Treasury Franchise Fund 

Mission Statement 

To assist customer agencies in meeting their mission by providing responsive, customer-focused, 

cost-effective financial management and administrative support services. 

Program Summary by Budget Activity 

Dollars in Thousands 

FY 2009 FY 2010 FY 2011

Actual Estimated Estimated $ Change % Change

 Consolidated/Integrated Administrative Management $15,261 $0 $0 $0 0% 

 Financial Management Administrative Support 

Services $146,400 $167,998 $176,213 $8,215 4.9%

 Financial Systems, Consulting and Training $4,811 $0 $0 $0 0% 

Total Resources $166,472 $167,998 $176,213 $8,215 4.9%

Total FTE 944 1,003 1,043 40 4.0%

FY 2011 Priorities 

• Maintain outstanding operational service to customer agencies. 

• Promote and maximize shared services benefits in support of Treasury and government-wide 

initiatives. 

• Participate in government-wide forums and support good government through maintaining 

and enhancing compliance and accountability. 

• Review services offered to ensure delivery of timely, valuable and cost effective solutions. 

• Continue to assess and report our performance and provide timely feedback to customers. 

• Enhance human capital strategies to recruit, develop and provide for a challenging, rewarding 

and values based work environment. 

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Table of Contents 

Overview...................................................................................................Erro

r! Bookmark not defined.

Section 1 – Purpose ..................................................................................................................2

1A – Description of Bureau Vision and Priorities .......................................................... 2

1B – Program History and Future Outlook ..................................................................... 3

1C – Industry Outlook .................................................................................................... 5

Section 2 – Budget Adjustments and Appropriation Language ..........................................6

2.2 – Operating Levels Table .......................................................................................... 6

2.3 – Resource Detail Table ............................................................................................ 7

2B – Appropriations Language and Explanation of Changes ......................................... 7

2C – Legislative Proposals ............................................................................................. 7

Section 3 – Budget and Performance Plan ............................................................................8

3.1 – Budget by Strategic Outcome ................................................................................ 8

3.2.1 – Consolidated/Integrated Administrative Management Budget and Performance 

Plan ................................................................................................................................. 9

3.2.2 – Financial Management Administrative Support Services Budget and Performance 

Plan ............................................................................................................................... 10

3.2.3 – Financial Systems, Consulting and Training Budget and Performance Plan ... 11

Section 4 – Supporting Materials .........................................................................................12

4A – Human Capital Strategy Description ................................................................... 12

4B – Information Technology Strategy ........................................................................ 12

4.2 – Program Evaluation ............................................................................................. 13

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Section 1 – Purpose

1A – Description of Bureau Vision and Priorities 

The Treasury Franchise Fund’s (The Fund) vision is to be a leader in providing responsible, 

effective administrative support services through commitment to service, efficient operations, 

openness to change and values based behavior. The Fund provides accounting, procurement, 

travel, human resources, and information technology services through the Bureau of the Public 

Debt (Public Debt), Administrative Resource Center (ARC). Services are provided to more than 

70 federal customers, including most of the Department of the Treasury, on a reimbursable, feefor-service basis. In FY 2009, 944 FTE were dedicated to servicing franchise customers and 

generated over $150 million in earned revenue. 

The Fund’s top priority is to support Treasury and government-wide initiatives by providing 

timely, high quality, cost effective, and value added administrative support services. This 

requires continual assessment of services offered to market demands and adherence to The 

Fund’s “good government” vision. This vision ensures compliance with applicable rules and 

regulations, promotes cost savings through efficient and standardized service delivery while 

maintaining high customer satisfaction. 

A major operational priority is to assess and report on service delivery performance and provide 

customers with timely performance feedback in areas in which The Fund and customers must 

work together to successfully perform administrative services. This includes improving the 

Shared Service Provider (SSP) performance metrics and benchmarks and providing standardized 

feedback to customers on performance. Performance feedback is critical to customers’ ability to 

improve the efficiency of their own operations, which will lower the level of effort required to 

support them and maximize the benefits achieved through shared services. 

Another operational priority is enhancing infrastructure to better support customers in a SSP role. 

This is being accomplished by the partnering of service lines to migrate our Oracle E-Business 

Suite platforms to a commercial host. As planned, two of the platforms were successfully 

migrated in FY 2009, and the final platform is planned for FY 2010. In addition, the information 

technology business line is working to implement the infrastructure changes necessary to serve 

the role of a Trusted Internet Connection Access Provider (TICAP) for Treasury. Through 

completion of these enhancements, ARC will continue to work with customers to identify 

additional platform and service improvements in FY 2011. 

