Message from the Secretary of the Treasury 

Dear Member: 

In the Fiscal Year (FY) 2018 Budget Blueprint, the President challenged every agency to realize 

greater efficiencies and savings in order to contribute to the priorities promised to the American 

people. I am proud to submit a budget that achieves this goal. The FY 2018 President's Budget 

requests $11.2 billion for Treasury's operating bureaus and $1.5 billion for our International 

Programs. 

Consistent with the Administration's priorities, Treasury's request prioritizes national security 

and cyber security programs while requiring nearly every other program to find savings through 

efficiencies. The Budget funds core tax administration functions at the Internal Revenue Service 

(IRS), and promotes modernizing and securing legacy systems and platforms for interacting with 

taxpayers. IRS will utilize technology, training, and internal efficiencies to achieve a two 

percent reduction. The Budget also eliminates funding for Community Development Financial 

Institutions (CDFI) Fund grants, a savings of $210 million from the FY 2017 continuing 

resolution level. The CDFI Fund was created more than 20 years ago to jump-start a now mature 

industry in which private institutions have ready access to the capital needed to extend credit and 

provide financial services to underserved communities. 

As directed in the Executive Order on Core Principles for Regulating the United States 

Financial System, I am conducting a thorough review of the extent to which existing laws, 

regulations, and other Government policies promote (or inhibit) the Administration's priorities 

for financial regulation. The President's Budget includes $35 billion in savings to be realized 

through reforms that protect taxpayers and reverse burdensome regulations that hinder financial 

innovation and reduce access to credit for hardworking American families. Treasury is also 

reviewing its programs as directed by the Executive Order on a Comprehensive Plan for 

Reorganizing the Executive Branch, which presents an additional opportunity to more effectively 

achieve our mission. 

The FY 2018 Congressional Budget Justification includes the information required for the 

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

performance data in this report. 

Sincerely, 

Steven T. Mnuchin 

Executive Summary - 1 

FY 2018 EXECUTIVE SUMMARY 

CONGRESSIONAL JUSTIFICATION FOR APPROPRIATIONS AND ANNUAL 

PERFORMANCE REPORT AND PLAN 

Mission Statement 

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

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

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

government’s finances and resources effectively. 

Executive Summary 

FY 2018 President’s Budget by Function 

Dollars in Thousands 

 

FY 2016 FY 2017 FY 2018 Increase/ Percent

Enacted Annualized CR 

Rate Request Decrease Change

Management & Financial $1,404,653 $1,401,983 $1,122,000 ($279,983) -19.97%

Departmental Offices Salaries and Expenses $222,500 $222,077 $201,751 ($20,326) -9.15%

Terrorism and Financial Intelligence (TFI) $117,000 $116,778 $116,778 $0 0.00%

Cybersecurity Enhancement $0 $0 $27,264 $27,264 100.00%

Department-wide Systems and Capital Investments 

Program $5,000 $4,990 $4,426 ($564) -11.30%

Office of Inspector General $35,416 $35,349 $34,112 ($1,237) -3.50%

Treasury IG for Tax Administration $167,275 $166,957 $161,113 ($5,844) -3.50%

Special Inspector General for TARP $40,671 $40,594 $20,297 ($20,297) -50.00%

Community Development Financial Institutions Fund $233,523 $233,079 $14,000 ($219,079) -93.99%

Financial Crimes Enforcement Network $112,979 $112,764 $112,764 $0 0.00%

Alcohol and Tobacco Tax and Trade Bureau $106,439 $106,237 $98,658 ($7,579) -7.13%

