U.S. Department of the Treasury 

FY 2010 Budget in Brief 

Summary of FY 2010 President’s Budget 

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

Summary Tables and Charts 

 FY 2010 President’s Budget by Function....................................................................1 

 FY 2010 President’s Budget by Strategic Goal.............................................................3 

Fiscal Year Comparison of Full-Time Equivalent (FTE) Staffing......................................10 

Summary of FY 2010 Increases and Decreases.........................................................10 

Appropriated Accounts – Bureau Program Detail 

Departmental Office......................................................................................................... 11 

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

Office of the Inspector General ........................................................................................... 21 

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

Community Development Financial Institutions Fund.............................................................. 31 

Financial Crimes Enforcement Network................................................................................ 37 

Alcohol and Tobacco Tax and Trade Bureau..........................................................................41 

Financial Management Service............................................................................................47 

Bureau of the Public Debt...................................................................................................51 

Internal Revenue Service....................................................................................................55 

Non-Appropriated Accounts – Bureau Program Detail 

Emergency Economic Stabilization Act Programs...................................................................69 

Special Inspector General for TARP.....................................................................................73 

Housing Government Sponsored Enterprise Programs............................................................75 

Treasury Franchise Fund.................................................................................................. 77 

Bureau of Engraving and Printing........................................................................................ 79 

United States Mint............................................................................................................ 83 

Office of the Comptroller of the Treasury............................................................................... 87 

Office of Thrift Supervision................................................................................................. 91 

Treasury International Programs

Treasury International Programs.........................................................................................95 

Supplemental Information

Summary of FY 2010 Appropriations Language...................................................................105 

Total Funding Levels for the FY 2010 President’s Budget – Treasury Chapter............................113 

Detail of Other Treasury Accounts.....................................................................................115 

Executive Summary

FY 2010 President’s Budget by Function 

(Dollars in Thousands) 

FY 2008 FY 2009 FY 2010 

Enacted* ARRA Enacted 

President's 

Budget 

Increase/ 

Decrease 

Percent 

Change 

Management & Financial $699,412 $238,000 $745,583 $808,992 $63,409 8.5% 

Departmental Offices Salaries and Expenses** 248,360 131,000 278,870 302,388 23,518 8.4% 

Dept-wide Systems & Capital Invest. Programs 18,710 26,975 9,544 (17,431) -64.6% 

Office of Inspector General 18,450 26,125 26,700 575 2.2% 

Treasury IG for Tax Administration 140,533 7,000 146,083 149,000 2,917 2.0% 

Community Development Financial Institutions 

Fund 94,000 100,000 107,000 243,600 136,600 127.7% 

Financial Crimes Enforcement Network 85,844 91,465 102,760 11,295 12.3% 

Alcohol & Tobacco Tax and Trade Bureau 93,515 99,065 105,000 5,935 6.0% 

 Less Offsetting Fees 0 -80,000 (80,000) 100.0% 

Net, ATTB 99,065 25,000 (74,065) -74.8% 

Treasury Forfeiture Fund -30,000 -50,000 (20,000) 66.7% 

Fiscal Service Operations $481,469 $0 $417,137 $426,376 $9,239 2.2% 

Financial Management Service 298,598 239,785 244,132 4,347 1.8% 

Bureau of the Public Debt 172,871 187,352 192,244 4,892 2.6% 

 Less Offsetting Fees 10,000 -10,000 -10,000 0 0.0% 

Net, BPD 182,871 177,352 182,244 4,892 2.8% 

Tax Administration $11,094,519 $80,000 $11,522,598 $12,126,000 $603,402 5.2% 

IRS Taxpayer Services 2,191,085 2,293,000 2,269,830 (23,170) -1.0% 

IRS Enforcement 4,780,000 5,117,267 5,504,000 386,733 7.6% 

IRS Operations Support 3,841,109 3,867,011 4,082,984 215,973 5.6% 

IRS Business Systems Modernization 267,090 229,914 253,674 23,760 10.3% 

IRS Health Insurance Tax Credit 

Administration 15,235 80,000 15,406 15,512 106 0.7% 

Total, Treasury Appropriations Committee $12,275,400 $318,000 $12,685,318 $13,361,368 $676,050 5.3% 

Treasury International Programs $1,327,579 $1,578,000 $2,483,375 $905,375 57.4% 

International Financial Institutions 1,277,289 1,493,000 2,341,305 848,305 56.8% 

Technical Assistance 20,235 25,000 31,440 6,440 25.8% 

Debt Restructuring 30,055 60,000 110,630 50,630 84.4% 

Total $13,602,979 $318,000 $14,263,318 $15,844,743 $1,581,425 11.1% 

* The FY 2008 Enacted includes Economic Stimulus funding of $202.1 Million for the IRS and $64.2 Million for FMS. 

**ARRA funding includes $123 Million for IRS and $7 Million for FMS. 

Overview 

The Department of the Treasury’s mission is 

to promote the economic prosperity and 

financial security of the United States. 

Treasury operates 13 bureaus with a vast 

array of activities that are critical to the core 

functions of Federal Government, including 

collecting revenue and disbursing payments, 

managing federal finances, and protecting 

the financial system from threats. Treasury 

also plays a key role in modernizing the 

American financial regulatory system and 

ensuring effective, transparent 

administration of programs designed to 

revive and strengthen the economy. 

The FY 2010 Budget requests $13.4 billion 

to fund the activities at the Department's 

nine appropriated bureaus. The request 

provides $676 million over the FY 2009 

enacted level, a 5.3 percent increase. The 

request also includes $2.5 billion to support 

Treasury’s International assistance 

programs. 

Department of the Treasury - Budget in Brief FY 2010 Page 3
The FY 2010 Budget has been developed in 

order to make significant progress towards 

the Department's four strategic goals: 

• U.S. and World Economies Perform 

at Full Economic Potential 

• Effectively Managed U.S. 

Government Finances 

• Prevented Terrorism and Promoted 

the Nation's Security Through 

Strengthened Financial Systems 

• Management and Organizational 

Excellence 

The Department’s proposed funding 

increases are targeted to address current and 

future economic challenges. The budget 

will support additional staff in Domestic 

Finance and Tax Policy offices, as well 

various management areas to ensure 

Treasury maintains expertise in an array of 

complex finance and government fields ; 

provide resources to strengthen tax 

collection; and expand the availability of 

affordable credit in distressed communities 

by significantly increasing resources for the 

Community Development Financial 

Institutions (CDFI) Fund, including funding 

for the Capital Magnet Fund, a new 

affordable housing grant program. 

In addition to providing justification for the 

Department’s appropriated bureaus, this 

document provides summary level 

information on the Department’s nonappropriated bureaus and financial stability 

activities. Together, the appropriated and 

non-appropriated funding at the Department 

will provide the resources Treasury needs to 

strengthen and protect the financial system 

and the Department's ability to effectively 

manage U.S. Government finances. 

Department of the Treasury - Budget in Brief FY 2010 Page 4
FY 2010 President’s Budget by Strategic Goal 

 (Dollars in Thousands) 

Effectively Managed 

US Government Finances 

U.S. and World Economies 

Perform at Full 

Economic Potential 

Prevented Terrorism & 

Promoted Nation's Security 

Managem

Organizationa

Treasury Goal/Objective 

Direct $ Reimb. $ Direct $ Reimb. $ Direct $ Reimb. $ Direct $ 

Management & Financial $68,339 $8,113 $352,184 $12,866 $212,425 $36,374 $226,044 

Departmental Offices Salaries and Expenses 55,839 5,996 96,084 10,749 104,665 10,374 45,800 

Dept-wide Systems & Capital Invest. Program 5,000 4,544 

Office of Inspector General 26,700 

Treasury IG for Tax Administration 149,000 

Community Development Financial Institutions Fund 243,600 

Financial Crimes Enforcement Network 102,760 26,000 

Alcohol & Tobacco Tax and Trade Bureau 12,500 2,117 12,500 2,117 

Fiscal Service Operations $426,376 $256,522 $0 $0 $0 $0 $0 

Financial Management Service 244,132 234,690 

Bureau of the Public Debt 182,244 21,832 

Tax Administration $11,856,572 $131,120 $0 $0 $269,428 $15,981 $0 

IRS Taxpayer Services 2,269,830 39,000 

IRS Enforcement 5,306,315 44,816 197,685 15,981 IRS Operations Support 4,011,241 47,304 71,743 Business Systems Modernization 253,674 

Health Insurance Tax Credit Administration 15,512 

Total, Treasury Appropriations Committee 1/ $12,351,287 $395,755 $352,184 $12,866 $481,853 $52,355 $226,044 

Treasury International Programs 2,483,375 

Total, Appropriated Level $14,834,662 $395,755 $352,184 $12,866 $481,853 $52,355 $226,044 Non Appropriated Bureaus $0 $0 $0 $3,632,348 $0 $0 $0 

Treasury Franchise Fund 

 

Bureau of Engraving and Printing 591,000 U.S. Mint 2,030,067 

Office of the Comptroller of the Currency 830,281 

Office of Thrift Supervision 181,000 

Subtotal, Direct $ $14,834,662 $352,184 $481,853 $226,044 Subtotal, Reimbursable $ $395,755 $3,645,214 $52,355 Total, Treasury Level $15,230,417 $3,997,398 $534,208 $3891/ Total does not include $50 million Forfeiture Fund Reduction 

Department of the Treasury - Budget in Brief FY 2010 Page 

5
U.S. and World Economies Perform at Full 

Economic Potential______________________

The current economic turmoil facing the 

United States calls for broad and 

extraordinary measures. The Administration 

has five primary goals for Treasury's 

economic programs: 

• Restore confidence in the 

strength of the U.S. financial 

system 

• Restart the flow of credit critical 

to financing American 

households and businesses 

• Preserve homeownership and 

avoid preventable foreclosures 

• Restore net jobs creation and 

positive economic growth 

• Safeguard taxpayer interests 

The Treasury Department is committed to 

playing an active role in building a healthy, 

more stable and more competitive freemarket economic system that can encourage 

people to invest, innovate, create jobs, and 

build stronger communities and better lives. 

In order to do so, it will require action on a 

scale that has not been seen in generation – 

and it will require more high quality people 

to execute this vision. The FY 2010 budget 

provides $8.7 million in additional funds 

over FY 2009 appropriated levels to 

significantly increase the staffing and 

resources available to the Office of 

Domestic Finance. The initiative will create 

two new Deputy Assistant Secretary (DAS) 

positions: one DAS for Housing Finance, 

Small Business and Consumer Issues and 

one DAS for Capital Markets. The two 

DASs will lead teams designed to support 

the economic research and modeling for 

these critical areas. 

The FY 2010 Budget includes an additional 

$4.9 million for the Office of Tax Policy. 

Tax specialists are needed to ensure that the 

Treasury Department is able to respond to 

the challenges of the financial crisis, support 

the financial stimulus plan, and address key 

tax policy issues, such as climate change and 

health care. The new resources will provide 

the Department with the tools needed to 

respond in a more flexible manner to new 

challenges and to ensure policy revisions are 

made to support the Administration’s 

priorities in key areas. 

The Department has put in place under the 

Financial Stability Plan a series of financial 

initiatives to help lay the foundation for 

economic recovery, including: 1) a broad 

program to stabilize the housing market by 

encouraging lower mortgage rates and 

making it easier for millions to refinance 

and avoid foreclosure; 2) a new capital 

program to provide banks with a safeguard 

against a deeper recession; 3) a major new 

lending program with the Federal Reserve 

targeted at the securitization markets critical 

for consumer and small business lending; 4) 

a program to set up funds to provide a 

market for the legacy loans and securities 

that currently burden the financial system; 

and 5) a program to ensure available and 

affordable credit for small businesses. 

Funding for the management of the $700 

billion Troubled Asset Relief Program 

(TARP) was provided by the Emergency 

Economic Stabilization Act of 2008. The 

chart below presents the public 

commitments that the Department has made 

for the various programs handled under the 

TARP umbrella. The $700 billion is 

expected to be fully committed in FY 2009, 

but the programs will take several years to 

complete.

Department of the Treasury - Budget in Brief FY 2010 Page 6
Emergency Economic Stabilization Act Programs

Purchase Cap1 

Capital Purchase Program $218,000,000 

Public-Private Investment Program2,3 $75,000,000 

Systemically Significant Failing Institutions Program $70,000,000 

Consumer and Business Lending Initiative2 

TALF 1.0 $20,000,000 

TALF Asset Expansion $35,000,000 

TALF for Legacy Securities $25,000,000 

Unlocking SBA Lending Markets $15,000,000 

Home Affordable Modification Program $50,000,000 

Targeted Investment Program $40,000,000 

Automotive Industry Financing Program and Auto Supplier Support Program $35,400,000 

Asset Guarantee Program4 $12,500,000 

Estimate of Redemption ($25,000,000) 

Capital Assistance and Other TBD Programs2 $129,100,000 

Total $700,000,000 

1

Amount applied to the Section 115 Purchase Cap. 

2

Subsidy rate will be revised from the current 33.33% placeholder. 

3

The TALF for Legacy Securities program categorized under the Consumer and Business Lending Initiative in this table will be implemented under the Public-Private 

Investment program. 

 4 Loan Guarantees are expected to be $419 billion, but Treasury will be limited to a $12.5 billion second loss. 

The President's FY 2010 Budget includes a 

$250 billion contingent reserve for further 

efforts to stabilize the financial system. 

(The reserve, which reflects a net cost to the 

Government, would support $750 billion in 

asset purchases.) The existence of this 

reserve in the Budget does not represent a 

specific request. Rather as events warrant, 

the Administration will work with Congress 

to determine the appropriate size and shape 

of any such efforts, and as more information 

becomes available the Administration will 

define an estimate of potential costs. 

Treasury also has assumed responsibility for 

the Housing Government Sponsored 

Enterprise (GSE) Programs, using authority 

granted under the Housing and Economic 

Recovery Act of 2008 (HERA). The GSE 

effort consists of three different programs 

with respect to the two GSEs, the Federal 

National Mortgage Association (Fannie 

Mae) and Federal Home Loan Mortgage 

Corporation (Freddie Mac), and the Federal 

Home Loan Banks (FHLBs). These 

programs were created to support mortgage 

availability and financial market stability 

while protecting taxpayer interests. The 

chart below presents existing and expected 

disbursements for the three programs. 

Treasury's authority to enter into new 

agreements under HERA expires on 

December 31, 2009.

Housing Government Sponsored Enterprise Programs

(Dollars in Thousands) 

 FY 2008 FY 2009 FY 2010 

Program Activity Actual Estimated Estimated 

Preferred Stock Purchase Agreements Obligations $0 $105,900,000 $41,293,000 

Securities 

GSE MBS Purchase Program Purchased $5,000,000 $249,000,000 $60,000,000 

GSE Credit Facility Loan Levels $0 $0 $0 

The Budget also significantly increases funding for Community Development.

Department of the Treasury - Budget in Brief FY 2010 Page 7
Financial Institutions (CDFI) Fund, to a 

level of $243.6 million. Through meritbased grant programs, the CDFI Fund helps 

locally based financial institutions offer 

small business, consumer and home loans in 

communities and populations that lack 

access to affordable credit. The funding 

level for the CDFI Fund includes $80 

million for the Capital Magnet Fund, which 

is a new grant program established by the 

Housing and Economic Recovery Act 

(HERA) of 2008. This important new 

program will increase financing for the 

development, preservation, rehabilitation, 

and purchase of affordable housing or 

economic development projects (such as day 

care centers, workforce development 

centers, and health care clinics) in lowincome communities. CMF will complement the CDFI Fund’s existing programs 

to support community development in lowincome and underserved rural 

neighborhoods. 

The Department's non-appropriated bureaus 

also play a critical role in providing the 

regulation and currency needed for the 

economy to run smoothly. The Office of the 

Comptroller of the Currency (OCC) supervises approximately 1,629 national bank 

charters and 49 federal branches of foreign 

banks in the United States. Total assets 

under the OCC supervision are 

approximately $8.3 trillion or 70 percent of 

total U.S. commercial banking assets. The 

downturn in housing and the broader 

economy is having an adverse effect on 

national banks’ loan portfolios, with the 

levels of nonperforming and past due loans 

increasing. Responding to deteriorating 

credit quality and ensuring adequate 

liquidity, loan loss reserves, and capital 

buffers are maintained, will continue to be 

major focal points for the agency and the 

industry in the coming year. 

The Office of Thrift Supervision (OTS) 

regulated 818 thrifts at the end of the FY 

2008 with total assets of $1.18 trillion; OTS 

also supervised 469 holding company 

enterprises with approximately $8.1 trillion 

in U.S. domiciled consolidated assets. In 

response to the decline in the housing 

market, OTS has urged thrifts to bolster 

reserves for potential loan losses by 

significantly adding to their loan loss 

provisions. OTS is also encouraging thrifts 

to strike the appropriate balance between 

working with distressed borrowers to 

restructure loans to prevent avoidable foreclosures and ensuring sufficient recoveries 

to avoid further erosions in capital. 

The Bureau of Engraving and Printing 

(BEP) and the U.S. Mint are responsible for 

providing the nation's currency and coins, 

which are essential for the Federal Reserve's 

banking policies and for customer demands 

at banks and thrifts. BEP expects to produce 

and deliver 7.2 billion notes to the Federal 

Reserve System in 2010, an increase of six 

percent over the 2009 program. The Mint 

expects to produce and distribute 

approximately 8.5 billion coins to meet 

demand for circulating coins during FY 

2010, a decrease of 13.1 percent over 

estimated FY 2009 levels. 

 

Effectively Managed U.S. Government 

Finances ______ 

Collecting the revenue that funds the Federal 

government is a core mission of the 

Department of the Treasury. The Department’s priorities are to enforce the nation’s 

tax laws in a fair and uniform manner, 

minimize taxpayer burden, and provide 

service to taxpayers to maximize voluntary 

compliance and reduce the tax gap. The IRS 

serves every individual, business, and nonprofit organization in the nation, and 

processes over 250 million tax returns 

annually. 

Department of the Treasury - Budget in Brief FY 2010 Page 8
The FY 2010 budget request includes 

$12.126 billion for the IRS, which is an 

increase of $603 million above the FY 2009 

enacted level. This includes: 

• $8 billion for the enforcement 

program, which is funded in the 

Enforcement and Operations Support 

appropriations. In FY 2008 direct 

revenue from enforcement activities 

totaled $56.4 billion, yielding a 

return on investment of over five to 

one for all IRS activities. 

Additionally, vigorous enforcement 

encourages voluntary compliance, 

further increasing revenue. This 

impact is conservatively estimated to 

be at least three times the direct 

revenue impact. New enforcement 

initiatives, totaling $332 million will 

allow the IRS to address 

underreporting of tax associated with 

international activities and reduce 

noncompliance among businesses 

and high-income taxpayers. These 

initiatives will generate $2.0 billion 

in additional annual enforcement 

revenue once the new hires reach full 

potential in FY 2012. 

• $3.9 billion for the taxpayer service 

program, which is funded in the 

Taxpayer Service and Operations 

Support appropriations. This 

funding will support continued 

improvements to both the quality and 

efficiency of taxpayer service, using 

a variety of person-to-person, 

telephone, and web-based methods 

to help people understand their tax 

obligations and pay their taxes. In 

FY 2010, the IRS will increase selfservice applications, continue to 

ensure web navigation is userfriendly and improve the quality and 

accuracy of its telephone responses. 

• $254 million for Business Systems 

Modernization. This funding will 

support continued investments to 

modernize core IT systems, giving 

IRS employees the technology they 

need to continue to administer and 

improve both service and 

enforcement. In 2009, the IRS 

shifted its focus from concurrent 

development of a database and 

associated applications to a strategy 

that focuses on completion of the 

core taxpayer account database. 

This approach will allow the IRS to 

accelerate data conversion to the 

new database while also addressing 

security, financial material 

weaknesses, and long-term 

architectural planning concerns. 

Once completed, the core database 

will improve the overall 

functionality of existing 

modernization systems, as well as 

improve overall customer service to 

taxpayers. 

The Alcohol and Tobacco Tax and Trade 

Bureau (TTB) serves as the Nation’s 

primary federal authority in the regulation of 

the alcohol and tobacco industries. In FY 

2008, the TTB collected $14.6 billion in 

excise taxes, interest, and other revenues. In 

FY 2010 TTB is funded at $105 million, 

including $80 million in new user fees. The 

increase in user fees is attributable to the 

Administration's legislative proposal to 

transition the alcohol and tobacco regulatory 

system from an appropriated resources 

based system to a user fee based system that 

utilizes resources provided by licenses and 

other fees. 

Department of the Treasury - Budget in Brief FY 2010 Page 9
In addition to collecting revenue, Treasury’s 

management of the Federal Government’s 

finances includes disbursing payments, 

preparing public financial statements, and 

issuing debt. The Financial Management 

Service (FMS) provides central payment 

services to Federal Program Agencies 

(FPAs), operates the Federal Government’s 

collections and deposit systems, provides 

government-wide accounting and reporting 

services, and manages the collection of 

delinquent debt owed to the Government. In 

FY 2008, FMS issued nearly 1 billion nonDefense payments worth $1.8 trillion to a 

wide variety of recipients (79 percent issued 

electronically). In addition to its normal 

duties, in FY 2008 FMS administered 119 

million payments under the Economic 

Stimulus Act of 2008. In FY 2009, FMS 

expects to administer an additional 64 

million payments under the American 

Recovery and Reinvestment Act. The FY 

2010 Budget provides $244.1 million for 

FMS activities. 

The Bureau of Public Debt (BPD) borrows 

the money needed to operate the federal 

government, account for the resulting debt 

and provide reimbursable support services to 

Federal agencies through the Treasury 

Franchise Fund. BPD annually auctions and 

issues more than $4.6 trillion in Treasury 

bills, notes, bonds and Treasury 

Inflation-Protected Securities (TIPS); 

effectively regulates the primary and 

secondary Treasury securities markets; 

ensures reliable systems and processes are in 

place for issuing, transferring, paying 

interest on and redeeming Treasury 

securities; issues and redeems more than 70 

million paper savings bonds each year; 

administers in excess of $4 trillion in 

investments for more than 240 federal trust 

funds; and provides timely and accurate 

information on the public debt. The FY 

2010 Budget provides $182.2, including $10 

million in offsetting collections, for BPD 

activities. 

Promoting National Security 

The Treasury Department, through its Office 

of Terrorism and Financial Intelligence 

(TFI), supports the Department's intelligence 

and enforcement functions with the twin 

aims of safeguarding the financial system 

against illicit use and combating rogue 

nations, terrorist facilitators, weapons of 

mass destruction (WMD) proliferators, 

money launderers, drug kingpins, and other 

national security threats.

TFI had a number of successes in FY 2008, 

which it plans to build upon for a successful 

FY 2009 and FY 2010. These achievements 

included persuading a number of the world’s 

leading financial institutions of the risks of 

dealing with Iran and Iranian banks; 

designating and blocking key Zimbabwe 

regime supporters; completing actions 

against FARC (Revolution Armed Forces of 

Colombia); leading efforts within the 

Financial Action Task Force; and increasing 

collaboration with Intelligence Community. 

The FY 2010 Budget provides $64.6 million 

for TFI activities, a four percent increase 

over FY 2009 appropriated levels. This 

funding level includes resources the 

Afghanistan Threat Finance Cell. In 

addition, the FY 2010 budget provides 

resources to increase the protection of the 

Department’s IT systems from external 

threats and support Top Secret/SCI 

information technology systems. 

In addition to the resources requested for 

TFI, Treasury requests $102.8 million for 

the Financial Crimes Enforcement Network 

(FinCEN), which is responsible for 

administering the Bank Secrecy Act (BSA). 

FinCEN enhances U.S. national security, 

deters and detect criminal activity, and 

Department of the Treasury - Budget in Brief FY 2010 Page 10
safeguards financial systems from abuse by 

promoting transparency in the U.S. and 

international financial systems. The Budget 

provides additional resources to improve 

FinCEN’s collection, storage, sharing and 

analysis of BSA data. This is part of a 

multi-year investment which will enrich and 

standardize BSA data to maximize value, 

integrate data with other tate and federal 

sources, deploy advanced analystical and 

stoarge technologies, and establish more 

effective security and audit technologies to 

enhance data confidentiallity and integrity. 

Management and Organizational 

Excellence 

Strengthening the management & 

infrastructure of the Treasury Department, 

across all bureaus, is one of the critical 

priorities for the FY 2010 budget. The 

financial crisis has strained an already thin 

management infrastructure. Key support 

functions – human resources, information 

technology, facilities and space, accounting 

and financial management – are essential 

services supporting the Treasury offices 

working on which financial recovery efforts. 

The Budget provides $3 million to the 

Department to provide IT, human resource, 

procurement, and financial management 

support. The Budget also allows $4.5 

million to continue repairs to the Treasury 

Annex building, to ensure the safety and 

health of the occupants. 

The Office of Inspector General is required 

to keep both the Secretary and the Congress 

fully and currently informed about the 

problems and deficiencies relating to the 

administration of department programs and 

operations and the necessity for corrective 

action. The Budget provides $26.7 million 

for OIG activities. The OIG is mandated to 

conduct a material loss review on significant 

bank failures; in the past, this activity has 

been limited to one or two reviews a year. 

Due to the economic crisis, OIG is facing a 

tenfold increase in this mandatory workload. 

In FY 2010, the OIG expects to complete 62 

Audit products, meet all statutory audit 

requirements, and meet or exceed the 

investigative targets. 

The Treasury Inspector General for Tax 

Administration (TIGTA) provides audits and 

investigative services that promote 

economy, efficiency, and integrity in the 

administration of the internal revenue laws. 

The FY 2010 President's Budget request for 

TIGTA will be used to adapt to the IRS's 

continuously evolving operations and 

mitigate intensified risks associated with 

modernization, security, addressing the Tax 

Gap, and human capital challenges facing 

the IRS. The Budget will also allow TIGTA 

to respond to threats and attacks against IRS 

employees, property, and sensitive 

information; improve the integrity of IRS 

operations by detecting and deterring fraud, 

waste, abuse or misconduct by IRS 

employees; and conduct comprehensive 

audits, inspections, and evaluations that 

include recommendations for monetary 

benefits and enhancing IRS' service to 

taxpayers. Finally, with these resources 

TIGTA will inform the American people, 

Congress, and the Secretary of the Treasury 

of problems and progress made to resolve 

them. The FY 2010 Budget provides $149 

million for TIGTA activities. 

Department of the Treasury - Budget in Brief FY 2010 Page 11
Fiscal Year Comparison of Full-Time Equivalent (FTE) Staffing 

(Direct and Reimbursable) 

FY 2008 Actual FY 2009 Estimated FY 2010 President's Budget Appropriation 

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

Departmental Offices Salaries and Expenses 1,022 106 1,128 1,204 137 1,341 1,266 137 1,403 

Administrative Expenses, Recovery Act 570 570 892 892 

Office of Inspector General 103 0 103 154 0 154 154 0 154 

Treasury IG for Tax Administration 781 3 784 835 3 838 835 3 838 

Office of Financial Stability 134 0 134 225 0 225 

Community Development Financial Institutions Fund 58 0 58 75 0 75 75 0 75 

Financial Crimes Enforcement Network 311 1 312 330 1 331 331 1 332 

Alcohol & Tobacco Tax and Trade Bureau 510 10 520 525 15 540 550 15 565 

Financial Management Service 1,643 242 1,885 1,681 260 1,941 1,681 260 1,941 

Bureau of the Public Debt 1,265 16 1,281 1,042 0 1,042 1,042 0 1,042 

Internal Revenue Service 90,647 1,038 91,685 94,209 1,077 95,286 95,081 1,088 96,169 

Subtotal, Treasury Appropriated Level 96,340 1,416 97,756 100,759 1,493 102,252 102,132 1,504 103,636 

Working Capital Fund 0 205 205 0 205 205 0 205 205 

Treasury Franchise Fund 0 767 767 0 982 982 0 965 965 

Bureau of Engraving and Printing 0 2,018 2,018 0 2,075 2,075 0 2,050 2,050 

U.S. Mint 0 1,908 1,908 0 1,947 1,947 0 1,979 1,979 

Office of the Comptroller of the Currency 0 3,028 3,028 0 3,127 3,127 0 3,161 3,161 

Office of Thrift Supervision 0 1,029 1,029 0 1,095 1,095 0 847 847 

Terrorism Insurance Program 9 0 9 10 0 10 10 0 10 

Special Inspector General for the TARP 0 0 0 100 0 100 150 0 150 

Total 96,349 10,371 106,720 100,869 10,924 111,793 102,292 10,711 113,003 

Summary of FY 2010 Increases and Decreases 

 (Dollars in Thousands) 

DO DSCIP OIG TIGTA CDFI FINCEN TTB TFF FMS BPD IRS Total 

FY 2009 Enacted $278,870 $26,975 $26,125 $146,083 $107,000 $91,465 $99,065 $239,785 $187,352 $11,522,598 $12,725,318 

Across the Board Program 

Reduction ($1,464) ($9) ($504) ($69) ($323) ($217) ($1,174) ($944) ($13,732) (18,436) 

GAO Audit $1,500 $10,000 11,500 

Non-Pay Inflation 

Adjustments 1,531 0 90 318 107 495 421 808 706 31,113 35,589 

Pay Annualization 

Adjustments 1,587 0 166 1,110 76 419 556 1,558 1,135 80,054 86,661 

Pay Inflation Adjustments 3,259 0 328 2,340 136 834 1,014 3,155 2,495 148,894 162,455 

Maintaining Current 

Levels $4,913 $0 $575 $3,264 $250 $1,425 $1,774 $4,347 $4,892 $256,329 $277,769 

Base Realignment 0 0 0 0 0 0 0 0 0 0 0 

Non-Recurring Costs 0 (26,975) 0 (347) 0 (130) 0 0 0 (109,765) (137,217) 

Initiative Annualizations 1,731 0 0 0 0 0 0 0 0 0 1,731 

Transfers 0 0 0 0 0 0 0 0 0 0 0 

Efficiency/Savings 0 0 0 0 0 0 (1,339) 0 0 (8,360) (9,699) 

Base Reinvestments 0 0 0 0 0 0 0 0 0 2,331 2,331 

Adjustments to Base $1,731 ($26,975) $0 ($347) $0 ($130) ($1,339) $0 $0 ($115,794) ($142,854) 

FY 2009 Base $285,514 $0 $26,700 $149,000 $107,250 $92,760 $99,500 $244,132 $192,244 $11,663,133 $12,860,233 

Program Decreases 0 0 0 0 (2,000) 0 0 (958) (1,734) 0 (4,692) 

Program Reinvestments (2,110) 0 0 0 0 0 0 958 1,734 0 582 

Program Increases 18,984 9,544 0 0 138,350 10,000 5,500 0 0 462,867 645,245 

FY 2010 President's 

Budget $302,388 $9,544 $26,700 $149,000 $243,600 $102,760 $105,000 $244,132 $192,244 $12,126,000 $13,501,368 

Offsetting Fees and 

Cancellation of 

Unobligated Balances 0 0 0 0 0 0 (80,000) (50,000) 0 (10,000) 0 (140,000) 

FY 2010 President's 

Budget less Offsetting 

Fees $302,388 $9,544 $26,700 $149,000 $243,600 $102,760 $25,000 ($50,000) $244,132 $182,244 $12,126,000 $13,361,368 

Department of the Treasury - Budget in Brief FY 2010 Page 12
Departmental Offices - S & E 

Program Summary by Budget Activity 

(Dollars in thousands) 

FY 2008 FY 2009 FY 2010 Appropriation Enacted ARRA 1/ Enacted Request $ Change % Change

Salaries and Expenses $248,360 $131,000 $278,870 $302,388 $23,518 8.4%

 Executive Direction $20,749 $0 $21,619 $22,383 $764 3.5%

 Economic Policies and Programs $44,242 $0 $45,910 $44,749 ($1,161) -2.5%

 Financial Policies and Programs $29,465 $1,000 $36,038 $47,580 $11,542 32.0%

 Terrorism and Financial Intelligence $56,775 $0 $62,098 $64,611 $2,512 4.1%

 Treasury-wide Management and Programs $18,505 $130,000 $21,600 $22,779 $1,179 5.5%

 Administration Programs $78,624 $0 $91,604 $100,286 $8,682 9.5%

Subtotal, Departmental Offices - S & E $248,360 $131,000 $278,870 $302,388 $23,518 8.4%

Offsetting Collections - Reimbursables $19,800 $0 $38,642 $33,842 ($4,800) -12.4%

Total Program Operating Level $268,160 $131,000 $317,512 $336,230 $18,718 5.9%

1/ ARRA funding includes $123 Million for IRS and $7 Million for FMS. 

Explanation of Request 

 

The Fiscal Year (FY) 2010 President’s Budget 

Request for the Salaries and Expenses 

appropriation provides new resources to 

develop superior capabilities in Offices of 

Domestic Finance and Tax Policy, as well as 

various management areas within the 

Department of the Treasury. In order to meet 

current and future economic challenges, 

Treasury staff must maintain vast expertise in 

an array of complex finance and government 

fields. The Budget supports this need, 

particularly in the areas of housing finance, 

capital markets, and tax administration. The 

Budget also provides resources for the 

Afghanistan Threat Finance Cell and covers 

administrative expenses associated with the 

tax credit exchange programs authorized in the 

American Recovery and Reinvestment Act of 

2009. 

DO’s top priorities and proposed initiatives 

support each of the Department’s strategic 

goals; Effectively Manage U.S. Government 

Finances; Ensure U.S. and World Economies 

Perform at Full Potential; Prevent Terrorism 

and Promote the Nation’s Security Through 

Strengthened International Financial Systems; 

and Promote Management and Organizational 

Excellence 

Total resources requested to support DO 

activities for FY 2010 are $336,230,000, 

including $302,388,000 from direct 

appropriations and $33,842,000 from 

offsetting collections and reimbursable 

programs. 

Purpose of Program 

 

Departmental Offices, as the headquarters 

bureau for the Department of the Treasury, 

provides leadership in such critical areas as 

economic and financial policy, terrorism and 

financial intelligence, financial crimes, and 

general management. The Secretary of the 

Treasury has the primary role in formulating 

and managing the domestic and international 

tax and financial policies of the Federal 

Government. Through effective management, 

policies, and leadership, the Treasury 

Department develops and implements 

strategies to counter terrorist financing and 

money laundering, promotes the stability of 

the nation's financial markets and ensures the 

government's ability to collect revenue. 

Department of the Treasury - Budget in Brief FY 2010 Page 13
DO FY 2010 Budget Highlights

(Dollars in thousands) 

Appropriation Amount

FY 2009 Enacted 278,870

Changes to Base: 

Maintaining Current Levels (MCLs): $4,913

Across the Board program reduction (1,464)

Non-Pay Inflation Adjustment 1,531

Pay Annualization 1,587

Pay Inflation 3,259

Initiative Annualization: $1,731

DF - Debt Management Office Analytical 307

Support 

GSE Support 464

OGC - General Counsel Support for 338

CFIUS 

OIA - Counterintelligence and Security 622

Capabilities Enhancement 

Subtotal FY 2010 Changes to Base $6,644

Total FY 2010 Base 285,514

Program Changes: 

Program Reinvestment: ($2,110)

International Affairs Reduction (2,110)

Program Increases: $18,984

Domestic Finance Staffing 8,731

Tax Policy Staffing 4,863

Management Staffing 3,000

Recovery Act Program Support 400

Afghanistan Threat Finance Cell and 790

International Dues 

CIO Treasury Foreign Intelligence 1,200

Network (TFIN) 

Subtotal FY 2010 Program Changes $16,874

Total FY 2010 President's Budget Request 302,388

FY 2010 Budget Adjustments 

 

FY 2009 Enacted 

The FY 2009 enacted direct appropriation for 

DO is $278,870,000. 

Maintaining Current Levels (MCLs) 

Adjustments Necessary to Maintain 

Current Levels +$4,913,000 / +0 FTE Funds 

are requested for: FY 2010 cost of the January 

2009 pay increase of $1,587,000; proposed 

January 2010 pay raise of $3,259,000; and 

non-labor related items such as contracts, 

travel, supplies, equipment and GSA rent 

adjustments of $1,531,000. In addition, there 

is an across the board program reduction of 

$1,464,000. 

Initiative Annualization 

DF - Debt Management Office Analytical 

Support +$307,000 / +2 FTE Annualization 

of the FY 2009 Domestic Finance initiative to 

modify the debt management system and 

provide dedicated analytical staff. 

GSE Support +$464,000 / +4 FTE

Annualization of the FY 2009 Domestic 

Finance initiative provided for the executing 

and managing of the Government Sponsored 

Enterprises (GSE) program. The funding is 

used for program personnel and their 

administrative expenses as well as audit and 

consulting services. 

OGC - General Counsel Support for CFIUS 

+$338,000 / +2 FTE Annualization of the FY 

2009 initiative which provided legal support to 

the Office of the Assistant General Counsel 

(OGC) for IA. Additional resources will 

enable IA and OGC to meet the increased 

demand to support clients on the Treasurychaired Committee on Foreign Investment in 

the United States. 

OIA - Counterintelligence and Security 

Capabilities Enhancement +$622,000 / +3 

FTE Annualization of the FY 2009 initiative 

which augmented the Department’s efforts to 

address current and emerging threats that 

affect its national security mission. These 

include: preventing espionage in the 

Department; thwarting adversarial threats to 

our personnel, programs, and facilities; and 

identifying and mitigating threats from 

compromise of Treasury critical programs or 

theft. 

Program Reinvestment 

International Affairs Reduction -$2,110,000 

/ -4 FTE The Department considers its attaché 

program to be a valuable asset for building 

relationships with foreign officials and 

working with local U.S. industry and agency 

representatives to advance U.S. interests, but it 

does recognize that with current economic 

conditions a partial amount of the funding for 

Department of the Treasury - Budget in Brief FY 2010 Page 14
this program must be realigned to other offices 

that are focused on the domestic economic 

situation. The Department has identified funds 

in the attaché program, and will reallocate 

these resources to meet the increased workload 

on the Office of Domestic Finance for the 

initiative described in the program increases 

section below. 