Over half of The Fund’s budgetary resources are used for salaries and benefits. For that reason, 

human capital strategies are always a high priority. The Fund’s goal is to recruit high quality, 

dedicated employees that care about the success of ARC and its customers. The Fund also 

focuses on development processes to educate and train staff on new responsibilities as federal 

stewards, and providing a challenging, rewarding and values based work environment. 

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1B – Program History and Future Outlook 

The Government Management Reform Act of 1994 (GMRA) authorized the establishment of six 

Franchise Fund programs within the Federal Government. The franchise concept was built on 

OMB’s twelve operating principles for business-like organizations, including provider 

competition, customer’s voluntary exit, full cost recovery, initial capitalization and performance 

measurement and benchmarking. 

In 1996, OMB designated the Department of the Treasury as one of the six Executive Branch 

agencies authorized to establish a franchise fund program. The Fund began operations in 1997 

with six Franchise Business Activities (FBA), less than 80 FTE and earned revenue of $38 

million. 

In FY 2008, The Fund’s services were reviewed for consistency with Treasury’s core mission 

and to ensure that they are advantageous as shared services. This resulted in the decision to 

transition out of the consulting and training business lines provided by the Federal Consulting 

Group (FCG) and the Financial Management Services' (FMS), Treasury Agency Services (TAS), 

as well as, the interagency acquisition services provided by FedSource. 

In FY 2009, ARC worked with FMS to migrate TAS from The Fund, successfully transitioned 

FCG to another federal host and substantially closed out the FedSource business activity. 

Therefore, in FY 2010 and 2011 the administrative services provided by ARC are the only 

services provided. 

Future Outlook

In FY 2011, The Fund will maintain its commitment to excellence and continue to meet all 

strategic goals and benchmarks. ARC continues to look for measured and controlled growth 

opportunities to expand existing service lines or add other value added, marketable 

administrative services. 

As a SSP, The Fund plays an important role in achieving the current administration’s goals of 

improving efficiency, cost effectiveness, and accountability within the federal sector. This is 

attributable to demonstrated successes in reducing duplication, providing accurate and timely 

financial management information and providing responsive support for government-wide 

initiatives. 

ARC’s estimated FY 2011 FTE and earned revenue are 1,043 and $179 million, respectively. 

Demonstrated Success – Eliminating Duplication

Shared Platform and Services

ARC reduces the number of federal administrative systems by providing access to an integrated 

system platform for accounting, travel, procurement, human resources, and information 

technology services. In addition, as a SSP, ARC provides many customers with value added 

services, such as transaction processing and financial reporting. 

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ARC was designated by the Office of Management and Budget (OMB) as a Center of Excellence 

for Financial Management Line of Business (FMLoB) and a Shared Services Center for 

Information Systems Security (ISSLoB). In addition, ARC has critical supporting roles in the 

Human Resources (HRLoB) and Public Key Infrastructure (PKI) SSP designations of the 

Department of Treasury. 

ARC currently provides: 

• 30 organizations with accounting services 

• 37 organizations with travel services 

• 36 organizations with procurement services 

• 31 organizations with personnel services 

• 19 organizations with information technology services 

Providing shared services to federal customers results in cost savings and improved quality and 

compliance. Savings are achieved through consolidated buying power and cost sharing 

opportunities in the areas of operations and maintenance, enhancements and upgrades. Improved 

quality and compliance is achieved through ARC’s service model and standardized business 

processes that align with applicable laws, rules and regulations. 

Demonstrated Success –Timeliness and Accuracy

Timely and Accurate Financial Information 

ARC provides timely and high quality services in the area of financial reporting. Using ARC’s 

Oracle E-Business Suite platform, federal managers have timely financial management 

information available for decision-making. 

Internally, there is no better test for the accuracy and quality than annual financial statement and 

internal control audits. The Fund has received 13 consecutive unqualified audit opinions. In 

addition, ARC undergoes a Type II SAS-70 audit annually and has received 7 consecutive 

unqualified opinions. The SAS-70 results enhances customer confidence in ARC’s systems and 

services and reduces agencies annual financial statement audit costs. 

Demonstrated Success – Responsiveness

ARC has demonstrated the ability to respond timely to government-wide priorities. For 

example, increased emphasis on information security led ARC’s information technology service 

line to become a leader in the federal government. On behalf of Treasury, ARC hosts and 

maintains PKI SSP infrastructure and is an OMB designated shared service center for the 

ISSLoB. Additionally, in FY 2009 ARC provided timely support to Treasury and other federal 

agencies in implementing the Troubled Asset Relief Program (TARP), the American Recovery 

and Reinvestment Act (ARRA) and the Housing and Economic Recovery Act of 2008 (HERA). 