Bureau of the Fiscal Service $363,850 $363,158 $330,837 ($32,321) -8.90%

Tax Administration1 $11,235,000 $11,213,642 $10,975,000 ($238,642) -2.13%

IRS Taxpayer Services $2,333,376 $2,328,940 $2,212,311 ($116,629) -5.01%

IRS Enforcement $4,714,936 $4,855,688 $4,706,500 ($149,188) -3.07%

IRS Operations Support $3,896,688 $3,739,565 $3,946,189 $206,624 5.53%

IRS Business Systems Modernization $290,000 $289,449 $110,000 ($179,449) -62.00%

Subtotal, Treasury Appropriations excluding 

TEOAF $12,639,653 $12,615,625 $12,097,000 ($518,625) -4.11%

Treasury Forfeiture Fund Total2 ($876,000) ($876,000) ($876,000) $0 0.00%

Temporary Rescission ($876,000) ($876,000) $876,000 -100.00%

Permanent Rescission ($876,000) ($876,000) 0.00%

Subtotal, Treasury Appropriations including 

TEOAF $11,763,653 $11,739,625 $11,221,000 ($518,625) -4.42%

Treasury International Programs $2,313,470 $2,309,072 $1,505,953 ($803,119) -34.78%

Multilateral Development Banks $1,816,477 $1,813,024 $1,348,123 ($464,901) -25.64%

Food Security $74,930 $74,787 $30,000 ($44,787) -59.89%

Environmental Trust Funds $398,563 $397,806 $102,375 ($295,431) -74.27%

Office of Technical Assistance (OTA) $23,500 $23,455 $25,455 $2,000 8.53%

Total, Treasury Appropriations $14,077,123 $14,048,697 $12,726,953 ($1,321,744) -9.41%

FY 2017 CR to FY 2018

1/ The IRS was provided with $290 million in funding in its administrative provisions. This table shows that funding as allocated. 

FY 2016/2017: $176.8 million Taxpayer Services, $4.9 million Enforcement, and $108.2 million Operations Support.

2/ In FY 2016 and FY 2017, total includes ($176,000,000) of the DHS Rescission (temporary).
Executive Summary - 2 

Funding Highlights 

The President’s Fiscal Year 2018 Budget provides $11.2 billion in discretionary funding (a 4 percent 

reduction from FY 2017 annualized continuing resolution (CR) levels) for Treasury’s operating accounts 

and $1.5 billion for Treasury’s international assistance programs. This includes: 

 Investing in core administration functions at IRS, modernizing legacy systems and platforms for 

interacting with taxpayers. IRS will utilize technology, training, and internal efficiencies to achieve a 

modest $239 million (two percent) reduction, in support of the President’s commitment to deficit 

reduction. 

 Eliminating funding for Community Development Financial Institutions (CDFI) Fund grants, a 

savings of $210 million from the 2017 annualized CR level. 

 Prioritizing investments in cybersecurity through a Department-wide plan to strategically enhance 

existing security systems and preempt fragmentation of information technology management across 

the bureaus and financial sector.

 Maintaining funding for Treasury’s array of economic enforcement tools and key programs that 

freeze the accounts of terrorists and proliferators, implement sanctions on rogue nations, and link law 

enforcement agencies with financial institutions are critical to the continued safety and financial 

stability of the Nation. 

 Preserving top donor status with international financial institutions while reducing Treasury 

International Programs funding by $803 million, a 35 percent reduction from the FY 2017 annualized 

CR level. 

 Targeted savings in nearly every Treasury program. 

Key Initiatives and Reforms 

 On February 3, 2017, the Administration issued the Executive Order on Core Principles for 

Regulating the United States Financial System. The Secretary of the Treasury, with the heads of the 

member agencies of the Financial Stability Oversight Council, is conducting a thorough review of the 

extent to which existing laws, regulations, and other Government policies promote (or inhibit) these 

Core Principles. The President’s Budget includes $35 billion in savings to be realized through 

reforms that prevent bailouts and reverse burdensome regulations that hinder financial innovation and 

reduce access to credit for hardworking American families. 

 Treasury is developing a plan for responding to the Executive Order on a Comprehensive Plan for 

Reorganizing the Executive Branch which will: 

o identify activities and functions that should be eliminated or consolidated because they are not 

core to our mission, are redundant, or are ineffective; 

o guide Treasury’s efforts to reshape its workforce; 

o determine processes and organizational structures that can be streamlined for greater 

efficiencies; and 

o align reform proposals with the priorities, including goals and objectives, under development 

for the FY 2018-2022 Strategic Plan and the FY 2018 and 2019 budgets. 