Program Increases 

Domestic Finance Staffing +$8,731,000 / 

+26 FTE In order to meet current and future 

economic challenges, Treasury must maintain 

a vast expertise is complex finance and 

government fields, particularly housing 

finance, small business and capital markets. In 

support of this objective, this initiative will 

fund additional staff in the Office of Domestic 

Finance, including two new Deputy Assistant 

Secretary (DAS) positions: one DAS for 

Housing Finance, Small Business and 

Consumer Issues and one DAS for Capital 

Markets. The two DASs will lead teams 

designed to support the economic research and 

modeling for these critical areas. 

Tax Policy +$4,863,000 / +15 FTE To ensure 

Treasury possesses capabilities sufficient to 

support rigorous analysis and implementation 

of revenue policy, the Budget includes funding 

for an additional 15 tax specialists in 

Treasury’s Office of Tax Policy. These new 

tax specialists will apply tax expertise in of the 

following key areas: (1) the financial crisis; (2) 

the financial stimulus plan; (3) climate change; 

and (4) health care reform. 

Management Staffing +$3,000,000 / +13 

FTE DO has identified a number of staffing 

shortfalls in the areas of Treasury-wide human 

capital, IT and procurement policy. The 

Office of the Chief Information Officer 

(OCIO) needs additional staff to support the 

increasingly sophisticated technology needs of 

Treasury leadership and policy offices. As the 

Department takes on broader and more 

complex financial and fiscal issues, 

policymakers and advisors require more IT 

support and programs for their work, in order 

to effectively meet these needs. The new staff 

will support the implementation of new 

procurement requirements associated with the 

Administration's efforts for increased 

transparency in Federal contracting, as well as 

provide additional support to process large, 

complex IT contracts. In addition, the 

additional HR staff and privacy directives staff 

will ensure that Treasury’s directives, both for 

HR and otherwise, are codified and made 

accessible to Treasury employees. 

Recovery Act Program Support +$400,000 / 

+1 FTE In accordance with sections 1602 and 

1603 of the American Recovery and 

Reinvestment Act of 2009 (Recovery Act), the 

Secretary is implementing two new grant 

programs: (1) Grants to States for Low-Income 

Housing Projects in Lieu of Low-Income 

Housing Tax Credits and (2) Grants for 

Specified Energy Property in Lieu of Tax 

Credits. Funding is requested to continue the 

administration of these programs in FY 2010. 

TFI Afghanistan Threat Finance Cell and 

International Dues +$790,000 / +1 FTE

Resources are requested to provide designated 

Treasury staff for the Afghanistan Threat 

Finance Cell and support annual dues to international anti-money laundering or-ganizations. 

The Afghanistan Threat Finance Cell (ATFC) 

was established in FY 2009 on the model of 

the successful Iraq Threat Finance Cell as a 

joint Treasury, State and Defense Department 

initiative. Treasury requests resources to 

provide one dedicated, full-time staff member 

for this important effort. Treasury leads the 

United States delegation at the Asia-Pacific 

Group and the Financial Action Task Force, 

international bodies dedicated to combating 

money laundering and terrorist financing, and 

streng-thening the financial systems of 

member states. Treasury requests funds to 

support dues payments. 

Department of the Treasury - Budget in Brief FY 2010 Page 15
CIO Treasury Foreign Intelligence Network 

(TFIN) +$1,200,000 / +0 FTE Provide ongoing Operations and Maintenance (O&M) 

support for the TFIN system, including 

program management, O&M managed 

services provider contractor support, 

telecommunications and circuit costs, 

hardware and software maintenance, and 

technology refresh. 

Explanation of Budget Activities 

 

Salaries and Expenses 

 

Executive Direction ($22,383,000 from 

direct appropriations and $1,092,000 from 

reimbursable programs) Provides direction 

and policy formulation to the Department, and 

interacts with Congress and the public on 

Departmental policy matters. 

Economic Policies and Programs 

($44,749,000 from direct appropriations 

and $5,097,000 from reimbursable 

programs) Monitors domestic and 

international economic conditions and collects 

and analyzes financial data, including foreign 

credits and credit guarantees. 

Financial Policies and Programs 

($47,580,000 from direct appropriations 

and $5,225,000 from reimbursable 

programs) Monitors and provides economic 

and financial policy expertise in the areas of 

domestic finance and tax policy. 

Terrorism and Financial Intelligence 

($64,610,000 from direct appropriations 

and $5,637,000 from reimbursable 

programs) Develops and implements 

strategies to counter terrorist financing and 

money laundering. 

Treasury-wide Management and Programs 

($22,779,000 from direct appropriations 

and $4,575,000 from reimbursable 

programs) Provides strategic plans, and 

policy direction in the fields of human 

resources, information technology security, 

and financial administration that include the 

formulation and management of the budget. 

Administration Programs ($100,286,000 

from direct appropriations and $12,216,000 

from reimbursable programs) Provides 

operational support and shared services to all 

offices within DO. Activities include 

accounting, budget, human resources, 

information technology, procurement, 

facilities support and travel services. 

Legislative Proposals 

 

The Budget proposes one new Administrative 

Provisions. The Provision would authorize a 

permanent indefinite authority to establish new 

Treasury fund symbols for the payment of tax 

refunds and related interest by Alcohol and 

Tobacco Tax & Trade Bureau, Customs and 

Border Protection, and the Bureau of Alcohol, 

Tobacco, Firearms and Explosives. 

The proposed Administrative Provision will 

greatly improve the efficiency of the payment 

of various types of tax refunds and related 

interest. 

Department of the Treasury - Budget in Brief FY 2010 Page 16
DO Performance by Budget Activity 

Budget Activity Performance Measure Actual Actual Actual Target 

Met? Target Target

Economic Policies Number of new trade and investment 

and Programs negotiations underway or completed (Oe) 

N/A N/A 14 Baseline 6 2 

Terrorism and Number of countries that are assessed for 

Financial Intelligence compliance with the Financial Action Task 

Force (FATF) 40 + 9 recommendations (Ot)

5 6 12 Yes Discontinued Discontinued 

Treasury-wide Completed investigations of EEO 

Management and complaints within 180 days (%) (Oe) 

Programs 

20 52 56 Yes 50 50 

Treasury-wide Injury and illness rate Treasurywide - 

Management and including DO (Oe) 

Programs 

1 0 1.29 Yes Discontinued Discontinued 

FY 2006 FY 2007 FY 2008 FY 2009 FY 2010

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

Description of Performance 

 

The Treasury Department is committed to 

participating in the negotiation and 

implementation of international agreements, 

which help to remove trade and investment 

barriers and stimulate domestic and global 

growth. Treasury’s Office of International 

Affairs advises and assists in the formulation 

and execution of U.S. international 

economic and financial policy. In FY 2008, 

the office met or exceeded its targets for all 

of its performance measures. During the 

year, the office modified its measure related 

to trade and investment negotiations to 

broaden its scope and added a new measure 

related to the enactment, implementation 

and enforcement of US trade law and 

international agreements. For FY 2009 and 

FY 2010, it is anticipated that completion of 

new international trade and investment 

agreements will be challenged by 

protectionist sentiment associated with the 

global recession. Commitments by G-20 

nations to resume the World Trade 

Organization’s Doha Round of trade 

negotiations and limit protection are 

extremely favorable, but the performance 

results of FY 2008 are likely to be 

unrepeatable in the current climate. 

Performance targets for FY 2009 and FY 

2010 for both measures have consequently 

been set to reflect these economic 

challenges. 

Departmental Offices are primarily 

responsible for managing Treasury-wide 

management programs and initiatives. For 

FY 2008, DO met or exceeded its 

performance measures related to Equal 

Opportunity Employment and Departmentwide injury and illness rates. During FY 

2008 the Office of the Deputy Assistant 

Secretary for Human Resources / Chief 

Human Capital Officer (DASHR/CHCO) 

began using two performance measures to 

assess how well employee expectations 

align with organization performance. 

DASHR/CHCO also implemented its first 

human capital operating plan to ensure 

steady progress towards the goals laid out in 

the Human Capital Strategic Plan. These 

new initiatives have significantly improved 

insight into human capital programs and 

additional measures are being developed to 

determine the effectiveness of strategies 

articulated in the plan. 

The Department is continuing in its efforts 

to develop and replace performance 

measures for the Offices of International 

Affairs, Economic Policy, Domestic 

Finance, Foreign Asset Control, Intelligence 

and Analysis, and Terrorism Financing and 

Department of the Treasury - Budget in Brief FY 2010 Page 17
Financial Crimes to improve alignment with 

the 2007-2012 Treasury Strategic Plan. In 

FY 2008 the Office of Technical Assistance 

established two new, comprehensive 

performance measures to assess the 

effectiveness of assistance programs for 

client countries. Additional measures of this 

type are currently being considered for other 

policy offices 

Department of the Treasury - Budget in Brief FY 2010 Page 18
Department-wide Systems and Capital Investments Programs 

Program Summary by Budget Activity 

(Dollars in thousands) 

FY 2008 FY 2009 FY 2010 Appropriation Enacted Enacted Request $ Change % Change

Department-wide Systems and Capital Investments 

Programs $18,710 $26,975 $9,544 ($17,431) (64.62%)

 Department-wide Systems and Capital Investments 

Programs $18,710 $26,975 $9,544 ($17,431) (64.62%)

Total Appropriated Resources $18,710 $26,975 $9,544 ($17,431) (64.62%)

Explanation of Request 

 

The Department-wide Systems and Capital 

Investments Programs (DSCIP) request 

includes funds for Treasury Annex Repair and 

Maintenance (ARM), the Departmental Cyber 

Security program, and enhancements to the 

Treasury Foreign Intelligence Network 

(TFIN). 

Annex Repair and Maintenance: The 90-

year old Treasury Annex, owned by the 

Department, is considered an American 

treasure; the building is part of the Lafayette 

Square National Register Historic District. 

With no major system overhaul in decades, 

the condition of the building has 

deteriorated. The FY 2010 request for the 

Annex Repair and Maintenance (ARM) 

project will enable Treasury to address the 

immediate need to correct critical building 

and system deficiencies to ensure the safety 

and health of the occupants. Substantial 

corrective measures are necessary to address 

the infrastructure that is at the end of its life 

cycle. The FY 2010 ARM priority will be 

the replacement of the existing elevators, 

which have exceeded their life expectancy.

Cyber Security: Cyber Security funds will 

be used to help ensure the protection of 

Treasury systems and information against 

threats, identify and mitigate vulnerabilities, 

provide for cyber security governance 

throughout the Department, and ensure that 

the Department’s Critical Infrastructure / 

Key Resources (CI/KR) are identified The 

funds will also be used to develop security 

metrics and ensure they are regularly 

measured, advance the Department’s cyber 

security requirements to meet new threats 

and vulnerabilities, and to conduct security 

reviews to help ensure full implementation 

of security measures to protect the 

Department. This program will provide 

greater protection against network 

intrusions, which can result in significant 

disruptions and delays in its business 

activities. Funding in this area will also 

support reviews of selected bureau security 

programs and support enhanced protection 

of the Department’s classified systems, thus 

directly supporting the goal of better 

protecting the national security, by reducing 

the risk to those systems. 

Treasury Foreign Intelligence Network: 

The TFIN system is the Department’s only 

Sensitive Compartmented Information-level 

system that receives and stores information 

used for daily intelligence analysis for senior 

Treasury policymakers as well as actionable 

intelligence for use by other agencies within 

the Intelligence Community (IC). The 

system enables analysts to provide critical 

insights into the threats to economic stability 

in countries/regions important to U.S. 

interests and policy objectives, and to assess 

financial vulnerabilities, impact of sanctions, 

and threats to critical financial 

infrastructure. Program management goals 

will be achieved by 

Department of the Treasury - Budget in Brief FY 2010 Page 19
ensuring reliable, secure, efficient, effective, 

and technologically current IT infrastructure 

and software applications. Progress towards 

these goals will be measured through diligent 

monitoring of meaningful cost, schedule, and 

performance metrics focused on supporting the 

Treasury’s intelligence mission. 

Purpose of Program 

 

The Department-wide Systems and Capital 

Investments Programs (DSCIP) provides the 

Secretary of the Treasury resources to improve 

Departmental infrastructure and modernize 

business processes through strategic use of 

information technology in order to achieve 

operational efficiency and effectiveness. 

DSCIP FY 2010 Budget Highlights

(Dollars in thousands) 

Appropriation Amount

FY 2009 Enacted 26,975

Changes to Base: 

Non-Recurring Costs: ($26,975)

Zero-based Budget (26,975)

Subtotal FY 2010 Changes to Base ($26,975)

Total FY 2010 Base -

Program Changes: 

Program Increases: $9,544

Annex Repair and Maintenance 4,544

Cyber Security 3,000

Treasury Foreign Intelligence Network 2,000

(TFIN) 

Subtotal FY 2010 Program Changes $9,544

Total FY 2010 President's Budget Request 9,544

FY 2010 Budget Adjustments 

 

FY 2009 Enacted 

The FY 2009 enacted direct appropriation for 

DSCIP is $26,975,000. 

Non-Recurring Costs 

Zero-based Budget -$26,975,000 / +0 FTE

DSCIP is a zero-based budget. 

Program Increases 

Annex Repair and Maintenance 

+$4,544,000 / +0 FTE The FY 2010 Budget 

proposed funding for the Annex Repair and 

Maintenance (ARM) project will enable 

Treasury to continue to address the immediate 

need to correct building and system 

deficiencies in order to ensure the safety and 

health of the building occupants. The FY 

2010 ARM priority will be the replacement of 

the existing elevators which have exceeded 

their life expectancy. This work will be 

possible, in part, due to the new building 

electrical service that is financed with funding 

in FY 2009. 

Cyber Security +$3,000,000 / +0 FTE The 

Cyber Security program protects the security 

of Treasury systems, and related information 

and services. This Department-wide program 

supports: the comprehensive security policy 

and compliance framework to protect cyber 

assets throughout the Department; protection 

of Departmental cyber critical infrastructure 

resources against attack; protection of 

classified systems and information through the 

National Security Program; and operation of 

both the Department-wide cyber security 

program for sensitive systems and the 

Treasury Computer Security Incident 

Response Center. 

Treasury Foreign Intelligence Network 

(TFIN) +$2,000,000 / +0 FTE For FY 2010, 

DSCIP funding is required to enhance the high 

priority, classified intelligence capabilities of 

TFIN, including application development 

designed to comport with changes that the 

Office of the Director for National Intelligence 

(ODNI)/CIO makes to the IC enterprise 

architecture to facilitate more timely 

intelligence information sharing and analysis. 

Department of the Treasury - Budget in Brief FY 2010 Page 20
Explanation of Budget Activities 

 

Salaries and Expenses 

 

Department-wide Systems and Capital 

Investments Programs ($9,544,000 from 

direct appropriation) -

The purpose of DSCIP funds is to improve 

Departmental infrastructure and modernize 

business processes through strategic use of 

information technology in order to achieve 

operational efficiency and effectiveness. All 

of the DSCIP efforts provide tangible benefits 

in their specific areas to produce an improved 

overall environment for the Department of the 

Treasury. Improvements to the Treasury 

Annex will allow the department to maximize 

the utility of the facility while ensuring that 

Treasury employees are working in a safe and 

secure environment. The Departmental Cyber 

Security program enables Treasury to protect 

the sensitive information entrusted to the 

Department by the public, while also ensuring 

the availability of IT resources necessary for 

Treasury to perform its missions. Investments 

in TFIN facilitate Treasury’s contributions to 

national security.

Legislative Proposals 

 

DSCIP has no legislative proposals for 

FY 2010. 

Description of Performance 

 

The Treasury Department has four strategic 

goals: 

• Effectively manage U.S. government 

finances; 

• Ensure U.S. and world economies 

perform at full economic potential; 

• Prevent terrorism and promote the 

nation’s security through strengthened 

international financial systems; and, 

• Ensure management and organizational 

excellence. 

The Department uses DSCIP funds to make 

investments necessary to facilitate 

achievement of these goals. 

For FY 2010, the Annex Repair and 

Maintenance (ARM) project will enable 

Treasury to continue to address building and 

system deficiencies and thereby contributes to 

the achievement of the goal of ensuring 

management and organizational excellence. 

The FY 2010 ARM investment will build off 

of similar FY 2009 DSCIP investments in the 

program. 

In support of Treasury’s strategic goal to 

prevent terrorism and promote the nation’s 

security through strengthened international 

financial systems, FY 2010 DSCIP resources 

will be used to enhance the analytical 

capabilities available to intelligence analysts 

using the Treasury Financial Intelligence 

Network (TFIN). The planned enhancements 

will ensure the system remains compliant with 

increased security requirements and that 

Treasury intelligence systems facilitate the 

increasingly dynamic information exchange 

between agencies of the intelligence 

community. 

By enabling protection of information and 

information systems across Treasury, the 

Cyber Security program contributes to the 

accomplishment of all four Treasury strategic 

goals. Because Treasury is highly dependent 

on IT and is highly inter-connected with other 

agencies, the private sector and the public, a 

strong Departmental Cyber Security program 

is essential for Treasury mission success, 

particularly given the highly-advanced threats 

posed against the Department’s systems. 

Department of the Treasury - Budget in Brief FY 2010 Page 21
Department of the Treasury - Budget in Brief FY 2010 Page 22
Office of Inspector General 

Program Summary by Budget Activity 

(Dollars in thousands) 

FY 2008 FY 2009 FY 2010 Appropriation Enacted Enacted Request $ Change % Change

Salaries and Expenses $18,450 $26,125 $26,700 $575 2.2%

 Audit $12,658 $20,116 $20,559 $443 2.2%

 Investigations $5,792 $6,009 $6,141 $132 2.2%

Subtotal, Office of Inspector General $18,450 $26,125 $26,700 $575 2.2%

Offsetting Collections - Reimbursables $6,361 $7,381 $8,000 $619 8.4%

Total Program Operating Level $24,811 $33,506 $34,700 $1,194 3.6%

Explanation of Request 

 

The Fiscal Year (FY) 2010 President’s Budget 

request for the Office of Inspector General 

(OIG) will be used to provide critical audit and 

investigative services, ensuring the 

effectiveness and integrity of Treasury’s 

programs and operations. The OIG will 

continue to address mandated requirements 

related to (1) audits of the Department’s 

financial statements, (2) information security, 

and (3) failed institutions regulated by the 

Office of the Comptroller of the Currency or 

the Office of Thrift Supervision resulting in 

material losses to the deposit insurance fund 

(material loss is currently defined as the 

greater of $25 million or 2 percent of the 

institution’s assets). To the extent that 

resources are available, the OIG will conduct 

audits of the Department’s highest risk 

programs and operations. Five of those 

programs and operations are discussed below. 

This list is not all inclusive, and risks change 

over time and circumstance. 

Programs to Ensure the Safety and 

Soundness of the Nation’s Financial 

Markets – The wave of bank failures that 

started in 2008 underscore the need for 

increased audit coverage of a more prospective 

nature. Material loss reviews are a backward 

look at the quality of supervision as it relates 

to the failed institution under review. The OIG 

believes that it is important for regulators to 

address emerging risks in financial markets 

and products. The subprime mortgage crises 

was a costly lesson that serves to remind us 

that regulators need to anticipate, recognize, 

and control business practices that create 

unreasonable risk. 

Another area that the OIG believes requires 

vigorous oversight is Treasury’s 

responsibilities under the Housing and 

Economic Recovery Act of 2008. Treasury has 

taken on an important role to complement the 

Federal Housing Finance Agency’s September 

2008 decision to place Fannie Mae and 

Freddie Mac in conservatorship. 

Programs to Promote Economic Recovery - 

With the enactment of the American Recovery 

and Reinvestment Act of 2009 (Recovery 

Act), Treasury was provided with, among 

other things, over $4 billion for low-income 

housing projects and specified energy 

properties of which the OIG has jurisdiction or 

joint jurisdiction with the Treasury Inspector 

General for Tax Administration. Additionally, 

the Community Development Financial 

Institutions Fund received $100 million to 

supplement its FY 2009 funding round for 

qualified program applicants. 

Programs to Combat Terrorist Financing 

and Money Laundering – Treasury faces 

unique challenges in carrying out its 

responsibilities under the Bank Secrecy Act 

Department of the Treasury - Budget in Brief FY 2010 Page 23
(BSA) and USA PATRIOT Act to prevent 

and detect money laundering and terrorist 

financing. Past audits and Congressional 

hearings have surfaced serious regulatory 

gaps in the detection of and/or timely 

enforcement action against financial 

institutions for BSA and related violations. 

Furthermore, with the current distress facing 

so many financial institutions throughout 

our country, we believe that there is an 

increased risk that compliance with BSA 

may have deteriorated further and may 

continue to worsen. 

Efforts to Ensure the Security of Treasury’s 

Information Systems -- The Department 

faces serious challenges in bringing its systems 

into compliance with information technology 

security policies, procedures, standards, and 

guidelines. In its FY 2008 Federal Information 

Security Management Act independent audit, 

the OIG continued to report deficiencies in the 

Department’s information security programs 

and practices. 

Treasury’s Management of Capital 

Investments -- Treasury needs to ensure that 

large acquisitions of systems and other capital 

investments are properly managed. The 

Department’s record in this regard has been 

mixed and requires continued attention. 

The requested funding will also allow the OIG 

to: continue to prevent fraud, waste and abuse, 

at all Treasury non-IRS bureaus and offices, 

including investigating complaints of alleged 

employee misconduct, and allegations of fraud 

and other crimes involving Treasury programs; 

performing oversight of the Treasury's police 

operations at the Bureau of Engraving and 

Printing and the U.S. Mint; continuing review 

and investigation of instances where the U.S. 

Mint’s Coin Redemption and Bureau of 

Engraving and Printing’s Currency 

Redemption Programs are used to facilitate 

money laundering, structuring, and other 

unlawful activities; and conducting proactive 

efforts to detect, investigate, and deter 

electronic crimes and other threats to the 

Department’s physical and cyber critical 

infrastructure. 

 

Resources required to support OIG operations 

for FY 2010 are $26,700,000 from direct 

appropriations, and $8,000,000 from offsetting 

collections and reimbursable agreements for 

contract financial statement audits of other 

Treasury bureaus. 

Purpose of Program 

 

The Treasury OIG plays a major role in 

support of the Department of the Treasury’s 

goal to ensure accountability and transparency, 

to protect the integrity of the Department, and 

to improve overall efficiency and effectiveness 

in Treasury programs and operations. OIG 

conducts audits and investigations of all nonIRS offices in accordance with the Inspector 

General Act, as amended, to (a) promote 

economy, efficiency, and effectiveness in the 

administration of Treasury programs and 

operations; (b) prevent and detect fraud, waste, 

and abuse in Treasury programs and 

operations; and (c) keep the Secretary and the 

Congress fully and currently informed about 

problems, abuses, and deficiencies in Treasury 

programs and operations. 

There are also appropriated to the Department 

of the Treasury funds specifically identified 

for the annual audit of the Treasury-wide 

financial statements. 

Department of the Treasury - Budget in Brief FY 2010 Page 24
OIG FY 2010 Budget Highlights

(Dollars in thousands) 

Appropriation Amount

FY 2009 Enacted 26,125

Changes to Base: 

Maintaining Current Levels (MCLs): $575

Across the Board program reduction (9)

Non-Pay Inflation Adjustment 90

Pay Annualization 166

Pay Inflation Adjustment 328

Subtotal FY 2010 Changes to Base $575

Total FY 2010 Base 26,700

Total FY 2010 President's Budget Request 26,700

FY 2010 Budget Adjustments 

 

FY 2009 Enacted 

The FY 2009 enacted direct appropriation for 

OIG is $26,125,000. 

Maintaining Current Levels (MCLs) 

Adjustments Necessary to Maintain 

Current Levels +$575,000 / +0 FTE Funds 

are requested for: FY 2010 cost of the January 

2009 pay increase of $166,000; proposed 

January 2010 pay raise of $328,000; and nonlabor related items such as contracts, travel, 

supplies, equipment and GSA rent adjustments 

of $90,000. 

Explanation of Budget Activities 

 

Salaries and Expenses 

 

Audit ($20,559,000 from direct 

appropriations and $8,000,000 from 

reimbursable programs) The Treasury OIG 

plays a major role in support of the 

Department of the Treasury’s goal to ensure 

accountability and transparency, to protect the 

integrity of the Department, and to improve 

overall efficiency and effectiveness in 

Treasury programs and operations. OIG 

conducts audits and investigations of eight 

Treasury bureaus and all non-IRS Treasury 

offices in accordance with the Inspector 

General Act, as amended, to (a) promote 

economy, efficiency, and effectiveness in the 

administration of Treasury programs and 

operations, (b) prevent and detect fraud, waste, 

and abuse in Treasury programs and 

operations; and (c) keep the Secretary and the 

Congress fully and currently informed about 

problems, abuses, and deficiencies in Treasury 

programs and operations. 

There are also appropriated to the Department 

of the Treasury funds specifically identified 

for the annual audit of the Treasury-wide 

financial statements. This audit is performed 

by an independent public accounting firm 

under the supervision of OIG. These funds are 

not available for OIG programs and 

operations. 

Investigations ($6,141,000 from direct 

appropriations) The Office of Investigations 

prevents, detects and investigates complaints 

of fraud, waste and abuse at eight Treasury 

bureaus and all non-IRS Treasury offices. This 

includes the detection and prevention or 

deterrence of employee misconduct and fraud, 

or related financial crimes within or directed 

against Treasury. The Office of Investigations 

refers its cases to the Department of Justice 

and state or local prosecutors for criminal 

prosecution or civil litigation, or to agency 

officials for corrective administrative action. 

 

Legislative Proposals 

 

The OIG has no legislative proposals for FY 

2010. 

OIG Performance by Budget Activity 

Department of the Treasury - Budget in Brief FY 2010 Page 25
FY 2006 FY 2007 FY 2008 FY 2009 FY 2010

Budget Activity Performance Measure Actual Actual Actual Target 

Met? Target Target

Audit Number of completed audit products (Ot) 57 64 64 Yes 60 62 

Audit Percent of statutory audits completed by 

the required date (%) (E) 

100 100 100 Yes 100 100 

Investigations Percent of all cases that were accepted by 

prosecutors, referred for agency action, or 

closed during fiscal year and were 

completed within 18 months of case 

initiation (Oe) 

 Baseline 70 

Investigations Percentage of all cases closed during fiscal 

year that were referred for criminal/civil 

prosecution or Treasury Administrative 

action (%) (E) 

 Baseline 70 

Description of Performance 

 

In FYs 2007 and 2008, the Office of Audit 

completed 128 audit products, identified 

potential monetary benefits totaling nearly 

$7 million for bureaus and programs and 

completed all statutory audits by the 

required deadlines. 

In FY 2008, the Office of Audit performed 

or supervised contractors to meet its 

financial statement and information security 

mandated audit requirements. It also 

performed mandated material loss reviews 

of failed financial institutions supervised by 

Treasury. Furthermore, the Office of Audit 

directed its self-initiated work toward 

addressing Treasury’s major management 

and performance challenges. The Office of 

Audit completed 64 audit products, and met 

all statutory completion requirements. 

In FY 2008, the Office of Investigations 

continued investigating all reports of fraud, 

waste and abuse and other criminal activity. 

The Office of Investigations also continued 

to conduct a limited number of proactive 

integrity projects such as the fraudulent 

improper payments project initiated in FY 

2006. The Office of Investigations referred 

93 investigations for criminal prosecution, 

civil litigation, or corrective administrative 

action. The Office of Investigations 

undertook a thorough review of its 

performance measure methodology, and has 

developed better and more realistic measures 

with which to gauge its investigative 

performance. These new measures went into 

effect in FY 2009, and will be evaluated 

throughout the year. 

In FY 2009, the OIG expects to maintain 

performance at a level consistent with FY 

2008, and will continue to direct a 

significant portion of its limited resources to 

conducting the increasing number of 

material loss reviews of failed banks. 

Furthermore, the OIG will begin to provide 

oversight of more than $4 billion for lowincome housing projects and specified 

energy properties grants authorized by the 

Recovery Act. 

FY 2010 requested resources will enhance 

OIG’s ability to complete mandated material 

loss reviews by the statutory deadline. OIG 

will continue to direct much of its remaining 

resources to auditing Treasury programs: to 

ensure the safety and soundness of the 

Nation’s financial markets; to promote 

economic recovery; to combat terrorist 

financing and money laundering; to ensure 

the security of treasury’s information 

systems, and; to improve Treasury’s 

management of capital investments. The 

OIG expects to meet the revised 

investigative targets of 70 percent of all 

cases that were accepted by prosecutors, 

referred for agency action, closed, or 

exonerated during the fiscal year and were 

completed within 18 months of case 

Department of the Treasury - Budget in Brief FY 2010 Page 26
initiation; and 70 percent of all cases closed 

during the fiscal year that were referred for 

criminal/civil prosecution or Treasury 

Administrative action.; complete 62 audit 

products, and complete 100 percent of 

statutory audits on time in FY 2010.

Department of the Treasury - Budget in Brief FY 2010 Page 27
Department of the Treasury - Budget in Brief FY 2010 Page 28
Inspector General for Tax Administration 

Program Summary by Budget Activity 

(Dollars in thousands) 

FY 2008 FY 2009 FY 2010 Appropriation Enacted ARRA Enacted Request $ Change % Change

Salaries and Expenses $140,533 $7,000 $146,083 $149,000 $2,917 2.0%

 Audit $52,959 $5,600 $55,186 $56,289 $1,103 2.0%

 Investigations $87,574 $1,400 $90,897 $92,711 $1,814 2.0%

Subtotal, Inspector General for Tax 

Administration $140,533 $7,000 $146,083 $149,000 $2,917 2.0%

Offsetting Collections - Reimbursables $900 $0 $900 $1,300 $400 44.4%

Total Program Operating Level $141,733 $7,000 $146,983 $150,300 $3,317 2.3%

Explanation of Request 

 

The FY 2010 President’s Budget request for 

Treasury Inspector General for Tax 

Administration (TIGTA) will be used to 

continue to provide critical audit, 

investigative, and inspection and evaluation 

services, promoting the integrity of tax 

administration on behalf of the Nation’s 

taxpayers. While there are a number of critical 

areas where TIGTA will provide oversight, 

highlights of TIGTA’s investigative and audit 

priorities include: 

• Adapting to the Internal Revenue Service’s 

(IRS) continuously evolving operations 

and mitigating intensified risks associated 

with modernization, security, addressing 

the tax gap, and human capital challenges 

facing the IRS; 

• Responding to threats and attacks against 

IRS employees, property, and sensitive 

information; 

• Improving the integrity of IRS operations 

by detecting and deterring fraud, waste, 

abuse and misconduct by IRS employees; 

• Conducting comprehensive audits, 

inspections, and evaluations that include 

recommendations for monetary benefits 

and enhancing IRS’ service to taxpayers; 

and 

• Informing the American people, Congress, 

and the Secretary of the Treasury of 

problems and progress made to resolve 

them. 

Total resources required in FY 2010 to support 

TIGTA’s mission are $150,300,000, including 

$149,000,000 from direct appropriations, and 

approximately $1,300,000 from reimbursable 

agreements. 

Purpose of Program 

 

The Treasury Inspector General for Tax 

Administration (TIGTA) was created by 

Congress as a part of the Internal Revenue 

Service Restructuring and Reform Act of 1998 

(RRA 98). TIGTA’s audits and investigations 

protect and promote the fair administration of 

the American tax system. TIGTA conducts 

audits that advise the American people, 

Congress, the Secretary of the Treasury, and 

IRS management of high-risk issues, 

problems, and deficiencies related to the 

administration of IRS programs and 

operations. TIGTA’s audit recommendations 

aim to improve IRS systems and operations, 

while maintaining fair and equitable treatment 

of taxpayers. TIGTA’s investigations ensure 

the integrity of IRS employees, contractors, 

and other tax professionals; provide for 

infrastructure security; and protect the IRS 

from external attempts to threaten or corrupt 

Department of the Treasury - Budget in Brief FY 2010 Page 29
the administration of the tax laws. TIGTA’s 

Office of Inspections and Evaluations (I&E) 

provides responsive, timely, and cost-effective 

inspections and evaluations of IRS challenge 

areas. TIGTA’s oversight is essential to the 

efficiency and equity of the Federal tax 

administration system. TIGTA ensures that 

the American taxpayer can have confidence 

that the IRS collects nearly $3 trillion in tax 

revenue in an effective and efficient manner 

using a system which is just and equitable. 

TIGTA FY 2010 Budget Highlights

(Dollars in thousands) 

Appropriation Amount

FY 2009 Enacted 146,083

Changes to Base: 

Maintaining Current Levels (MCLs): $3,264

Across the Board Program Reduction (504)

Non-Pay Inflation Adjustment 318

Pay Annualization 1,110

Pay Inflation Adjustment 2,340

Non-Recurring Costs: ($347)

No obligation to fund CIGIE (347)

Subtotal FY 2010 Changes to Base $2,917

Total FY 2010 Base 149,000

Total FY 2010 President's Budget Request 149,000

FY 2010 Budget Adjustments 

 

FY 2009 Enacted 

The FY 2009 enacted direct appropriation for 

TIGTA is $146,083,000. 

Maintaining Current Levels (MCLs) 

Adjustments Necessary to Maintain 

Current Levels +$3,264,000 / +0 FTE Funds 

are requested for: FY 2010 cost of the January 

2009 pay increase of $1,110,000; proposed 

January 2010 pay raise of $2,340,000; and 

non-labor related items such as contracts, 

travel, supplies, equipment and GSA rent 

adjustments of $318,000. 

Non-Recurring Costs 

No obligation to fund CIGIE -$347,000 / +0 

FTE There will be no interagency funding 

provided for the Council of Inspectors General 

on Integrity and Efficiency (CIGIE) in this 

request. 

Explanation of Budget Activities 

 

Salaries and Expenses 

 

Audit ($56,289,000 from direct 

appropriations and $551,000 from 

reimbursable programs) The Office of 

Audit’s (OA) mission is to provide 

comprehensive coverage and oversight of all 

aspects of the IRS’ daily operations. Audits, 

inspections, and evaluations not only focus on 

the economy and efficiency of IRS functions 

but also ensure that taxpayers’ rights are 

protected and the taxpaying public is 

adequately served. Moreover, the IRS’ 

implementation of audit recommendations 

results in: cost savings and increased or 

protected revenue; reduction of taxpayer 

burden; protection of taxpayer rights and 

entitlements, taxpayer privacy and security; 

and protection of IRS resources. Overall, as of 

September 30, 2008, audit reports produced 

potential financial benefits of approximately 

$2.4 billion, and potentially impacted 

approximately 5.7 million taxpayer accounts in 

areas such as taxpayer burden, rights and 

entitlements, taxpayer privacy and security, 

protection of resources/reliability of 

information, and increased revenue/revenue 

protected. Each fiscal year, OA develops an 

annual audit plan that communicates oversight 

priorities to Congress, the Department of the 

Treasury, and the IRS. This plan strikes a 

balance between statutory audit coverage and 

high risk audit work. The statutory coverage 

includes audits mandated by the IRS 

Restructuring and Reform Act of 1998, as well 

as reviews that address computer security and 

financial management. The high-risk 

workload includes issues pertaining to the IRS' 

modernization efforts, its major management 

challenges, its progress in achieving its 

strategic goals, as well as Congressional and 

other stakeholder requests for audit coverage. 

Department of the Treasury - Budget in Brief FY 2010 Page 30
Investigations ($92,711,000 from direct 

appropriations and $749,000 from 

reimbursable programs) While most Offices 

of Inspector General focus primarily on fraud, 

waste and abuse, TIGTA’s mission is more 

extensive. TIGTA has the statutory 

responsibility to protect the integrity of tax 

administration and to protect the ability of the 

IRS to collect revenue for the federal 

government. To accomplish this, TIGTA 

investigates allegations of criminal violations 

and administrative misconduct by IRS 

employees, protects the IRS against external 

attempts to corrupt tax administration, and 

ensures IRS employee safety and IRS data and 

infrastructure security. The following 

summaries highlight TIGTA’s investigative 

efforts in these three core areas: 

Employee Integrity: The IRS’ ability to 

deliver taxpayer service, enforce tax laws 

effectively, and collect the proper amount of 

taxes can be undermined by employee 

misconduct. Over 50 percent of TIGTA’s 

current investigations involve alleged 

employee misconduct. These investigations of 

employee misconduct allegations include 

extortion, theft, taxpayer abuse, false 

statements, and financial fraud. In addition, an 

integral part of the employee integrity program 

involves investigations of unauthorized access 

to confidential taxpayer records by IRS 

employees. 

Employee and Infrastructure Security: In 

1998, The President of the United States 

designated IRS operations as a critical 

infrastructure.1

 TIGTA meets the challenge of 

maintaining IRS employee and infrastructure 

security by conducting investigations in 

reaction to incidents in which IRS employees, 

facilities, and infrastructure are sabotaged, 

threatened, or assaulted. Potential threats to 

tax administration are identified by TIGTA’s 

administration of a Criminal Intelligence 

 

1 Presidential Decision Directive NSC-63.

Program that utilizes law enforcement and 

intelligence resources to proactively identify 

individuals and groups who may pose a threat 

to tax administration. 

External Attempts to Corrupt Tax 

Administration: External attempts to corrupt 

tax administration impede the IRS’ ability to 

collect revenue. TIGTA’s investigations of 

external attempts to corrupt or interfere with 

tax administration include: bribes offered by 

taxpayers to compromise IRS employees; the 

use of fraudulent IRS documentation to 

commit crimes; taxpayer abuse by tax 

practitioners; impersonation of IRS 

employees; and the corruption of IRS 

programs through procurement fraud. 

Legislative Proposals 

 

TIGTA has no legislative proposals for FY 

2010. 