ARC’s support included implementation projects onto ARC platforms and providing 

administrative services in support of the agencies responsibilities under the acts. 

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1C – Industry Outlook 

There is a positive outlook for shared services in the federal government. The Fund anticipates 

further growth in this sector due to OMB’s Line of Business (LOB) initiatives and increased 

budget constraints. 

There is tremendous synergy between the business model established by the Treasury several 

years ago and recent OMB initiatives. Each model supports the concept of sharing costs across 

agencies to reduce each entity’s cost burden, especially capital investments in systems. In 

addition, most of the Lines of Business use competition to keep the costs of service providers to 

a minimum and to allow customer agencies to shop around for the service provider that best 

satisfies their needs. 
Section 2 – Budget Adjustments and Appropriation Language 

2.2 – Operating Levels Table 

Treasury Franchise Fund FY 2009 

Obligated

FY 2010 

Estimated

FY 2011 

Estimated

 

FTE 944 1,003 1,043

Object Classification: 

11.1 - Full-time permanent 69,033 70,047 75,651

11.3 - Other than full-time permanent 520 540 583

11.5 - Other personnel compensation 2,615 2,940 3,176

12 - Personnel benefits 19,414 21,270 22,972

13 - Benefits for former personnel 211 0 0

21 - Travel and transportation of persons 1,011 1,625 1,625

22 - Transportation of things 99 48 50

23.2 - Rental payments to others 697 13 13

23.3 - Comm, utilities, and misc charges 3,485 3,190 3,302

24 - Printing and reproduction 40 44 46

25.1 - Advisory and assistance services 4,328 5,503 3,810

25.2 - Other services 19,462 12,530 12,969

25.3 - Other purchases of goods and services from Govt. 25,911 31,821 32,946

accounts 

25.4 - Operation and maintenance of facilities 90 110 114

25.7 - Operation and maintenance of equip 7,243 8,410 8,703

26 - Supplies and materials 949 1,440 1,490

31 - Equipment 10,475 8,466 8,762

32 - Land and structures 877 0 0

42 - Insurance claims and indemnities 11 0 0

43 - Interest and dividends 1 1 1

Total Budget Authority $166,472 $167,998 $176,213

 

Budget Activities: 

Consolidated/Integrated Administrative Management 15,261 0 0

Financial Management Administrative Support Services 146,400 167,998 176,213

Financial Systems, Consulting and Training 4,811 0 0

Total Budget Authority $166,472 $167,998 $176,213

 

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2.3 – Resource Detail Table 

2B – Appropriations Language and Explanation of Changes 

The Fund receives no appropriated funds from Congress. 

2C – Legislative Proposals 

The Fund has no legislative proposals for FY 2011. 

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Section 3 – Budget and Performance Plan

This table lists all FY 2011 resources by strategic goal, objective and outcome outlined in the FY 

2007-2012 Treasury Department Strategic Plan. The Treasury Strategic Plan is a corporate level 

plan for the Department that provides a description of what the agency intends to accomplish 

over the next five years. 

For detailed information about the FY 2007-2012 Treasury Strategic Plan, please go to: 

http://www.treasury.gov/offices/management/budget/strategic_plan.shtml

3.1 – Budget by Strategic Outcome 

Dollars in Thousands 

Treasury Strategic Outcome FY 2010 

Estimated

FY 2011 

Estimated Percent Change

 Aligned organization 167,998 176,213 4.89%

Total $167,998 $176,213 4.89%

3A – Consolidated/Integrated Administrative Management (No funding): This Budget 

Activity consists of only one Federal Budget Activity, FedSource. 

The mission of FedSource was to provide entrepreneurial business solutions for the acquisition 

and financial management of common administrative services and products in support of agency 

missions and objectives. FedSource focused on contract support services and copier/printer 

management. 

In FY 2009, ARC implemented Treasury’s decision to transition out of the interagency 

acquisition business operated by FedSource. All FedSource offices were closed by March 31, 

2009, with residual operational and closeout work performed by ARC staff. Substantially all 

FedSource customer agreements were closed out at the end of FY 2009, resulting in 

discontinuing this budget activity in FY 2010 and 2011. 