 The Budget requests statutory authority for BEP to begin construction of a new currency production 

facility in the vicinity of Washington, D.C.

The Budget includes reauthorization and reforms to the CDFI Bond Guarantee Program to encourage 

provision of community development capital without requiring taxpayer subsidies. 
Executive Summary - 3 

 Fiscal Year Comparison of Full‐Time Equivalent (FTE) Staffing (Direct and Reimbursable) Appropriation Direct Reimb. Total Direct Reimb. Total Direct Reimb. Total Departmental Offices Salaries and Expenses 814 189 1,003 891 107 998 811 107 918 Terrorism and Financial Intelligence 383 31 414 391 31 422 386 31 417 Cybersecurity Enhancement 0 0 0 0 0 0 19 0 19 Office of Inspector General 164 6 170 194 19 213 175 5 180 Treasury Inspector General for Tax Administration 787 2 789 859 2 861 819 2 821 Special Inspector General for TARP 137 0 137 192 0 192 100 0 100 Community Development Financial Institutions Fund 77 0 77 77 0 77 42 0 42 Financial Crimes Enforcement Network 278 1 279 338 1 339 332 1 333

Alcohol and Tobacco Tax and Trade Bureau 470 10 480 494 10 504 456 10 466

Bureau of the Fiscal Service 1,626 417 2,043 1,693 427 2,120 1,680 427 2,107

Internal Revenue Service 77,925 640 78,565 77,008 684 77,692 71,199 711 71,910

Subtotal, Treasury Appropriated Level 82,661 1,296 83,957 82,137 1,281 83,418 76,019 1,294 77,313Office of Financial Stability (Administrative Account) 67 0 67 53 0 53 43 0 43

Small Business Lending Fund Program 11 0 11 7 0 7 8 0 8

State Small Business Credit Initiative 10 10 9 9 0Capital Magnet Fund 7 7 6 6

Office of Financial Research 208 0 208 223 0 223 139 0 139

Financial Stability Oversight Council 22 22 23 23 21 21

Treasury Franchise Fund 0 1,715 1,715 0 1,794 1,794 0 1,848 1,848

Bureau of Engraving and Printing 1,818 0 1,818 1,842 0 1,842 1,842 0 1,842

United States Mint 1,692 0 1,692 1,801 0 1,801 1,801 0 1,801

Office of the Comptroller of the Currency 0 3,845 3,845 0 3,938 3,938 0 4,041 4,041

Terrorism Insurance Program 3 0 3 10 0 10 10 0 10IRS Private Collection Agent Program 5 5 17 17 84 84Subtotal, Treasury Non-Appropriated Level 3,836 5,560 9,396 3,992 5,732 9,724 3,954 5,889 9,843Total, Treasury 86,497 6,856 93,353 86,129 7,013 93,142 79,973 7,183 87,1561/ A portion of Fiscal Service's Reimbursable/Fee FTE is funded by fee revenue as authorized by the Debt Collection Improvement Act (DCIA) of 1996.2/ IRS FY 2018 Total FTE is overstated in the President's Budget Appendix by 102 FTE as a result of a reporting error in the Business Systems Modernization account. 

2016 Actual 2017 Annualized CR Rate 2018 President's Budget
Executive Summary - 4 

 DO TFI Cyber DSCIP OIG TIGTA SIGTAR P CDFI FinCEN TTB FS IRS Subtotal TEOAF T otal

FY 2017 Annualized CR Rate $222,077 $116,778 $0 $4,990 $35,349 $166,957 $40,594 $233,079 $112,764 $106,237 $363,158 $11,213,642 $12,615,625 ($876,000) $11,739,625 

(MCLs)Maintaining Current Levels $4,284 $2,315 - - $729 $3,335 $809 - $2,276 $2,102 $6,971 $220,035 $242,856 - $242,856 Non-Recurring Costs - - - ($4,990) - - - - - - ($14,890) - ($19,880) - ($19,880)Efficiency Savings - ($2,315) - - - - - - ($1,206) ($570) ($1,935) - ($6,026) - ($6,026)