Department of the Treasury - Budget in Brief FY 2010 Page 31
TIGTA Performance by Budget Activity 

FY 2006 FY 2007 FY 2008 FY 2009 FY 2010

Budget Activity Performance Measure Actual Actual Actual Target 

Met? ARRA Target Target

Investigations Percentage of results from 

investigative activities (%) (Oe) 

79 81 78 Yes 78 78 78 

Audit Percentage of audit products delivered 

when promised to stakeholders (%) 

(Oe) 

0 68 65 Yes 65 65 65 

Audit Percentage of recommendations made 

that have been implemented (%) (Oe) 

0 90 85 Yes 83 83 83 

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

Description of Performance 

 

• Issued 179 audit, inspection, and 

evaluation reports, identifying 

approximately $2.4 billion in potential 

financial benefits (i.e., costs savings, 

increased or protected revenue, taxpayer 

rights and entitlements, and inefficient 

use of resources). 

• Closed 78 percent of the 3,662 final 

closed investigations which generated 

results, including 1,569 cases of 

employee misconduct referred for action 

and 179 cases accepted for criminal 

prosecution with final legal action. 

Department of the Treasury - Budget in Brief FY 2010 Page 32
Community Development Financial Institutions Fund 

Program Summary by Budget Activity 

(Dollars in thousands) 

FY 2008 FY 2009 FY 2010 Appropriation Enacted ARRA Enacted Request $ Change % Change

Program Account $94,000 $100,000 $107,000 $243,600 $136,600 127.7%

 Community Development Financial Institutions 

Program $52,250 $90,000 $59,750 $113,600 $53,850 90.1%

 New Markets Tax Credit Program $4,120 $67 $4,200 $4,203 $3 0.1%

 Bank Enterprise Award Program $20,000 $0 $22,000 $22,000 $0 -

 Native Initiatives $8,000 $8,000 $8,500 $10,000 $1,500 17.6%

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

 Administration $9,630 $1,933 $10,550 $13,797 $3,247 30.8%

 Financial Education and Counseling $0 $0 $2,000 $0 ($2,000) (100.0%)

Total Appropriated Resources $94,000 $100,000 $107,000 $243,600 $136,600 127.7%

/1The CDFI Fund will seek to implement additional reforms to the BEA program to enhance the capacity of CDFI banks, and to 

strengthen partnerships between small community banks and CDFIs. 

/2 The Administration budget activity excludes resources to administer the New Markets Tax Credit program. 

Explanation of Request 

 

The FY 2010 request for the Community 

Development Financial Institutions (CDFI) 

Fund will ensure the Fund meets its mission of 

promoting access to capital and local 

economic growth in urban and rural lowincome communities across the nation. 

Through its various programs, the CDFI Fund 

enables locally based organizations to further 

goals such as economic development; 

affordable housing; and community 

development financial services. 

Total resources required to support CDFI Fund 

activities for FY 2010 are $243,600,000 from 

direct appropriations. 

Purpose of Program 

 

The Community Development Financial 

Institutions (CDFI) Fund expands the 

availability of credit, investment capital, and 

financial services in distressed urban and rural 

communities, and carries out the Community 

Development Banking and Financial 

Institutions Act of 1994. The CDFI Fund’s 

investments work toward building private 

markets, creating healthy local tax revenues 

(through job creation, business development, 

commercial real estate and housing 

development and homeownership), and 

empowering residents by stimulating the 

creation and expansion of diverse community 

development financial institutions (CDFIs, 

which provide basic banking services to 

underserved communities and financial 

literacy training). The CDFI Fund provides 

infusions of capital to institutions that serve 

economically distressed communities and lowincome individuals. The CDFI Fund’s 

activities leverage millions of private sector 

investment dollars from banks, foundations, 

and other funding sources. 

The Capital Magnet Fund (CMF) will be a 

newly authorized program that will be 

administered by the CDFI Fund beginning in 

FY 2010. The purpose of the CMF is to 

increase capital investment for the 

development, preservation, rehabilitation, or 

the purchase of affordable housing for low-, 

very low-, and extremely low-income families, 

and related economic development activities. 

Department of the Treasury - Budget in Brief FY 2010 Page 33
CDFI FY 2010 Budget Highlights

(Dollars in thousands) 

Appropriation Amount

FY 2009 Enacted 107,000

Changes to Base: 

Maintaining Current Levels (MCLs): $250

Across the Board Program Reduction (69)

Non-Pay Inflation Adjustment 107

Pay Annualization 76

Pay Inflation Adjustment 136

Subtotal FY 2010 Changes to Base $250

Total FY 2010 Base 107,250

Program Changes: 

Program Decreases: ($2,000)

Financial Counseling Grants program (2,000)

Program Increases: $138,350

CDFI program 53,850

Native Initiatives 1,500

Capital Magnet Fund 80,000

Capital Magnet Fund Implementation 1,300

Research, Evaluation & Performance 850

Transition to Departmental Offices' IT LAN 850

Subtotal FY 2010 Program Changes $136,350

Total FY 2010 President's Budget Request 243,600

FY 2010 Budget Adjustments 

 

FY 2009 Enacted 

The FY 2009 enacted direct appropriation for 

CDFI is $107,000,000. 

Maintaining Current Levels (MCLs) 

Adjustments Necessary to Maintain 

Current Levels +$250,000 / +0 FTE Funds 

are requested for: Across the Board Program 

Reduction of $69,000; FY 2010 cost of the 

January 2009 pay increase of $76,000; 

proposed January 2010 pay raise of $136,000; 

and non-labor related items such as contracts, 

travel, supplies, equipment and GSA rent 

adjustments of $107,000. 

Program Decreases 

Financial Counseling Grants program -

$2,000,000 / +0 FTE The CDFI Fund will 

discontinue the financial counseling grants 

pilot program, begun in FY 2009, and reinvest 

these resources in its existing financial 

assistance and technical assistance grants 

programs. 

Program Increases 

CDFI program +$53,850,000 / +0 FTE The 

FY 2010 budget request seeks to increase 

funding to support the increased demand for 

CDFI Program grants. CDFIs use these grants 

to increase their overall capacity, and their 

ability to offer loans, investments and other 

financial services in underserved communities. 

Awards are used by CDFIs to, among other 

things, increase their net assets, create loan 

loss reserves, and offer subordinated debt 

products. As a result, CDFIs are able to 

leverage CDFI Program awards by 

approximately 15:1. 

Native Initiatives +$1,500,000 / +0 FTE

Through the Native Initiatives, the CDFI Fund 

assists Native Communities (Native American, 

Alaskan Native and Native Hawaiian 

communities) to overcome certain barriers to 

financial services. The budget requests an 

additional $1.5 million, bringing the total 

program funding to $10 million. 

Capital Magnet Fund +$80,000,000 / +0 FTE

The Capital Magnet Fund seeks to increase 

capital investment for the development, 

preservation, rehabilitation, or purchase of 

affordable housing, and related economic 

development activities. The budget requests 

$80 million in funding to begin this important 

program, which will stimulate the economy in 

the nation's most distressed neighborhoods. 

Capital Magnet Fund Implementation 

+$1,300,000 / +6 FTE These resources will 

enable the CDFI Fund to hire additional grants 

and program compliance staff with expertise in 

programs designed to facilitate affordable 

housing and related investments. 

Research, Evaluation & Performance 

+$850,000 / +2 FTE To conduct strategic 

research to analyze the impact and outcomes 

of the CDFI Fund's programs, including the 

effect of changing economic conditions. 

Transition to Departmental Offices' IT LAN 

+$850,000 / +2 FTE In FY 2010, the CDFI 

Fund will transition from its separate 

Department of the Treasury - Budget in Brief FY 2010 Page 34
information technology LAN to a shared 

service provided model, leveraging the 

Department of Treasury Departmental Offices 

LAN capabilities. This transition will result in 

a one time cost estimated at $1.5 million. 

Explanation of Budget Activities 

 

Salaries and Expenses 

 

Community Development Financial 

Institutions Program ($113,600,000 from 

direct appropriations) The Community 

Development Financial Institutions (CDFI) 

Program uses federal resources to invest in and 

build the capacity of CDFIs to serve lowincome people and communities lacking 

adequate access to affordable financial 

products and services. The CDFI Program 

provides monetary awards for financial 

assistance to further economic development 

(job creation, business development, and 

commercial real estate development); 

affordable housing (housing development and 

homeownership); and community 

development financial services (provision of 

basic baking services to underserved 

communities and financial literacy training). 

The CDFI Program also provides technical 

assistance awards to help start-up and existing 

CDFIs build their capacity to serve their target 

markets through the acquisition of consulting 

services, technology purchases, and staff or 

board training. 

New Markets Tax Credit Program 

($4,203,000 from direct appropriations) The 

NMTC Program attracts private sector capital 

into low-income communities. Community 

Development Entities (CDEs) apply to the 

Fund for allocations of tax credits in annual 

competitive rounds. The CDEs, in turn, 

provide tax credits to private investors in lowincome communities. In addition to awarding 

tax credits, the Fund monitors CDE 

compliance with the terms of their allocation 

agreements. The amount requested in this 

account funds the administrative expenses of 

the NMTC. 

Bank Enterprise Award Program 

($22,000,000 from direct appropriations)

The CDFI Fund instituted program changes in 

2009 requiring most awardees to reinvest their 

award dollars in support of CDFIs or in 

additional qualifying low-income community 

activities. In FY 2010, the CDFI Fund will 

seek to make additional reforms to the BEA 

Program to enhance the capacity of CDFI 

banks, and to strengthen partnerships between 

community banks and CDFIs. The CDFI Fund 

will work with Congress, the Office of 

Management and Budget and other 

stakeholders in the development of proposed 

reforms, and seek Congressional approval as 

appropriate. 

Native Initiatives ($10,000,000 from direct 

appropriations) The Native Initiatives 

comprises two components: (i) the Native 

American CDFI Assistance (NACA) Program 

through which FA and TA awards are 

provided to build the capacity of new or 

existing CDFIs serving Native American 

Communities (Native American CDFIs), and 

(ii) complementary capacity-building 

initiatives that seek to foster the development 

of Native American CDFIs through training 

and technical assistance. The CDFI Fund 

achieves these objectives through two 

principal strategies: (i) the Native American 

CDFI Assistance (NACA) Program, which 

provides financial assistance and technical 

assistance awards to new or existing Native 

CDFIs, and (ii) a complementary series of 

training programs, called Expanding Native 

Opportunities, that foster the development of 

new Native CDFIs, strengthen the operational 

capacity of existing Native CDFIs, and guide 

Department of the Treasury - Budget in Brief FY 2010 Page 35
Native CDFIs in the creation of important 

financial education and asset building 

programs for their communities. 

Capital Magnet Fund ($80,000,000 from 

direct appropriations) The Capital Magnet 

Fund was enacted through the Housing and 

Economic Recovery Act of 2008. Through the 

Capital Magnet Fund, the CDFI Fund will 

carry out a competitive grant program for 

CDFIs and nonprofit organizations (if their 

principal purposes is the development or 

management of affordable housing) to attract 

private capital for increase investment in (i) 

develop, preserve, rehabilitate, and purchase 

affordable housing for primarily extremely 

low-, very low-, and low-income families; and 

(ii) undertake economic development activities 

or community services facilities (such as day 

care centers, workforce development centers, 

and health care clinics) which in conjunction 

with affordable housing activities will 

implement a concerted strategy to stabilize or 

revitalize a low-income area or underserved 

rural area. The Act established the Capital 

Magnet Fund as a program that will be 

administered by the CDFI Fund. 

Administration ($13,797,000 from direct 

appropriations) Administration encompasses 

the CDFI Fund’s operational support and 

management activities for each of the grant 

and tax credit programs it administers. This 

includes finalizing the terms of assistance 

agreements with awardees, making 

disbursements, and monitoring awardee 

compliance with the terms of their three-year 

award assistance and seven-year allocation 

agreements. 

Legislative Proposals 

 

For purposes of the CDFI Fund’s FY 2010 

appropriations, the CDFI Fund is requesting a 

waiver of the statutory cap on award amounts 

(12 U.S.C. 4707 (d)) and a waiver of the 

matching funds requirements (12 U.S.C. 4707 

(e)) for the FY 2010 funding rounds, given the 

current need to stabilize the economy. 

Award Cap Waiver 

The CDFI Fund proposes waiving the 3-year, 

$5 million cap (12 U.S.C. 4707(d)(1)-(2)) for 

FY 2010. The FY 2010 Budget includes a 

significant increase in CDFI Program 

resources, and the CDFI Fund requires the 

option to use some of the additional resources 

to fully fund high quality applicants that 

received awards in previous resources. Due to 

additional resources made available through 

the Recovery Act, and the increase of the FY 

2010 budget request, the Administration 

supports waiving the award cap. 

Matching Fund Waiver 

The second proposal waives the CDFI 

Programs matching funds provision in 2010, 

which requires applicants to match awards on 

a 1:1 basis with private funding. Given 

current credit market conditions, CDFIs may 

find it difficult to obtain affordable private 

credit. Under this proposal, highly qualified 

CDFIs will be able to apply even if they are 

struggling to find a private match. Given the 

market challenges in the credit and equities 

markets, many CDFIs are encountering a 

significant contraction of capital support to 

obtain matching funds. 

This contraction in capital support is coming at 

a time when many CDFIs are seeing an 

increased demand for their products, as many 

of the traditional mainstream lenders are 

reducing their lending activities. The 

Administration supports waiving the matching 

funds requirement to enable all CDFIs that are 

able to serving distressed communities to be 

eligible to apply regardless of the market 

conditions that have impacted the ability to 

obtain matching funds. 

Department of the Treasury - Budget in Brief FY 2010 Page 36
CDFI Performance by Budget Activity 

FY 2006 FY 2007 FY 2008 FY 2009 FY 2010

Budget Activity Performance Measure Actual Actual Actual Target 

Met? ARRA Target Target

Bank Enterprise Increase in community 

Award development activities over prior 

year for all BEA program applicants 

($ millions) (Oe) 

318 227 232 Yes NA 202 210 

Community Dollars of private and non-CDFI 

Development Fund investments that CDFIs are 

Financial able to leverage because of their 

Institutions CDFI Fund Financial Assistance ($ 

Program millions) (Oe) 

1,400 778 621 No NA 635 725 

Community Number of full-time equivalent jobs 

Development created or maintained in 

Financial underserved communities by 

Institutions businesses financed by CDFI 

Program program awardees (Oe) 

22,329 35,022 29,539 Yes 76,000 44,000 85,000 

New Markets Tax Community Development Entities' 

Credit Program annual investments in low-income 

communities ($ billions) (Oe) 

2 2.5 3.3 Yes NA 2.5 2.5 

Native Initiatives Annual percentage increase in the 

total assets of Native CDFIs (%) 

(Oe) 

182 19 19 Yes NA 15 15 

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

Description of Performance 

 

Description of Performance: In In FY 2008, 

the CDFI Fund leveraged $621 million in 

private and non-CDFI Program dollars, 

which was less than the target of $750 

million. The shortfall was due to two 

reasons: (i) in FY 2008 there was a decrease 

in the amount of FA disbursements 

compared to that which was projected; and 

(ii) the calculated leverage ratio actually 

increased from $19:1, to $21:1. The 

leverage ratio will change over time simply 

because the size and composition of the 

group of CDFIs that provides leverage 

information changes every year. Different 

CDFIs have varying ability to raise equity 

and borrow against that equity, and will 

invest in widely different projects. 

In FY 2008, the CDFI Fund created or 

maintained 29,539 full-time equivalent jobs 

in underserved communities, a slight 

improvement over its goal of 28,676 jobs. 

Department of the Treasury - Budget in Brief FY 2010 Page 37
Department of the Treasury - Budget in Brief FY 2010 Page 38
Financial Crimes Enforcement Network 

Program Summary by Budget Activity 

(Dollars in thousands) 

FY 2008 FY 2009 FY 2010 Appropriation Enacted Enacted Request $ Change % Change

Salaries and Expenses $90,098 $91,465 $102,760 $11,295 12.3%

 BSA Administration and Analysis $76,889 $82,287 $93,444 $11,157 13.6%

 Regulatory Support Programs $8,955 $9,178 $9,316 $138 1.5%

Subtotal, Financial Crimes Enforcement Network $85,844 $91,465 $102,760 $11,295 12.3%

Offsetting Collections - Reimbursables $1,541 $6,000 $3,000 $-3,000 -50%

Total Program Operating Level $91,639 $97,465 $105,760 $8,295 8.5%

Explanation of Request 

 

The Financial Crimes Enforcement Network 

(FinCEN) FY 2010 President’s Budget request 

includes funding to strengthen its capability to 

safeguard the nation’s financial system from 

the abuses of financial crime, including 

terrorist financing, money laundering, and 

other illicit activity. Specifically, the funding 

request maintains current operating levels, and 

initiates modernization of Bank Secrecy Act 

(BSA) information management and analysis. 

Total resources required to support FinCEN 

activities for FY 2010 are $105,760,000 

including $3,000,000 from offsetting 

collections and reimbursable agreements. 

Purpose of Program 

 

The mission of FinCEN, a bureau within 

Treasury’s Office of Terrorism and Financial 

Intelligence, is to enhance U.S. national 

security, deter and detect criminal activity, and 

safeguard financial systems from abuse by 

promoting transparency in the U.S. and 

international financial systems. FinCEN 

fulfills its mission, goals and priorities by: 

administering the BSA; supporting law 

enforcement, intelligence, and regulatory 

agencies through sharing and analysis of 

financial intelligence; enhancing international 

anti-money laundering and counter-terrorist 

financing efforts and cooperation; and 

networking people, entities, ideas, and 

information. 

FinCEN FY 2010 Budget Highlights

(Dollars in thousands) 

Appropriation Amount

FY 2009 Enacted 91,465

Changes to Base: 

Maintaining Current Levels (MCLs): $1,295

Across the Board Program Reduction (453)

Non-Pay Inflation Adjustment 495

Pay Annualization 419

Pay Inflation Adjustment 834

Subtotal FY 2010 Changes to Base $1,295

Total FY 2010 Base 92,760

Program Changes: 

Program Increases: $10,000

Implement Information Technology 10,000

Modernization 

Subtotal FY 2010 Program Changes $10,000

Total FY 2010 President's Budget Request 102,760

FY 2010 Budget Adjustments 

 

FY 2009 Enacted 

The FY 2009 enacted direct appropriation for 

FinCEN is $91,465,000. 

Maintaining Current Levels (MCLs) 

Adjustments Necessary to Maintain 

Current Levels +$1,295,000 / +0 FTE Funds 

are requested for: Across the Board Program 

Reduction of $453,000; FY 2010 cost of the 

January 2009 pay increase of $419,000; 

proposed January 2010 pay raise of $834,000; 

and non-labor related items such as contracts, 

travel, supplies, equipment and GSA rent 

adjustments of $495,000. 

Department of the Treasury - Budget in Brief FY 2010 Page 39
Program Increases 

Implement Information Technology 

Modernization +$10,000,000 / +1 FTE The 

request supports a subset of efforts FinCEN 

has identified to modernize the BSA technical 

environment. This effort will begin to enrich 

and standardize BSA data to maximize value, 

integrate data with other state and federal 

sources, deploy advanced analytical and 

storage technologies, and establish more 

effective security and audit technologies to 

enhance data confidentiality and integrity. 

Explanation of Budget Activities 

 

Salaries and Expenses 

BSA Administration and Analysis 

($93,444,000 from direct appropriations 

and $3,000,000 from reimbursable 

programs) This activity comprises FinCEN’s 

efforts to administer the BSA, including 

promulgating regulations, providing outreach 

and issuing guidance to the regulated 

industries, providing oversight of BSA 

compliance, initiating enforcement actions, 

and, with the IRS, managing the information 

filed by the regulated industries, as well as 

analytic activities. Internationally, FinCEN 

promotes the development of anti-money 

laundering regimes through training and 

technical assistance. Analytical programs 

include support to U.S. law enforcement and 

international FIUs in combating financial 

crime by facilitating the exchange of 

investigative information; identifying foreign 

and domestic money laundering and terrorist 

financing trends, patterns, and techniques; and 

liaison with and support of intelligence 

initiatives within the intelligence community 

and within Treasury. This activity also 

incorporates efforts to support large-scale, 

complex law enforcement investigations 

involving terrorist financing, money 

laundering, and other financial crimes. 

Regulatory Support Programs ($9,316,000 

from direct appropriations) This activity 

supports implementation, strengthening and 

clarification of the programmatic (anti-money 

laundering, Customer Identification Program, 

and suspicious activity reporting), 

recordkeeping, and reporting requirements of 

the BSA for financial institutions subject to 

those requirements. FinCEN will continue 

efforts with the IRS, especially related to the 

money services business (MSB) industry to 

ensure compliance, respond to public 

inquiries, distribute forms and publications, 

and support collection and maintenance of 

BSA information. This may include 

enhancing the capability to correct identified 

data quality issues, enhance electronic filing, 

potentially explore overall forms design, and 

other related enhancements to the BSA 

collection and dissemination systems. These 

resources also fund IRS BSA compliance 

activities for non-bank financial institutions, 

especially related to the MSB industry. 

Legislative Proposals 

 

FinCEN does not have any legislative 

proposals for FY 2010. 

Department of the Treasury - Budget in Brief FY 2010 Page 40
FinCEN Performance by Budget Activity 

FY 2006 FY 2007 FY 2008 FY 2009 FY 2010

Budget Activity Performance Measure Actual Actual Actual Target 

Met? Target Target

BSA Percentage of customers satisfied with 

Administration and the BSA E-Filing (%) (Ot) 

Analysis 

92 94 93 Yes 90 90 

BSA Percentage of FinCEN's Regulatory 

Administration and Resource Center customers rating the 

Analysis guidance received as understandable 

(%) (Ot) 

94 91 94 Yes 90 90 

BSA The percentage of domestic law 

Administration and enforcement and foreign financial 

Analysis intelligence units finding FinCEN's 

analytical reports highly valuable (%) 

(Oe) 

77 82 83 Yes 80 80 

BSA Average time to process enforcement 

Administration and matters (in years) (E) 

Analysis 

1 1.1 0.7 Yes 1 1 

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

Satisfaction 

Description of Performance 

 

In the regulatory area, FinCEN’s goal to 

provide financial institutions with 

understandable guidance is critical to 

institutions establishing anti-money 

laundering programs that comply 

appropriately with the BSA. FinCEN’s FY 

2008 goal was to maintain a 90 percent 

satisfaction level and it surpassed the target 

with 94 percent of customers rating the 

guidance received as “understandable.” 

FinCEN also works closely with its 

regulatory partners to take enforcement 

action against financial institutions that 

systemically and egregiously violate the 

provisions of the BSA, including through 

imposition of civil money penalties when 

appropriate. Timely enforcement action is 

essential to deter non-compliance with the 

BSA. In FY 2008, FinCEN surpassed its 

target of an average time to process 

enforcement matters of 1.0 years with an 

average time of 0.7 years. 

In the analytical area, FinCEN supports 

domestic law enforcement and international 

Foreign Intelligence Unit (FIU) partners by 

both providing analyses of BSA 

information, and measuring the percentage 

of customers finding FinCEN’s analytical 

reports highly valuable. The measure 

closely ties to how BSA information is used 

by both law enforcement and international 

FIUs to identify, investigate, and prevent 

abuse of the financial system. In FY 2008, 

FinCEN surpassed its target of 79 percent 

with 83 percent of its customers finding the 

analytic products highly valuable. 

For the efficient management, safeguarding, 

and use of BSA information, FinCEN 

conducts a survey of the users of the BSA EFiling system to determine the overall 

satisfaction level and to identify where 

improvements are needed. The FY 2008 

target was to maintain at least a 90 percent 

satisfaction level, and FinCEN surpassed its 

target with 93 percent. 

Department of the Treasury - Budget in Brief FY 2010 Page 41
Department of the Treasury - Budget in Brief FY 2010 Page 42
Alcohol and Tobacco Tax and Trade Bureau 

Program Summary by Budget Activity 

(Dollars in thousands) 

FY 2008 FY 2009 FY 2010 Appropriation Enacted Enacted Request $ Change % Change

Salaries and Expenses $93,515 $99,065 $105,000 $5,935 6.0%

 Collect the Revenue $47,693 $50,523 $52,500 $1,977 3.9%

 Protect the Public $45,822 $48,542 $52,500 $3,958 8.2%

Subtotal, Alcohol and Tobacco Tax and Trade Bureau $93,515 $99,065 $105,000 $5,935 6.0%

Offsetting Collections - Reimbursables $3,755 $5,154 $4,234 ($920) (17.9%)

Total Program Operating Level $97,270 $104,219 $109,234 $5,015 4.6%

Note: The FY 2010 Budget Request includes $80 million in offsetting collections from fee revenues. To the extent that these allocations differ 

from the Budget, the reader should refer to the figures presented in this document. 

Explanation of Request 

 

In FY 2010, the Alcohol Tobacco Tax and 

Trade bureau (TTB) will continue to focus its 

efforts on helping industry members comply 

with alcohol, tobacco, firearms and 

ammunition laws and regulations, in the 

interest of collecting all appropriate excise 

taxes and promoting a marketplace for alcohol 

beverages that complies fully with federal 

production, labeling, advertising, and 

marketing standards. The FY 2010 President’s 

budget request enables TTB to continue its 

programs and activities necessary to meet the 

performance measures that support TTB’s 

strategic goals of collecting revenue and 

protecting the public. 

Total resources required to support TTB 

activities for FY 2010 are $109,234,000, and 

552 FTE, including $25,000,000 from direct 

appropriations and $84,234,000 in offsetting 

collections. The offsetting collections include 

$80,000,000 from annual fee receipts, and 

$4,234,000 from other offsetting collections 

and reimbursable programs. 

Purpose of Program 

 

TTB serves as the nation’s primary federal 

authority in the regulation of the alcohol and 

tobacco industries. TTB is responsible for the 

administration and enforcement of two major 

areas of federal law affecting those industries, 

namely: those sections of the Internal Revenue 

Code associated with the collection of excise 

taxes on alcohol, tobacco, firearms, and 

ammunition; and the Federal Alcohol 

Administration Act, which provides for the 

regulation of those engaged in the alcohol 

beverage industry and the protection of 

consumers of alcohol beverages. 

Collect the Revenue - TTB is charged with 

collecting alcohol, tobacco, firearms, and 

ammunition excise taxes. These products 

generate nearly $22 billion in tax revenue 

annually, making TTB the third largest tax 

collection agency in the federal government. 

Alcohol and tobacco taxes collected by TTB 

are remitted to the Department of the Treasury 

General Fund. Firearms and ammunition 

excise taxes are remitted to the Fish and 

Wildlife Restoration Fund under provisions of 

the Pittman-Robertson Act of 1937. 

 

The excise taxes collected by TTB come from 

taxes imposed and collected at the producer 

and importers level of operations. Members of 

the regulated industries paying excise taxes are 

distilleries, breweries, bonded wineries, 

bonded wine cellars, manufacturers of paper 

and tubes for tobacco products, manufacturers 

of tobacco products, and manufacturers and 

importer of firearms and ammunition. About 

200 of the largest taxpayers account for 98 

Department of the Treasury - Budget in Brief FY 2010 Page 43
percent of the annual excise tax collected. In 

FY 2008, the majority of taxes collected were 

from tobacco (49 percent) and alcohol (49 

percent), with the remainder from firearms and 

ammunition (2 percent). 

Strategies used to collect the revenue rightfully 

due are identifying any gaps in tax payment, 

identifying any illegal entities or individuals 

operating outside the excise tax system, 

developing a balanced field approach of audits 

and investigations that target non-compliant 

industry members, and establishing an 

identifiable presence within all of industry that 

encourages voluntary compliance. 

Protect the Public - TTB works to ensure the 

integrity of the alcohol and tobacco industries 

and of beverage alcohol products found in the 

marketplace, and regulates roughly 46,200 

alcohol and tobacco businesses. Under this 

activity, TTB enforces Federal laws related to 

the issuance of permits to industry members 

and the production, labeling, advertising, and 

marketing of alcohol products. TTB conducts 

these activities through investigations, 

application reviews, laboratory testing, and 

educational programs. TTB works with 

industry, foreign and state governments, and 

other interested parties to make it easier to 

comply with regulatory requirements and 

maintain the appropriate level of oversight to 

ensure public safety. Education, partnerships, 

and open communication are paramount 

strategies in facilitating compliance with 

regulatory requirements 

TTB FY 2010 Budget Highlights

(Dollars in thousands) 

Appropriation Amount

FY 2009 Enacted 99,065

Changes to Base: 

Base Realignment: $0

Base Realignment from Collect the (990)

Revenue 

Base Realignment to Protect the Public 990

Maintaining Current Levels (MCLs): 

Across the Board Program Reduction (1,556)

Pay Annualization 556

 Pay Inflation Adjustment 1,014 

Non-Pay Inflation Adjustment 421

Subtotal FY 2010 Changes to Base $435

Total FY 2010 Base 99,500

Program Changes: 

Program Increases: $5,500

Annual Licensing and Registration Fee 5,500

Program 

Subtotal FY 2010 Program Changes $5,500

Total FY 2010 President's Budget Request 105,000

 Annual Fees (80,000)

Total FY 2010 President's Budget Request 

(Net)

25,000

FY 2010 Budget Adjustments 

 

FY 2009 Enacted 

The FY 2009 enacted direct appropriation for 

TTB is $99,065,000. 

Base Realignment 

Base Realignment from Collect the 

Revenue -$990,000 / +0 FTE Realignment of 

funds from the Collect the Revenue budget 

activity 

Base Realignment to Protect the Public 

+$990,000 / +0 FTE Realignment from Collect 

the Revenue to Protect the Public. 

Maintaining Current Levels (MCLs) 

Adjustments Necessary to Maintain 

Current Levels +$435,000 / +0 FTE Funds 

are requested for: Across the Board Reduction 

of $1,556,000; FY 2010 cost of the January 

2009 pay increase of $556,000; proposed 

January 2010 pay raise of $1,014,000; nonlabor related items such as contracts, travel, 

supplies, equipment and GSA rent adjustments 

of $421,000 

Department of the Treasury - Budget in Brief FY 2010 Page 44
Program Increases 

Annual Licensing and Registration Fee 

Program +$5,500,000 / +12 FTE Funds are 

needed to implement the proposed legislation 

designed to establish a permanent program for 

FY 2010 and each fiscal year thereafter, 

requiring the payment of annual fees from 

alcohol industry members. The $5.5 million in 

program costs are principally recurring costs, 

and will cover labor and other program 

operating costs. This program will conduct 

key business activities including the mailing 

and processing of returns, issuance of non 

compliance letters, maintaining a client 

registry, responding to customer inquiries, 

along with processing of collections and 

accounting for the revenues. 

Adjustments to Request 

Special Receipts (Annual Fees) -

$80,000,000 / -410 FTE Special Receipts 

(Annual Fees) 

Explanation of Budget Activities 

 

Salaries and Expenses 

Collect the Revenue ($12,500,000 from 

direct appropriations, $40,000,000 from 

special fund receipts (annual fees), and 

$2,117,000 from reimbursable programs)

The FY 2010 President’s Budget request is 

$12,500,0002

 from direct appropriations, 

$40,000,000 from offsetting collections 

(annual fees) and $2,117,000 from 

reimbursable programs, for a total operating 

level of $54,617,000. The Collect the 

Revenue activity works toward providing the 

most effective and efficient systems for the 

collection of tax revenue, eliminating or 

preventing tax evasion and other criminal 

conduct, and providing high quality service 

while imposing the least regulatory burden on 

 

2

 The allocation of appropriated resources presented in 

the President’s Budget has been updated in this 

document. To the extent that these allocations differ 

from the Budget, the reader should refer to the figures 

presented in this document.

taxpayers. This program includes projects 

designed to allow taxpayers to report and pay 

excise taxes electronically. 

Protect the Public ($12,500,000 from direct 

appropriations, $40,000,000 from special 

fund receipts (annual fees), and $2,117,000 

from reimbursable programs) The FY 2010 

President’s Budget request is $12,500,000 

from direct appropriations, $40,000,000 from 

offsetting collections (annual fees) and 

$2,117,000 from reimbursable programs, for a 

total operating level of $54,617,000. The 

Protect the Public activity ensures the integrity 

of products and industry members in the 

marketplace, ensures compliance with laws 

and regulations by regulated industries, and 

provides information to the public as a means 

to prevent consumer deception. Under this 

activity, TTB enforces compliance with 

federal laws related to the issuance of permits 

to industry members and the production, 

importation, exportation, labeling, advertising, 

and marketing of alcohol products. TTB 

conducts investigations, application reviews, 

laboratory testing, and educational programs in 

support of its mission. 

Legislative Proposals 

 

Extend Pay Demonstration Program for one 

additional year: TTB proposes to continue the 

Pay Demonstration Program by amending the 

General Provision language to extend the 

program for one additional year.

Annual Licensing and Registration Fee 

Program: Legislation will be proposed to 

allow TTB to establish a permanent program 

for FY 2010 and for future fiscal years 

requiring the payment of annual fees from its 

industry members. In the first year, the annual 

estimated offsetting fee collections will be 

less, but it is anticipated that the annual 

collections from this program will reach $105 

million each year thereafter. In general, these 

fees will support the Bureau’s core mission 

Department of the Treasury - Budget in Brief FY 2010 Page 45
and the funds will be used to continue to 

provide benefits to retailers, wholesalers, 

breweries, wineries, distilleries, and industrial 

alcohol businesses. In particular, TTB’s 

efforts help ensure that alcohol products are 

not contaminated, misbranded, illegally 

marketed, and prevent dishonest persons from 

entering into the alcohol distribution system. 

This promotes fair competition among all 

industry members. Regulation of these 

industries also protects the public against 

adulterated alcohol products, and misleading 

labels and advertisements. 

TTB Performance by Budget Activity 

FY 2006 FY 2007 FY 2008 FY 2009 FY 2010

Budget Activity Performance Measure Actual Actual Actual Target 

Met? Target Target

Collect the Revenue Amount of revenue collected per program 

dollar (E) 

N/A N/A 313 Yes 300 260 

Collect the Revenue Percentage of Voluntary Compliance from 

large tax payers in filing tax payments 

timely and accurately (in terms of 

revenue) (Oe) 

N/A N/A 94 Yes 92 92 

Protect the Public Percent of electronically filed Certificate of 

Label Approval applications (%) (E) 

38 51 62 Yes 53 54 

Protect the Public National Revenue Center (NRC) 

customer satisfaction results (Oe) 

N/A N/A 90 Yes 85 85 

Protect the Public Average number of days to process an 

original permit application at the National 

Revenue Center (E) 

N/A N/A 64 Yes 72 78 

Protect the Public Percentage of importers identified by TTB 

as illegally operating without a Federal 

permit (%) 

N/A N/A 22 N/A 20 19 

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

 

Description of Performance 

 

The Bureau continues to collect the federal 

excise taxes in a highly efficient manner, 

and continues to help industry members 

comply with alcohol and tobacco laws and 

regulations. During FY 2008, TTB met all 

of its performance goals, while showing 

continued improvements in performance 

scores. The Bureau plans to continue to 

monitor its performance, and will continue 

to capture performance information on 

program operations to both measure and 

improve the effectiveness of its operation. 

The investments in the Collect the Revenue 

Activity resulted in the following 

performance highlights and 

accomplishments during 

FY 2008: 

• Collected $14.6 billion in excise taxes, 

interest, and other revenues from 

alcohol, tobacco, firearms, and 

ammunition industries from 8,500 excise 

taxpayers holding permits. 

• Expanded the e-filing program to allow 

all excise taxpayers to file and pay taxes, 

and file monthly operational reports, 

electronically through the Pay.Gov 

system. The number of Pay.gov 

registrants is over 3,600. 

• Processed $373 million in cover-over 

payments to Puerto Rico and $8 million 

to the Virgin Islands. Federal excise 

taxes collected on rum produced in 

Department of the Treasury - Budget in Brief FY 2010 Page 46
Puerto Rico and the Virgin Islands that 

are subsequently imported into the 

United States are “covered-over” (or 

paid into) the treasuries of Puerto Rico 

and the Virgin Islands. 

• Processed $283 million in drawback 

claims. Under current law, persons who 

use non-beverage alcohol in the 

manufacture of medicines, food 

products, flavors, extracts, or perfume 

and other non-potable products may be 

eligible to claim drawback of excise 

taxes paid on distilled spirits used in 

their products. The TTB laboratory 

analyzes and approves a product formula 

before a company can manufacture a 

product and file a claim. 

The investments in Protect the Public 

Activity have resulted in the following 

performance highlights and 

accomplishments during 

FY 2008: 

• Processed 133,427 Certificate of Label 

Approval (COLAs) applications through 

the bureau’s COLAs Online system for 

electronic filing of label applications. 

The number of electronic filed 

applications increased from the prior 

year from fifty one percent to sixty two 

percent. The Federal Alcohol 

Administration Act requires importers 

and bottlers of alcoholic beverages to 

obtain a COLA prior to introduction of 

the product into commerce. 

• Issued 4,600 original permits and 

approved 21,400 amended permits and 

related correspondence. TTB issues 

original and amended permits to persons 

who are engaged in the alcohol and 

tobacco industries. Illicit activity in 

these industries has the potential to be 

highly lucrative so it is crucial that 

organized crime and terrorists are kept 

out of these industries. 

• Conducted more than 900 field 

application investigations of industry 

members regarding applications, 

consumer complaints, tax fraud, trade 

practice violations, and product and 

labeling integrity verifications. 

Department of the Treasury - Budget in Brief FY 2010 Page 47
Department of the Treasury - Budget in Brief FY 2010 Page 48
Financial Management Service 

Program Summary by Budget Activity 

(Dollars in thousands) 

FY 2008 FY 2009 FY 2010 Appropriation Enacted Enacted Request $ Change % Change

Salaries and Expenses $298,598 $239,785 $244,132 $4,347 1.8%

 Payments $210,152 $147,717 $150,395 $2,678 1.8%

 Collections $19,804 $21,521 $21,911 $390 1.8%

 Government-wide Accounting and Reporting $68,642 $70,547 $71,826 $1,279 1.8%

Subtotal, Financial Management Service $298,598 $239,785 $244,132 $4,347 1.8%

Offsetting Collections - Reimbursables $215,179 $228,010 $234,690 $6,680 2.9%

Total Program Operating Level $513,777 $467,795 $478,822 $11,022 2.4%

Note: The FY 2008 Enacted Column includes $64.2 Million in Economic Stimulus Funds.