 

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3.2.1 – Consolidated/Integrated Administrative Management Budget and Performance 

Plan 

Resource Level

FY 2007 FY 2008 FY 2009 FY 2010 FY 2011

Obligated Obligated Obligated Estimated Estimated

 Appropriated Resources $0 $0 $0 $0 $0 

 Reimbursable Resources $419,041 $180,361 $15,261 $0 $0 

Total Resources $419,041 $180,361 $15,261 $0 $0

Budget Activity Total $419,041 $180,361 $15,261 $0 $0

Consolidated/Integrated Administrative Management Budget Activity

Measure FY 2007 FY 2008 FY 2009 FY 2010 FY 2011

Actual Actual Target Actual Target Target

Customer Satisfaction Index - N/A DISC DISC DISC DISC DISC 

Consolidated/Integrated Administrative 

Management (%)(Oe) 

Operating expenses as a percentage of revenue-- 4 18 DISC DISC DISC DISC 

Consolidated/Integrated Administrative 

Management (%)(E) 

Key: Oe - Outcome Measure, E - Efficiency Measure, Ot - Output/Workload Measure, DISC – discontinued, and B 

- baseline 

Consolidated/Integrated Administrative Management Budget Activity

Description of Performance:

With the decision to close-out the FedSource business line, all efforts have been focused on 

ensuring a smooth transition for customers and vendors, providing employees with job 

placement and separation assistance and minimizing close-out costs. Therefore, The Fund’s 

performance measures are discontinued for this budget activity. 

The Fund’s objectives for the FedSource transition have been achieved. ARC developed a 

strategy to ensure customers were transitioned without loss of service and could continue their 

relationship with current vendors. In addition, employees received job placement and separation 

assistance and close-out costs were closely managed and controlled. ARC expects the 

FedSource closeout to be accomplished within FedSource’s operating reserve balance. 

3B – Financial Management Administrative Support Services ($176,213,000 from 

reimbursable programs): This Budget Activity consists of only one Federal Business Activity, 

Administrative Resource Center (ARC). 

The Financial Management Administrative Support Activity supports OMB’s shared services 

concept and furthers “good government” by standardizing the administrative financial systems 

and processes required to operate federal organizations. Value is provided through cost sharing 

opportunities in systems capital investments and operating costs and through providing other 

high quality, value added services. ARC, a Center of Excellence for the FMLoB and a Shared 

Service Center for ISSLoB, provides traditional administrative support functions with a focus on 

accounting, procurement, travel, human resources, and information technology services. The 

program has been very successful in meeting its mission goals as evidenced by the increasing 

demands for services and the level of satisfaction expressed by customers. 

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3.2.2 – Financial Management Administrative Support Services Budget and Performance 

Plan 

Financial Management Administrative Support Services Budget Activity

Resource Level

FY 2007 FY 2008 FY 2009 FY 2010 FY 2011

Obligated Obligated Obligated Estimated Estimated

 Appropriated Resources $0 $0 $0 $0 $0 

 Reimbursable Resources $109,615 $96,952 $146,400 $167,998 $176,213 

Total Resources $109,615 $96,952 $146,400 $167,998 $176,213

Budget Activity Total $109,615 $96,952 $146,400 $167,998 $176,213

Financial Management Administrative Support Services Budget Activity

Measure FY 2007 FY 2008 FY 2009 FY 2010 FY 2011

Actual Actual Target Actual Target Target

Customer Satisfaction Index – Financial Mgmt 0 97 80 89 80 80 

Admin Support Services (%)(Oe) 

Operating expenses as a percentage of 15 4 12 5 12 12 

revenue—Financial Management 

Administrative Support (%)(E) 

Key: Oe - Outcome Measure, E - Efficiency Measure, Ot - Output/Workload Measure, DISC – discontinued, and B - baseline 

Description of Performance: 

The Fund has established an outcome measure and target of 80 percent to determine performance 

in satisfying the needs of customer agencies. Annually, ARC conducts a customer satisfaction 

survey to assess performance within all service lines. For FY 2009, two thirds of ARC’s 

customers responded to the survey, and an overall customer satisfaction rate of 89 percent was 

achieved. 

The Fund has also established an efficiency measure and target of 12 percent for operating 

expenses as a percentage of total revenue. This provides franchise management with a measure 

that encourages efficiency in administrative operations and helps to assure services are provided 

at the lowest possible cost. ARC again met this performance measure in FY 2009 with a five 

percent operating expense ratio. 

3C – Financial Systems, Consulting and Training (No funding): This Budget Activity consists 

of two Franchise Business Activities, Federal Consulting Group (FCG) and Treasury Agency 

Services (TAS). 