FY 2018 Base $226,361 $116,778 $0 $0 $36,078 $170,292 $41,403 $233,079 $113,834 $107,769 $353,304 $11,433,677 $12,832,575 ($876,Adjustments to Base $4,284 $0 $0 ($4,990) $729 $3,335 $809 $0 $1,070 $1,532 ($9,854) $220,035 $216,950 $0 $216,950 

000) $11,956,575 

Program Decreases ($24,610) - - - ($1,966) ($9,179) ($21,106) ($219,079) ($1,070) ($9,111) ($22,467) ($638,126) ($946,714) - ($946,714)Program Increases - - $27,264 $4,426 - - - - - - - $179,449 $211,139 - $211,139

Subtotal, Program Changes ($24,610) $0 $27,264 $4,426 ($1,966) ($9,179) ($21,106) ($219,079) ($1,070) ($9,111) ($22,467) ($458,677) ($735,575) $0 ($735,575)FY 2018 President's Budget $201,751 $116,778 $27,264 $4,426 $34,112 $161,113 $20,297 $14,000 $112,764 $98,658 $330,837 $10,975,000 $12,097,000 ($876,000) $11,221,000 

(Dollars in Thousands)

Summary of FY 2018 Increases and Decreases
Executive Summary - 5 

Organization

Treasury is organized into the Departmental Offices, seven bureaus, and three inspectors general. 

The Department Offices are primarily responsible for policy formulation, while the bureaus are 

the operating units of the organization. 

 
Executive Summary - 6 

DEPARTMENTAL OFFICES 

 Domestic Finance works to preserve confidence in the U.S. Treasury securities market, 

effectively manage federal fiscal operations, strengthen financial institutions and markets, 

promote access to credit, and improve financial access and education in service of 

America’s long-term economic strength and stability. 

 Terrorism and Financial Intelligence (TFI) uses Treasury’s unique financial intelligence, 

expertise, and authorities to disrupt and disable terrorists, criminals, and other national 

security and foreign policy threats to the United States and to protect the U.S. and 

international financial systems from abuse. 

 International Affairs protects and supports U.S. economic prosperity and national security 

by working to foster the most favorable external environment for sustained employment 

and economic growth. 

 Tax Policy develops and implements tax policies and programs, reviews regulations and 

rulings to administer the Internal Revenue Code, negotiates tax treaties, and provides 

economic and legal policy analysis for domestic and international tax policy decisions. Tax 

Policy also provides revenue estimates for the President’s Budget. 

 Economic Policy reports on current and prospective economic developments and assists in 

the determination of appropriate economic policies. The office is responsible for the review 

and analysis of domestic economic issues and developments in the financial markets. 

 The Treasurer of the United States oversees the U.S. Mint and Bureau of Engraving and 

Printing, chairs the Advanced Counterfeit Deterrence Steering Committee, and is a key 

liaison with the Federal Reserve. In addition, the Treasurer serves as a senior advisor to the 

Secretary in the areas of community development and public engagement. 

 The Office of Management, including the Chief Financial Officer (CFO), manages the 

Department’s financial resources and oversees Treasury-wide programs, including human 

capital, information technology, acquisition, and diversity and inclusion. 

 Other offices within Departmental Offices include General Counsel, Legislative Affairs, 

and Public Affairs. 

 Three Inspectors General – the Office of Inspector General (OIG), the Treasury Inspector 

General for Tax Administration (TIGTA), and the Special Inspector General for the 

Troubled Asset Relief Program (SIGTARP) – provide independent audits, investigations, 

and oversight of Treasury and its programs. 
Executive Summary - 7 

BUREAUS 

 The Alcohol and Tobacco Tax and Trade Bureau (TTB) collects federal excise taxes on alcohol, 

tobacco, firearms, and ammunition and is responsible for enforcing and administering laws 

covering the production, use, and distribution of alcohol products. 