Explanation of Request 

 

The Financial Management Service (FMS) FY 

2010 President’s Budget request focuses on 

continued implementation of modernization 

initiatives in FMS’ payments, collections, debt 

collection, and government-wide accounting 

functions. One such initiative is the Financial 

Information Reporting Standardization 

(FIRST) which will enhance and improve 

operations by improving accuracy and 

integrating budgetary and government-wide 

accounting with proprietary information. 

Another initiative is the Collections and Cash 

Management Modernization (CCMM) 

program which is streamlining, modernizing 

and improving the process of Treasury’s 

collections and cash management programs. 

Total resources required to support FMS 

activities for FY 2010 are $478,822,000, 

including $244,132,000 from direct 

appropriations, and $234,690,000 from 

offsetting collections and reimbursable 

programs. 

Purpose of Program 

 

The Financial Management Service (FMS) 

plays a key role in supporting the Department 

of the Treasury’s strategic goal of managing 

the United States Government’s finances 

effectively by operating as the financial 

manager and principal fiscal agent for the 

Federal Government. This role includes 

managing the nation’s finances by collecting 

money due to the United States, disbursing its 

payments, and performing central accounting 

functions. 

As the Government’s financial manager, FMS 

oversees a daily cash flow in excess of 

$60 billion, disbursing 85 percent of the 

Federal Government’s payments. These 

payments include income tax refunds, Social 

Security benefits, veterans’ benefits and other 

Federal payments to individuals and 

businesses. FMS also administers the world’s 

largest collection system, collecting over $3.1 

trillion in FY 2008. FMS provides cash 

management guidance to Federal Program 

Agencies (FPAs), maintains the Government’s 

accounting books, and compiles and publishes 

government-wide financial information used to 

monitor the Government’s financial status. 

Finally, FMS serves as the Government’s 

central debt collection agency for delinquent 

non-tax debt. 

Department of the Treasury - Budget in Brief FY 2010 Page 49
FMS FY 2010 Budget Highlights

(Dollars in thousands) 

Appropriation Amount

FY 2009 Enacted 239,785

Changes to Base: 

Maintaining Current Levels (MCLs): $4,347

Across the Board Program Reduction (1,174)

Pay Annualization 1,558

Pay Inflation Adjustment 3,155

Non-Pay Inflation Adjustment 808

Subtotal FY 2010 Changes to Base $4,347

Total FY 2010 Base 244,132

Total FY 2010 President's Budget Request 244,132

FY 2010 Budget Adjustments 

 

FY 2009 Enacted 

The FY 2009 enacted direct appropriation 

for FMS is $239,785,000. 

Maintaining Current Levels (MCLs) 

Adjustments Necessary to Maintain 

Current Levels +$4,347,000 / +0 FTE

Funds are requested for: Across the Board 

Program Reduction of $1,174,000; FY 2010 

cost of the January 2009 pay increase of 

$1,558,000; proposed January 2010 pay 

raise of $3,155,000; and non-labor related 

items such as contracts, travel, supplies, 

equipment and GSA rent adjustments of 

$808,000. 

Explanation of Budget Activities 

 

Salaries and Expenses 

Payments ($150,395,000 from direct 

appropriations and $137,057,000 from 

reimbursable programs) FMS issues and 

distributes payments, develops and 

implements Federal payment policy and 

procedures, promotes the use of electronics 

in the payment process, and assists agencies 

in converting payments from paper checks 

to Electronic Funds Transfer (EFT). This 

activity also includes controlling and 

providing financial integrity to the payments 

process through reconciliation, accounting, 

and claims activities. Included in this 

activity is the claims activity which settles 

claims against the United States. These 

claims result from Federal Government 

checks that have been forged, lost, stolen, or 

destroyed. FMS collects monies from those 

parties liable for fraudulent or otherwise 

improper negotiation of Government checks. 

It also includes processing claims and 

reclamations for EFT payments. 

Collections ($21,911,000 from direct 

appropriations and $113,000 from 

reimbursable programs) FMS collects 

revenues needed to operate the Federal 

Government through the management of the 

Federal Government’s collections 

infrastructure. FMS collected a record of 

$3.2 trillion in FY 2008 through a network 

of more than 9,000 financial institutions. It 

also manages the collection of Federal 

revenues such as individual and corporate 

income tax deposits, customs duties, loan 

repayments, and fines and proceeds from 

leases. 

Debt Collection ($93,397,000 from 

reimbursable programs) The Debt 

Collection activity collects delinquent 

Government and child support debt by 

providing centralized debt collection, 

oversight, and operational services to FPAs 

and states as required by the Debt Collection 

Improvement Act (DCIA) of 1996 and 

related legislation. The services include, but 

are not limited to, collecting delinquent 

debts through Cross-Servicing and offsetting 

Federal payments, providing a database for 

use as a tool for barring delinquent debtors, 

providing post-judgment collection, advising 

and educating agencies towards improving 

debt management, and referrals to the 

Department of Justice. 

Government-wide Accounting and 

Reporting ($71,826,000 from direct 

appropriations and $4,123,000 from 

reimbursable programs) The Governmentwide Accounting and Reporting activity 

Department of the Treasury - Budget in Brief FY 2010 Page 50
maintains the Federal Government’s books 

and accounts for its monetary assets and 

liabilities by operating and overseeing the 

Government’s central accounting and 

reporting system. It also works with Federal 

agencies to adopt uniform accounting and 

reporting standards and systems and 

provides support, guidance, and training to 

assist FPAs in improving their governmentwide accounting and reporting 

responsibilities. FMS gathers and publishes 

government-wide financial information 

which is used in establishing fiscal and debt 

management policies and is also used by the 

public and private sectors to monitor the 

Government’s financial status. These 

publications include: the Daily Treasury 

Statement, the Monthly Treasury Statement, 

the Treasury Bulletin, the Combined 

Statement of the United States Government, 

and the Financial Report of the United 

States Government (FR). 

Legislative Proposals 

 

Authorize Post-Levy Due Process for 

Levies Under the Federal Payment Levy 

Program 

This proposal would further expand the 

exception to the requirement for pre-levy 

collection due process (CDP) hearing 

proceedings. This would include levies 

issued to collect Federal tax liabilities from 

Federal vendor payments under the Federal 

Payment Levy Program. The proposal will 

allow IRS to levy the payment at the time 

the payment is identified. Debtors will have 

an opportunity for a CDP hearing within a 

reasonable period after the levy. This 

proposal is estimated to result in an 

additional $1.2 billion in collections over ten 

years. 

Technical Correction to Allow IRS to 

Levy 100 Percent of All Vendor 

Payments to Collect Delinquent Taxes 

The current language, which was intended to 

cover all Federal vendor payments, refers to 

payments for "goods and services." This 

has been interpreted to exclude payments for 

the purchase or lease of real estate. 

Therefore, a technical correction is proposed 

to ensure that all Federal vendor payments 

are covered. This proposal is estimated to 

result in an additional $845 million in 

collections over ten years. 

FMS Performance by Budget Activity 

FY 2006 FY 2007 FY 2008 FY 2009 FY 2010

Budget Activity Performance Measure Actual Actual Actual Target 

Met? Target Target

Payments Percentage of Treasury payments and 

associated information made 

electronically (%) (Oe) 

77.00 78.00 79.00 Yes 80.00 81.00 

Collections Percentage collected electronically of 

total dollar amount of Federal 

government receipts (%) (Oe) 

79.00 79.00 80.00 Yes 80.00 80.00 

Debt Collection Amount of delinquent debt collected 

through all available tools ($ billions) 

(Ot) 

3.34 3.76 4.41 Yes 3.90 3.70 

Government wide Percentage of Government-wide 

Accounting and accounting reports issued accurately 

Reporting (%) (Oe) 

100 100 100 Yes 100 100 

Government wide Percentage of Government-wide 

Accounting and accounting reports issued timely (%) 

Reporting (E) 

100 100 100 Yes 100 100 

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

Satisfaction 

Department of the Treasury - Budget in Brief FY 2010 Page 51
Description of Performance 

 

Payments: In FY 2008, FMS issued 

nearly 1 billion non-Defense payments 

worth $1.8 trillion to a wide variety of 

recipients, such as those who receive 

Social Security benefits, IRS tax 

refunds, and veterans’ benefits. Seventynine percent of all payments disbursed 

were issued via direct deposit. In 

addition, FMS issued an additional 119 

million Economic Stimulus Payments 

valued at over $96 billion. Over 36 

percent of the Economic Stimulus 

Payments were issued by direct deposit. 

In FY 2010, FMS will continue to 

expand the use of electronic media to 

deliver Federal payments. Electronic 

media provides a safer, more secure and 

reliable method of payment for 

recipients. It also decreases the number 

of paper checks issued, which minimizes 

costs and inefficiencies associated with 

the delivery of non-electronic benefits. 

Collections: In FY 2008, FMS collected 

a record $3.2 trillion of which 80 percent 

was collected electronically through a 

network of more than 9,000 financial 

institutions. Dollar revenues collected in 

FY 2008 exceeded those collected in FY 

2007. FMS is in the process of 

developing a comprehensive effort to 

streamline, modernize, and improve the 

processes and systems supporting 

Treasury’s collections and cash 

management program. This effort, 

Collections and Cash Management 

Modernization (CCMM), will improve 

financial performance by enabling FMS 

and government agencies to more 

effectively manage financial transaction 

information and improve the efficiency 

of the collections information reporting 

processes. 

Debt Collection: In FY 2008, FMS 

collected a record $5.9 billion in 

delinquent debt which includes $1.5 

billion in Economic Stimulus payment 

offsets. As a result of FMS’ program 

improvements, total collections since the 

enactment of the DCIA in 1996 are over 

$37.4 billion through FY 2008. FMS 

will continue to roll out Debt Check, an 

online program used to help agencies bar 

delinquent debtors from obtaining new 

loans or loan guarantees 

Government-wide Accounting and 

Reporting: For FY 2008, FMS released 

the Financial Report of the United States 

Government (FR) 75 days after the fiscal 

year-end. The FR presents a picture of 

government-wide finances that 

complements the traditional Federal 

Government budget information. 

Additionally, FMS issued 100 percent of 

its government-wide accounting reports 

accurately and timely. FMS will 

continue to revamp and implement 

government-wide accounting processes 

to provide more useful and reliable 

financial information on a regular basis. 

FMS will continue moving forward on 

the Financial Information and Reporting 

Standardization (FIRST) initiative. This 

initiative integrates budget and financial 

reports from FPAs. FIRST will 

improve the consistency of the 

budgetary and proprietary accounting 

data recorded in agency financial 

statements and reported to FMS through 

its trial balance. 

Department of the Treasury - Budget in Brief FY 2010 Page 52
Bureau of the Public Debt 

Program Summary by Budget Activity 

(Dollars in thousands) 

FY 2008 FY 2009 FY 2010 Appropriation Enacted Enacted Request $ Change % Change

Administering the Public Debt $182,871 $187,352 $192,244 $4,892 2.6%

 Wholesale Securities Services $23,828 $23,438 $24,492 $1,054 4.5%

 Government Agency Investment Services $15,745 $17,723 $16,264 ($1,459) (8.2%)

 Retail Securities Services $135,690 $139,109 $142,645 $3,536 2.5%

 Summary Debt Accounting $7,608 $7,082 $8,843 $1,761 24.9%

Subtotal, Bureau of the Public Debt $182,871 $187,352 $192,244 $4,892 2.6%

Offsetting Collections - Reimbursables $15,294 $21,196 $21,832 $636 3.0%

Total Program Operating Level $198,165 $208,548 $214,076 $5,528 2.6%

Note: The FY 2010 Budget Request includes $10 Million in projected user fee collections. 

Explanation of Request 

 

The FY 2010 President’s Budget request for 

the Bureau of the Public Debt (BPD) includes 

funding to support the Department of the 

Treasury’s strategic outcome of financing the 

government at the lowest possible cost over 

time. Public Debt’s top priority is to ensure 

that the most efficient systems are in place to 

conduct borrowing operations and deliver 

securities services to investors. 

Total resources to support Public Debt 

activities in FY 2010 are $214,076,000, 

including $192,244,000 from direct 

appropriations, of which $10,000,000 are user 

fees, and $21,832,000 from offsetting 

collections. 

Purpose of Program 

 

BPD’s mission is to borrow the money needed 

to operate the federal government, account for 

the resulting debt, and provide reimbursable 

support services to federal agencies. In 

carrying out its mission and vision, Public 

Debt annually auctions and issues more than 

$4 trillion in Treasury bills, notes, bonds and 

Treasury Inflation-Protected Securities (TIPS); 

effectively administers the regulations that 

govern the primary and secondary Treasury 

securities markets; ensures reliable systems 

and processes are in place for issuing, 

transferring, paying interest on and redeeming 

Treasury securities; issues and redeems more 

than 70 million paper savings bonds each year; 

administers in excess of $4 trillion in 

investments for more than 240 federal trust 

funds; and provides timely and accurate 

information on the public debt. 

In support of Treasury’s strategic outcome of 

financing the government at the lowest 

possible cost over time, Public Debt’s top 

priority is to ensure the most efficient systems 

are in place to conduct borrowing operations 

and deliver securities services to investors. To 

this end, in FY 2008, Public Debt introduced 

an enhanced auction system. The new 

Treasury Automated Auction Processing 

System (TAAPS) provides improved bidentry, more timely and easier access to data, 

and greater reliability and security. The 

bureau also continues to enhance its 

TreasuryDirect system where retail customers 

can purchase and manage their holdings of 

Treasury securities online. 

Department of the Treasury - Budget in Brief FY 2010 Page 53
BPD FY 2010 Budget Highlights

(Dollars in thousands) 

Appropriation Amount

FY 2009 Enacted $187,352

Changes to Base: 

Maintaining Current Levels (MCLs): $4,892

GAO Audit 1,500

Across the Board program reduction (944)

Pay Annualization 1,135

Pay Inflation Adjustment 2,495

 Non-Pay Inflation Adjustment 706

Subtotal FY 2010 Changes to Base $4,892

Total FY 2010 Base $192,244

Program Changes: 

Program Decreases: ($1,734)

Government Agency Investment Services (1,734)

System (GAISS) Savings 

Program Reinvestment: $1,734

Hot-site Disk Storage Replacement 498

Intrusion Detection and Security 338

Infrastructure Refresh and Update 

Mainframe Software Upgrade 598

Trusted Internet Connection Initiative 300

Subtotal FY 2010 Program Changes $0

Total FY 2010 President's Budget Request $192,244

User Fees (10,000)

Total FY 2010 President's Budget Request 

(Net)

 $182,244

FY 2010 Budget Adjustments 

 

FY 2009 Enacted 

The FY 2009 enacted direct appropriation for 

BPD is $187,352,000. 

Maintaining Current Levels (MCLs) 

Adjustments Necessary to Maintain 

Current Levels +$4,892,000 / +0 FTE Funds 

are requested for: GAO audit reimbursement 

of $1,500,000; Across the Board program 

reduction -944,000: FY 2010 cost of the 

January 2009 pay increase of $1,135,000; 

proposed January 2010 pay raise of 

$2,495,000; and (4) non-labor related items 

such as contracts, travel, supplies, equipment 

and GSA rent adjustments of $706,000. 

Program Decreases 

Government Agency Investment Services 

System (GAISS) Savings -$1,734,000 / +0 

FTE Due to the completion of the final phase 

of the development, modernization and 

enhancement (DME) project, Public Debt will 

realize $1,734,000 in savings for GAISS. 

Program Reinvestment 

Hot-site Disk Storage Replacement 

+$498,000 / +0 FTE Public Debt expects disk 

storage at the Kansas City disaster recovery 

hot-site to exceed its current service life and 

capacity. New disk storage will ensure 

continued disaster recovery capabilities for 

systems that support Public Debt’s mission 

essential functions. 

Intrusion Detection and Security 

Infrastructure Refresh +$338,000 / +0 FTE

Aging technology requires Public Debt to 

upgrade the majority of its Intrusion Detection 

and Security Event Management Infrastructure 

in FY 2010. The refresh will ensure continued 

availability and heightened security awareness 

of customer systems, including GAISS, 

TreasuryDirect and Public Debt’s website 

TreasuryDirect.gov. 

Mainframe Software Upgrade +$598,000 / 

+0 FTE An increase in BPD’s mainframe 

processing capacity is required. As the 

number of transactions processed by the 

mainframe increases, so do operating software 

costs. This upgrade will allow BPD to meet 

current and future capacity needs. 

Trusted Internet Connection Initiative 

+$300,000 / +0 FTE All BPD internet and 

external connectivity must traverse a Trusted 

Internet Connection Access Provider (TICAP). 

Public Debt will procure security devices and 

support in order to fully meet this objective. 

Adjustments to Request 

User Fees -$10,000,000 / +0 FTE Public Debt 

charges Legacy Treasury Direct system 

account holders a $100 account maintenance 

fee on accounts with a balance of more than 

$100,000 in par value.

Department of the Treasury - Budget in Brief FY 2010 Page 54
Explanation of Budget Activities 

 

Administering the Public Debt 

 

Wholesale Securities Services ($24,492,000 

from direct appropriations and $2,781,000 

from reimbursable programs) Public Debt 

announces, auctions and issues marketable 

Treasury bills, notes, bonds and Treasury 

Inflation-Protected Securities (TIPS). This 

program ensures that the government’s critical 

financing needs are met and that an efficient 

infrastructure is in place for the transfer, 

custody and redemption of Treasury securities 

in the wholesale market. Public Debt also 

administers Treasury's regulations that provide 

investor protection and maintain the integrity, 

liquidity and efficiency in the government 

securities market.

Government Agency Investment Services 

($16,264,000 from direct appropriations 

and $1,847,000 from reimbursable 

programs) Public Debt supports federal, state 

and local government agency investments in 

non-marketable Treasury securities as well as 

federal agency borrowing from the 

Department of the Treasury. There are more 

than 240 trust and investment funds held by 

federal agencies. For 18 of the funds, Public 

Debt also maintains the investment accounts 

and performs additional administrative 

functions on behalf of the Secretary of the 

Treasury. 

Retail Securities Services ($142,645,000 

from direct appropriations and $16,200,000 

from reimbursable programs) Public Debt 

serves more than 50 million retail customers 

who have invested in marketable and savings 

securities directly with Treasury. Investors 

may hold these securities in book-entry or 

paper form. BPD will position Treasury to 

eliminate new issues of paper savings bonds. 

The program will also focus on improving the 

quality and efficiency of customer service by 

implementing the first phases of the new 

Treasury Retail E-Services customer service 

environment.

Summary Debt Accounting ($8,843,000 

from direct appropriations and $1,004,000 

from reimbursable programs) This program 

is key to meeting Public Debt's responsibility 

to account for the public debt and related 

annual interest expenses. Public Debt 

produces daily reports on the balance and 

composition of the public debt and also 

provides the overarching control structure for 

numerous subsidiary securities systems and 

their related transactions and cash flows. 

Legislative Proposals 

 

Public Debt has no legislative proposals for 

FY 2010. 

Department of the Treasury - Budget in Brief FY 2010 Page 55
BPD Performance by Budget Activity 

FY 2006 FY 2007 FY 2008 FY 2009 FY 2010

Budget Activity Performance Measure Actual Actual Actual Target 

Met? Target Target

Wholesale Securities Percent of auction results released in two 

Services minutes +/- 30 seconds (%) (Oe) 

100 99.10 100 Yes 95 95 

Government Agency Cost per federal funds investment 

Investment Services transaction ($) (E) 

62.64 68.53 64.98 Yes 69.11 54.69 

Government Agency Number of Government Agency Investment 

Investment Services Services control processes consolidated 

(Oe) 

N/A 3 2 Yes 0 5 

Retail Securities Percentage of retail customer service 

Services transactions completed within 5 business 

days (%) (Ot) 

N/A N/A N/A N/A Baseline TBD 

Summary Debt Cost per summary debt accounting 

Accounting transaction ($) (E) 

10.96 9.29 9.11 Yes 10.01 12.28 

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

Description of Performance 

 

The Bureau of the Public Debt has 

continued to set challenging performance 

goals with positive results. To improve 

performance, Public Debt places a high 

priority on adopting new technology to 

increase the security, flexibility and 

efficiency of financing the needs of the 

federal government.

In FY 2008, Public Debt released auction 

results within two minutes, plus or minus 30 

seconds, 100 percent of the time, surpassing 

its performance target of 95 percent. In 

addition, Public Debt processed over 99 

percent of retail customer transactions 

within 11 business days and met its targeted 

costs for summary debt accounting and 

federal funds investment transactions. 

Department of the Treasury - Budget in Brief FY 2010 Page 56
Internal Revenue Service 

Appropriation / Budget Activity FY 2008 FY 2009 FY 2010

Enacted1 ARRA Enacted2 Request $ Change % Change

Taxpayer Services $2,191,085 $2,293,000 $2,269,830 ($23,170) -1.01%

 Pre-filing Taxpayer Assistance and Education 645,253 661,000 676,063 15,063 2.28%

 Filing and Account Services 1,545,832 1,632,000 1,593,767 (38,233) -2.34%

Enforcement 4,780,000 5,117,267 5,504,000 386,733 7.56%

 Investigations 592,906 603,466 637,694 34,228 5.67%

 Exam and Collections 4,037,812 4,363,826 4,706,350 342,524 7.85%

 Regulatory 149,282 149,975 159,956 9,981 6.66%

Operations Support 3,841,109 3,867,011 4,082,984 215,973 5.59%

 Infrastructure 826,313 883,325 900,852 17,527 1.98%

 Shared Services and Support 1,291,296 1,254,542 1,296,629 42,087 3.35%

 Information Services 1,723,500 1,729,144 1,885,503 156,359 9.04%

Business Systems Modernization 267,090 229,914 253,674 23,760 10.33%

Health Insurance Tax Credit Administration 15,235 80,000 15,406 15,512 106 0.69%

Subtotal, Internal Revenue Service $11,094,519 $80,000 $11,522,598 $12,126,000 $603,402 5.24%

Offsetting Collections - Reimbusable 140,207 143,611 147,101 3,490 2.43%

Mandatory Appropriation - User Fees 246,946 175,700 167,700 (8,000) -4.55%

Total Program Operating Level $11,481,672 $80,000 $11,841,909 $12,440,801 $598,892 5.06% 1 The FY 2008 Enacted Budget reflects the FY 2008 Operating Plan which includes a transfer of $9.6M between Taxpayer Services and Operations Support and includes 

supplemental funding for Economic Stimulus payment of $202.1M.

2 The FY 2009 Enacted column excludes the Recovery Act, Administrative Expenses account, funded in the Treasury Departmental Offices ($123M).

Explanation of Request

The Internal Revenue Service (IRS) collects 

the revenue that funds the government and 

administers the nation’s tax laws. The IRS 

collected $2.7 trillion in FY 2008, 96 percent 

of total federal receipts. In order to protect 

the flow of revenues to the government, the 

IRS pursues a robust service and enforcement 

agenda. The service agenda is designed to 

support and protect the trillions in revenue 

from hundreds of millions of taxpayers that 

already come into the Treasury every year. 

The enforcement agenda is designed to 

vigorously pursue those who evade their 

responsibility to pay the taxes they owe. 

Total resources to support the IRS activities 

for FY 2010 are $12,440,801,000. This 

includes $12,126,000,000 from direct 

appropriation, an estimated $147,101,000 

from reimbursable programs, and an estimated 

$167,700,000 from user fees. The direct 

appropriation is a $603,402,000 increase, or 

an increase of 5.2 percent, over the FY 2009 

enacted level of $11,522,598,000 (excludes 

funding to implement the American Recovery 

and Reinvestment Act (ARRA) of 2009 

(Public Law 111-5)). 

The IRS Strategic Plan 2009-2013 guides 

program and budget decisions and supports 

the Department of the Treasury Strategic Plan. 

The IRS Strategic Plan recognizes the 

increasing complexity of tax laws, changing 

business models, expanding use of electronic 

data and related security risks, accelerating 

growth in international tax activities, and 

growing human capital challenges. 

The IRS strategic plan goals and objectives 

are: 

Goal 1 Improve Service to Make 

Voluntary Compliance Easier 

Goal 2 Enforce the Law to Ensure 

Everyone Meets Their Obligation 

to Pay Taxes 

Department of the Treasury - Budget in Brief FY 2010 Page 57
To improve service and make voluntary 

compliance easier, the IRS must: 

• Incorporate taxpayer perspectives to 

improve all service interactions; 

• Expedite and improve issue resolution 

across all interactions with taxpayers, 

making it easier to navigate IRS; 

• Provide taxpayers with targeted, timely 

guidance and outreach; and 

• Strengthen partnerships with tax 

practitioners, preparers, and other third 

parties to ensure effective tax 

administration. 

To enforce the law to ensure everyone meets 

their obligation to pay taxes, the IRS must: 

• Proactively enforce the law in a timely 

manner while respecting taxpayer rights 

and minimizing taxpayer burden; 

• Expand enforcement approaches and tools; 

• Meet the challenges of international tax 

administration; 

• Allocate compliance resources using a 

data-driven approach to target existing and 

emerging high-risk areas; 

• Continue focused oversight of the taxexempt sector; and 

• Ensure that all tax practitioners, tax 

preparers, and other third parties in the tax 

system adhere to professional standards 

and follow the law. 

To achieve the service and enforcement goals, 

the IRS must: 

• Make the IRS the best place to work in 

government; 

• Build and deploy advanced information 

technology systems, processes, and tools 

to improve IRS efficiency and 

productivity; 

• Use data and research across the 

organization to make informed decisions 

and allocate resources; and 

• Ensure the privacy and security of data 

and safety and security of employees. 

The FY 2010 President’s Budget Request for 

IRS provides the funding needed to implement 

key strategic priorities. 

Enforcement Program: The FY 2010 

President’s Budget request includes program 

increases of $332.2 million for investments in 

strong compliance programs, including a 

robust portfolio of international enforcement 

initiatives. The Budget request includes 

additional resources for enhanced tax 

enforcement through a program integrity 

allocation adjustment.

 

Increased resources for the IRS compliance 

programs yield direct measurable results 

through high return-on-investment activities. 

The new enforcement personnel funded in the 

FY 2010 President’s Budget will generate 

$2.0 billion in additional annual enforcement 

revenue once the new hires reach full potential 

in FY 2012. This estimate does not account 

for the deterrent effect of IRS enforcement 

programs, which are conservatively estimated 

to be at least three times larger than the direct 

revenue impact. 

The tax law is complex, and even 

sophisticated taxpayers make honest mistakes 

on their tax returns. Accordingly, helping 

taxpayers understand their obligations under 

the tax law is a critical to improving 

compliance. To this end, the IRS remains 

committed to a balanced program of assisting 

taxpayers in both understanding the tax law 

and remitting the proper amount of tax. 

Taxpayer Service Program: The FY 2010 

President’s Budget request continues 

improvements to both the quality and 

efficiency of taxpayer service, using a variety 

of person-to-person, telephone, and web-based 

methods to help people understand their tax 

obligations and pay their taxes. The IRS 

taxpayer service program is funded in the 

Department of the Treasury - Budget in Brief FY 2010 Page 58
Taxpayer Services and Operations Support 

appropriations. 

Providing quality taxpayer service is 

fundamental to keeping honest taxpayers in 

the system. It also helps them avoid making 

unintentional errors before returns are filed, 

which in turn reduces the need for follow up 

correspondence from the IRS. The IRS 

provides year-round assistance to millions of 

taxpayers, including outreach and education 

programs, issuance of tax forms and 

publications, rulings and regulations, tollfree call centers, the IRS.gov web site, 

Taxpayer Assistance Centers (TACs), 

Volunteer Income Tax Assistance (VITA) 

sites, and Tax Counseling for the Elderly 

(TCE) sites. 

 

American Recovery and Reinvestment 

Act: ARRA includes a number of tax 

provisions for which IRS implementation is 

now underway, including among others: 

individual tax credits; tax incentives for 

business; bond incentives along with tax 

exempt and tax-favored bonds for economic 

recovery; and a tax credit to provide 

discounted health benefits to certain workers 

who have lost their jobs. IRS will be able to 

continue to implement and administer these 

critical tax programs within the levels 

contained in this Budget request.

Purpose of Program 

The IRS serves individuals, businesses, and 

non-profit organizations, and processes over 

249 million tax returns annually. Our 

system of voluntary tax compliance requires 

the IRS to excel at taxpayer service for those 

who are trying to meet their obligations 

under the law and enforcement programs for 

those who shirk their responsibilities to their 

fellow citizens. Most taxpayers comply 

with the law by filing returns and paying 

their taxes on time, but some do not comply 

either because they do not understand their 

obligations under our complex tax laws, or 

because they seek to avoid those obligations. 

The FY 2010 President’s Budget request 

seeks funding to improve the responsiveness 

of taxpayer service, to support a robust 

portfolio of international tax and other 

compliance initiatives, and to address 

critical information technology 

infrastructure needs to allow the IRS to 

adapt to the complex and constantly 

changing environment in which the IRS 

operates. 

Department of the Treasury - Budget in Brief FY 2010 Page 59
IRS FY 2010 Budget Highlights

(Dollars in thousands)

Health Insurance Operations Business Systems Appropriation Taxpayer Services Enforcement Tax Credit Total Support Modernization Administration

FY 2009 Enacted $2,293,000 $5,117,267 $3,867,011 $229,914 $15,406 $11,522,598

Changes to Base

Maintaining Current Levels (MCLs) $60,195 $133,815 $61,060 $1,153 $106 $256,329

Pay Annualization 20,135 46,489 13,005 412 13 80,054

Pay Inflation Adjustment 38,828 85,486 23,816 741 23 148,894

Non-Pay Inflation Adjustment 2,463 3,680 24,829 141 31,113

Government-wide Reduction for Productivity Improvements (1,231) (1,840) (10,590) (71) (13,732)

GAO Audit Reimbursement Pursuant to P.L. 110-323 10,000 10,000

Efficiencies/Savings ($90,918) ($27,207) ($118,125)

Increase e-File Savings (8,227) (133) (8,360)

Non-Recur Savings (27,074) (27,074)

Non-Recur Stimulus Savings (67,900) (67,900)

Non-Recur FY08 Reduction Adjustment / Correspondence Inventory (13,439) (13,439)

Non-Recur Pension Plan (1,352) (1,352)

 Reinvestment $2,025 $306 $2,331

Submission Processing Consolidation (Andover) 2,025 306 2,331

Subtotal, FY 2010 Changes to the Base ($28,698) $133,815 $34,159 $1,153 $106 $140,535

Total FY 2010 Base $2,264,302 $5,251,082 $3,901,170 $231,067 $15,512 $11,663,133

Program Changes

Program Increases

Enforcement Initiatives $5,528 $252,918 $73,714 $332,160

Reduce the Tax Gap Attributable to International Activities $3,124 $104,113 $20,827 128,064

Improve Reporting Compliance of SB/SE Taxpayers 267 75,114 18,834 94,215

Expand Document Matching for Business Taxpayers 1,425 17,955 6,857 26,237

Address Nonfiling/Underpayment and Collection Coverage 712 55,736 27,196 83,644

Infrastructure Initiatives 108,100 108,100

Address IT Security and Material Weakness 90,000 90,000

Implement Return Review Program (RRP) 18,100 18,100

Business Systems Modernization Initiative 22,607 22,607

Subtotal, FY 2010 Program Changes $5,528 $252,918 $181,814 $22,607 $462,867

Total FY 2010 President's Budget Request $2,269,830 $5,504,000 $4,082,984 $253,674 $15,512 $12,126,000

Department of the Treasury - Budget in Brief FY 2010 Page 60
FY 2010 Budget Adjustments 

The IRS funding increase for FY 2010 is 

$603,402,000, which includes $256,329,000 

for maintaining current levels; a net decrease 

of $115,794,000 from efficiency/savings and 

reinvestments; and a program increase of 

$462,867,000 to strengthen enforcement, 

address IT security needs and deploy 

information technology systems. These 

investments fund increased front-line 

enforcement efforts. By FY 2012, these 

investments are projected to increase annual 

enforcement revenue by $2.0 billion. 

The budget request supports these activities by 

proposing: 

• $332,160,000 to target the tax gap by 

addressing underreporting of tax 

associated with complex international 

activities; expanding enforcement efforts 

on noncompliance among business and 

high-income taxpayers; and minimizing 

revenue loss by increasing document 

matching efforts; 

• $108,100,000 to address critical IT 

operational and security infrastructure 

needs; and 

• $22,607,000 to accelerate efforts to 

modernize the core taxpayer account 

database. 

FY 2009 Enacted 

The FY 2009 enacted level for the IRS is 

$11,522,598,000, supporting an estimated 

94,209 FTE. 

Maintaining Current Levels 

Adjustments Necessary to Maintain 

Current Levels +$260,061,000 / 0 FTE 

Funds are requested for: FY 2010 cost of the 

January 2009 pay increase of $80,054,000, 

the proposed January 2010 pay raise of 

$148,894,000, and non-labor related items 

such as contracts, travel, supplies, equipment, 

and GSA rent adjustments of $31,113,000. 

Government-wide Reduction for 

Productivity Improvements -$13,732,000 / 

0 FTE The IRS continues to focus on 

improving the efficiency of its operations 

through a disciplined process of productivity 

improvement. Note that the IRS outlines 

additional efficiency savings in the next 

section. 

GAO Audit Reimbursement Pursuant to 

Public Law 110-323 +$10,000,000 / 0 FTE 

This adjustment will provide funds up to 

$10 million to reimburse the Government 

Accountability Office (GAO) for the audit of 

the IRS annual financial statements. The IRS 

must pay this cost pursuant to Public 

Law 110-323. In prior years, GAO conducted 

the financial statement audit for which it did 

not receive reimbursement. 

Efficiency Savings 

Increase e-File Savings -$8,360,000 / 

-182 FTE This decrease is a result of savings 

from increased electronic filing (e-File), 

which is projected to lead to 4.6 million fewer 

returns filed on paper (2.9 million individual 

and 1.7 million business) in FY 2010. This is 

projected to result in a savings of 182 FTE in 

submission processing. 

Non-Recur Savings -$27,074,000 / 0 FTE 

This is the net reduction of one-time costs 

associated with the IRS FY 2009 enforcement 

initiatives. 

Non-Recur Stimulus Savings -$67,900,000 

/ -1,322 FTE One-time resources were 

provided in FY 2009 to meet the requirements 

of the Economic Stimulus Act of 2008 (Public 

Law 110-185). 

Department of the Treasury - Budget in Brief FY 2010 Page 61
Non-Recur FY 2009 Reduction Adjustment/ 

Correspondence Inventory -$13,439,000 /

0 FTE One-time resources were provided in 

FY 2009 to handle the increased 

adjustment/correspondence workload that 

resulted from diverting staff from paper 

correspondence to telephone service to meet 

the requirements of the Economic Stimulus 

Act of 2008 (Public Law 110-185). 

Non-Recur Pension Plan Form Processing 

-$1,352,000 / 0 FTE This is a decrease 

resulting from the funding of the one-time cost 

in FY 2009 to test the IRS ERISA (Employee 

Retirement Income Security Act of 1974) 

Residual Solution (IERS) system. This 

system will process the electronic Form 5500, 

Annual Return/Report of Employee Benefit 

Plan from the new Department of Labor 

ERISA Filing Acceptance system and the 

paper Form 5500EZ, Annual Return of OneParticipant (Owners and Their Spouses) 

Retirement. 

Reinvestment 

Submission Processing Consolidation 

(Andover) +$2,331,000 / 0 FTE Increased 

use of electronic filing options has led to 

consolidation of the individual return 

processing sites. Increased e-File savings will 

be reinvested to fund one-time severance pay 

costs for the ramp down of the Andover 

submissions processing site. As the Andover 

consolidation approaches, the IRS will 

continue to assist employees in finding 

employment either in or outside the IRS. 

Program Increases 

Reduce the Tax Gap Attributable to 

International Activities +$128,064,000 / 

+784 FTE The IRS plans a multi-year 

investment, beginning in FY 2010, to deal 

more effectively with increasing international 

tax activities of individual and business 

taxpayers. 

This effort will address the underreporting of 

tax associated with international transactions 

as well as domestic taxpayers involved with 

offshore activities. It will also expand the IRS 

presence in the tax-exempt and governmental 

sectors and confront international tax evasion 

schemes. 

This initiative will increase examinations of 

additional international issues of complex 

international structures involving tiered passthrough entities and cross-border transactions 

by a projected 5,357; close an estimated 

additional 1,057 related corporate and 

individual returns; increase the number of 

additional examinations of individual and 

small business returns with offshore activity 

by an estimated 1,145; and resolve 

approximately 18,362 additional collection 

cases. These additional activities will 

generate $736.6 million in additional 

enforcement revenue once the new hires reach 

full potential in FY 2012. 

Improve Reporting Compliance of Small 

Business and High Income Taxpayers 

+$94,215,000 / +755 FTE This initiative 

will improve reporting compliance by 

increasing examinations of business and highincome returns and exams involving 

flow-through entities by 47,400; audits 

targeting employment, excise, and estate and 

gift taxes by 6,350; and investigations of 

business non-filers by 183,000. This request 

will generate $567.2 million in additional 

enforcement revenue once new hires reach full 

potential in FY 2012. 

Department of the Treasury - Budget in Brief FY 2010 Page 62
Expand Document Matching for Business 

Taxpayers +$26,237,000 / +300 FTE This 

initiative will increase the coverage of the 

document matching program to reduce the 

number of business taxpayers who misreport 

their income. This request will generate 

$386.5 million in additional revenue once new 

hires reach full potential in FY 2012. 

Address Nonfiling/Underpayment and 

Collection Coverage +$83,644,000 / 

+491 FTE With expanded enforcement 

efforts in recent years, the IRS must invest in 

improving its collection operations to ensure 

appropriate overall balance and coverage. 

This initiative will generate $359.4 million in 

additional revenue once new hires reach full 

potential in FY 2012. In addition, this 

initiative will fund the rent, furniture, 

telecommunication, and IT costs to build two 

new Automated Collection System (ACS) 

sites. 