The mission of FCG is to support other federal agencies transformation efforts to become more 

efficient, effective, citizen-centric, and results-oriented by providing performance measurement, 

consulting and executive coaching services. TAS’s mission is to help agencies improve the 

quality of government financial management through providing information, advice, assistance, 

and training. 

In FY 2009, ARC implemented Treasury’s decision to transition out of the Financial Systems, 

Consulting and Training budget activity operated by FCG and TAS. In conjunction with FMS, 

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TAS was transitioned from The Fund effective October 1, 2008. In addition, ARC successfully 

transitioned FCG to a new federal host in FY 2009. With the success of these transitions, The 

Fund discontinued this activity in FY 2010 and 2011. 

3.2.3 – Financial Systems, Consulting and Training Budget and Performance Plan 

Financial Systems, Consulting and Training Budget Activity

Resource Level

FY 2007 FY 2008 FY 2009 FY 2010 FY 2011

Obligated Obligated Obligated Estimated Estimated

 Appropriated Resources $0 $0 $0 $0 $0 

 Reimbursable Resources $13,671 $13,691 $4,811 $0 $0 

Total Resources $13,671 $13,691 $4,811 $0 $0

Budget Activity Total $13,671 $13,691 $4,811 $0 $0

Financial Systems, Consulting and Training Budget Activity

Measure FY 2007 FY 2008 FY 2009 FY 2010 FY 2011

Actual Actual Target Actual Target Target

Customer Satisfaction Index – Financial Systems, N/A DISC DISC DISC DISC DISC 

Consulting and Training (%)(Oe) 

Operating expenses as a percentage of revenue-- 7 6 DISC DISC DISC DISC 

Financial Systems, Consulting and Training (%) (E) 

Key: Oe - Outcome Measure, E - Efficiency Measure, Ot - Output/Workload Measure, DISC – discontinued, and B - 

baseline 

Description of Performance:

With the decision to transition out of the FCG and TAS business lines, all efforts have been 

focused on ensuring smooth transitions to their new federal hosts. Therefore, The Fund’s 

performance targets are discontinued for this budget activity. 

 

For detailed information about each performance measure, including definition, verification and 

validation, please go to: http://treas.gov/offices/management/budget/

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Section 4 – Supporting Materials 

4A – Human Capital Strategy Description 

The Fund follows the human resource strategy of Public Debt, ARC’s host organization. Public 

Debt is a values-based organization where candidates want to work and employees want to stay. 

Many employment benefits contribute to this human capital success, including efforts to improve 

employee health and well-being through providing access to fitness centers, health units and 

cafeterias. 

In the Office of Personnel Management’s 2008 Federal Human Capital Survey, Public Debt 

ranked in the top 2 percent of federal agency subcomponents. Although the results achieved are 

exceptional, Public Debt continues to strive for improvement in the areas of telework, 

performance culture and communications. 

The Fund’s strategic management of human capital is consistent with its mission, vision and 

priorities and supports government-wide initiatives, Treasury’s strategic goals, and those of 

Public Debt. Following Public Debt’s comprehensive recruitment program, The Fund has 

embraced Public Debt’s human capital strategy of operating a values-based organization, using a 

full range of pay flexibilities to recruit and retain high quality candidates with the skills 

necessary to accomplish its mission and emphasize succession planning. In addition, The Fund 

provides employees at all levels with opportunities for continuous development and performance 

plans that link to its strategic plan.

4B – Information Technology Strategy 

The Fund follows the information technology (IT) strategy of Public Debt, ARC’s host 

organization. Public Debt’s IT Strategic Roadmap for 2008 – 2012 calls for a culture of 

continuous improvement through adoption of best practices, improved quality of information 

supporting IT investments and improved effectiveness of project execution. 

IT best practices adopted by Public Debt include using an Information Technology Infrastructure 

Library, environmentally conscience purchasing and refresh/recycle business processes and 

providing for effective enterprise solutions to protect systems against fraud, identity theft and 

other cyber-crimes. 

Public Debt’s Capital Planning and Investment Control program is a disciplined, integrated 

process that addresses system prioritization of new and existing IT investments, risk 

management, long-range planning, business objectives, alternative analysis and governance. It 

includes quarterly enterprise architecture reviews to ensure alignment of its IT investments to the 

strategic enterprise direction of Treasury and identify potential duplication of systems. 

Finally, Public Debt is continually working to achieve effective project management execution. 

Through a disciplined and consistent approach, IT investments are closely monitored for cost, 

schedule and performance to ensure expected results and benefits are achieved. 

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4.2 – Program Evaluation 

The Treasury Franchise Fund has not received a program evaluation.