 The Bureau of Engraving and Printing (BEP) develops and produces U.S. currency notes that 

are trusted worldwide. 

 The Financial Crimes Enforcement Network (FinCEN) safeguards the financial system from 

illicit use, combats money laundering, and promotes national security through the collection, 

analysis, and dissemination of financial intelligence and strategic use of financial authorities. 

 The Bureau of the Fiscal Service (Fiscal Service) provides central payment services to federal 

program agencies, operates the U.S. government’s collections and deposit systems, delivers 

administrative shared services to federal agencies, provides government-wide accounting and 

reporting services, manages the collection of delinquent debt owed to the U.S. government, 

borrows the money needed to operate the U.S. government through the sale of marketable, 

savings, and special-purpose U.S. Treasury securities (including the state and local government 

series), and accounts for and services the public debt. 

 The Internal Revenue Service (IRS) is the largest of our bureaus and determines, assesses, and 

collects tax revenue in the United States. 

 The United States Mint (U.S. Mint) designs, mints, and issues U.S. circulating and bullion 

coins; prepares and distributes numismatic coins and other items; and strikes Congressional 

Gold Medals and other medals of national significance. The U.S. Mint maintains physical 

custody and protection of most of the Nation’s gold and all of its silver assets. 

 The Office of the Comptroller of the Currency (OCC) charters, regulates, and supervises 

national banks and federal savings associations (thrifts) to ensure that they operate in a safe and 

sound manner, provide fair access to financial services, treat customers fairly, and comply with 

applicable laws and regulations. The OCC also supervises federal branches and agencies of 

foreign banks and has rule-making authority for all savings associations. 

Treasury Strategic Framework 

The Government Performance and Results Act (GPRA) of 1993 and the GPRA Modernization Act of 

2010 require federal agencies to publish strategic plans every four years, aligning to the Administration 

transition, and establish the need for agencies to identify performance goals, report progress against 

targets, and conduct data-driven reviews. When done well, these practices serve two key purposes for 

stakeholders within and outside of the organization: to assess the organization’s health and impact and 

to inform decision-making and strategy, including effective resource allocation. In this spirit, we 

developed a strategic framework supported by using best-in-class organizational performance practices 
Executive Summary - 8 

to ultimately help achieve its strategic goals. Currently, we are developing Treasury’s FY 2018-2022 

Strategic Plan. 

Treasury Organizational Performance Review Cycle 

Treasury’s organizational performance reviews provide a regular forum for open dialogue and 

coordination between Department and bureau and office leadership, bringing together different 

perspectives to set and align priorities, identify and solve problems, review agency performance goals 

and drive results. The cycle integrates statutory requirements to conduct quarterly performance 

reviews of agency goals and a Strategic Objective Annual Review (SOAR), which analyzes crosscutting performance and designates a set of strategic objectives as making “Noteworthy Progress” or as 

“Focus Area for Improvement.” 

Fall Winter Spring Summer 

Focus 

Performance Strategic Objective 

Annual Review 

(SOAR) 

 Performance Budget 

Goals/Outcomes 

 Gain a shared 

understanding of 

prior year’s 

performance at the 

bureau/office level 

 Set priorities for 

current year 

 Recognize successes 

 Evaluate crossagency progress 

toward strategic 

objectives 

 Identify strategic 

shifts/ validate 

Treasury priorities 

 Outline potential 

topics for annual 

FedStat meeting 

with OMB 

 Introduction of 

bureau/office to new 

leadership 

 Assess progress on 

priorities 

 Surface problems or 

assistance needed 

 Recognize successes

 Connect priorities to 

future funding 

 Explore performance 

impacts 

 Strengthen IT 

acquisition 

budgeting 

accountability

To close out the FY 2014-2017 strategic plan, we used the FY 2017 SOAR to identify focus areas that 

will likely become priorities in the FY 2018-2022 strategic plan (including tax reform, financial 

transparency, and data-driven decision-making). In addition, we completed a scan of Treasury’s 

internal and external environment to identify proposed goals and objectives. The annual performance 

plan will be updated in FY 2019 to reflect the final strategic plan. 