Return on Investment for Enforcement Initiatives

Dollars in Millions

First Year (FY 2010) Full Performance (FY 2012)

FY 2010 Enforcement Investment Cost Revenue ROI Cost Revenue ROI

Direct Revenue Producing Initiatives $332.1 $611.1 1.8 $262.8 $2,049.7 7.8

Reduce the Tax Gap Attributable to International Activities 128.1 93.8 0.7 103.4 736.6 7.1

Improve Reporting Compliance of SB/SE Taxpayers 94.2 159.6 1.7 72.6 567.2 7.8

Expand Document Matching for Business Taxpayers 26.2 191.8 7.3 22.8 386.5 17.0

Address Nonfiling/Underpayment and Collection Coverage 83.6 165.9 2.0 64.0 359.4 5.6

Address IT Security and Material 

Weakness 

+$90,000,000 / +36 FTE Improving IT 

security is necessary to ensure the integrity of 

the tax system and maintain taxpayer 

confidence. This initiative will allow the IRS 

to enhance enterprise security risk 

management; harden software applications 

and network infrastructure security; improve 

security compliance monitoring and reporting; 

and provide an enterprise solution to deploy 

end-to-end audit log collection. 

Implement Return Review Program (RRP) 

+$18,100,000 / +10 FTE In FY 2008 the 

Electronic Fraud Detection (EFDS) System 

stopped $1.4 billion in erroneous refunds. This 

initiative will complete modernization of the 

IRS fraudulent refund detection systems. It 

will deliver an integrated and unified RRP 

system that will enhance IRS capabilities to 

detect, resolve, and prevent criminal and civil 

tax refund and abuse. 

Business System Modernization (BSM) 

+$22,607,000 / 0 FTE This initiative will 

provide funding for the continued 

modernization of the core taxpayer account 

database. This effort is a critical underpinning 

of the next generation of IRS service and 

enforcement initiatives. The integration 

strategy includes a particular focus on 

enhanced information technology security 

practices and robust accounting and financial 

management controls. 

Department of the Treasury - Budget in Brief FY 2010 Page 63
Explanation of Budget Activities 

Enforcement 

The FY 2010 President’s Budget request is 

$5,504,000,000 in direct appropriations and an 

estimated $60,797,000 from reimbursable 

programs, and an estimated $7,800,000 from 

user fees, for a total operating level of 

$5,572,597,000. The direct appropriations 

level is an increase of 7.6 percent from the 

FY 2009 enacted level and includes enhanced 

tax enforcement activities funded by an 

allocation adjustment. This appropriation 

funds the following budget activities. 

Investigations ($637,694,000 from direct 

appropriations and an estimated $51,553,000 

from reimbursable programs) This budget 

activity funds the criminal investigations 

programs that explore potential criminal 

violations of the internal revenue tax laws, 

enforce criminal statutes relating to these 

violations, and recommend prosecution as 

warranted. These programs identify and 

document the movement of both legal and 

illegal sources of income to identify and 

document cases of suspected intent to defraud. 

It also includes investigation and prosecution 

of tax and money laundering violations 

associated with narcotics organizations. 

Exam and Collections ($4,706,350 from 

direct appropriations, an estimated 

$8,783,000 from reimbursable programs, and 

an estimated $7,800,000 from user fees) This 

budget activity funds programs that enforce 

the tax laws and compliance through 

examination and collection programs that 

ensure proper payment and tax reporting. The 

budget activity also supports appeals and 

litigation activities associated with exam and 

collection. 

Regulatory ($159,956,000 from direct 

appropriations and an estimated $461,000 

from reimbursable programs) This budget 

activity funds the development and printing of 

published IRS guidance materials; 

interpretation of tax laws; advice on general 

legal servicing, ruling and agreements; 

enforcement of regulatory rules, laws, and 

approved business practices; and supporting 

taxpayers in the areas of pre-filing 

agreements, determination letters, and 

advance pricing agreements. The Office of 

Professional Responsibility is funded within 

this budget activity and is responsible for 

identifying, communicating, and enforcing the 

Treasury Circular 230 standards of 

competence, integrity, and conduct of 

professionals representing taxpayers before 

the IRS. 

Taxpayer Services 

The FY 2010 President’s Budget request is 

$2,269,830,000 in direct appropriations, an 

estimated $39,000,000 from reimbursable 

programs, and an estimated $127,000,000 

from user fees, for a total operating level of 

$2,435,830,000. The direct appropriations 

level is a reduction of 1.0 percent from the 

FY 2009 enacted level though it does not 

represent a program reduction due to nonrecurrent activities and savings. This 

appropriation funds the following budget 

activities. 

Pre-Filing Taxpayer Assistance and 

Education ($676,063,000 from direct 

appropriations, an estimated $819,000 from 

reimbursable programs, and an estimated 

$18,700,000 from user fees) This budget 

activity funds services to assist with tax return 

preparation, including tax law interpretation, 

publication production, and advocate services. 

In addition, funding for these programs 

continues to emphasize taxpayer education, 

outreach, increased volunteer support time and 

locations, and enhancing pre-filing taxpayer 

support through electronic media. 

Filing and Account Services ($1,593,767,000 

from direct appropriations, an estimated 

Department of the Treasury - Budget in Brief FY 2010 Page 64
$38,181,000 from reimbursable programs, 

and an estimated $108,300,000 from user 

fees) This budget activity funds programs that 

provide filing and account services to 

taxpayers, process paper and electronically 

submitted tax returns, issue refunds, and 

maintain taxpayer accounts. The IRS 

continues to make progress in decreasing 

paper returns and increasing the use of 

electronic filing and payment methods. 

Operations Support 

The FY 2010 President’s Budget request is 

$4,082,984,000 in direct appropriations, an 

estimated $47,304,000 from reimbursable 

programs, and an estimated $32,900,000 from 

user fees, for a total operating level of 

$4,163,188,000. The direct appropriation 

level is an increase of 5.6 percent from the 

FY 2009 enacted level and includes dedicated 

support funding for enhanced enforcement 

activities. This appropriation funds the 

following budget activities. 

Infrastructure ($900,852,000 from direct 

appropriations, an estimated $155,000 from 

reimbursable programs, and an estimated 

$16,100,000 from user fees) This budget 

activity funds administrative services related 

to space and housing, rent and space 

alterations, building services, maintenance, 

guard services, and non-Automated Data 

Processing (ADP) equipment. 

Shared Services and Support 

($1,296,629,000 from direct appropriations 

and an estimated $32,228,000 from 

reimbursable programs) This budget activity 

funds policy management, IRS-wide support 

for research, strategic planning, 

communications and liaison, finance, human 

resources, and equal employment opportunity 

and diversity services and programs. It also 

funds printing and postage, business systems 

planning, security, corporate training, legal 

services, procurement, and specific employee 

benefits programs. 

Information Services ($1,885,503,000 from 

direct appropriations, an estimated 

$14,921,000 from reimbursable programs, 

and an estimated $16,800,000 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. The 

IRS business programs rely on these systems 

to process tax and information returns, 

account for tax revenues collected, send bills 

for taxes owed, issue refunds, assist in the 

selection of tax returns for audit, and provide 

telecommunications services for all business 

activities including the public’s toll-free 

access to tax information. 

Business Systems Modernization (BSM) 

The FY 2010 President’s Budget request is 

$253,674,000 in direct appropriation. This is 

an increase of 10.3 percent from the FY 2009 

enacted level. This appropriation funds the 

following budget activity. 

BSM ($253,674,000 from direct 

appropriations) This budget activity funds 

the planning and capital asset acquisition of 

information technology (IT) to continued 

modernization of the core taxpayer account 

database. This effort is a critical underpinning 

of the next generation of IRS service and 

enforcement initiatives. The integration 

strategy includes a particular focus on 

enhanced information technology security 

practices and robust accounting and financial 

management controls. This activity also funds 

the ongoing development of the Modernized 

e-File platform for filing tax returns 

electronically. BSM labor (salaries and 

expense dollars) and related contract costs 

also are funded. 

Health Insurance Tax Credit 

Administration (HITCA) 

Department of the Treasury - Budget in Brief FY 2010 Page 65
The FY 2010 President’s Budget request is 

$15,512,000 in direct appropriations. This is 

an increase of 0.7 percent from the FY 2009 

enacted level. This appropriation funds the 

following budget activity. 

HITCA ($15,512,000 from direct 

appropriations) This budget activity funds 

costs to administer a refundable tax credit for 

health insurance to qualified individuals, 

which was enacted as part of the Trade 

Adjustment Assistance Reform Act of 2002. 

Legislative Proposals 

The FY 2010 President’s Budget includes a 

number of legislative proposals intended to 

improve tax compliance with minimum 

taxpayer burden. These proposals will 

specifically target the tax gap and generate 

nearly $11 billion over the next ten years. The 

Administration proposes to expand 

information reporting, improve compliance by 

businesses, strengthen tax administration, and 

expand penalties. 

Expand information reporting – Compliance 

with the tax laws is highest when payments 

are subject to information reporting to the 

IRS. Specific information reporting proposals 

would: 

• Require information reporting on 

payments to corporations; 

• Require a certified taxpayer identification 

number (TIN) from contractors; 

• Require increased information reporting 

on certain government payments; and 

• Increase information return penalties. 

Improve compliance by businesses – 

Improving compliance by businesses of all 

sizes is important. Specific proposals to 

improve compliance by businesses would: 

• Require electronic filing by certain large 

organizations; and 

• Implement standards clarifying when 

employee leasing companies can be held 

liable for their clients’ federal employment 

taxes. 

Strengthen tax administration – The IRS has 

taken a number of steps under existing law to 

improve compliance. These efforts would be 

enhanced by specific tax administration 

proposals that would: 

• Expand IRS access to information in the 

National Directory of New Hires for tax 

administration purposes; 

• Make repeated willful failure to file a tax 

return a felony; 

• Facilitate tax compliance with local 

jurisdictions; 

• Extend statutes of limitations where state 

tax adjustments affect federal tax liability; 

• Improve the investigative disclosure 

statute; 

• Expand electronic filing requirements for 

tax return preparers; 

• Repeal the requirement of a partial 

payment with an application for an offerin-compromise; and 

• Allow assessment of criminal restitution as 

tax. 

Expand penalties – Penalties play an 

important role in discouraging intentional noncompliance. Specific proposals to expand 

penalties would: 

• Impose a penalty on failure to comply with 

electronic filing requirements; and 

• Clarify that the bad check penalty applies 

to electronic checks and other forms of 

payment. 

Improve Tax Administration and Other 

Miscellaneous Proposals 

Department of the Treasury - Budget in Brief FY 2010 Page 66
The Administration has put forward additional 

proposals relating to IRS administrative 

reforms. These proposals would: 

• Apply the Federal Payment Levy Program 

to contractors before providing Collection 

Due Process; and 

• Clarify that vendor levy on “goods and 

• Require information reporting on expense services” would not exclude “property.” 

payments relating to rental property; 

• Improve the foreign trust reporting 

penalty; 

IRS Performance by Programs

FY 2006 FY 2007 FY 2008 FY 2009 FY 2010

Programs Performance Measure Target Actual Actual Actual Target Target Met?

Customer Contacts Resolved per Staff Year - E 7,414 7,648 12,634 Yes 10,386 8,919

Taxpayer Service Customer Accuracy - Tax Law Phones (%) - Ot 90.9% 91.2% 91.2% Yes 91.0% 91.2%

Percent of Individual Returns Processed Electronically (%) - Oe (L) 54.1% 57.1% 57.6% No 64.0% 67.3%

Examination Efficiency - Individual (1040) - E (L) 128 137 138 Yes 132 130

Enforcement Automated Collection System Accuracy (%) - Oe 91.0% 92.9% 95.3% Yes 92.0% 93.5%

AUR Efficiency E (L) 1,832 1,956 1,982 Yes 1,855 1,894

Key: Oe - Outcome Measure, E - Efficiency Measure, Ot - Output/Workload Measure, L - Long-Term goal

Description of Performance 

In FY 2008 the IRS continued to provide 

excellent service to taxpayers and enforced 

the tax laws in a balanced manner. The 

following is a summary of significant 

program performance improvements: 

Enforcement 

Enforcement of the tax laws is an 

integral component of the IRS effort to 

enhance voluntary compliance and close 

the tax gap. IRS enforcement activities, 

such as examination and collection, 

target elements of the tax gap, remained 

a high priority in FY 2008, and will 

continue to be a high priority in the 

future. 

In FY 2008 the IRS collected $56.4 

billion in enforcement revenue. 

• Increased high-income taxpayer 

audits almost 16 percent; 

• Increased small business audits 

In FY 2008, IRS enforcement 3 percent; 

performance improved over FY 2007 in 

the following key areas: • Increased tax-exempt and 

government entities compliance 

contacts 6 percent; 

IRS Enforcement Revenue (In Billions)

$70

$59.2

$60 $56.4

$47.3 $48.7 $50 $43.1

$37.6 $40 $34.1

$30

$20

$10

$0

FY 02 FY 03 FY 04 FY 05 FY 06 FY 07 FY 08

Department of the Treasury - Budget in Brief FY 2010 Page 67
• Increased Automated Underreporter 

(AUR) contact closures by almost 

4 percent; and dollars collected 

through AUR and information return 

processing by 22 percent; and 

• Increased collection case closures 

1.4 percent. 

The IRS continued to investigate 

vigorously egregious tax, money 

laundering, and other financial crimes 

that adversely affect tax administration. 

Performance levels for the criminal 

investigation program remained high in 

FY 2008 with 4,044 completed criminal 

investigations and 2,144 convictions. 

Maintaining a strong enforcement 

presence in the tax-exempt sector is 

important to ensure that charitable 

organizations are not used for noncharitable or illegal purposes. In FY 

2008, the IRS increased tax-exempt and 

government entities compliance contacts 

6 percent over FY 2007 levels. 

Research allows the IRS to target 

specific areas of noncompliance to 

improve voluntary compliance and 

allocate resources more effectively to 

reduce the tax gap. Improved research 

data also refine the workload selection 

models to reduce audits of compliant 

taxpayers and ultimately help the IRS 

achieve high rates of return from its 

enforcement programs. Current 

National Research Program (NRP) 

efforts include analyzing individual 

income tax returns for Tax Years 2006, 

2007, and 2008. In addition, an 

employment tax reporting compliance 

study is in the planning stages. Results 

from these studies will be used to 

develop additional approaches to 

addressing the tax gap. 

Taxpayer Service 

In 2008, the IRS served taxpayers through 

multiple channels during the tax filing 

season while also delivering $94.3 billion in 

economic stimulus payments to 116.2 

million taxpayers and successfully 

implementing Alternative Minimum Tax 

legislation enacted late in 2007. Demand for 

telephone services was 

Tot a l S yst e m Demand ( I n M i l l i ons of Ca l l s) 80

60

40

20

0

Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep

FY 2005 FY 2006 FY 2007 FY 2008 

unprecedented in 2008, and as a result, the 

overall telephone level of service was 53 

percent, well below the target of 82 percent. 

In FY 2008, there were nearly 350 million 

visits to IRS.gov, up over 61 percent from 

215 million in FY 2007. Taxpayers visited 

the website to obtain information on the 

economic stimulus package, determine if 

they qualify for the Earned Income Tax 

Credit (EITC), and track the status of their 

returns using the “Where’s My Refund?” 

feature. The IRS answered 92.4 million calls 

and served over 6.9 million taxpayers at 

401 Taxpayer Assistance Centers. Taxpayer 

service improvements are reflected in 

increases in IRS Customer Satisfaction 

scores as measured by the independent 

American Customer Satisfaction Index 

showing improvement from 53 percent in 

1998 to 68 percent in 2008. For the 

thirteenth year in a row, the number of 

individual returns that were filed 

electronically, excluding taxpayers who 

filed solely to claim an economic stimulus 

payment, increased, with over 63 percent of 

Department of the Treasury - Budget in Brief FY 2010 Page 68
all individual income tax returns e-filed in 

FY 2008. 

FY 2009 continues to bring significant 

challenges to IRS service programs. 

Workload remains high from taxpayers 

seeking assistance in resolving issues from 

the Economic Stimulus Act of 2008 (Public 

Law 110-185). At the same time, the IRS is 

implementing the ARRA tax provisions. 

Business System Modernization 

IRS modernization efforts continued to 

focus on its core tax administration 

systems designed to provide more 

sophisticated tools to taxpayers and the 

IRS employees. 

The following highlights the IRS efforts 

in FY 2008 in advancing these core 

systems: 

• CADE– The 2008 CADE release was 

delivered on time for the filing 

season, and over 30.6 million 

taxpayers were processed using a 

modernized account database, a 

substantial increase from 

11.2 million in 2007. 

• Modernized e-File (MeF) – In 2008, 

MeF accepted over 3.7 million 

returns, a 55 percent increase over 

the same period in 2007; and 

• Account Management Services 

(AMS) – The 2008 releases of AMS 

delivered the capability to update 

account data on a daily cycle to over 

33,000 IRS customer service 

representatives and provided 

improved customer support with new 

inventory and workflow 

functionalities. 

Human Capital 

In late FY 2008, the IRS Commissioner 

established a Workforce of Tomorrow

task force to address recruitment and 

retention issues so that the IRS has the 

necessary leadership and workforce to 

address future challenges. 

The IRS considers employee 

engagement fundamental to the overall 

success of the organization and believes 

that employee engagement is an ongoing 

process. The IRS conducts an annual 

survey to assess the level of engagement 

of employees. Overall satisfaction 

showed steady improvement from a 

score of 3.48 in 2002 to a score of 3.79 

in 2008, on a scale of 1 to 5, with 5 

being the most satisfied. 

IRS job satisfaction is higher than most 

other federal agencies according to the 

Office of Personnel Management’s 

Federal Human Capital Survey. 

Department of the Treasury - Budget in Brief FY 2010 Page 69
Department of the Treasury - Budget in Brief FY 2010 Page 70
Emergency Economic Stabilization Act Programs 

Program Summary by Budget Activity 

(Dollars in Thousands) 

FY 2009 FY 2010 

Purchase 

Cap1 

Obligations2 Purchase 

Cap1

Obligations2

Capital Purchase Program $218,000,000 $58,830,700 $0 $0

Public-Private Investment Program3, 4 $75,000,000 $24,997,500 $0 $0

Systemically Significant Failing Institutions 

Program 

$70,000,000 $57,946,000 $0 $0

Consumer and Business Lending Initiative3 

TALF 1.0 $20,000,000 $6,666,000 $0 $0

TALF Asset Expansion $35,000,000 $11,665,500 $0 $0

TALF for Legacy Securities $25,000,000 $8,332,500 $0 $0

Unlocking SBA Lending Markets $15,000,000 $4,999,500 $0 $0

Home Affordable Modification Program $50,000,000 $50,000,000 $0 $0

Targeted Investment Program $40,000,000 $19,540,000 $0 $0

Automotive Industry Financing Program and 

Auto Supplier Support Program 

$35,400,000 $18,235,070 $0 $0

Asset Guarantee Program5 $12,500,000 ($752,500) $0 $0

Estimate of Redemption ($25,000,000

)

NA $0 $0

Capital Assistance and Other TBD Programs3 $129,100,000 $43,029,030 $0 $0

Total $700,000,000 $303,489,300 $0 $0 1

Amount applied to the Section 115 Purchase Cap. 

2

Estimated program costs or savings do not include $1,998,749,041 in estimated modification costs due to revisions of 

the initial loan and equity purchase terms. 

3

Subsidy rate will be revised from the current 33.33% placeholder. 4

 The TALF for Legacy Securities program categorized under the Consumer and Business Lending Initiative in this 

table will be implemented under the Public-Private Investment program. 

5

 Loan Guarantees are expected to be $419 billion, but Treasury will be limited to a $12.5 billion second loss. 

Explanation of Budget Estimate 

_________________________________ 

The Office of Financial Stability (OFS) 

budget includes funding to carry out the 

authorities delegated to the OFS by the 

Secretary of the Treasury to implement 

the Troubled Assets Relief Program 

(TARP). These authorities were vested 

to the Treasury Secretary by the 

Emergency Economic Stabilization Act 

of 2008 (EESA), which authorized the 

Secretary of the Treasury to establish the 

TARP to “purchase, and to make and 

fund commitments to purchase troubled 

assets from any financial institution, on 

terms and conditions as are determined 

by the Secretary.” 

The EESA further authorized that the 

Secretary implement the TARP through 

an Office of Financial Stability. 

The purposes of the EESA are to — 

(1) immediately provide authority and 

facilities that the Secretary of the 

Treasury can use to restore liquidity and 

stability to the financial system of the 

United States; and 

(2) ensure that such authority and such 

facilities are used in a manner that — 

Department of the Treasury - Budget in Brief FY 2010 Page 71
(A) protects home values, college 

funds, retirement accounts, and 

life savings; 

(B) preserves homeownership 

and promotes jobs and economic 

growth; 

(C) maximizes overall returns to 

the taxpayers of the United 

States; and 

(D) provides public 

accountability for the exercise of 

such authority. 

Purpose of the Program 

Since the passage of EESA in October 

2008, the OFS has implemented a 

number of programs aimed to stabilize 

the financial system and restore the flow 

of credit to consumers and businesses. 

These include: 

Capital Purchase Program 

The Capital Purchase Program (CPP) 

was created to stabilize the financial 

system by building the capital base of 

healthy, viable U.S. financial 

institutions, which in turn will increase 

the capacity of those institutions to lend 

to businesses and consumers and support 

the economy. Under this program, 

Treasury is purchasing senior preferred 

shares from qualifying U.S. controlled 

banks, savings associations, and certain 

bank and savings and loan holding 

companies. 

Systemically Significant Failing 

Institution 

The Systemically Significant Failing 

Institution program (SSFI) is intended to 

provide stability and prevent disruptions 

to financial markets from the failure of a 

systemically significant institution. The 

Treasury will determine the eligibility of 

participants on a case-by-case basis. In 

determining whether an institution is 

systemically significant and at 

substantial risk of failure, Treasury may 

consider, among other things: 

1. The extent to which the 

failure of an institution could 

threaten the viability of its 

creditors and counterparties 

because of their direct exposures 

to the institution; 

2. Whether the institution is 

sufficiently important to the 

nation’s financial and economic 

system; or 

3. The extent and probability of 

the institution’s ability to access 

alternative sources of capital and 

liquidity. 

Targeted Investment Program 

The Targeted Investment Program (TIP) 

is designed to prevent a loss of 

confidence in financial institutions that 

could result in significant market 

disruptions, threatening the financial 

strength of similarly situated financial 

institutions, impairing broader financial 

markets, and undermining the overall 

economy. Treasury will consider 

institutions as candidates, based on a 

number of factors including the threats 

posed by destabilization of the 

institution, the risks caused by a loss of 

confidence in the institution, and the 

institution’s importance to the nation’s 

economy. 

Automotive Industry Financing 

Program 

 The Automotive Industry Financing 

Program (AIFP) is intended to prevent a 

significant disruption of the American 

automotive industry, which would pose a 

systemic risk to financial market 

Department of the Treasury - Budget in Brief FY 2010 Page 72
stability and have a negative effect on 

the economy of the United States. The 

program requires participating 

institutions to implement plans that will 

achieve long-term viability. 

Asset Guarantee Program 

The Asset Guarantee Program (AGP) 

provides guarantees for assets held by 

systemically significant financial 

institutions that face a risk of losing 

market confidence due in large part to a 

portfolio of distressed or illiquid assets. 

The AGP will be applied with extreme 

discretion in order to improve market 

confidence in the systemically 

significant institution and in financial 

markets broadly. Treasury does not 

anticipate that the program will be made 

widely available and notes that the 

EESA requires that premiums under 

section 102 be set to ensure that 

taxpayers are fully protected. 

The Consumer and Business Lending 

Initiative (CBLI) 

Term Asset-Backed Securities Loan 

Facility

The creation of the Term Asset-Backed 

Securities Loan Facility (TALF) was 

announced in November 2008 as a 

Federal Reserve facility to which 

Treasury will provide $20 billion in 

funding through the TARP. The Federal 

Reserve will lend on a non-recourse 

basis to holders of certain AAA-rated 

asset-backed securities (ABS) secured 

by newly and recently originated 

consumer and small business loans. 

TALF loans will have a term of three 

years and will be secured solely by 

eligible collateral. Haircuts (a 

percentage reduction used for collateral 

valuation) will be determined based on 

the riskiness of each type of eligible 

collateral and the maturity of the eligible 

collateral pledged to the Federal 

Reserve. The haircuts will provide 

additional protection to taxpayers by 

protecting the Federal Government from 

loss. 

Initiative to Unlock Credit for Small 

Businesses

In March, Treasury announced a 

program to unlock credit for small 

businesses as part of the Consumer and 

Business Lending Initiative. As part of 

the program, Treasury will make up to 

$15 billion in TARP funds available to 

make direct purchases to unlock the 

secondary market for the governmentguaranteed portion of SBA 7(a) loans as 

well as first-lien mortgages made 

through the 504 program. These 

purchases, combined with higher loan 

guarantees and reduced fees 

implemented under the American 

Recovery and Reinvestment Act of 

2009, will help provide lenders with the 

confidence that they need to extend 

credit, knowing that if they make an 

SBA loan, they will be able to sell it and 

access the liquidity necessary to do 

further lending. 

Making Home Affordable 

Making Home Affordable includes two 

separate programs: the Home Affordable 

Refinance Program and the Home 

Affordable Modification Program. 

Together, these programs will assist as 

many as nine million homeowners 

making a good-faith effort to stay 

current on their mortgage payments and 

will also work to prevent the destructive 

impact of foreclosures on families and 

communities. 

Department of the Treasury - Budget in Brief FY 2010 Page 73
Capital Assistance Program 

The Capital Assistance Program (CAP) is 

designed to ensure the continued ability of 

U.S. financial institutions to lend to 

creditworthy borrowers in the face of a 

weaker than expected economic 

environment and larger than expected 

potential losses. The CAP consists of two 

elements aimed at restoring confidence in 

the conditions of the U.S. banking system: a 

supervisory exercise and a new capital 

access program for qualifying financial 

institutions. 

Public-Private Investment Program 

To address the challenge of legacy assets, 

Treasury – in conjunction with the FDIC 

and the Federal Reserve – is announcing the 

Public-Private Investment Program (PPIP) 

as part of its efforts to repair balance sheets 

throughout our financial system and ensure 

that credit is available to the households and 

businesses, large and small, that will help 

drive us toward recovery. 

Legislative Proposals 

____________________________________ 

The TARP has no legislative proposals in 

FY 2010. 

Performance Measures 

_________________________________ 

Performance metrics are currently in 

development for the Troubled Assets Relief 

Programs and will be available by FY 2010. 

Department of the Treasury - Budget in Brief FY 2010 Page 74
Special Inspector General for TARP 

Program Summary 

(Dollars in thousands) 

FY 2008 FY 2009 FY 2010

Obligated Estimated Estimated $ Change % Change

 Appropriation n/a $50,000 n/a $0 0%

 Estimated Obligations n/a $25,000 $25,000 $0 0%

Total FTE n/a 100 150 - -

Purpose of Program 

 

SIGTARP’s mission is to advance economic 

stability by promoting the efficiency and 

effectiveness of Troubled Assets Relief 

Program (TARP) management, through 

transparency, through coordinated oversight, 

and through robust enforcement against 

those, whether inside or outside of 

Government, who waste, steal or abuse 

TARP funds. 

Transparency

Promoting transparency in the management 

and operation of TARP is one of 

SIGTARP’s primary roles. Through the 

Emergency Economic Stabilization Act of 

FY 2008 (EESA), the American taxpayer 

has been asked to fund - to the tune of 

hundreds of billions of dollars - an 

unprecedented effort to stabilize the 

financial system and promote economic 

recovery; in this context, the public has a 

right to know how that money is being 

spent. Transparency is a powerful tool to 

ensure that all those managing the TARP 

funds will act appropriately, consistent with 

the law and in the best interests of the 

country. 

Coordinated Oversight

SIGTARP plays a vital role in promoting the 

economy and efficiency in the management 

of TARP and views its oversight role both 

prospectively (by advising TARP managers 

on issues relating to internal controls and 

oversight, for example) and retrospectively 

(by assessing the effectiveness of TARP 

activities over time and suggesting 

improvements and making 

recommendations for positive change). 

SIGTARP closely coordinates its oversight 

activities with the other TARP oversight 

bodies to ensure maximum oversight 

coverage and to avoid redundant and unduly 

burdensome requests. 

Robust Enforcement

SIGTARP’s third primary role is to prevent, 

detect and investigate cases of fraud, waste 

and abuse of TARP funds and programs. 

SIGTARP, through its own investigative 

resources and through partnership with other 

relevant law enforcement agencies, is 

committed to robust criminal and civil 

enforcement against those, whether inside or 

outside of Government, who waste, steal or 

abuse TARP funds. 

In 2010, SIGTARP will continue to design 

and conduct programmatic audits of 

Treasury's TARP operations, as well as 

recipients' compliance with their obligations 

under relevant law and contract. SIGTARP 

will also conduct and supervise criminal and 

civil investigations into any parties 

suspected of TARP-related fraud, waste, or 

abuse and it must remain flexible at all times 

to respond to future changes to the TARP 

programs. 

Department of the Treasury - Budget in Brief FY 2010 Page 75
SIGTARP faces the administrative realities 

of any new organization, and is working to 

formulate a full strategic plan, and to 

identify the resource requirements that it 

will enable it to fully and effectively carry 

out its mission. Future funding needs are 

under review. If additional resources are 

necessary, a request will be made. 

Legislative Proposals 

 

SIGTARP has no legislative proposals for 

FY 2010.

Department of the Treasury - Budget in Brief FY 2010 Page 76
Housing Government Sponsored Enterprise Programs 

Program Summary by Budget Activity 

(Dollars in Thousands) 

FY 2008 FY 2009 FY 2010 

Housing Government 

Sponsored Enterprise 

Programs Activity Actual Estimated Estimated $ Change % Change 

Preferred Stock Purchase Obligations Agreements $0 $105,900,000 $41,293,000 ($64,607,000) -61.01% 

Securities GSE MBS Purchase Program Purchased $5,000,000 $249,000,000 $60,000,000 ($189,000,000) -75.90% 

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

Explanation of Budget Estimate 

____________________________________ 

The Housing Government Sponsored 

Enterprise (GSE) Programs consist of three 

different programs with respect to, Fannie 

Mae and Freddie Mac, and the Federal 

Home Loan Banks (FHLBs) outlined below. 

These programs were created to provide 

stability to the financial markets and 

promote mortgage affordability while at the 

same time protecting the taxpayer. These 

programs include Preferred Stock Purchase 

Agreements (PSPAs) with Fannie Mae and 

Freddie Mac, a Mortgage-Backed Securities 

(MBS) Purchase Program limited to such 

securities issued by Fannie Mae and Freddie 

Mac, and a Treasury credit facility for all 

three entities. 

These programs are designed to meet the 

following priorities: 

• To promote stability in financial 

markets.

• To improve the availability of 

mortgage credit to American 

homebuyers. 

• To ensure investor confidence in the 

GSEs by maintaining and/or 

increasing the PSPAs. 

The FY 2010 budget estimate anticipates 

decreases in two of the programs due to 

reduced draws under the PSPAs as housing 

market conditions improve; and the 

authority to make purchases under the GSE 

MBS Program expiring on December 31, 

2009. Treasury does not expect to use the 

Credit Facility in FY 2010. 

Purpose of Program 

____________________________________ 

The function of the PSPAs is to instill 

confidence in investors that Fannie Mae and 

Freddie Mac will remain viable entities 

critical to the functioning of the housing and 

mortgage markets. The PSPAs provide up 

to $200 billion for each GSE to ensure that 

each enterprise maintains a positive net 

worth. 

The function of the GSE MBS Purchase 

Program is to help improve the availability 

of mortgage credit to American homebuyers 

and mitigate pressures on mortgage rates. 

To promote the stability of the mortgage 

market, Treasury has purchased GSE MBS 

in the secondary market. By purchasing 

these guaranteed securities, Treasury sought 

to broaden access to mortgage funding for 

current and prospective homeowners as well 

as to promote market stability. 

The function of the GSE Credit Facility is to 

ensure credit availability to the housing 

GSEs by providing secured funding on an as 

Department of the Treasury - Budget in Brief FY 2010 Page 77
needed basis under terms and conditions 

established by the Secretary of the Treasury 

to protect taxpayers. Fannie Mae, Freddie 

Mac, and FHLBs are eligible to borrow 

under this program if needed. This facility 

offers liquidity if needed until December 31, 

2009. Treasury does not expect to use this 

program in FY 2010. 

Explanation of Budget Activities 

Preferred Stock Purchase 

________________________

Agreements ($41.293 billion in 

obligations) 

This measure enhances market stability by 

providing additional security to holders of 

Fannie Mae and Freddie Mac securities, 

which, in turn, leads to increased mortgage 

affordability by providing additional 

confidence to investors in GSE mortgagebacked securities. This commitment also 

significantly diminishes the potential for 

mandatory triggering of receivership. To this 

end, the PSPAs are an effective means of 

averting systemic risk while at the same 

time protecting the taxpayer. They are more 

efficient than a one-time equity injection, in 

that Treasury will use them only as needed 

and on terms that the Treasury deems 

appropriate.

GSE MBS Purchase Program ($60 billion 

in purchases) 

The size and timing of this program is 

subject to the discretion of the Secretary of 

the Treasury. The scale of the program is 

based on developments in the capital 

markets and housing markets. Given that 

Treasury can hold these securities to 

maturity, the spreads between Treasury 

issuances and GSE MBS indicate that there 

is little likelihood to expect taxpayer losses 

from this program, and, the program could 

produce gains. Treasury's authority to 

purchase GSE MBS expires on 

December 31, 2009. 

GSE Credit Facility Program (No funding) 

Loans would be for short-term durations and 

would in general be expected to be for less 

than one month but no shorter than one 

week. The rate on a loan request ordinarily 

would be based on the daily LIBOR fix for a 

similar term of the loan plus 50 basis points. 

The rate is set at the discretion of the 

Secretary of the Treasury with the objective 

of protecting the taxpayer, and is subject to 

change. All loans would be collateralized 

and collateral is limited to mortgage backed 

securities issued by Freddie Mac and Fannie 

Mae and advances made by the FHLBs. 

Loans will not be made with a maturity date 

beyond December 31, 2009. 

Legislative Proposals 

____________________________________ 

The Housing GSE programs have no 

legislative proposals for FY 2010. 

Performance Measures 

____________________________________ 

Performance metrics are currently in 

development for Housing Government 

Sponsored Enterprise Programs. Finalization 

of program metrics is expected by the end of 

the third quarter of FY 2009. 

Department of the Treasury - Budget in Brief FY 2010 Page 78
Treasury Franchise Fund 

Program Summary by Budget Activity 

(Dollars in thousands) 

FY 2008 FY 2009 FY 2010 Budget Activity Obligated Estimated Estimated $ Change % Change

 Consolidated/Integrated Administrative Management $180,361 $11,293 $0 ($11,293) (100.00%)

 Financial Management Administrative Support Services $96,952 $146,828 $147,968 $1,140 (78.0%)

 Financial Systems, Consulting and Training $13,691 $2,117 $0 ($2,117) (100.0%)

Total Cost of Operations $291,004 $160,238 $147,968 ($12,270) (7.66%)

Explanation of Budget Estimate 

 

Historically, the Treasury Franchise Fund (the 

Fund) has reported activity in the following 

budget activities. 

• Consolidated/Integrated Administrative 

Management 

• Financial Management Administrative 

Support Systems 

• Financial Systems, Consulting and 

Training 

In FY 2010, the Fund is reporting only the 

Financial Management Administrative Support 

Systems budget activity, Public Debt’s 

Administrative Resource Center (ARC). The 

remaining activities were eliminated due to 

Treasury decisions to transition out of those 

business lines because they were not consistent 

with Treasury’s core mission or are not 

advantageous to be offered as a shared service. 

ARC is projecting a net increase in budgetary 

resources of 2 percent for FY 2010. The net 

increase is comprised of increases due to 

estimated inflation adjustments and anticipated 

new customers, and a decrease due in the 

assisted acquisition service line. 

Purpose of Program 

 

The Treasury Franchise Fund (the Fund) is a 

revolving fund that supplies financial and 

administrative services on a fee-for-service 

basis. The Fund has transformed the 

administrative support arena in the Federal 

Government through a shared services 

business model that offers marketplace success 

through competition. The Fund became 

permanent in the Consolidated Appropriations 

Act, 2005 (Public Law 108-447) and is 

codified in U.S.C. 322, note. In addition, 

Public Debt’s Administrative Resource Center 

(ARC) is a federal shared service center and 

was recognized as a Center of Excellence in 

2005. 

Since inception, the Fund has been a leader in 

redefining the processes and methods for 

delivering administrative products and services 

to federal customers. The Fund offers onestop shopping to customers and we use 

streamlined processes, ensure full 

accountability, offer competitive prices and 

timely services. In FY 2010, the Fund will 

maintain its commitment to excellence and 

will meet or exceed all applicable strategic 

goals and benchmarks. 

Explanation of Budget Activities 

 

Consolidated/Integrated Administrative 

Management (No funding) In previous fiscal 

years, FedSource was reported under this 

budget activity. With Treasury’s decision to 

transition out of the FedSource service line, 

the Franchise Fund has discontinued this 

budget activity in 2010. 

Department of the Treasury - Budget in Brief FY 2010 Page 79
Financial Management Administrative 

Support Services ($147,968,000 from 

reimbursable programs) This Franchise 

Fund budget activity includes Public Debt’s 

Administrative Resource Center (ARC), an 

OMB approved federal shared service 

provider. ARC provides accounting, 

procurement, travel, human resources, and 

information technology services to federal 

customers and is a Center of Excellence for 

Financial Management. 

