applications contributes to the nation’s 

economy by enabling national banks and federal savings associations to complete various 

corporate transactions and introduce new financial products and services. Delays in providing 

prompt decisions on applications and notices can deprive a national bank or federal savings 

association of a competitive or business opportunity, create business uncertainties, or diminish 

financial results. Time frames have been established for completing each type of application and 

notice. As of September 30, 2018, the OCC completed 97 percent of national bank and federal 

savings association applications and notices within the required time frame, above the target of 
OCC - 13 

95 percent. The OCC will continue to meet its Charter Program goals by providing staff 

training, coordinating efforts between charter and supervisory staff on safety and soundness and 

compliance matters, issuing updated procedures, and maintaining an emphasis on accessibility 

and early consultation with national bank and federal savings association organizers and others 

proposing national bank and federal savings association structure changes. 

Section III – Additional Information

A - Summary of Capital Investments

The OCC’s IT strategic plan aligns information technology initiatives and investments to the 

OCC’s core mission, including the development of new or enhanced applications and services 

and the disposition of redundant or “end-of-lifecycle” applications, capabilities, and services. 

The IT strategic plan is implemented through the budget formulation and the Capital Planning 

and Investment Control processes. These processes ensure that all IT investments are aligned 

with the OCC’s mission, goals, objectives, and target enterprise architecture before a project is 

funded. The OCC IT strategy ensures adequate funding and staff resources to address IT 

investment priorities, and considers risk mitigation strategies for IT investments that are not 

meeting stated cost, time, and performance goals. Performance metrics are linked to the 

delivery, alignment, and achievement of the OCC’s strategic program objectives. Cost 

effectiveness for each investment is evaluated through regular benchmarking studies, featuring 

peer group organizations. Key metrics used to evaluate infrastructure include availability, 

reliability, utilization, defects, and customer satisfaction. 

FY 2019 and 2020 Plans - The OCC has 4 major IT initiatives in FY 2019 and 2020: 

Servers Support Services (SSS) - The SSS supports the OCC’s server Operations and 

Maintenance. The infrastructure staff continues to build out additional capacity at the colocation facility to support the server technology refresh, business resiliency, and increases in 

enterprise storage capacity. 

Telecommunications Services and Support (TSS) - TSS includes telecommunications Wide Area 

Network (WAN) and Local Area Network (LAN) infrastructure. Remote access to the OCC 

systems is facilitated via a virtual private network, dial-in, and cellular wireless access using 

two-factor authentication. This also includes messaging services supporting highly-mobile bank 

examiners and the OCC staff. In FY 2019, the OCC will continue an on-going effort to upgrade 

the headquarters and field office phone systems and telecom infrastructure including LAN/WAN

hardware and Voice Over Internet Protocol.

End User Services and Support (EUSS) - EUSS includes help desk/customer service support, 

personal computer hardware and software operations and maintenance, asset management, and 

desktop engineering and image management. New computers and peripherals will be deployed 

to the workforce in FY 2019/2020. 

Cyber Security (CS) – CS includes technologies, processes and practices aligned to protect 

networks, computers, programs and data from attack, damage or unauthorized access. In 

alignment with Federal and Treasury requirements, the OCC has transitioned the Agency's 

systems and applications into Information System Continuous Monitoring (ISCM) and Ongoing 

Authorization (OA). In FY 2019 the OCC will be implementing Cloud Access Security Broker 

and Identity as a Service capabilities to prepare the OCC information technology environment to 
OCC - 14 

deploy additional cloud-based services and to minimize our dependence on the OCC Data Center 

for critical network services and infrastructure services. 

A summary of capital investment resources, including major information technology and nontechnology investments, can be viewed and downloaded at: 

http://www.treasury.gov/about/budget-performance/Pages/summary-of-capital-investments.aspx

This website also contains a digital copy of this document.


International Programs

The Department of the Treasury’s FY 2020 budget request for International Programs is included 

in the State, Foreign Operations, and Other Related Programs Appropriation.