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

quarter and many run their own internal performance reviews.1

                                                            

1 The FY 2016 Verification and Validation Report is available at: https://www.treasury.gov/about/budget‐

performance/Pages/index.aspx
Executive Summary - 9 

Summary of Management and Performance Challenges 

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

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

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

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

2016 Treasury Agency Financial Report (AFR) for a detailed discussion of these challenges, 

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

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

another. 

 OIG- IDENTIFIED MANAGEMENT CHALLENGES

 Cyber Threats

 Efforts to Promote Spending Transparency and to Prevent and Detect Improper Payments

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

 Management of Treasury’s Authorities Intended to Support and Improve the Economy 

 TIGTA- IDENTIFIED MANAGEMENT CHALLENGES

 Security Over Taxpayer Data and Protection of IRS Resources 

 Identity Theft and Impersonation Fraud 

 Implementing the Affordable Care Act and Other Tax Law Changes 

 Improving Tax Compliance 

 Reducing Fraudulent Claims and Improper Payments 

 Improving Tax Systems and Expanding Online Services 

 Providing Quality Taxpayer Services Operations 

 Impact of Global Economy on Tax Administration 

 Protecting Taxpayer Rights 

 Achieving Program Efficiencies and Cost Savings 

 GAO- IDENTIFIED HIGH-RISK AREAS

 Modernizing the U.S. Financial Regulatory System and the Federal Role in Housing Finance 

 Enforcement of Tax Laws 

                                                            

2 The FY 2016 Annual Financial Report is available at: https://www.treasury.gov/about/budgetperformance/annual-performance-plan/Documents/FY16%20AFR%20(508)_FINAL.pdf
Executive Summary - 10 

FY 2017 Enacted Levels 

Dollars in Thousands 

 

FY 2016 FY 2017 FY 2017 FY 2018 Increase/ Percent

Enacted Annualized CR 

Rate Omnibus1 Request Decrease Change

Management & Financial $1,404,653 $1,401,983 $1,473,456 $1,122,000 ($279,983) -19.97%

Departmental Offices Salaries and Expenses $222,500 $222,077 $224,376 $201,751 ($20,326) -9.15%

Terrorism and Financial Intelligence (TFI) $117,000 $116,778 $123,000 $116,778 $0 0.00%

Cybersecurity Enhancement $0 $0 $47,743 $27,264 $27,264 100.00%

Department-wide Systems and Capital Investments 

Program $5,000 $4,990 $3,000 $4,426 ($564) -11.30%

Office of Inspector General $35,416 $35,349 $37,044 $34,112 ($1,237) -3.50%

Treasury IG for Tax Administration $167,275 $166,957 $169,634 $161,113 ($5,844) -3.50%

Special Inspector General for TARP $40,671 $40,594 $41,160 $20,297 ($20,297) -50.00%

Community Development Financial Institutions Fund $233,523 $233,079 $248,000 $14,000 ($219,079) -93.99%

Financial Crimes Enforcement Network $112,979 $112,764 $115,003 $112,764 $0 0.00%

Alcohol and Tobacco Tax and Trade Bureau $106,439 $106,237 $111,439 $98,658 ($7,579) -7.13%

Bureau of the Fiscal Service $363,850 $363,158 $353,057 $330,837 ($32,321) -8.90%

Tax Administration2 $11,235,000 $11,213,642 $11,235,000 $10,975,000 ($238,642) -2.13%

IRS Taxpayer Services $2,333,376 $2,328,940 $2,333,376 $2,212,311 ($116,629) -5.01%

IRS Enforcement $4,714,936 $4,855,688 $4,864,936 $4,706,500 ($149,188) -3.07%

IRS Operations Support $3,896,688 $3,739,565 $3,746,688 $3,946,189 $206,624 5.53%

IRS Business Systems Modernization $290,000 $289,449 $290,000 $110,000 ($179,449) -62.00%