 

Financial Systems, Consulting and 

Training (No funding) In previous fiscal 

years, the Federal Consulting Group and 

TFF Performance by Budget Activity 

FY 2006 FY 2007 FY 2008 FY 2009 FY 2010

Budget Activity Performance Measure Actual Actual Actual Target 

Met? Target Target

Consolidated/Integrated Operating expenses as a percentage of 

Administrative revenue –Consolidated/Integrated 

Management Administrative Management (%) (E) 

4.00 4.30 17.70 Yes N/A N/A 

Financial Management Operating expenses as a percentage of 

Administrative Support revenue—Financial Management 

Services Administrative Support (%) (E) 

17.00 15.10 3.60 Yes 12.00 12.00 

Financial Systems, Operating expenses as a percentage of 

Consulting and Training revenue—Financial Systems, 

Consulting and Training (%) (E) 

10.00 6.70 6.49 Yes N/A N/A 

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

Treasury Agency Services were reported under 

this budget activity. With Treasury’s decision 

to transition out of these service lines, the 

Franchise Fund has discontinued this budget 

activity in 2010. 

Legislative Proposals 

 

The Treasury Franchise Fund has no 

legislative proposals for FY 2010. 

Description of Performance 

 

The Treasury Franchise Fund (the Fund) has 

defined customer satisfaction and operating 

expenses as a percentage of revenue as key 

performance measurement areas. 

In FY 2008, all budget activities did not 

meet the Fund’s performance targets. 

Specifically, the Consolidated/Integrated 

Administrative 

Management activity (FedSource) failed to 

meet the operating expense performance 

target due to decreased revenue and 

increased operating costs caused by closeout 

activities. 

The Fund discontinued the customer 

satisfaction performance metric in FY 2008 

for the budget activities being closed out 

(FedSource, Federal Consulting Group and 

Treasury Agency Services) and discontinued 

all performance metrics for these activities 

in FY 2009. The remaining budget activity 

(Administrative Resource Center) exceeded 

all of the Fund’s performance metrics in 

FY 2008 and is expected to meet them in 

FY 2009 and FY 2010. 

Department of the Treasury - Budget in Brief FY 2010 Page 80
Bureau of Engraving and Printing 

Program Summary by Budget Activity 

(Dollars in thousands) 

FY 2008 FY 2009 FY 2010 Budget Activity Obligated Estimated Estimated $ Change % Change

 Manufacturing $476,700 $519,650 $530,000 $10,350 2.0%

 Protection and Accountability of Assets $61,500 $61,000 $61,000 $0 0.0%

Total Cost of Operations $538,200 $580,650 $591,000 $10,350 1.8%

Explanation of Budget Estimate 

 

The Bureau of Engraving and Printing 

(BEP) began printing currency in 1862. It 

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 at BEP are financed by a 

revolving fund established in 1950 in 

accordance with Public Law 81-656. This 

fund is reimbursed through product sales for 

direct and indirect costs of operations 

including administrative expenses. In 1977, 

Public Law 95-81 authorized the Bureau to 

include an amount sufficient to fund capital 

investments and to meet working capital 

requirements in the prices charged for 

products. This funding mechanism 

eliminated the need for appropriations from 

Congress. 

BEP’s key priorities for FY 2010 include: 

• Redesign the $100 note. Development 

of a redesigned $100 note is currently in 

process. BEP expects to gain design 

approval by the Secretary of Treasury 

and to begin production in the 

2009/2010 time frame. The redesign of 

the $100 note will mark the completion 

of the current multi-year initiative to 

implement the most ambitious currency 

redesign in United States history. 

• Continue re-tooling and retrofitting of 

the currency production process. 

Successful implementation of new 

technology will improve productivity, 

reduce BEP’s environmental impact, and 

provide needed capabilities to produce 

increasingly more complex currency 

note designs. 

• Train and prepare the workforce for 

increasingly sophisticated technology 

integrated into 21st century 

manufacturing processes. 

• Improve the Nation’s currency to better 

serve the needs of Americans and others 

around the world, including the blind 

and visually impaired. To this end, The 

Bureau, in coordination with the 

Department of Treasury, commissioned 

a study that began in 2008 to assess 

improved methods for denominating 

currency for the blind and visually 

impaired; the results of the study will be 

released for public comment in 2009. 

• Install a new wastewater recycling 

system that will recycle approximately 

95% of water used in the printing 

process. This investment is indicative of 

the Bureau’s commitment to keeping the 

greenback and the environment “green”. 

• Continue process improvements as 

required of an ISO 9001 certified 

organization, a designation that indicates 

to current and prospective customers that 

the Bureau employs a rigorous quality 

management program. 

Department of the Treasury - Budget in Brief FY 2010 Page 81
• Work in concert with the Advanced 

Counterfeit Deterrent Committee, and 

other Government agencies to research and 

develop state-of-the-art counterfeit 

deterrent features and systems for use in 

currency notes that will enhance and 

protect future notes. 

Purpose of Program 

 

The mission of the Bureau of Engraving and 

Printing is to design and manufacture high 

quality security documents that deter 

counterfeiting and meet customer requirements 

for quality, quantity and performance. 

BEP’s vision is to maintain its position as a 

world-class securities printer providing its 

customers and the public superior products 

through excellence in manufacturing and 

technological innovation. The Bureau strives 

to produce U.S. currency of the highest 

quality, as well as many other security 

documents issued by the Federal Government. 

Other activities at the Bureau include 

engraving plates and dies; manufacturing inks 

used to print security products; purchasing 

materials, supplies and equipment; and storing 

and delivering products in accordance with the 

requirements of customers. In addition, the 

Bureau provides technical assistance and 

advice to other Federal agencies in the design 

and production of documents, which, because 

of their innate value or other characteristics, 

require counterfeit deterrence. 

In line with BEP’s vision, the Bureau’s top 

priorities for FY 2010 include the continued 

re-tooling and retrofitting of the currency 

production process which will allow the BEP 

to improve productivity and reduce its 

environmental impact. This initiative will also 

provide the needed capabilities to produce 

increasingly more complex currency note 

designs which would improve the nation’s 

currency to better serve the needs of 

Americans and others, including the blind and 

visually impaired. The new equipment will 

also ensure that the BEP continues to operate 

in an efficient and cost-effective manner. 

Another top priority for FY 2010 is the 

redesign the $100 note. Development of a 

redesigned $100 note is currently in process. 

BEP expects to gain design approval by the 

Secretary of Treasury and begin production in 

the 2009/2010 time frame. The Federal 

Reserve will determine when the new note is 

issued to the public. Because aggressive law 

enforcement, effective design, and public 

education are all essential components of a 

concerted anti-counterfeiting program, the 

Bureau will continue its work with the 

Advanced Counterfeit Deterrent Committee to 

research and develop future currency designs 

that will enhance and protect future notes. 

Explanation of Budget Activities 

 

Manufacturing ($530,000,000 from 

reimbursable programs) BEP manufactures 

high quality security documents that deter 

counterfeiting. These manufactured products 

are grouped into two programs: Federal 

Reserve notes and other security documents. 

The manufacturing of state-of –the-art 

currency deters counterfeiting, contributes to 

public confidence, and facilitates daily 

commerce ensuring seamless, “business as 

usual” transactions as new currency designs 

are introduced to the public. 

Protection and Accountability of Assets 

($61,000,000 from reimbursable programs)

BEP protects and accounts for its assets by 

providing effective and efficient product 

security and accountability during the 

manufacture and delivery of currency notes to 

the Federal Reserve which preserves the 

integrity of the nation’s currency. Protection 

and Accountability of Assets includes the 

protection of thousands of BEP employees and 

contractors, facilities and equipment. 

Department of the Treasury - Budget in Brief FY 2010 Page 82
Legislative Proposals 

 

Representation Funds - This legislative 

proposal would authorize the Bureau of 

Engraving and Printing to expend up to $5,000 

per fiscal year from its revolving fund for 

official reception and representation expenses. 

The Bureau’s head will use these funds to pay 

for expenses associated with official Bureau 

events, characterized by a mix of social and/or 

business purpose when hosting foreign 

dignitaries involved in the security printing 

and banking industries. 

Capital Investments Summary 

 

Major Investments: BEP has no planned 

independent major investments for 2010. BEP 

participates as a partner in significant 

Treasury-wide enterprise level investments 

such as T/Net (Treasury’s implementation of 

General Services Administration’s (GSA) 

Networx), Homeland Security Presidential 

Directive -12 (again through Treasury’s 

partnership with GSA), HRConnect (an 

Human Resources Line of Business service 

provider) and Internet Protocol version 6. 

BEP Performance by Budget Activity 

FY 2006 FY 2007 FY 2008 FY 2009 FY 2010

Budget Activity Performance Measure Actual Actual Actual Target 

Met? Target Target

Manufacturing for Manufacturing costs for currency 

BEP (dollar costs per thousand notes 

produced) ($) (E) 

27.49 28.71 29.47 Yes 34 37 

Manufacturing for Percent of currency notes delivered to 

BEP the Federal Reserve that meet 

customer quality requirements (%) 

(Oe) 

99.90 100.00 100.00 Yes 99.90 99.90 

Protection and Currency shipment discrepancies per 

Accountability of million notes (%) (Oe) 

Assets 

0.01 0.01 0.01 Yes 0.01 0.01 

Protection and Security costs per 1000 notes 

Accountability of delivered ($) (E) 

Assets 

6.25 6.00 5.65 No 5.65 5.10 

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

Description of Performance 

 

Manufacturing Costs for Currency (dollar 

cost per 1,000 notes produced) is an 

indicator of manufacturing efficiency and 

effectiveness of program management. This 

measure is based on contracted price factors, 

and anticipated productivity improvements. 

Actual performance against standard 

depends on BEP’s ability to meet annual 

spoilage, efficiency, and capacity utilization 

goals. Performance against this measure has 

been favorable for the past seven years. 

Currency Shipment Discrepancies is an 

indicator of the Bureau’s ability to provide 

effective product security and 

accountability. This measure refers to 

product overages or underages of as little as 

a single currency note in shipments of 

finished notes to the Federal Reserve Banks 

expressed as a percentage of total program. 

For several years, this measure has had an 

annual target of .01 percent. The Bureau has 

been able to meet or do better than this 

target on a regular basis. BEP continually 

strives to meet its long term goal of 0 

percent, and has been able to do so several 

times. 

Department of the Treasury - Budget in Brief FY 2010 Page 83
Department of the Treasury - Budget in Brief FY 2010 Page 84
United States Mint 

Program Summary by Budget Activity 

(Dollars in thousands) 

FY 2008 FY 2009 FY 2010 Budget Activity Obligated Estimated Estimated $ Change % Change

 Manufacturing $2,015,699 $2,055,945 $1,981,643 ($74,302) (3.6%)

 Protection $42,598 $47,441 $48,424 $983 2.1%

Total Cost of Operations $2,058,297 $2,103,386 $2,030,067 ($73,319) (3.5%)

Capital Investments $34,499 $36,810 $38,512 1,702 4.6% 

(Not included in Total Cost of Operations above) 

Explanation of Budget Estimate 

 

The United States Mint manufactures and 

delivers domestic circulating coinage, 

numismatic coinage, and bullion products. 

Furthermore, the United States Mint provides 

security for assets, including the government’s 

stock of gold bullion, silver bullion, coins and 

coinage metals. 

The United States Mint’s key priorities for 

FY 2010 include: 

• Efficiently and effectively produce and 

distribute approximately 8.5 billion coins 

to meet demand for circulating coins 

during FY 2010 to enable commerce, an 

important strategic objective for the 

Department of the Treasury. 

• Mint and issue Presidential $1 Coins for 

circulation to honor the following 

Presidents: Zachary Taylor, Millard 

Fillmore, Franklin Pierce and James 

Buchanan. 

• Mint and issue coins and products required 

by the America’s Beautiful National Parks 

Quarter-Dollar Coin Act. 

• Mint and issue the Native American $1 

Coin. 

• Prepare and distribute recurring 

numismatic and bullion products and sets, 

as well as other numismatic items, in 

quantities sufficient to make them 

accessible, available, and affordable to 

Americans who choose to purchase them. 

• Mint for sale to the public the American 

Veterans Disabled for Life 

Commemorative Coin and the Boy Scouts 

of America Centennial Commemorative 

Coin. 

FY 2010 United States Mint estimated total 

revenues are $2,449,400,000, total expenses 

are $2,030,067,000, capital investments are 

$38,512,000, and net results are $419,333,000. 

Purpose of Program 

 

Since FY 1996, the United States Mint has 

been operating under the United States Mint’s 

Public Enterprise Fund (PEF). As authorized 

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

PEF eliminates the need for appropriations. 

Proceeds from the sales of circulating coins to 

the Federal Reserve Banks and numismatic 

items to the public are the source of funding 

for operations. Both operating expenses and 

capital investments are associated with the 

production of circulating and numismatic 

coins and coin-related products and protective 

services. Revenues in excess of amounts 

required by the PEF are transferred to the 

United States Treasury General Fund. 

Department of the Treasury - Budget in Brief FY 2010 Page 85
Explanation of Budget Activities 

 

Manufacturing ($1,981,643,000 from 

reimbursable programs) The United States 

Mint manufactures and sells products. For 

budget reporting purposes, these products are 

grouped into two programs: Circulating 

Coinage and Numismatic Program.

Circulating Coinage includes the one-cent 

coin, 5-cent coin, dime, half-dollar and dollar 

used to enable the conduct of trade and 

commerce. The primary mission of the United 

States Mint is to enable commerce by minting 

and issuing circulating coinage to meet the 

needs of the United States. The United States 

Mint delivers the circulating coinage to the 

Federal Reserve Banks for distribution as 

demanded by commerce. 

Beginning in 2010 through 2018, the United 

States Mint will mint and issue “America’s 

Beautiful National Parks Quarter Dollar 

Coins” in accordance with Public Law 110-

456. This program honors national parks and 

sites in each of the 50 states in the order in 

which they were first established as a national 

park or site. Similar to the issuance of the 50 

State Quarters Program, five different coin 

designs will be issued each year of this 

program. 

The Numismatic Program prepares and 

distributes a variety of numismatic products 

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 Numismatic Program 

includes the American Eagle Program, the 

American Buffalo Program, the recurring 

programs, commemorative coins, and medals. 

The United States Mint also produces bullion 

coins under American Eagle and American 

Buffalo Programs to fulfill investor demand. 

The current FY 2010 budget estimate includes 

resource needs of $1,405 million to generate 

$1,422 million in revenues from the sale of 

these products. 

Protection ($48,424,000 from reimbursable 

programs) The United States Mint secures 

over $200 billion in market value of the 

nation’s gold reserves, silver, and other assets. 

The United States Mint Police protects United 

States Mint assets while safeguarding its 

employees against potential threats at its 

facilities across the country. The United States 

Mint Police addresses possible threats by 

ensuring good perimeter security at all sites, 

and increasing coordination with various 

Federal, state and local law enforcement 

agencies. It also ensures that proper policies 

are in place, and procedures followed, in 

handling the assets used to produce and 

transport coinage. 

Legislative Proposals 

 

The United States Mint has no legislative 

proposals for FY 2010. 

Capital Investments Summary 

 

The United States Mint’s FY 2010 circulating 

and protection capital request is $20.5 million, 

which is $6.2 million below the projected 

circulation and protection depreciation (capital 

limit) amount of $26.7 million. 

Each year, the United States Mint commits 

funds for capital projects to maintain, upgrade 

or acquire physical structures, equipment, 

physical security, and information technology 

systems. Total capital projects are estimated 

Department of the Treasury - Budget in Brief FY 2010 Page 86
to be $38.5 million in FY 2010. This includes 

approximately $12.5 million for circulating 

projects, $8.0 million for security 

improvement projects, and $18.0 million for 

numismatic projects. 

Mint Performance by Budget Activity 

FY 2006 FY 2007 FY 2008 FY 2009 FY 2010

Budget Activity Performance Measure Actual Actual Actual Target 

Met? Target Target

Manufacturing for Conversion cost per 1000 coin equivalents 

Mint ($) (E) 

7.55 7.23 8.46 No N/A N/A 

Protection for Mint Protection cost per square foot ($) (E) 32.49 31.75 31.76 Yes 31.75 31.70 

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

Description of Performance 

 

Conversion Cost per 1,000 Coin Equivalents 

The United States Mint’s costs vary by the 

volume and mix of products sold each year. 

This makes it difficult to compare operating 

results from year to year. A Coin 

Equivalent (CE) calculation is used to 

convert production output to a common 

denominator based on a fixed product cost 

ratio. In FY 2008, the conversion cost was 

$8.46 per 1000 CEs, 11 percent above the 

baseline of $7.62. CE production decreased 

to 21.3 billion in FY 2008 from 24.0 billion 

in FY 2007, because of significantly lower 

FRB orders for circulating coins. As a 

result, this FY 2008 performance measure 

was not met.

Cost per Square Foot 

Protection cost per square foot is the Office 

of Protection’s total operating cost divided 

by the United States Mint’s area of usable 

space, which is 90 percent of the total square 

footage. The cost per square foot provides a 

measurement of efficiency over time. Total 

square footage of usable space at the United 

States Mint is a stable figure and will only 

change significantly with major events such 

as the addition, removal or expansion of a 

facility. Protection cost per square foot for 

FY 2008 was $31.76, below the target of 

$32.50. 

Department of the Treasury - Budget in Brief FY 2010 Page 87
Department of the Treasury - Budget in Brief FY 2010 Page 88
Office of Comptroller of the Currency 

Program Summary by Budget Activity 

(Dollars in thousands) 

FY 2008 FY 2009 FY 2010 Appropriation Obligated Estimated Estimated $ Change % Change

 Supervise $565,921 $647,400 $693,285 $45,885 7.09%

 Regulate $87,583 $102,343 $109,597 $7,254 7.09%

 Charter $20,212 $25,586 $27,399 $1,813 7.09%

Total Cost of Operations $673,716 $775,329 $830,281 $54,952 7.09%

*FY 2010 data provided for informational purposes only. The budget information presented below is for FY 2009. 

Explanation of Budget Estimate 

 

As of December 31, 2008, The Office of the 

Comptroller of the Currency (OCC) 

supervised approximately 1,605 national bank 

charters and 50 federal branches of foreign 

banks in the United States (U.S.). Total assets 

under the OCC supervision were 

approximately $8.7 trillion or 70 percent of 

total U.S. commercial banking assets. The 

average size and complexity of the institutions 

in the national banking system continue to 

grow, creating increasing and diverse 

challenges for the OCC. 

The OCC’s priorities for fiscal year (FY) 2009 

include conducting examinations based on the 

risk profile of individual national banks to 

ensure they are safe and sound, sufficiently 

capitalized, and comply with consumer 

protection laws. The OCC is working closely 

with the Department of Treasury to implement 

provisions of the Emergency Economic 

Stabilization Act (ESSA) of 2008 and the 

administration’s Financial Stability Plan. 

Other significant activities include assessing 

national banks’ compliance with BSA/AML 

and USA PATRIOT Act requirements, 

addressing issues raised by the range of retail 

banking products offered by national banks, 

and identifying and ensuring appropriate 

follow-up to continued disruption and 

volatility in the financial and credit markets. 

The latter activities include work underway 

with other global supervisors to enhance the 

risk-based Basel II capital standards in 

response to the recent market turmoil and 

coordination among the federal banking 

agencies to oversee the implementation of 

those standards at large U.S. banking 

organizations. Coordination and cooperation 

with state regulators will be a significant focus 

for the agency. Filling key experienced and 

specialty examiner and bank supervision 

policy analyst positions, recruiting entry-level 

examiners and enhancing their retention at the 

critical three/four-year point of their careers, 

and continuing to develop the next generation 

of bank supervision leadership are also critical 

initiatives of the OCC. 

In FY 2009, an estimated $775,329,000 is 

needed to fund ongoing OCC operations and 

address program priorities effectively. 

Estimated OCC revenue for FY 2009 is 

$784,000,000. 

The OCC collects revenue primarily from 

semiannual assessments levied on national 

banks. The OCC receives no appropriated 

funds from Congress. 

Purpose of Program 

 

The OCC was created by Congress to charter 

national banks, to oversee a nationwide system 

of banking institutions, and to ensure that 

national banks are safe and sound, competitive 

Department of the Treasury - Budget in Brief FY 2010 Page 89
and profitable, and capable of serving in the 

best possible manner the banking needs of 

their customers. 

As the regulator of national banks, the OCC 

has established four strategic goals that help 

support a strong economy for the American 

public: 1) a safe and sound national banking 

system; 2) fair access to financial services and 

fair treatment of bank customers; 3) a flexible 

legal and regulatory framework that enables 

the national banking system to provide a full 

competitive array of financial services; and 4) 

an expert, highly motivated, and diverse 

workforce that makes effective use of OCC 

resources. The OCC organizes its activities 

under three programs: Supervise, Regulate, 

and Charter, to achieve the goals and 

objectives outlined in its strategic plan. 

Explanation of Budget Activities 

 

Supervise ($647,400,000 from reimbursable 

programs): The Supervise program consists 

of those ongoing supervision and enforcement 

activities undertaken to ensure that each 

national bank is operating in a safe and sound 

manner and is complying with applicable laws, 

rules, and regulations relative to the bank and 

the customers and communities it serves. This 

program includes bank examinations and 

enforcement activities; resolution of disputes 

through the National Bank Appeals process; 

ongoing monitoring of banks; and analysis of 

systemic risks and market trends in the 

national banking system or groups of national 

banks, the financial services industry, and the 

economic and regulatory environment. 

Regulate ($102,343,000 from reimbursable 

programs): The Regulate program consists of 

those ongoing activities that result in the 

establishment of regulations, policies, 

operating guidance, and interpretations of 

general applicability to national banks. These 

regulations, policies, and interpretations may 

establish system-wide standards, define 

acceptable banking practices, provide 

guidance on risks and responsibilities facing 

national banks, or prohibit (or restrict) banking 

practices deemed to be imprudent or unsafe. 

This program includes the establishment of 

examination policies, handbooks, and 

interpretations for examiners as well as 

representation of the OCC’s regulatory 

authorities and interpretations in 

administrative, judicial, and congressional 

hearings. 

Charter ($25,586,000 from reimbursable 

programs): The Charter program involves 

those ongoing activities that result in the 

chartering of national banks as well as the 

evaluation of the permissibility of structures 

and activities of national banks and their 

subsidiaries. This includes the review and 

approval of new national bank charters, federal 

branches and agencies, mergers, acquisitions, 

conversions, business combinations, corporate 

reorganizations, changes in control, operating 

subsidiaries, branches, relocations, and 

subordinated debt issues. 

Legislative Proposals 

 

OCC currently has no legislative proposals. 

Capital Investments Summary 

 

In FY 2008, OCC implemented the Workflow 

and Information Systems and Document 

Manager (WISDM). WISDM streamlines the 

Large Bank Supervision (LBS) supervisory 

processes, improves collaboration, and 

enhances the security of sensitive documents 

while providing the OCC management greater 

visibility into the status of ongoing 

Department of the Treasury - Budget in Brief FY 2010 Page 90
examinations. The system will provides LBS 

examiners and management the ability to 

collaboratively develop, securely store, search, 

and report on the status of their work 

documents. Enhancements and upgrades to 

WISDM continue into FY 2009. 

The OCC continues to develop an HSPD-12 

program for Smartcard ID issuance and 

subsequent use of that card for both physical 

access to OCC facilities and logical access to 

OCC information systems. The OCC 

continued its close coordination with the 

Treasury HSPD-12 Program Management 

Office and General Services Administration 

(GSA) Managed Service Office to implement 

the Treasury Enterprise Solution for HSPD-12. 

This Treasury and GSA solution will satisfy 

goals pertaining to the E-Government 

initiatives for sharing government-wide 

services and those goals relating to ensuring 

the interoperability of the HSPD-12 

credentials across the Government. 

The OCC Information Security program 

expanded to enable increased focus on policy, 

compliance, training, technical oversight and 

audit. A revised Federal Information Security 

Management Act (FISMA) compliant IT 

Security Policy was published. In addition to 

aligning the OCC information security 

program with FISMA requirements, the new 

security policy establishes a framework for 

addressing other information security related 

issues. 

OCC Performance by Budget Activity 

FY 2006 FY 2007 FY 2008 FY 2009 FY 2010

Budget Activity Performance Measure Actual Actual Actual Target 

Met? Target Target

Percentage of national banks that are Supervision categorized as well-capitalized (%) (Oe) 99 99 99 Yes 95 95 

Percentage of national banks with 

Supervision composite CAMELS rating of 1 or 2 (%) 

(Oe) 

95 96 92 Yes 90 90 

Percentage of national banks with 

Supervision consumer compliance rating of 1 or 2 

(%) (Oe) 

94 97 97 Yes 94 94 

Rehabilitated national banks as a 

percentage of the problem national banks Supervision one year ago (CAMELS 3, 4 or 5) (%) 

(Oe) 

46 52 47 Yes 40 40 

Percentages of licensing applications and 

Charter notices completed within established 

timeframes. (%)(Oe) 

96 94 95 Yes 95 95 

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

Description of Performance 

 

While the national banking system remains 

fundamentally sound, the effects of 

disruption and volatility in the financial and 

credit markets are working through the 

financial system. At the beginning of FY 

2009, banks rated 1 or 2 represented 92 

percent of all national banks. However, the 

impact of economic conditions on national 

banks will likely result in a decline from that 

level. As of September 30, 2008, 99 percent 

of national banks were classified as well 

capitalized and 97 percent had a consumer 

compliance rating of either 1 or 2. 

Bank regulatory agencies use the Uniform 

Financial Institutions Rating System, 

CAMELS, to provide a general framework 

for evaluating all significant financial, 

Department of the Treasury - Budget in Brief FY 2010 Page 91
operational and compliance factors inherent 

in a bank. Evaluations are made on Capital 

adequacy, Asset quality, Management, 

Earnings, Liquidity, and Sensitivity to 

market risk. The rating scale is 1 through 5 

of which 1 is the best rating granted. 

CAMELS ratings are assigned at the 

completion of every supervisory cycle or 

when there is a significant event leading to a 

change in CAMELS. Although the absolute 

number of problem banks increased in FY 

2008, during that period 47 percent of banks 

with composite CAMELS rating of 3, 4, or 5 

improved their ratings to either 1 or 2. This 

exceeded the OCC goal of 40 percent. 

The OCC’s timely and effective approval of 

corporate applications contributes to the 

nation’s economy by enabling national 

banks to complete various corporate 

transactions and introduce new financial 

products and services. Delays in providing 

prompt decisions on applications and notices 

can deprive a bank 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. The OCC completed 95 percent of 

applications and notices within the time 

standard through September 30, 2008. 

Institutions receiving decisions on their 

corporate applications and notices rated the 

OCC’s overall licensing services an average 

of 1.2. The licensing survey is based on a 

five-point rating scale, in which 1 indicates 

outstanding and 5 indicates significantly 

deficient. 

Beginning in FY 2006, the OCC 

implemented a performance measure that 

reflects the efficiency of its operations while 

meeting the increasing supervisory demands 

of a growing and more complex national 

banking system. This measure supports the 

OCC’s strategic goal of efficient use of 

agency resources. The OCC’s ability to 

control its costs while ensuring the safety 

and soundness of the banking system 

benefits all national bank customers. 

Department of the Treasury - Budget in Brief FY 2010 Page 92
Office of Thrift Supervision 

Program Summary by Budget Activity 

(Dollars in thousands) 

FY 2008 FY 2009 FY 2010 Budget Activity Obligated Estimated Estimated $ Change % Change

 Supervision of the Thrift Industry $245,699 $246,706 $181,000 ($65,706) (26.6%)

Total Cost of Operations $245,699 $246,706 $181,000 ($65,706) (26.6%)

Explanation of Budget Estimate 

 

The Office of Thrift Supervision (OTS) budget 

supports OTS’s strategic and performance 

goals that provide for the proactive supervision 

of the industry, reduced regulatory burden, and 

improved credit availability. The budget 

enables OTS to continue tailoring supervisory 

examinations to the risk profile of the 

institutions, while effectively allocating 

resources to oversee and assess the safety and 

soundness and consumer compliance record of 

the thrift industry. OTS works closely with 

the industry to maintain the profitability, 

integrity, and viability of the thrift charter. 

For FY 2009, OTS estimates that its revenues 

will total $248,850,000 and its expenditures 

will be $246,706,000. OTS receives no 

appropriated funds from Congress. The 

income of the bureau is derived principally 

from assessments on savings associations and 

savings and loan holding companies. Other 

sources of income include fees, rents, and 

interest on investments. 

Purpose of Program 

 

OTS was established by Congress as a bureau 

of the Department of the Treasury on 

August 9, 1989. The bureau’s mission is to 

supervise savings associations and their 

holding companies in order to maintain their 

safety and soundness and compliance with 

consumer laws and to encourage a competitive 

industry that meets America’s financial 

services needs. OTS’s vision is to perform, 

and to be recognized, as the premier regulator 

of financial institutions and holding 

companies. 

OTS charters, examines, supervises, and 

regulates federal savings associations insured 

by the Federal Deposit Insurance Corporation 

(FDIC). OTS also examines, supervises, and 

regulates state-chartered savings associations 

insured by the FDIC and provides for the 

registration, examination, and regulation of 

savings and loan holding companies (SLHCs) 

and other affiliates. 

Explanation of Budget Activities 

 

Supervision of the Thrift Industry 

($181,000,000 from reimbursable 

programs) OTS examines savings 

associations every 12 – 18 months for safety 

and soundness and compliance with consumer 

protection laws and regulations. During these 

exams, the association’s ability to identify, 

measure, monitor, and control risk is 

evaluated, including the risk posed by other 

entities within the corporate structure. When 

weaknesses are identified, supervisory action 

is taken. 

OTS receives no appropriated funds from 

Congress; its revenue is derived principally 

from assessments on savings associations and 

savings and loan holding companies. While 

the FY 2009 projected assessment revenue is 

consistent with FY 2008 levels, OTS continues 

Department of the Treasury - Budget in Brief FY 2010 Page 93
to monitor the impact of recent thrift failures 

and ongoing industry consolidation, driven in 

part by the current financial crisis. The bureau 

has experienced surpluses in recent years 

which led to an increase in the agency’s cash 

reserves in excess of $200 million. Existing 

reserves will be sufficient to cover any FY 

2009 shortfall. In addition, OTS is limiting 

new hires and prudently managing other 

expenses to adjust to any revenue reductions. 

With efficient operations and demonstrated 

prudent use of funds, OTS will be able to 

continue supervising savings associations and 

holding companies while maintaining the 

safety and soundness of the thrift industry for 

years to come. 

Legislative Proposals 

 

OTS currently has no legislative proposals. 

Capital Investments Summary 

 

OTS has no major IT investments planned for 

FY 2009. 

OTS Performance by Budget Activity 

FY 2006 FY 2007 FY 2008 FY 2009 FY 2010

Budget Activity Performance Measure Actual Actual Actual Target 

Met? Target Target

Supervision of the Percent of safety and soundness 

Thrift Industry exams started as scheduled (%) (Oe) 

94.00 95.00 94.00 Yes 90.00 90.00 

Supervision of the Percent of thrifts that are well 

Thrift Industry capitalized (%) (Oe) 

99.90 99.00 98.40 Yes 95.00 95.00 

Supervision of the Percent of thrifts with a compliance 

Thrift Industry examination rating of 1 or 2 (%) (Oe) 

93.00 97.00 95.80 Yes 90.00 90.00 

Supervision of the Percent of thrifts with composite 

Thrift Industry CAMELS ratings of 1 or 2 (%) (Oe) 

93.00 93.00 90.00 Yes 90.00 90.00 

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

Description of Performance 

 

OTS met all of its performance measure 

targets for FY 2008 except for “Total OTS 

Cost per $100,000 in Savings Association 

Assets Regulated,” which missed by only 

one-tenth of one percent (.1%). OTS is 

presently repositioning its resources to meet 

the requirements of supervising a smaller 

asset base. The FY 2009 Performance 

Budget describes the goals, strategies, and 

priorities that will guide OTS’s operations. 

The FY 2009 budget enables OTS to 

continue tailoring supervisory examinations 

to the risk profile of the institutions, while 

effectively allocating resources to oversee 

and assess the safety and soundness and 

consumer compliance record of the thrift 

industry. The following is a brief 

description of each performance measure: 

Percent of thrifts with composite CAMELS 

ratings of 1 or 2 On December 9, 1996, the 

Federal Financial Institutions Examination 

Council (FFIEC) adopted the CAMELS 

rating system (Capital adequacy, Asset 

quality, Management, Earnings, Liquidity 

and Sensitivity to market risk) as the internal 

rating system to be used by the federal and 

state regulators for assessing the safety and 

soundness of financial institutions on a 

uniform basis. The CAMELS rating system 

puts increased emphasis on the quality of 

risk management practices. OTS assigns a 

composite CAMELS rating to savings 

associations at each examination. OTS 

adjusts the level of supervisory resources 

devoted to an association based on the 

Department of the Treasury - Budget in Brief FY 2010 Page 94
composite rating. The CAMELS rating is 

based upon a scale of 1 through 5 in 

increasing order of supervisory concern. 

Percent of thrifts with compliance 

examination ratings of 1 or 2 A uniform, 

interagency compliance rating system was 

first approved by the FFIEC in 1980. The 

FFIEC rating system was designed to 

reflect, in a comprehensive and uniform 

fashion, the nature and extent of a savings 

association’s compliance with consumer 

protection statutes, regulations, and 

requirements. The Compliance Rating 

System is based upon a scale of 1 through 5 

in increasing order of supervisory concern. 

OTS elected to combine safety and 

soundness and compliance examinations in 

2002 to attain exam efficiencies and to 

improve risk assessment. Using 

comprehensive exam procedures, 

compliance with consumer protection laws 

is reviewed at more frequent intervals, 

which has improved the quality of the 

examination process. 

Percent of thrifts that are well capitalized - 

Capital absorbs losses, promotes public 

confidence, and provides protection to 

depositors and the FDIC insurance fund. It 

provides a financial cushion that can allow a 

savings association to continue operating 

during periods of loss or other adverse 

conditions. The Federal Deposit Insurance 

Act established a system of prompt 

corrective action (PCA) that classifies 

insured depository institutions into five 

categories (well-capitalized; adequately 

capitalized; undercapitalized, significantly 

undercapitalized; and critically 

undercapitalized) based on their relative 

capital levels. The purpose of PCA is to 

resolve the problems of insured depository 

institutions at the least possible long-term 

cost to the deposit insurance fund. 

Percent of safety and soundness exams 

started as scheduled OTS examines savings 

associations every 12-18 months for safety 

and soundness, compliance and consumer 

protection laws. OTS performs safety and 

soundness examinations of its regulated 

savings associations consistent with 

statutory authority. When safety and 

soundness or compliance issues are 

identified during its risk-focused 

examinations, OTS acts promptly to ensure 

association management and directors 

institute corrective actions to address 

supervisory concerns. OTS staff often 

meets with the savings association’s board 

of directors after delivery of the Report of 

Examination to discuss findings and 

recommendations. 

Total OTS Costs Relative to Every 

$100,000 in Savings Association Assets 

Regulated Beginning in FY 2006, OTS 

included a performance measure that reflects 

the efficiency of its operations while 

meeting the increasing supervisory demands 

of a growing and more complex thrift 

industry. This measure supports OTS’s 

ongoing efforts to efficiently use agency 

resources. The efficiency measure is 

impacted by the relative size of the savings 

associations regulated. Approximately 60 

percent of all savings associations have total 

assets of less than $250 million and are 

generally community-based organizations 

that provide retail financial services in their 

local markets. The measure does not 

include over $8.5 trillion in assets of holding 

company enterprises regulated by OTS. 

Department of the Treasury - Budget in Brief FY 2010 Page 95
Department of the Treasury - Budget in Brief FY 2010 Page 96
Treasury International Programs 

Program Summary by Appropriations Account 

(Dollars in Thousands) 

FY 2008 FY 2009 FY 2010 Appropriations Enacted Enacted President's Budget 

International Financial Institutions $1,277,289 $1,493,000 $2,341,305 

International Development Association 942,305 1,115,000 1,320,000 

Multilateral Investment Guarantee Agency 0 0 0 

Global Environment Facility 81,101 80,000 86,500 

Clean Technology Fund 500,000 

 Strategic Investment Fund 0 0 100,000 

Inter-American Development Bank: 

Multilateral Investment Fund 24,798 25,000 25,000 

Inter-American Investment Corporation 0 0 4,670 

Asian Development Bank 0 0 0 

Asian Development Fund 74,544 105,000 115,250 

African Development Bank 2,021 0 0 

African Development Fund 134,585 150,000 159,885 

European Bank for Reconstruction and Development 10 0 0 

International Fund for Agricultural Development 17,926 18,000 30,000 

Debt Restructuring $30,055 $60,000 $110,630 

Treasury Technical Assistance $20,235 $25,000 $31,440 

Total Program Level $1,327,578 $1,578,000 $2,483,375 

Explanation of Request

The FY 2010 President’s Budget request 

for the Department of the Treasury’s 

International Assistance Programs 

supports key objectives of the President's 

international assistance agenda, such as 

responding to the financial crisis, 

addressing global climate change, the 

Multilateral Debt Relief Initiative 

(MDRI), measuring results, improving 

debt sustainability, supporting grants, 

improving transparency and fighting 

corruption. Total resources required to 

support Treasury International 

Assistance Programs for FY 2010 are 

$2.483 billion, including contributions to 

the International Financial Institutions 

(IFIs) of $2.341 billion, $110.63 million 

for Debt Restructuring, and 

$31.44 million for Treasury's 

International Affairs Technical 

Assistance Programs. 

Purpose of Program

The mission of Treasury International 

Programs is to promote economic 

growth and poverty reduction in 

developing countries through U.S. 

participation in the multilateral 

development banks (MDBs), efforts to 

prevent the buildup of unsustainable 

debt burden in poor countries and 

technical advice to developing countries 

on building market-based economies. 