Subtotal, Treasury Appropriations excluding 

TEOAF $12,639,653 $12,615,625 $12,708,456 $12,097,000 ($518,625) -4.11%

Treasury Forfeiture Fund Total3 ($876,000) ($876,000) ($1,302,000) ($876,000) $0 0.00%

Temporary Rescission ($876,000) ($876,000) ($988,000) $876,000 -100.00%

Permanent Rescission ($314,000) ($876,000) ($876,000) 0.00%

Subtotal, Treasury Appropriations including 

TEOAF $11,763,653 $11,739,625 $11,406,456 $11,221,000 ($518,625) -4.42%

Treasury International Programs $2,313,470 $2,309,072 $1,800,577 $1,505,953 ($803,119) -34.78%

Multilateral Development Banks $1,816,477 $1,813,024 $1,571,014 $1,348,123 ($464,901) -25.64%

Food Security $74,930 $74,787 $53,000 $30,000 ($44,787) -59.89%

Environmental Trust Funds $398,563 $397,806 $146,563 $102,375 ($295,431) -74.27%

Office of Technical Assistance (OTA) $23,500 $23,455 $30,000 $25,455 $2,000 8.53%

Total, Treasury Appropriations $14,077,123 $14,048,697 $13,207,033 $12,726,953 ($1,321,744) -9.41%

1/ The omnibus was passed after the budget was completed. It is presented here for the readers' convenience.

FY 2017 CR to FY 2018

2/ The IRS was provided with $290 million in funding in its administrative provisions. This table shows that funding as allocated. 

FY 2016/2017: $176.8 million Taxpayer Services, $4.9 million Enforcement, and $108.2 million Operations Support.

3/ In FY 2016 and FY 2017 CR, total includes ($176,000,000) of the DHS Rescission (temporary). FY 2017 Ominibus, total includes ($187,000,000) of the 

DHS Rescission (temporary).

Department of the Treasury

Internal Revenue Service

Congressional Justification

for Appropriations and

Annual Performance

Report and Plan

FY 2018
IRS-i

Table of Contents

Section I – Budget Request......................................................................................................3

1A – Mission Statement........................................................................................................3

1.1 – Appropriations Detail Table.......................................................................................3

1B – Summary of the Request.............................................................................................4

1.2 – Budget Adjustments Table .........................................................................................8

1C – Budget Increases and Decreases Description............................................................8

1.3 – Operating Levels Table.............................................................................................11

1D – Appropriations Language and Explanation of Changes........................................12

1E – Legislative Proposals .................................................................................................16

Section II – Budget and Performance Plan..........................................................................17

Taxpayer Services...............................................................................................................17

2.1 – Budget Adjustments Table.......................................................................................18

2.2 – Operating Levels Table............................................................................................19

2.3 – Appropriation Detail Table ......................................................................................20

2A – Pre-Filing Taxpayer Assistance and Education .......................................................20

2.1.1 – Budget and Performance Report and Plan ............................................................22

2B – Filing and Account Services.....................................................................................23

2.1.2 – Budget and Performance Report and Plan ............................................................25

Enforcement........................................................................................................................27

2.1 – Budget Adjustments Table.......................................................................................28

2.2 – Operating Levels Table............................................................................................29

2.3 – Appropriation Detail Table ......................................................................................30

2C – Investigations............................................................................................................30

2.1.3 – Budget and Performance Report and Plan ............................................................32

2D – Exam and Collections ..............................................................................................32

2.1.4 – Budget and Performance Report and Plan ............................................................37

2E – Regulatory ................................................................................................................38

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

Operations Support............................................................................................................41

2.1 – Budget Adjustments Table.......................................................................................42

2.2 – Operating Levels Table............................................................................................43

2.3 – Appropriation Detail Table ......................................................................................44

2F – Infrastructure.............................................................................................................44

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

2G – Shared Services and Support....................................................................................45

2.1.7 – Budget and Performance Report and Plan ............................................................48

2H – Information Services................................................................................................48

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

Business Systems Modernization ......................................................................................52
IRS-ii

2.1 – Budget Adjustments Table.......................................................................................53