International Programs FY 2009 Budget Highlights 

(Dollars in Thousands) 

International Financial 

Institutions 

Technical 

Assistance 

Debt 

Restructuring Total 

FY 2008 Enacted $1,277,289 $20,235 $30,055 $1,327,578 

Increases/(Decreases) 215,711 4,765 29,945 250,422

FY 2009 Enacted $1,493,000 $25,000 $60,000 $1,578,000 

FY 2010 President's Budget Request $2,341,305 $31,440 $110,630 $2,483,375 

Department of the Treasury - Budget in Brief FY 2010 Page 97
FY 2010 Program Requests

International Financial Institutions 

(IFIs) ($2,341,305,000) 

The FY 2010 President’s Budget 

requests $2.34 billion to the multilateral 

development banks (MDBs), including 

$600.0 million to the Climate Investment 

Funds and $100.0 million to pay a 

portion of outstanding U.S. arrears, 

which now exceed $1 billion.). 

International Development Association 

(IDA) ($1,320,000,000) 

The request of $1,320.0 million includes 

the second installment of the U.S. threeyear commitment to the IDA15 

replenishment ($1,235.0 million) and 

$85 million to pay down arrears to IDA. 

Through IDA, the World Bank supports 

78 of the world’s poorest countries by 

providing the largest source of interestfree loans, grants and debt relief of any 

multilateral development institution. 

Major IDA15 initiatives and policy 

reforms include: an expanded results 

measurement system; improvements to 

World Bank engagement in fragile and 

post-conflict states, measures to further 

improve debt sustainability, and progress 

towards greater transparency and 

accountability at the institution. IDA 

funding is also necessary to meet the 

U.S. share of the costs of debt relief for 

the poorest indebted countries through 

the Multilateral Debt Relief Initiative 

(MDRI). 

Global Environment Facility (GEF) 

($86,500,000) 

The FY 2010 President’s Budget 

requests $80.0 million for the final 

installment to the fourth replenishment 

of the Global Environment Facility 

(GEF-4) and an additional $6.5 million 

to pay off a portion on U.S. arrears to the 

GEF. The GEF is the leading 

multilateral financier of projects in 

developing countries benefiting the 

global environment. It provides partial 

funding for projects in six environmental 

sectors, including projects that reduce 

greenhouse gas emissions, conserve 

global biodiversity, and prevent or 

reduce the release of long-lived, toxic 

chemicals. The GEF also helps 

developing countries strengthen their 

environmental management capacity 

enabling their economies to grow in a 

more environmentally sustainable 

manner. The GEF serves as the financial 

mechanism of the United Nations 

Framework Convention on Climate 

Change (UNFCCC) and several other 

international environmental conventions, 

and its role is expected to increase in the 

post-Kyoto Protocol period. 

Climate Investment Funds (CIF) 

($600,000,000) 

The request provides $600.0 million to 

the Climate Investment Funds, two new 

multilateral trust funds at the World 

Bank. $500.0 million is for the Clean 

Technology Fund (CTF), an effort to 

reduce the growth of greenhouse gas 

emissions in emerging economies by 

catalyzing large-scale private sector 

investments through financing the 

additional costs of commercially 

available cleaner technologies over 

dirtier, conventional alternatives. Efforts 

to create the fund were led by the United 

States, the United Kingdom, and Japan 

with considerable input and support 

from other donor and potential recipient 

countries, including China, India, and 

Brazil. The remaining $100.0 million is 

for the Strategic Climate Fund (SCF), 

Department of the Treasury - Budget in Brief FY 2010 Page 98
which will help to pilot new, 

transformative approaches to adaptation, 

forestry, and energy for the poor. CTF 

and SCF will serve as interim measures 

to immediately address climate 

challenges in developing countries and 

to constructively inform the 

development of a post-Kyoto 

international climate agreement. 

Multilateral Investment Fund (MIF) 

($25,000,000) 

The request of $25.0 million is for the 

fourth installment of the U.S. 

contribution to the first replenishment of 

the MIF. The MIF works directly with 

private sector and public sector partners 

to strengthen the environment for 

business, build the capabilities and skills 

standards of the workforce, and broaden 

the economic participation of smaller 

enterprises. MIF projects incorporate a 

significant degree of counterpart 

financing, with a goal of having 50% of 

project costs financed by local 

counterpart contributions. The MIF is 

providing highly-focused support for 

private sector development in Latin 

America and the Caribbean through the 

provision of technical assistance on 

regulatory and legal reforms, re-training 

of the workforce, and increasing 

productivity and competitiveness of 

small businesses and micro-enterprises. 

Inter-American Investment Corporation 

(IIC) ($4,670,000) 

The request of $4.7 million will cover 

10% of current cumulative U.S. arrears 

to the IIC. Ten percent of U.S. arrears 

must be paid by 2010 in order for the 

United States to not lose capital shares. 

If shares are lost, the United States loses 

considerable authority at the IIC 

including veto over transfers of shares 

among members and charter 

amendments. Also, shares lost by the 

United States will likely be purchased by 

other shareholder countries. The IIC 

promotes private small and medium-size 

enterprises (SMEs) in Latin America and 

the Caribbean. Through a combination 

of direct loans to and equity investments 

in individual companies, lending through 

private local banks, and participation in 

regional equity funds, the IIC helps 

SMEs obtain affordable capital to start 

up, expand, or modernize their 

operations. 

Asian Development Fund (AsDF) 

($115,250,000) 

The request of $115.3 million is for the 

first of four installments of the U.S. 

contribution to the ninth replenishment 

of the AsDF (AsDF10). The AsDF, the 

Asian Development Bank’s concessional 

window, provides development 

financing for investments in 

infrastructure, health, education, 

environment, and private-sector 

development, as well as policy advice to 

the poorest countries in the Asia-Pacific 

region. In the AsDF10 Agreement, the 

United States secured a number of 

important policy reforms, including: the 

completion of a grants framework 

through which grants will comprise 25% 

or more of assistance; a significant 

improvement in the results framework 

governing AsDF and AsDB operations; 

strengthened internal oversight and 

safeguards; and increased transparency.

African Development Fund (AfDF) 

($159,885,000) 

The request of $159.9 million includes 

the second of three installments of the 

U.S. contribution to the AfDF11 

replenishment ($156.1 million) and $3.8 

million to pay down arrears to AfDF10. 

AfDF is the African Development 

Bank’s concessional window and serves 

40 of the poorest countries in Africa, by 

Department of the Treasury - Budget in Brief FY 2010 Page 99
providing interest-free loans, grants and 

debt relief. Funding of the U.S. AfDF11 

commitment is needed to ensuring that 

reforms championed by the United 

States during the replenishment process, 

such as the performance-based allocation 

system and the results-measuring 

system, are implemented fully. AfDF11 

also created a Fragile States Facility to 

provide additional assistance to postconflict countries to accelerate the 

transition process from conflict and 

decline to stability and growth. AfDF 

funding is also necessary to meet the 

U.S. share of the costs of debt relief for 

the poorest indebted countries through 

the MDRI. 

International Fund for Agricultural Development 

(IFAD) ($30,000,000) 

The request of $30.0 million will cover 

the first of three payments of the U.S. 

contribution to IFAD’s eighth 

replenishment. IFAD is the only 

multilateral development institution 

focused exclusively on reducing rural 

poverty and hunger through improving 

agricultural productivity. Because of its 

mission and expertise, IFAD plays a key 

role in supporting the renewed focus on 

agricultural development, as well as 

responding to the food price crisis. 

Although prices have fallen from their 

peak, the rural poor remain profoundly 

vulnerable to the volatility of food, 

fertilizer, and food prices. IFAD8 makes 

key commitments to a number of U.S. 

priorities: a strengthened results 

measurement framework; human 

resources reform; a renewed 

performance-based allocation system; 

and a commitment to developing a 

comprehensive environmental strategy 

that will help poor farmers adapt to the 

likely impacts of climate change. 

Debt Restructuring ($110,630,000) 

The FY 2010 President’s Budget 

requests $110.63 million for the cost of 

debt restructuring programs, including 

bilateral Heavily Indebted Poor 

Countries (HIPC) initiative debt 

reduction, the HIPC Trust Fund, and the 

Tropical Forest Conservation Act 

(TFCA). The enhanced HIPC initiative 

was launched to provide deeper, broader, 

and faster debt reduction for the poor, 

heavily-indebted countries that have 

made a real commitment to economic 

reform and poverty reduction. For the 

poorest and most heavily indebted 

countries, the United States will continue 

support for bilateral debt relief though 

the Paris Club of official creditors and 

the enhanced HIPC Initiative. The 

Administration requests a total of $90.63 

million in funding for the cost of debt 

restructuring programs, including 

bilateral HIPC and poorest country debt 

reduction and the HIPC Trust Fund. 

Under the enhanced HIPC initiative, 

funding is needed to complete United 

States bilateral debt reduction for the 

Democratic Republic of the Congo 

(DRC) when the DRC reaches its HIPC 

Completion Point. Funding is also 

needed to help satisfy the $75.4 million 

in outstanding U.S. pledges to the HIPC 

Trust Fund to support debt relief from 

the regional development banks. $20.0 

million is requested for the Tropical 

Forest Conservation Act (TFCA) which 

authorizes debt relief for low and 

middle-income countries to support 

conservation of tropical forests. Under 

the program, treated debt is “redirected” 

to enable a forest fund in the beneficiary 

country to make grants to local NGOs 

and other entities engaged in forest 

conservation. The United States uses 

appropriated funds to pay for the budget 

cost of this debt reduction/redirection. 

Department of the Treasury - Budget in Brief FY 2010 Page 100
Technical Assistance ($31,440,000) 

The FY 2010 President’s Budget 

requests $31.440 million for the cost of 

the Department of Treasury’s 

International Affairs Technical 

Assistance Program. Through the Office 

of Technical Assistance (OTA), U.S. 

Treasury provides highly experienced 

financial advisors to reform-minded 

developing countries, transitional 

economies, and nations recovering from 

conflict. The program supports 

economic policy and financial 

management reforms, focusing on five 

core areas: budget and financial 

accountability; tax policy and 

administration; government debt 

issuance and management; banking and 

financial institutions; and economic 

crimes. The FY 2010 budget request, 

which is $6.4 million higher than the 

enacted level for FY 2009, will support 

approximately 70 technical assistance 

projects worldwide. This increase is 

justified by the growing need for 

Treasury technical assistance from 

countries directly affected by the 

international financial crisis and to 

maintain support for low-income 

countries (primarily in Africa and Latin 

America.), many of which are under 

increased stress due to the global 

economic downturn and other indirect 

effects of the financial crisis. There is 

strong demand for U.S. Treasury’s 

technical assistance because of the 

program’s ability to field highly 

experienced advisors quickly. Based on 

currently available information, Treasury 

foresees financial-crisis related 

assistance needs in Central and Eastern 

Europe, Latin America, Africa, and 

certain parts of Asia. Funding to support 

Treasury technical assistance in Iraq and 

Afghanistan is not included in this 

request. Funding for Iraq and 

Afghanistan will be part of a broader 

interagency package that reflects the 

administration’s strategy in these 

countries. 

Explanation of Programs 

International Financial Institutions 

($2,341,305,000 from direct appropriations) 

International Financial Institutions (IFIs) 

provide loans, grants and investments to 

developing and transition economies to 

promote growth and poverty reduction 

through their support of public and 

private projects, programs, and policy 

reforms. The IFIs are responding to the 

financial crisis by accelerating grants 

and lending programs; leveraging 

resources of donor governments, 

bilateral aid agencies and private sector 

investors; providing guarantees for trade 

finance; and coordinating assistance 

from diverse sources. 

Debt Restructuring ($110,630,000 from 

direct appropriations) 

Debt Restructuring for the poorest 

countries provides an incentive to 

implement macro-economic and 

structural reforms necessary for 

economic growth and also frees up 

resources for poverty reduction efforts. 

Debt reduction under the Tropical Forest 

Conservation Act allows for reduction of 

U.S. concessional debt and redirection of 

payments in local currency in eligible 

countries to support programs to 

conserve tropical forests. 

International Affairs Technical Assistance 

($31,440,000 from direct appropriations) 

International Affairs Technical 

Assistance provides financial advisors to 

countries seeking assistance in 

implementing significant economic 

reforms, especially during critical 

periods of transition to market-based 

economies. The program supports 

Department of the Treasury - Budget in Brief FY 2010 Page 101
economic policy and financial 

management reforms focusing on the 

functional areas of budget, revenue, 

government debt, financial institutions 

and financial crimes law enforcement. 

International Monetary Fund 

Realigning IMF quotas is part of a larger 

effort to reform the Fund's governance 

structure to ensure country voting 

weights reflect the rapid growth and 

increasing significance of dynamic 

emerging economies. Because the 

Fund's overall quota resources will be 

expanded to facilitate the realignment, 

an increase in the U.S. nominal quota is 

necessary to keep the U.S. voting share 

constant at 16.7 percent of total voting 

power in the Fund, and thus maintain our 

leadership role and our ability to shape 

the future of the institution. 

The present financial crisis demonstrates 

that, in a world of globalization and 

substantial international capital flows, 

the magnitude of crises can be larger 

than in earlier decades. The IMF does 

not have sufficient resources to cope 

with the problems facing member 

countries in today's world. The G-20 

has called for a very substantial increase 

in the IMF New Arrangements to 

Borrow (NAB) and expanding NAB 

membership to more G-20 countries. 

Consistent with the budgetary treatment 

recommended by the President's 

Commission on Budget Concepts in 

1967, the U.S. transactions with the IMF 

under the quota and NAB are monetary 

exchanges that would not increase the 

deficit in any year. 

Description of Performance 

International Financial Institutions

Responding to Financial and Food 

Crises 

The IFIs have responded aggressively to 

the financial and food crises of the last 

year and full funding of the FY 2010 

request for the MDBs is necessary to 

help ensure that they continue to assist 

developing countries withstand the 

impact of these crises and meet other 

pressing needs. To counter the impact of 

the financial crisis, IFIs are taking a 

number of steps to support emerging 

market governments, the poorest 

countries, and the developing world’s 

private sector. For example, to meet the 

critical needs of the poorest countries the 

IFIs are making up to $3 billion in 

concessional resources available faster 

than these window’s replenishments 

originally planned. The IFIs have also 

made a concerted effort to support the 

private sector, including new 

investments of over $13 billion in bank 

recapitalization and liquidity facilities, 

trade finance, and infrastructure 

financing. 

 

The IFIs have also responded with a 

number of initiatives and programs to 

respond to emerging food and 

agricultural needs. The World Bank 

approved a $1.2 billion Global Food 

Crisis Response Program in May 2008, 

the African Development Bank is 

seeking to provide up to $600 million in 

support for food crisis response and 

prevention, and the Asian Development 

Bank is planning to provide up to $500 

million in budgetary support over the 

next year to strengthening social safety 

net programs and facilitate access to 

agricultural inputs. Finally, the 

International Fund for Agricultural 

Development approved approximately 

$650 million in loans and grants in 2008, 

a 10% increase over 2007, including 

$200 million to give poor farmers access 

Department of the Treasury - Budget in Brief FY 2010 Page 102
to essential inputs such as seed and 

fertilizer. 

Reforms within International Financial 

Institutions

Through U.S. leadership in the IFI 

replenishment negotiations, key policy 

reforms were initiated, reinforced and 

extended in the international financial 

institutions. In recent years, these 

reforms included: 

• Increased grant financing for the 

poorest countries at IDA, the AfDF, 

AsDF and other MDBs; 

• Adoption of a debt sustainability 

framework to provide increased 

grant resources for the poorest 

countries and to help break the lendand-forgive cycle of development 

assistance; 

• Development of robust results-based 

management systems to incorporate 

measurable performance goals and 

demonstrate positive results on the 

ground; 

• Improvement of performance based 

allocation systems to maintain the 

centrality of performance in the 

distribution of resources; and 

• Increased efforts to promote greater 

transparency and combat corruption 

at institutional, project, country and 

regional levels. 

Debt Relief 

The 2005 Multilateral Debt Relief 

Initiative – a landmark debt relief effort 

– will cancel 100 percent of debt 

obligations owed to the World Bank’s 

International Development Association, 

the African Development Fund, and the 

IMF by the world’s poorest and most 

heavily indebted countries. Through 

U.S. efforts, a similar debt relief 

initiative was approved in 2007 for the 

Fund for Special Operations at the InterAmerican Development Bank. This 

initiative will provide critical debt relief 

to Bolivia, Guyana, Haiti, Honduras and 

Nicaragua, helping to end the lend-andforgive-cycle development assistance, 

while freeing-up funds for other poverty 

reduction efforts. 

Results Measurement 

Results measurement systems have been 

expanded significantly through the 

IDA14 and 15, AfDF10 and 11, and 

AsDF9 and 10 replenishment 

agreements which adopt clear, 

measurable goals and targets, and 

results-based management processes and 

standards. The management for results 

agenda emphasizes measures to 

strengthen the focus on delivering 

positive development results on the 

ground and the institutional management 

policies and procedures required to 

deliver them. A two-tiered results 

measurement framework is in place in 

IDA and the AfDF to measure, monitor, 

and report on outcomes and outputs at 

the project, country, regional and 

institutional levels. The AsDF 

replenishment agreement went further to 

cover the entire institution (that is, both 

tha AsDF and AsDB) across a fourtiered results measurement framework.

Transparency and Fighting Corruption 

Through U.S. leadership, the MDBs 

have continued strong efforts to improve 

transparency, including disclosure of 

MDB documents and processes, and to 

fight corruption at the project, country 

and institutional levels. For example, 

the World Bank is fully implementing 

the recommendations made in the 2007 

Volcker Panel Report which was a 

review and evaluation of the work and 

oversight mechanisms of the Bank’s 

Department of Institutional Integrity. 

Department of the Treasury - Budget in Brief FY 2010 Page 103
Debt Restructuring 

The Enhanced Heavily Indebted Poor 

Country (HIPC) Initiative continues to 

make more resources available to poor, 

heavily indebted countries, while 

providing a framework for growth 

enhancing reforms. Thirty-three 

countries demonstrated sufficient 

progress to reach their HIPC Decision 

Points as of the end of FY 2008. 

Creditors have committed to reduce the 

external debt of these 33 countries by 

over $68 billion (nominal terms) under 

the HIPC framework, freeing resources 

to support poverty reduction and 

economic growth, particularly in areas 

prioritized in their Poverty Reduction 

Strategy. In 2000, poverty-reducing 

expenditures in the post-Decision Point 

HIPCs were only about 50% larger than 

debt service payments. Consistent with 

the goal of increasing poverty reducing 

expenditures, by 2007 poverty reducing 

expenditures were estimated to be over 

eight times as large as debt service 

payments. 

Under the Tropical Forest Conservation 

Act (TFCA), a total of 14 agreements 

have now been signed with 12 countries, 

generating more than $188 million over 

time for tropical forest conservation. 

The TFCA debt swap mechanism has 

also developed a unique public/private 

partnership in which environmental 

NGOs provide additional funds for debt 

reduction, increasing the size of 

individual agreements, and contributing 

additional expertise in the management 

of resulting programs. 

Technical Assistance 

The Office of Technical Assistance 

(OTA) continues to provide financial 

technical assistance worldwide; 

currently 49 resident projects and 55 

intermittent projects are being conducted 

in 48 countries around the globe. OTA 

programming in counterpart countries 

strengthens laws, systems, and processes 

and sustains financial institutions 

(ministries, banks, bond markets, 

financial crime investigation and 

prosecution, and revenue collection). 

While OTA sometimes assists in policy 

development, its principal focus is on 

practical applications such as: drafting 

laws and regulations to reform financial 

and administrative policies; establishing 

procedures for auditing large taxpayer 

accounts; setting up bond markets; 

building working financial intelligence 

units on detection and prosecution of 

crime; or closing non-performing banks. 

In most projects, OTA assists transition 

and developing countries to build strong 

government systems and services that 

increase financial integrity, build 

capacity (both human and systems), 

integrate public and private aspects of 

the economy, eliminate weak or nonfunctioning organizations of government 

financial management, draft improved 

legislation, and fight corruption and 

terrorist financing. Some projects are 

assist countries with weak and fragile 

financial systems. In FY 2008, OTA 

provided assistance to 17 countries in 

various states of HIPC completion– 

Afghanistan, Burundi, Ethiopia, Ghana, 

Haiti, Honduras, the Kyrgyz Republic, 

Liberia, Madagascar, Malawi, 

Mozambique, Nicaragua, Niger, 

Rwanda, Sao Tome & Principe, Uganda, 

and Zambia. In some instances, OTA 

acts as a first-responder in conflict and 

post-conflict countries (as it did and 

continues to do in Afghanistan, Bosnia, 

Kosovo, and Iraq). In such cases, the 

OTA projects become part of the 

military-civilian struggle to bring an end 

Department of the Treasury - Budget in Brief FY 2010 Page 104
to the chaos of war and take steps toward 

reestablishing civil society through the 

building of strong government financial 

systems. 

Examples of results achieved by OTA in 

FY 2008: 

A regional project supported the Latin 

America Small Business Lending 

Initiative (LASBI) to increase the 

number of loans made to small 

businesses and micro-finance 

institutions, and leverage the $20.5 

million non-reimbursable line of credit 

extended by the Inter-American 

Development Bank. Support provided in 

Paraguay to the Central Bank and the 

Ministry of Finance resulted in 

development of the country’s first 

National Debt Strategy. In Niger, the tax 

administration gave significant credit to 

OTA assistance in raising tax revenues 

from 10.3% to 11.7% over a two-year 

period. The OTA Debt project in 

Rwanda has resulted in issuance of two 

and three year government bonds; and 

set the stage for corporate issuance of a 5 

year bond. Through an Economic 

Crimes project, the Philippines has been 

removed from the Non-Cooperating 

Countries and Territories list, become a 

member of the Egmont group and of the 

Steering Committee of the Asia Pacific 

Group (FATF), and completed training 

for 1,000 law enforcement personnel. 

OTA recommended eighteen improved 

performance indicators to the 

government of Costa Rica that have 

proved so effective in pilot ministries 

that they are being expanded to 

government-wide application. A 

Revenue project in Honduras has 

resulted in a planned government rollout of civil service reform including 

legal prohibitions against non-merit 

based human resources decisions. 

Improvements in Nicaragua’s tax 

administration recommended by OTA 

resulted in a 34% ($10.6 million) 

increase in enforced collections from 

January to August 2008. 

Although it is difficult to measure 

activities related to such varied technical 

assistance projects (quantitative 

measures fail to fully describe the impact 

of this important work), OTA conducted 

three separate organizational evaluation 

efforts in FY 2008: a systematic 

client/customer survey; a program peer 

revue carried out by the Australian 

Treasury; and a revised measurement 

system approved by OMB and 

highlighted as an innovative practice at 

the annual Excellence in Government 

conference. Each of these performance 

evaluation initiatives provided both 

positive confirmation of OTA’s past and 

current effectiveness, and has provided 

precise information on areas where 

further program strengthening may be 

realized. 

 

Department of the Treasury - Budget in Brief FY 2010 Page 105
Department of the Treasury - Budget in Brief FY 2010 Page 106
Summary of FY 2010 Appropriations Language 

Below is a summary of proposed appropriations 

language changes from the FY 2009 enacted 

level. Please note that brackets indicate which 

material will be deleted, and italics indicate 

which material will be inserted. 

Departmental Offices 

___________________________________ 

Salaries and Expense 

(Including Transfer of Funds) 

For necessary expenses of the Departmental 

Offices including operation and maintenance of 

the Treasury Building and Annex; hire of 

passenger motor vehicles; maintenance, repairs, 

and improvements of, and purchase of 

commercial insurance policies for, real 

properties leased or owned overseas, when 

necessary for the performance of official 

business, [$278,870,000, of which not to exceed 

$21,619,000 is for executive direction program 

activities; not to exceed $45,910,000 is for 

economic policies and programs activities; not 

to exceed $36,039,000 is for financial policies 

and programs activities; not to exceed 

$62,098,000 is for terrorism and financial 

intelligence activities; not to exceed $21,600,000 

is for Treasury-wide management policies and 

programs activities; and not to exceed 

$91,604,000 is for administration programs 

activities: Provided, That the Secretary of the 

Treasury is authorized to transfer funds 

appropriated for any program activity of the 

Departmental Offices to any other program 

activity of the Departmental Offices upon 

notification to the House and Senate Committees 

on Appropriations: Provided further, That no 

appropriation for any program activity shall be 

increased or decreased by more than 4 percent 

by all such transfers: Provided further, That any 

change in funding greater than 4 percent shall be 

submitted for approval to the House and Senate 

Committees on Appropriations] $302,388,000: 

Provided, That of the amount appropriated under 

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

remain available until September 30, [2010] 

2011, is for information technology 

modernization requirements; not to exceed 

$200,000 is for official reception and 

representation expenses; and not to exceed 

$258,000 is for unforeseen emergencies of a 

confidential nature, to be allocated and expended 

under the direction of the Secretary of the 

Treasury and to be accounted for solely on his 

certificate: Provided further, That of the amount 

appropriated under this heading, [$5,232,443]

$6,787,000, to remain available until September 

30, [2010] 2011, is for the Treasury-wide 

Financial Statement Audit and Internal Control 

Program, of which such amounts as may be 

necessary may be transferred to accounts of the 

Department's offices and bureaus to conduct 

audits: Provided further, That this transfer 

authority shall be in addition to any other 

provided in this Act: Provided further, That of 

the amount appropriated under this heading, 

$500,000, to remain available until September 

30, [2010] 2011, is for secure space 

requirements: [Provided further, 

That of the amount appropriated under this 

heading, $1,100,000, to remain available until 

September 30, 2010, is for salary and benefits 

for hiring of personnel whose work will require 

completion of a security clearance investigation 

in order to perform highly classified work to 

further the activities of the Office of Terrorism 

and Financial Intelligence:] Provided further, 

That of the amount appropriated under this 

heading, $3,400,000, to remain available until 

September 30, [2011] 2012, is to develop and 

implement programs within the Office of 

Critical Infrastructure Protection and 

Compliance Policy, including entering into 

cooperative agreements: Provided further, That 

of the amount appropriated under this heading 

$3,000,000 to remain available until September 

30, [2011]

2012, is for modernizing the Office of Debt 

Management's information technology. 

Department of the Treasury - Budget in Brief FY 2010 Page 107
(Department of the Treasury Appropriations 

Act, 2009.)

Department-wide Systems and Capital 

Investments Programs 

___________________________________ 

(Including Transfer of Funds) 

For development and acquisition of automatic 

data processing equipment, software, and 

services for the Department of the Treasury, 

[$26,975,000] $9,544,000, to remain available 

until September 30, [2011] 2012: Provided, That 

[$11,518,000] $4,544,000 is for repairs to the 

Treasury Annex Building: Provided further, 

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''. (Department of the Treasury 

Appropriations Act, 2009.)

Office of Inspector General 

___________________________________ 

Salaries and Expenses 

For necessary expenses of the Office of 

Inspector General in carrying out the provisions 

of the Inspector General Act of 1978, as 

amended, $26,700,000, of which not to exceed 

$2,000,000 for official travel expenses, 

including hire of passenger motor vehicles; and 

of which not to exceed 

$100,000 for unforeseen emergencies of a 

confidential nature, to be allocated and expended 

under the direction of the Inspector General of 

the Treasury[, $26,125,000, of which not to 

exceed $2,500 shall be available for official 

reception and representation expenses]. 

(Department of the Treasury Appropriations 

Act, 2009.) 

Treasury Inspector General for Tax 

Administration 

___________________________________ 

Salaries and Expenses 

For necessary expenses of the Treasury 

Inspector General for Tax Administration in 

carrying out the Inspector General Act of 1978, 

as amended, including purchase (not to exceed 

150 for replacement only for 

police-type use) and hire of passenger motor 

vehicles (31 U.S.C. 1343(b)); services 

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

may be determined by the Inspector General for 

Tax Administration; [$146,083,000]

$149,000,000, of which not to exceed 

$6,000,000 shall be available for official travel 

expenses; and 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]. 

(Department of the Treasury Appropriations 

Act, 2009.)

Treasury Forfeiture Fund 

___________________________________ 

[(Rescission] (Cancellation) 

Of the unobligated balances available under this 

heading, [$30,000,000] $50,000,000 are 

[rescinded] hereby permanently cancelled. 

(Department of the Treasury Appropriations 

Act, 2009.) 

Community Development Financial 

Institutions Fund 

___________________________________ 

Program Account 

To carry out the Community Development 

Banking and Financial Institutions Act of 1994 

(Public Law 103-325), including services 

authorized by 5 U.S.C. 3109, but at rates for 

individuals not to exceed the per diem rate 

equivalent to the rate for ES-3, [$107,000,000] 

$243,600,000, to remain available until 

September 30, [2010] 2011, of which 

Department of the Treasury - Budget in Brief FY 2010 Page 108
[$8,500,000] $113,600,000 shall be for the 

Community Development Financial Institutions

Program; of which $10,000,000 shall be for 

financial assistance, technical assistance, 

training and outreach programs under sections 

105 through 109 of the Community Development 

Banking and Financial Institutions Act of 1994 

(12 U.S.C. 4704-4708), designed to benefit 

Native[ American, Native Hawaiian, and 

Alaskan Native] communities and provided 

primarily through qualified community 

development lender organizations with 

experience and expertise in community 

development banking and lending in Indian 

country, Native American organizations, tribes 

and tribal organizations and other suitable 

providers[, $2,000,000 shall be available for the 

pilot project grant program under section 

1132(d) of division A of the Housing and 

Economic Recovery Act of 2008 (Public Law 

110-289)], notwithstanding sections 108(d) and 

108(e) of such Act (12 U.S.C. 4707(d) and 

4707(e)); and of which $80,000,000 shall be

transferred to the "Capital Magnet Fund", as 

authorized by section 1339 of the Federal 

Housing Enterprises Financial Safety and 

Soundness Act of 1992 (12 U.S.C. 1301 et seq.), 

as amended by section 1331 of the

Housing and Economic Recovery Act of 2008 

("HERA"; Public Law 110-289), to support 

financing for affordable housing and economic 

development projects: Provided further, That 

section 1339(h)(3) of the Federal Housing 

Enterprises Financial Safety and Soundness Act 

of 1992, as amended by section 1131 of HERA, 

shall be applied by substituting the term "at least 

10 times the grant amount or such other amount 

(including none) that the Secretary may require" 

for "at least 10 times the grant amount"; and up 

to [$14,750,000] $18,000,000 may be used for 

administrative expenses, including 

administration of the New Markets Tax Credit[, 

up to $7,500,000 may be used for the cost of 

direct loans, and up to $250,000 may be used for 

administrative expenses to carry out the direct 

loan program: Provided, That the cost of direct 

loans, including

the cost of modifying such loans, shall be as 

defined in section 502 of the Congressional 

Budget Act of 1974: Provided further, That 

these funds are available to subsidize gross 

obligations for the principal amount of direct 

loans not to exceed $16,000,000] Program. 

(Department of the Treasury Appropriations 

Act, 2009.)

Financial Crimes Enforcement Network 

___________________________________

Salaries and Expenses 

For necessary expenses of the Financial Crimes 

Enforcement Network, including hire of 

passenger motor vehicles; travel and training 

expenses, including for course development, of 

non-Federal and foreign government personnel 

to attend meetings and training concerned with 

domestic and foreign financial intelligence 

activities, law enforcement, and financial 

regulation; not to exceed $14,000 for official 

reception and representation expenses; and for 

assistance to Federal law enforcement agencies, 

with or without reimbursement, [$91,465,000] 

$102,760,000, of which not to exceed 

[$16,340,000] $26,085,000 shall remain 

available until September 30, [2011] 2012; and 

of which [$9,178,000] $9,316,000 shall remain 

available until September 30, [2010] 2011: 

Provided, That funds appropriated in this 

account may be used to procure personal 

services contracts. 

(Department of the Treasury Appropriations 

Act, 2009.) 

Financial Management Service 

______________________________________

Salaries and Expenses 

For necessary expenses of the Financial 

Management Service, [$239,785,000] 

$244,132,000, of which not to exceed 

$9,220,000 shall remain available until 

September 30, [2011] 2012, for information 

systems modernization initiatives; and of which 

not to exceed $2,500 shall be available for 

Department of the Treasury - Budget in Brief FY 2010 Page 109
official reception and representation expenses. 

(Department of the Treasury Appropriations 

Act, 2009.)

Alcohol and Tobacco Tax and Trade Bureau 

___________________________________

Salaries and Expenses 

For necessary expenses of carrying out section 

1111 of the Homeland Security Act of 2002, 

including hire of passenger motor vehicles, 

[$99,065,000] $105,000,000; of which not to 

exceed $5,500,000 for administrative expenses 

related to implementation of the fees authorized 

by 27U.S.C. Section 202, as amended by this 

Act, to remain available until September 30, 

2011; not to exceed $6,000 for official reception 

and representation expenses; not to exceed 

$50,000 for cooperative research and

development programs for laboratory services; 

and provision of laboratory assistance to State 

and local agencies with or without 

reimbursement: Provided, That [of the amount 

appropriated under this heading,

$2,000,000, to remain available until September 

30, 2010, is for information technology 

management] the sum herein appropriated from 

the general fund shall be reduced as offsetting 

collections assessed and collected pursuant to 

the Federal Alcohol Administration Act (27 

U.S.C. 201 et seq.), as amended by this Act, are 

received during fiscal year 2010, so as to result 

in a fiscal year 2010 appropriation from the 

general fund estimated at $25,000,000: 

Provided further, That any amount received in

excess of $80,000,000 in fiscal year 2010 shall 

be available only to the extent provided in 

subsequent appropriations acts. (Department of 

the Treasury Appropriations Act, 2009.)

United States Mint 

___________________________________ 

United States Mind Public Enterprise Fund 

Pursuant to section 5136 of title 31, United 

States Code, the United States Mint is provided 

funding through the United States Mint Public 

Enterprise Fund for costs associated with the 

production of circulating coins, numismatic 

coins, and protective services, including both 

operating expenses and capital investments. The 

aggregate amount of new liabilities and 

obligations incurred during fiscal year [2009] 

2010 under such section 5136 for circulating 

coinage and protective service capital 

investments of the United States Mint shall not 

exceed [$42,150,000] $26,700,000. (Department 

of the Treasury Appropriations Act, 2009.)

Bureau of the Public Debt 

___________________________________ 

Administering the Public Debt 

For necessary expenses connected with any 

public-debt issues of the United States, 

[$187,352,000] $192,244,000, of which not to 

exceed $2,500 shall be available for official 

reception and representation expenses, and of 

which not to exceed $2,000,000 shall remain 

available until September 30, [2011] 2012, for 

systems modernization: Provided, That the sum 

appropriated herein from the general fund for 

fiscal year [2009] 2010 shall be reduced by not 

more than $10,000,000 as definitive security 

issue fees and Legacy Treasury Direct Investor 

Account Maintenance fees are collected, so as to 

result in a final fiscal year [2009] 2010 

appropriation from the general fund estimated at 

[$177,352,000] $182,244,000. In addition, 

$90,000 to be derived from the Oil Spill 

Liability Trust Fund to reimburse the Bureau for 

administrative and personnel expenses for 

financial management of the Fund, as authorized 

by section 1012 of Public Law 101-380. 

(Department of the Treasury Appropriations

Act, 2009.)

Internal Revenue Service 

___________________________________ 

Taxpayer Services 

For necessary expenses of the Internal Revenue 

Service to provide taxpayer services, including 

pre-filing assistance and education, filing and 

account services, taxpayer advocacy services, 

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

3109, at such rates as may be determined by the 

Department of the Treasury - Budget in Brief FY 2010 Page 110
Commissioner, [$2,293,000,000] 

$2,269,830,000, of which not less than 

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

the Elderly Program, of which not less than 

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

taxpayer clinic grants, [of which not less than 

$8,000,000, to remain available until September 

30, 2010, shall be available for a Community 

Volunteer Income Tax Assistance matching 

grants demonstration program for tax return 

preparation assistance, and of which not less 

than $193,000,000 shall be available for 

operating expenses of the Taxpayer Advocate 

Service] of which not more than $8,000,000, to 

remain available until September 30, 2011, shall 

be available for Community Volunteer Tax 

Assistance matching grants. (Department of the 

Treasury Appropriations Act, 2009.) 

Enforcement 

(Including Transfer of Funds) 

For necessary expenses for tax enforcement 

activities of the Internal Revenue Service to 

determine and collect owed taxes, to provide 

legal and litigation support, to conduct criminal 

investigations, to enforce criminal statutes 

related to violations of internal revenue laws and 

other financial crimes, [to]for the purchase (for 

police-type use, not to exceed 850) and hire 

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

and to provide other services as authorized by 5 

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

by the Commissioner, 

[$5,117,267,000]$4,904,000,000, of which not 

less than [$57,252,000]$59,206,000 shall be for 

the Interagency Crime and Drug Enforcement 

program; and of which not to exceed $126,500 

shall be for official reception and representation 

expenses associated with hosting the Leeds 

Castle Meeting in the United States during

2010: Provided, That up to $10,000,000 may be 

transferred as necessary from this account to 

"Operations Support'' solely for the purposes of 

the Interagency Crime and Drug Enforcement 

program: Provided further, That this transfer 

authority shall be in addition to any other 

transfer authority provided in this Act. In 

addition to amounts made available above, 

$600,000,000 shall be made available for 

enhanced tax enforcement activities. 

(Department of the Treasury Appropriations 

Act, 2009.)

Operations Support 

For necessary expenses of the Internal Revenue 

Service to support taxpayer services and 

enforcement programs, including rent payments; 

facilities services; printing; postage; physical 

security; headquarters and other IRS-wide 

administration activities; research and statistics 

of income; telecommunications; information 

technology development, enhancement, 

operations, maintenance, and security; the hire 

of passenger motor vehicles (31 U.S.C. 

1343(b)); and other services as authorized by 5 

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

by the Commissioner; [$3,867,011,000] 

$4,082,984,000, of which up to $75,000,000 

shall remain available until September 30, 

[2010] 2011, for information technology 

support; of which not to exceed $1,000,000 shall 

remain available until September 30, [2011] 

2012, for research; of which not [less than 

$2,000,000] to exceed $1,750,000 shall be for 

the Internal Revenue Service 

Oversight Board; [and] of which not to exceed 

$25,000 shall be for official reception and 

representation; and of which $290,000,000 shall 

be made available to support enhanced tax 

enforcement activities: Provided, That of the 

amounts provided under this heading, such sums 

as are necessary shall be available to fully 

support tax enforcement and enhanced tax 

enforcement activities. (Department of the 

Treasury Appropriations Act,

2009.) 

Business Systems Modernization 

For necessary expenses of the Internal Revenue 

Service's business systems modernization 

program, [$229,914,000] $253,674,000, to 

remain available until September 30, [2011] 

2012, for the capital asset acquisition of 

Department of the Treasury - Budget in Brief FY 2010 Page 111
information technology systems, including 

management and related contractual costs of 

said acquisitions, including related Internal 

Revenue Service labor costs, and contractual 

costs associated with operations authorized by 5 

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

of labor costs, none of these funds may be 

obligated until the Internal Revenue Service 

submits to the Committees on Appropriations[, 

and such Committees approve,] a plan for 

expenditure that: (1) meets the capital planning 

and investment control review requirements 

established by the Office of Management and 

Budget, including Circular A-11; (2) complies 

with the Internal Revenue Service's enterprise 

architecture, including the modernization 

blueprint; (3) conforms with the Internal 

Revenue Service's enterprise life cycle 

methodology; (4) is approved by the Internal 

Revenue Service, the Department of the 

Treasury, and the Office of Management and 

Budget; (5) has been [reviewed] received by the 

Government Accountability Office; and (6) 

complies with the acquisition rules, 

requirements, guidelines, and systems 

acquisition management practices of the Federal 

Government. (Department of the Treasury

Appropriations Act, 2009.)

Health Insurance Tax Credit Administration 

For expenses necessary to implement the health 

insurance tax credit included in the Trade Act of 

2002 (Public Law 107-210), 

[$15,406,000]$15,512,000. (Department of the 

Treasury Appropriations Act, 2009.)

Administrative Provisions-Internal Revenue 

Service 

(Including Transfer of Funds) 

___________________________________ 

SEC. 101. Not to exceed 5 percent of any 

appropriation made available in this Act to the 

Internal Revenue Service or not to exceed 3 

percent of appropriations under the heading 

"Enforcement'' may be transferred to any other 

Internal Revenue Service appropriation upon the 

advance [approval] notification of the 

Committees on Appropriations. 

SEC. 102. The Internal Revenue Service shall 

maintain a training program to ensure that 

Internal Revenue Service employees are trained 

in taxpayers' rights, in dealing courteously with 

taxpayers, and in crosscultural relations. 

SEC. 103. The Internal Revenue Service shall 

institute and enforce policies and procedures that 

will safeguard the confidentiality of taxpayer 

information. 

[SEC. 104. Funds made available by this or any 

other Act to the Internal Revenue Service shall 

be available for improved facilities and 

increased staffing to provide sufficient and 

effective 1-800 help line service for taxpayers. 

The Commissioner shall continue to make the 

improvement of the Internal Revenue Service 1-

800 help line service a priority and allocate 

resources necessary to increase phone lines and 

staff to improve the Internal Revenue Service 1-

800 help line service.]

[SEC. 105. Of the funds made available by this 

Act to the Internal Revenue Service, not less 

than $6,997,000,000 shall be available only for 

tax enforcement. In addition, of the funds made 

available by this Act to the Internal Revenue 

Service, and subject to the same terms and 

conditions, $490,000,000 shall be available for 

enhanced tax law enforcement.]

[SEC. 106. None of the funds made available in 

this Act may be used to enter into, renew, 

extend, administer, implement, enforce, or 

provide oversight of any qualified tax collection 

contract (as defined in section 6306 of the 

Internal Revenue Code of 1986). ] (Department 

of the Treasury Appropriations Act, 2009.)

Administrative Provisions—Department of 

the Treasury 

Department of the Treasury - Budget in Brief FY 2010 Page 112
(Including Transfer of Funds) 

___________________________________ 

SEC. 107. Appropriations to the Department of 

the Treasury in this Act shall be available for 

uniforms or allowances therefore, as authorized 

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

repairs, and cleaning; purchase of insurance for 

official motor vehicles operated in foreign 

countries; purchase of motor vehicles without 

regard to the general purchase price limitations 

for vehicles purchased and used overseas for the 

current fiscal year; entering into contracts with 

the Department of State for the furnishing of 

health and medical services to employees and 

their dependents serving in foreign countries; 

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

SEC. 108. Not to exceed 2 percent of any 

appropriations in this Act made available to the 

Departmental Offices—Salaries and Expenses, 

Office of Inspector General, Financial 

Management Service, Alcohol and 

Tobacco Tax and Trade Bureau, Financial 

Crimes Enforcement Network, and Bureau of 

the Public Debt, may be transferred between 

such appropriations upon the advance [approval 

of]notification to the Committees on 

Appropriations: Provided, That no transfer may 

increase or decrease any such appropriation by 

more than 2 percent. 

SEC. 109. Not to exceed 2 percent of any 

appropriation made available in this Act to the 

Internal Revenue Service may be transferred to 

the Treasury Inspector General for Tax 

Administration's appropriation upon the advance 

[approval of]notification to the Committees on 

Appropriations: Provided, That no transfer may 

increase or decrease any such 

appropriation by more than 2 percent. 

SEC. 110. Of the funds available for the 

purchase of law enforcement vehicles, no funds 

may be obligated until the Secretary of the 

Treasury certifies that the purchase by the 

respective Treasury bureau is consistent with 

departmental vehicle management principles: 

Provided, That the Secretary may delegate this 

authority to the Assistant Secretary for 

Management. 

SEC. 111. None of the funds appropriated in this 

Act or otherwise available to the Department of 

the Treasury or the Bureau of Engraving and 

Printing may be used to redesign the $1 Federal 

Reserve note. 

SEC. 112. The Secretary of the Treasury may 

transfer funds from Financial 

Management Service, Salaries and Expenses to 

the Debt Collection Fund as necessary to cover 

the costs of debt collection: Provided, That such 

amounts shall be reimbursed to such salaries and 

expenses account from debt collections received 

in the Debt Collection Fund. 

SEC. 113. Section 122(g)(1) of Public Law 105-

119 (5 U.S.C. 3104 note), is further amended by 

striking "[10] 11 years'' and inserting "[11] 12

years''. 

[SEC. 114. None of the funds appropriated or 

otherwise made available by this or any other 

Act may be used by the United States Mint to 

construct or operate any museum without the 

explicit approval of the Committees on 

Appropriations of the House of Representatives 

and the Senate, the House Committee on 

Financial Services, and the Senate Committee on 

Banking, Housing, and Urban Affairs.]

[SEC. 115. None of the funds appropriated or 

otherwise made available by this or any other 

Act or source to the Department of the Treasury, 

the Bureau of Engraving and Printing, and the 

United States Mint, individually or collectively, 

may be used to consolidate any or all functions 

of the Bureau of Engraving and Printing and the 

United States Mint without the explicit 

approval of the House Committee on 

Financial Services; the Senate Committee on 

Banking, Housing, and Urban Affairs; the 

Department of the Treasury - Budget in Brief FY 2010 Page 113
House Committee on Appropriations; and the 

Senate Committee on Appropriations.] 

SEC. [116]114. Funds appropriated by this 

Act, or made available by the transfer of funds 

in this Act, for the Department of the 

Treasury's intelligence or intelligence related 

activities are deemed to be specifically 

authorized by the Congress for purposes of 

section 504 of the National 

Security Act of 1947 (50 U.S.C. 414) during 

fiscal year [2009] 2010 until the enactment of 

the Intelligence Authorization Act for Fiscal 

Year [2009] 2010. 

SEC. [117]115. Not to exceed $5,000 shall be 

made available from the Bureau of Engraving 

and Printing's Industrial Revolving Fund for 

necessary official reception and representation 

expenses. 

SEC. 116. The Secretary is authorized to 

establish additional Treasury accounts for the 

Alcohol & Tobacco Tax and Trade Bureau, 

Department of the Treasury; U.S. Customs 

and Border Protection, Department of 

Homeland Security; and the Bureau of 

Alcohol, Tobacco Firearms and 

Explosives, Department of Justice, for 

purposes of administering refunds under 31 

U.S.C. 1324. (Department of the Treasury 

Appropriations Act, 2009.) 

Department of the Treasury - Budget in Brief FY 2010 Page 114
Total Funding Levels for the FY 2010 President’s Budget – Treasury Chapter 

Appropriations (Dollars in Millions) FY 2008 FY 2009 FY 2010 Increase/ Increase/ 

Enacted Estimate Estimate Decrease Decrease 

ANNUAL APPROPRIATIONS $12,275 $12,685 $13,361 $676 5.3% 

INTEREST PAYMENTS: 

 Interest on Public Debt 451,154 392,321 $62,172 454,493 15.8% 

 Refunding Internal Revenue Collections, Interest 4,487 3,290 $209 3,499 6.4% 

 Interest on Uninvested Funds 9 8 $0 8 0.0% 

 Interest Paid To Credit Financing Accounts 5,378 69,889 -$51,209 18,680 -73.3% 

 Fed. Interest Liabilities to States 1 2 $0 2 0.0% 

 Payment to Resolution Funding Corp 1,393 2,157 $28 2,185 1.3% 

 Subtotal, INTEREST PAYMENTS $462,422 $467,667 $478,867 $11,200 2.4% 

 OTHER INTEREST: 1/ -$13,972 -$132,310 -$130,337 $1,973 -1.5% 

 Subtotal, Net Interest $448,450 $335,357 $348,530 $13,173 3.9% 

PERMANENT AUTHORITY APPROPRIATIONS: 

 Terrorism Insurance Program 3 108 $257 365 238.0% 

 GSE Preferred Stock Purchase Program 200,000 200,000 -$200,000 0 0.0% 

 GSE Mortgage-Backed Securities Purchase Program 0 50 -$37 13 -74.0% 

 Office of Financial Stability 0 279 -$17 262 -6.1% 

 Troubled Asset Relief Program (TARP) 0 114,686 -$114,686 0 -100.0% 

 Troubled Asset Relief Program Equity Purchase Program 0 141,555 -$141,555 0 -100.0% 

 Troubled Asset Relief Program Home Affordable Modification Program 0 50,000 -$50,000 0 -100.0% 

 Financial Stabilization Reserve 0 250,000 -$250,000 0 -100.0% 

 Special Inspector General for Troubled Asset Relief Program 0 50 -$50 0 -100.0% 

 Grants to States for Low-Income Housing Projects 0 2,930 -$2,930 0 -100.0% 

 Grants for Specified Energy Property 0 346 $205 551 59.2% 

 Exchange Stabilization Fund-Money Market Mutual Fund 0 1,687 -$1,687 0 -100.0% 

 Community Development Financial Institutions Fund Program 1 

 Presidential Election Campaign Fund 49 50 $0 50 0.0% 

 Treasury Forfeiture Fund 579 655 -$297 358 -45.3% 

 Biomass Energy Development -8 -11 $0 -11 0.0% 

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

 Debt Collection Special Fund (FMS) 97 63 $0 63 0.0% 

 Financial Agent Services 536 581 $15 596 2.6% 

 Federal Reserve Bank Reimbursement by -- 

 FMS 304 305 $16 321 5.2% 

 BPD 138 113 $29 142 25.7% 

 Claims, Judgments and Relief Acts 786 962 -$143 819 -14.9% 

 Check Forgery Insurance Fund 0 2 $0 2 0.0% 

 Continued Dumping and Subsidy Offset 396 396 -$396 0 0.0% 

 Internal Revenue Collections for Puerto Rico 373 491 -$5 486 -1.0% 

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

 IRS User Fees 118 106 -$8 98 -7.5% 

 Payment Where Recovery Rebate Exceeds Liability for Tax 15,281 3,002 -$3,002 0 -100.0% 

 Payment Where EIC Exceeds Liability for Tax 40,600 41,461 $4,213 45,674 10.2% 

 Payment Where Child Credit Exceeds Liability for Tax 34,019 23,196 $2,377 25,573 10.2% 

 Payment Where Health Care Credit Exceeds Liability for Tax 97 156 $101 257 64.7% 

 Payment where AMT Credit Exceeds Liability for Tax 0 1,279 -$430 849 -33.6% 

 Payment where Certain Tax Credit Exceeds Liability for Corporate 0 269 -$269 0 -100.0% 

 Payment Where Tax Credit to Aid First-Time 

 Homebuyers Exceeds Liability for Tax 0 3,861 1,421 -$2,440 -63.2% 

 Payment Where American Opportunity Credit Exceeds Liability for Tax 0 0 1,616 $1,616 100.0% 

 Making Work Pay Tax Credit 0 662 $19,007 19,669 2871.1% 

 Build American Bond Payments, Recovery Act 0 91 $249 340 273.6% 

 Payment Where COBRA Credit Exceeds Liability for Tax 0 1,922 -$904 1,018 -47.0% 

 Payment Where Tax Credit for Certain Government Retirees Exceeds Liability for 

 Tax 0 0 

$99 

99 

100.0% 

 IRS Miscellaneous Retained Fees 70 70 $0 70 0.0% 

 IRS Informant Payments 21 50 $25 75 50.0% 

 Private Collection Agent Program 13 9 -$9 0 -100.0% 

 Offsets: 

 GSE Mortgage-Backed Securities Direct Loans, Negative Subsidies -54 -5,876 $3,638 -2,238 -61.9% 

 Troubled Asset Relief Program, Negative Subsidies 0 -752 $752 0 -100.0% 

 Proceeds, GSE Equity Related Transactions 0 -4,241 -$2,439 -6,680 57.5% 

 Excess of Proceeds from Debt Obligations Issued by Black Lung 0 -2,496 $2,496 0 -100.0% 

 Other Offsets -2,874 -2,285 $191 -2,094 -8.4% 

 Subtotal Offsets: -2,928 -15,650 $4,638 -11,012 -29.6% 

 Subtotal, PERMANENT AUTH. APPROP $290,551 $825,788 $89,770 -$736,018 -89.1% 

TOTAL, DEPARTMENT OF THE TREASURY $751,276 $1,173,830 $451,661 -$722,169 -61.5% 

1/ Change from FY 2008 to FY2009 and FY 2010 is mostly due to increase in interest received from TARP and GSE Credit Financing Accounts . 

 

Department of the Treasury - Budget in Brief FY 2010 Page 115
Department of the Treasury - Budget in Brief FY 2010 Page 116
Detail of Other Treasury Accounts 

Total Treasury Department Budget

The Treasury Chapter of the FY 2010 

President’s Budget covers the following 

areas: 

Annual Operating Appropriations (Most 

Treasury Bureaus) – $13.4 billion 

These are funds for Treasury operations 

which require annual appropriation action 

by the Congress. Bureau operating budget 

details are provided in the “Analysis of FY 

2010 President’s Budget” section. 

Interest Payments and other interest – 

$477.5 billion 

These are permanent, indefinite funds for 

interest payments needed: to finance the 

public debt; by the IRS on refunds of taxes 

to taxpayers; and on special accounts 

handled through the Treasury. 

Permanent Authority Appropriations and 

other Offsets – $89.8 billion 

These are special accounts for which the 

Congress has given the Department of 

Treasury permanent authority to expend 

funds as appropriations, such as: payments 

made when the earned income credit, child 

credit, and health care credit exceeds the 

taxpayer's tax liability; payments to the 

Resolution Funding Corporation; 

reimbursements to Federal Reserve Banks; 

special claims and damage payments 

required as a result of judgments against the 

U.S. government; payments to Presidential 

candidates and their parties in accordance 

with Federal Election Commission 

certification; and other accounts. 

Offsetting Collections – $11.0 billion 

Treasury receipts from other government 

agencies and private sources are subtracted 

from the total Treasury budget as an offset. 

Interest Payments

Interest on the Public Debt 

The Federal Government's outstanding debt 

requirements are financed through 

borrowing (e.g., auctions of Treasury Bills, 

Notes, and Bonds). Funds paid to lenders 

for the use of their money is paid from the 

Interest on the Public Debt appropriation. 

Interest on the Public Debt includes all 

interest paid on Treasury securities sold to 

the public (e.g., foreign and domestic 

financial institutions, individuals, insurance 

companies, state and local governments, 

etc.) and to Federal Government trust funds, 

revolving funds and deposit funds. 

Interest on IRS Refunds 

Under certain conditions in the tax law, the 

IRS must pay interest on Internal Revenue 

collections that must be refunded -- 

amended returns, delayed refunds of more 

than 45 days from the due date of the return, 

corporation losses covering prior year 

returns, results of tax audits, etc. The rate of 

interest changes every three months to 

reflect the prime interest rate then in effect. 

Interest on Uninvested Funds 

Under conditions of the law creating each 

trust account, interest accruing and payable 

from the general fund of the Treasury is 

appropriated to this account for payment to 

the proper fund receipt accounts. 

Interest Paid to Credit Financing 

Accounts 

Loan guarantee financing accounts receive 

various payments and fees and make 

payment on defaults. When cash balances 

result from an excess of receipts over 

outlays, these balances are deposited with 

Treasury and earn interest. This account 

pays such interest to credit loan guarantee 

financing accounts from the general fund of 

the Treasury in accordance with Section 

505(c) of the Federal Credit Reform Act of 

1990. 

Federal Interest Liabilities to the States 

As provided in U.S.C. 3335, U.S.C. 6503, 

and 31 C.F.R. 205, interest is paid to states 

when federal funds are not transferred 

timely. 

Department of the Treasury - Budget in Brief FY 2010 Page 117
Payment to Resolution Funding 

Corporation 

The Financial Institutions Reform, 

Recovery, and Enforcement Act of 1989 

authorized the Secretary of the Treasury 

such sums as may be necessary to cover 

interest payments on obligations issued by 

the Resolution Funding Corporation 

(REFCORP). REFCORP was established 

under the Act to raise $31.2 billion for the 

Resolution Trust Corporation (RTC) in 

order to resolve savings institution 

insolvencies. 

Permanent Authority Appropriations

Terrorism Risk Insurance Program 

The Terrorism Risk Insurance Extension Act 

of 2007 (P.L. 110-160) reauthorized and 

revised the program established by the 

Terrorism Risk Insurance Act (TRIA) of 

2002 (P.L. 107-297). The 2007 Act 

extended the Terrorism Insurance Program 

for seven years, through December 31, 

2014. This extension of TRIA added a 

requirement for commercial property and 

casualty insurers to make available coverage 

for losses from domestic as well as foreign 

acts of terrorism and extends TRIA coverage 

for those losses. 

GSE Preferred Stock Purchase

Agreement Program (PSPA)

Section 1117 of the Housing and Economic 

Recovery Act of 2008 (P.L. 110-289) 

provides temporary authority for the 

Secretary of the Treasury to purchase 

obligations and other securities issued by 

three housing related Government 

Sponsored Enterprises (GSEs): Fannie Mae, 

Freddie Mac and the Federal Home Loan 

Banks (FHLBs). Under this authority, 

Treasury established the PSPAs, to instill 

confidence in investors that Fannie Mae and 

Freddie Mac will remain viable entities 

critical to the functioning of the housing and 

mortgage markets. 

GSE Mortgage-Backed Securities 

Purchase Program 

Section 1117 of the Housing and Economic 

Recovery Act of 2008 (P.L. 110-289) 

provides temporary authority for the 

Secretary of the Treasury to purchase 

obligations and other securities issued by 

three housing related Government 

Sponsored Enterprises (GSEs): Fannie Mae, 

Freddie Mac and the Federal Home Loan 

Banks (FHLBs). Under this authority, 

Treasury established the GSE MBS 

Purchase Program to help improve the 

availability of mortgage credit to American 

homebuyers and mitigate pressures on 

mortgage rates. 

Office of Financial Stability 

The Emergency Economic Stabilization Act 

(EESA) of 2008 (PL 110-343) authorized 

the establishment of the Troubled Asset 

Relief Program (TARP) and the Office of 

Financial Stability (OFS) to purchase and 

insure certain types of troubled assets for the 

purpose of providing stability to and 

preventing disruption in the economy and 

financial systems and protecting taxpayers. 

The Act gives the Treasury Secretary broad 

and flexible authority to purchase and insure 

mortgage and other troubled assets, as well 

as inject capital by taking limited equity 

positions, as needed to stabilize the financial 

markets. This account provides for the 

administrative costs for the OFS. 

Troubled Asset Relief Program 

As authorized by Emergency Economic 

Stabilization Act of 2008 (PL 110-343) and 

required by the Federal Credit Reform Act 

of 1990, as amended, this account records 

the subsidy costs associated with the direct 

loans obligated and loan guarantees 

committed in 2008 and beyond. The direct 

loan programs serviced by this account 

include the Automotive Industry Financing 

Department of the Treasury - Budget in Brief FY 2010 Page 118
Program (AIFP) and other Section 101 

loans. The AIFP was developed to prevent a 

significant disruption of the American 

automotive industry, which would pose a 

systemic risk to financial market stability 

and have a negative effect on the economy 

of the United States. The guaranteed loan 

commitments serviced by this account 

include the Asset Guarantee Program 

(AGP). The AGP provides guarantees for 

assets held by systemically significant 

financial institutions that face a risk of 

losing market confidence due in large part to 

a portfolio of distressed or illiquid assets. 

Troubled Asset Relief Program Equity 

Purchase Program 

As authorized by Emergency Economic 

Stabilization Act of 2008 (PL 110-343) and 

required by the Federal Credit Reform Act 

of 1990, as amended, this account records 

the subsidy costs associated with the equity 

purchase obligations committed in 2008 and 

beyond. The equity purchase programs 

serviced by this account include the Capital 

Purchase Program (CAP), Systemically 

Significant Failing Institutions Program 

(SSFI), Targeted Investment Program (TIP), 

Automotive Industry Financing Program 

(AIFP), and the Capital Assistance Program 

(CAP). 

Troubled Asset Relief Program Home 

Affordable Modification Program 

As authorized by Sections 101 and 109 of 

the Emergency Economic Stabilization Act 

of 2008 (P.L. 110-343), the Housing 

Affordable Modification Program 

announced in March 2009 will offer 

assistance to as many as 4 million 

homeowners making a good-faith effort to 

stay current on their mortgage payments, 

while attempting to prevent the destructive 

impact of foreclosures on families and 

communities. 

Financial Stabilization Reserve 

As authorized by Emergency Economic 

Stabilization Act of 2008 (PL 110-343). 

The President's Budget includes a $250 billion 

contingent reserve for further efforts to 

stabilize the financial system. 

Special Inspector General for Troubled 

Asset Relief Program 

The Office of the Special Inspector General 

for the Troubled Assets Relief Program 

("SIGTARP") was created by the 

Emergency Economic Stabilization Act of 

2008 ("EESA") and is funded by a 

permanent appropriation. SIGTARP has the 

duty to conduct, supervise, and coordinate 

audits and investigations of funding 

provided under the Troubled Assets Relief 

Program ("TARP"). SIGTARP's mission is 

to advance the goal of economic stability 

through transparency, coordinated oversight, 

and robust enforcement of relief funding, 

thereby being a voice for, and protecting the 

interests of, those who fund the TARP 

programs --- the American taxpayers. 

Grants to States for Low-Income 

Housing Projects 

Section 1602 of the American Recovery and 

Reinvestment Act of 2009 (Recovery Act) 

authorizes and directs the Secretary of the 

Treasury to establish grants to states for 

low-income housing projects in lieu of lowincome housing tax credits (LIHTC). This 

account presents the estimated 

disbursements for this program. 

Grants for Specified Energy Property 

Section 1603 of the American Recovery and 

Reinvestment Act of 2009 authorizes and 

directs the Secretary of the Treasury to 

establish a grant in lieu of a tax credit for 

persons that place into service qualified 

renewable energy properties. This account 

presents the estimated disbursements for this 

program. 

Department of the Treasury - Budget in Brief FY 2010 Page 119
Exchange Stabilization Fund-Money 

Market Mutual Fund 

On September 19, 2008, the Treasury 

Department announced the establishment of 

the Temporary Guarantee Program for 

Money Market Funds. The Program is 

designed to enhance market and investor 

confidence and address temporary 

disruptions experienced in the U.S. money 

market mutual fund industry and 

dislocations in credit markets. The Program 

is supported through the use of funds from 

the ESF. The Emergency Economic 

Stabilization Act of 2008 requires that the 

ESF be reimbursed for any losses under the 

Program from funds authorized under that 

Act. The Program is set to expire on 

September 18, 2009. 

Community Development Financial 

Institutions Program Account 

This program is authorized to make loans to 

Community Development Financial 

Institutions and insured financial 

institutions. The loan funding is permanent, 

indefinite authority from the general fund. 

Presidential Election Campaign Fund 

The fund supports payments to the 

candidates running for President during the 

primaries and the general election, as well as 

support of nominating conventions. 

Appropriations to the fund represent receipts 

from the Presidential Election check-off on 

taxpayers' income tax returns. Upon 

certification by the Federal Election 

Commission, payments are made for the 

above purposes. Major expenditures occur 

during the year of the Presidential election -- 

appropriations represent collections from the 

check-off. 

Treasury Forfeiture Fund 

Public Law 102-393 established this 

permanent appropriation to be used to pay or 

reimburse certain seizure and forfeiture 

costs that occur pursuant to the laws 

enforced by the bureaus participating in the 

Fund and other expenses authorized by 31 

U.S.C. 9703. 

Biomass Energy Development: 

This account provided loan guarantees for 

the construction of biomass-to-ethanol 

facilities, as authorized under Title II of the 

Energy Security Act. All loans went into 

default, and the assets of all but one project 

have been liquidated. 

Payment to Terrestrial Wildlife Habitat 

Restoration Trust Fund 

Under P.L. 106-53, the Secretary of the 

Treasury is required to invest funds 

deposited in the Cheyenne River Sioux 

Tribe Terrestrial Wildlife Restoration Trust 

Fund and the Lower Brule Sioux Tribe 

Terrestrial Wildlife Restoration Trust Fund, 

until the funds are fully capitalized. 

Debt Collection Special Fund 

FMS provides debt collection operational 

services to client agencies which include 

collection of delinquent accounts; offset of 

federal payments against debts owed the 

government; collection of unclaimed 

financial assets; and disposition of 

foreclosed property. 

Financial Agent Services 

This permanent, indefinite appropriation 

allows the Financial Management Service to 

reimburse financial institutions for services 

provided in their capacity as depositaries 

and fiscal agents for the United States. The 

services provided are authorized under 

numerous statutes, including, but not limited 

to, 12 U.S.C. 90 and 265. The services 

include the acceptance and processing of 

deposits of public money, as well as services 

essential to the disbursement of and 

accounting for public monies. 

Reimbursement to Federal Reserve 

Banks 

Permanent, indefinite appropriations were 

established at the Bureau of the Public Debt 

and Financial Management Service to 

Department of the Treasury - Budget in Brief FY 2010 Page 120
reimburse Federal Reserve Banks for their 

services as fiscal agents and/or depositaries 

for the United States for all services required 

or directed by the Secretary of the Treasury 

to be performed on behalf of the Treasury or 

other Federal agencies. 

Claims, Judgments and Relief Acts 

Appropriations are made for payment of 

claims and interest for damages not 

chargeable to appropriations of individual 

agencies, and for payment of private and 

public relief acts. Public Law 95-26 

authorized a permanent, indefinite 

appropriation to pay certain judgments from 

the general fund of the Treasury. 

Check Forgery Insurance Fund 

This fund was established as a permanent, 

indefinite appropriation in order to maintain 

adequate funding for the Check Forgery 

Insurance Fund (Fund). The Fund facilitates 

timely payments for replacement Treasury 

checks necessitated due to a claim of 

forgery. The fund recoups disbursements 

through reclamations made against banks 

negotiating forged checks. 

To reduce hardships sustained by payees of 

Government checks that have been stolen 

and forged, settlement is made in advance of 

the receipt of funds from the endorsers of 

the checks. If the U.S. Treasury is unable to 

recover funds through reclamation 

procedures, the Fund sustains the loss. 

Continued Dumping and Subsidy Offset 

P.L. 106-387 provided for relief for certain 

domestic producers that may be impacted by 

injurious dumping and/or subsidization of 

imported products. Assessed duties are 

deposited into a special fund, and distributed 

to domestic producers, based on a 

determination that a domestic producer has 

been injured by these unfair trade practices. 

Internal Revenue Collections for Puerto 

Rico 

Treasury’s Alcohol and Tobacco Tax and 

Trade Bureau collects excise taxes on 

articles produced in Puerto Rico and the 

U.S. Virgin Islands. After the bureau 

deducts its cost of collecting these funds, the 

balance is refunded back to Puerto Rico and 

the U.S. Virgin Islands. The repayment is 

required to be included in total Treasury 

expenditures.

Government Losses in Shipment 

This account was created as self-insurance 

to cover losses in shipment of Government 

property such as coins, currency, securities, 

and some other losses. 

Payment Where Recovery Rebate 

Exceeds Liability for Tax 

The Economic Stimulus Act of 2008 (Public 

Law 110-185) allowed for the issuance of 

tax rebates (economic stimulus payments) to 

certain eligible taxpayers through December 

31, 2008. This tax rebate was a one-time 

benefit provided to taxpayers to stimulate 

the economy. Additionally, in 2009 the 

rebate were provided to taxpayers who did 

not receive the full economic stimulus 

payment in 2008 and whose circumstances 

may have changed, making them eligible for 

some or all of the unpaid portion. No 

outlays are expected from this account in 

2010, as the one-time program is no longer 

active. 

Payment Where Earned Income Credit 

Exceeds Liability for Tax 

As provided by law, there are instances 

wherein the earned income tax credit (EITC) 

exceeds the amount of tax liability owed 

through the individual income tax system, 

resulting in an additional payment to the tax 

filer. The EITC was originally authorized by 

the Tax Reduction Act of 1975 (Public Law 

94-12) and made permanent by the Revenue 

Adjustment Act of 1978 (Public Law 95-

600). The Tax Reform Act of 1986 and the 

Omnibus Budget Reconciliation Acts of 

1990 and 1993 increased the credit amount 

and expanded the eligibility for the EITC. 

Department of the Treasury - Budget in Brief FY 2010 Page 121
The American Recovery and Reinvestment 

Act of 2009 (Public Law 111-5) temporarily 

increases the EITC for working families 

with three or more children, and increases 

the threshold for the phase-out range for all 

married couples filing a joint return. 

Internal Revenue Service – User Fees 

The Secretary of the Treasury may establish 

new fees or raise existing fees for services 

provided by the IRS. The fees can be used 

to supplement IRS appropriations. 

Payment Where Child Credit Exceeds 

Liability for Tax 

As provided by law, there are instances 

wherein the child credit exceeds the amount 

of tax liability owed through the individual 

income tax system, resulting in an additional 

payment to the tax filer. The child credit was 

originally authorized by the Taxpayer Relief 

Act of 1997 (Public Law 105-34). The 

American Recovery and Reinvestment Act 

of 2009 (Public Law 111-5) expanded the 

pool of eligible low-income earners. The 

credit is refundable to the extent of 15 

percent of an individual’s earned income in 

excess of $3,000 for 2009 and 2010. 

Payment Where Health Care Credit 

Exceeds Liability for Tax 

The Trade Act of 2002 established the 

Health Coverage Tax Credit (HCTC), an 

advanceable, refundable tax credit for a 

portion of the cost of qualified insurance. 

This credit is available to certain recipients 

of trade adjustment assistance (TAA) and 

Pension Benefit Guaranty Corporation 

pension beneficiaries who are aged 55-64. 

The American Recovery and Reinvestment 

Act of 2009 (Public Law 111-5) 

significantly increased the benefits for 

certain HCTC eligible individuals. 

Payment Where Alternative Minimum Tax 

Exceeds Liability for Tax 

The Tax Relief and Health Care Act of 2006 

(Public Law 109-432) allows certain 

taxpayers to claim a refundable credit for a 

portion of their unused long-term alternative 

minimum tax (AMT) credits each year. The 

Emergency Economic Stabilization Act of 

2008 (Public Law 110-343) increases the 

AMT refundable credit portion from 

20 percent to 50 percent of the unused longterm minimum tax credits for the taxable 

year in question. 

Payment Where Certain Tax Credits 

Exceeds Liability for Corporate Tax 

The Housing and Economic Recovery Act 

of 2008 (Public Law 110-289) allows certain 

businesses to accelerate the recognition of a 

portion of their historic AMT or research 

and development (R&D) credits in lieu of 

taking bonus depreciation. The amount is 

capped at the lesser of $30 million or 

6 percent of historic AMT and R&D credits. 

The American Recovery and Reinvestment 

Act of 2009 (Public Law 111-5) extends this 

temporary benefit through 2009. 

Payment Where Tax Credit to Aid FirstTime Homebuyers Exceeds Liability for 

Tax 

The Housing and Economic Recovery Act 

of 2008 provided a refundable tax credit of 

up to $7,500 for first-time homebuyers. The 

credit allows for up to 10 percent of the 

purchase price for qualified residences. 

Taxpayers who qualify are allowed a onetime credit against their income tax for 

principal residences purchased on or after 

April 9, 2008, and before July 1, 2009. 

They must repay the credit over a 15-year 

period. 

The American Recovery and Reinvestment 

Act of 2009 (Public Law 111-5) expanded 

the credit and eliminated the repayment 

requirement. Taxpayers have the option of 

claiming up to $8,000 on either their 2008 or 

2009 tax returns for qualifying 2009 

purchases. The credit is available for 

Department of the Treasury - Budget in Brief FY 2010 Page 122
qualifying purchases made between January 

1, 2009 and November 30, 2009. 

Payment Where American Opportunity 

Credit Exceeds Liability for Tax 

The American Recovery and Reinvestment 

Act of 2009 (Public Law 111-5) allows 

certain taxpayers to claim a refundable Hope 

Scholarship Credit. Up to 40 percent of the 

credit is refundable. The credit applies 

dollar-for-dollar to the first $2,000 of 

qualified tuition, fees and course materials 

paid by the taxpayer, and applies at a rate of 

25 percent to the next $2,000 in qualified 

tuition, fees and course materials for a total 

credit of up to $2,500. This tax credit is 

subject to a phase-out for high-income 

taxpayers. 

Making Work Pay Tax Credit 

The American Recovery and Reinvestment 

Act of 2009 (Public Law 111-5) allows 

certain taxpayers to claim a refundable 

Making Work Pay tax credit of 6.2 percent 

of earned income, up to $400 for single 

taxpayers and up to $800 for married 

couples filing joint returns. The refundable 

credit phases out for high-income taxpayers. 

The Making Work Pay credit is claimed by 

taxpayers when they file their 2009 and 

2010 returns, and in order to accelerate the 

credit, it is being delivered in small 

increments through reduced payroll 

withholding. 

Build American Bond Payments, 

Recovery Act 

The Recovery and Reinvestment Act of 

2009 (Public Law 111-5) allows State and 

local governments to issue “Build America 

Bonds,” through December 31, 2010. These 

tax credit bonds, which include Recovery 

Zone Bonds, differ from tax-exempt 

governmental obligation bonds in two 

principal ways: (1) interest paid on tax credit 

bonds is taxable; and (2) a portion of the 

interest paid on tax credit bonds takes the 

form of a federal tax credit. The bond issuer 

may elect to receive a direct payment in the 

amount of the tax credit. 

Payment Where COBRA Credit Exceeds 

Liability for Tax 

COBRA gives workers who lose their jobs, 

and thus their health benefits, the right to 

purchase group health coverage provided by 

the plan under certain circumstances. 

The American Recovery and Reinvestment 

Act of 2009 (Public Law 111-5) treats 

assistance eligible individuals who pay 35 

percent of their COBRA premium as having 

paid the full amount. The remaining 65 

percent is reimbursed to the employer, 

insurer or health plan as a credit against 

certain employment taxes. This schedule 

reflects the cases where the credit exceeds 

the tax liability resulting in payment to the 

tax filer. 

Payment Where Tax Credit for Certain 

Government Retirees Exceeds Liability 

for Tax 

The American Recovery and Reinvestment 

Act of 2009 (Public Law 111-5) allows 

certain federal and state retirees to claim a 

one-time refundable credit of up to $250 

($500 in the case of a joint return where 

both spouses are eligible individuals). 

Internal Revenue Service – Informant 

Payments 

The Secretary of the Treasury may make 

payments to individuals resulting from 

information given that leads to the collection 

of Internal Revenue taxes. The Taxpayer 

Bill of Rights of 1996 authorizes these 

payments from the proceeds of amounts 

(other than interest) collected as a result of 

the information provided. 

Internal Revenue Service – Private 

Collection Agent Program 

The American Jobs Creation Act of 2004 

(Public Law 108-357) allows the IRS to use 

private collection contractors to supplement 

its own collection staff's efforts to ensure 

that all taxpayers pay what they owe. The 

IRS used this authority to contract with 

Department of the Treasury - Budget in Brief FY 2010 Page 123
several private debt collection agencies 

starting in 2006. In March 2009, the IRS 

allowed its private debt collection contracts 

to expire, thereby administratively 

terminating the program. 

Offsetting Collections

In general, amounts collected by the Federal 

Government are classified in two major 

categories: 

Governmental receipts – Revenues that arise 

from the sovereign and regulatory powers 

unique to the Federal Government. They 

consist primarily of tax receipts, but also 

include customs duties, court fines, certain 

licenses, etc. All governmental receipts are 

deposited into receipt accounts. These 

receipts are always reported in total (rather 

than as an offset to budget authority and 

outlays). 

Offsetting receipts - Collections that are 

offset against the budget authority and 

outlays of the collecting agency rather than 

reflected as governmental receipts in 

computing budget totals. Offsetting receipts 

are comprised of: 

• Proprietary Receipts - These receipts 

from the public are market-oriented and 

are derived from activities operated as 

business-type enterprises. 

• Intragovernmental Receipts - These are 

collections from other governmental 

accounts deposited in receipt accounts. 

These are further classified as follows: 

 Interfund Receipts - These are 

amounts derived from payments 

between federal and trust funds. 

 Intrafund Receipts - These are 

amounts derived from payments 

within the same fund group (i.e., 

within the federal fund group or 

within the trust fund group). 

Department of the Treasury - Budget in Brief FY 2010 Page 124