2.2 – Operating Levels Table............................................................................................54

2.3 – Appropriation Detail Table ......................................................................................55

2I – Business Systems Modernization ..............................................................................55

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

Section III................................................................................................................................59

3.1 – Summary of Capital Investments.............................................................................59

3.2 – Return on Investment (ROI) for IRS Major Enforcement Programs..................61

3.3 – IRS Performance Measure Table.............................................................................63

3.4 – Reducing the Tax Gap...............................................................................................67

3.5 – Summary of IRS FY 2018 Budget Request.............................................................68
IRS-3

Section I – Budget Request

1A – Mission Statement 

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

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

1.1 – Appropriations Detail Table

Dollars in Thousands

1FY 2016 Enacted includes $290 million in Section 113 Administrative Provision funding in the following amounts: $176.8 million in Taxpayer 

Services, $4.9 million in Enforcement, and $108.2 million in Operations Support. FY 2016 Enacted includes the approved inter-appropriation 

transfer of $150 million from Enforcement to Operations Support.

2A full-year 2017 appropriation for this account was not enacted at the time the budget was prepared; therefore, the budget assumes this account 

is operating under the Further Continuing Appropriations Act, 2017 (P.L. 114–254). The amounts included for 2017 reflect the annualized level 

provided by the continuing resolution. FY 2017 Annualized CR includes $289.5 million in Section 113 Administrative Provision funding in the 

following amounts: $208.9 million in Taxpayer Services, and $80.6 million in Operations Support.

3Resources from Transfers In/Out include a FY 2016 transfers between IRS and the Office of National Drug Control Policy (ONDCP) High 

Intensity Drug Trafficking Area (HIDTA) Program (obligations of $7,000).

4Resources from Other Accounts include Other Direct FTE funded by the Federal Highway Administration (2 FTE in FY 2016).

Internal Revenue Service

Appropriated Resources

New Appropriated Resources: FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

Taxpayer Services 28,316 $2,333,376 28,455 $2,328,940 24,392 $2,212,311 (4,063) ($116,629) -14.28% -5.01%

Pre-Filing Taxpayer Assistance and 

Education 5,009 620,338 4,978 625,829 4,458 600,717 (520) (25,112) -10.45% -4.01%

Filing and Account Services 23,307 1,713,038 23,477 1,703,111 19,934 1,611,594 (3,543) (91,517) -15.09% -5.37%

Enforcement 37,564 $4,714,936 36,349 $4,855,688 35,049 $4,706,500 (1,300) ($149,188) -3.58% -3.07%

Investigations 3,184 596,417 3,126 624,462 2,893 606,747 (233) (17,715) -7.45% -2.84%

Exam and Collections 33,426 3,981,257 32,251 4,083,908 31,199 3,967,808 (1,052) (116,100) -3.26% -2.84%

Regulatory 954 137,262 972 147,318 957 131,945 (15) (15,373) -1.54% -10.44%

Operations Support 11,078 $3,896,688 11,441 $3,739,565 11,365 $3,946,189 (76) $206,624 -0.66% 5.53%

Infrastructure - 848,191 - 861,229 - 860,643 - (586) N/A -0.07%

Shared Services and Support 4,861 1,110,811 4,981 1,014,139 4,871 1,011,411 (110) (2,728) -2.21% -0.27%

Information Services 6,217 1,937,686 6,460 1,864,197 6,494 2,074,135 34 209,938 0.53% 11.26%

Business Systems Modernization 442 $290,000 593 $289,449 229 $110,000 (364) ($179,449) -61.38% -62.00%

Subtotal New Appropriated 

Resources 77,400 $11,235,000 76,838 $11,213,642 71,035 $10,975,000 (5,803) ($238,642) -7.55% -2.13%

Other Resources:

Reimbursables 640 104,358 684 116,286 711 122,099 27 5,813 3.95% 5.00%

Offsetting Collections - Non 

Reimbursables - 19,212 - 28,134 - 29,541 - 1,407 N/A 5.00%

User Fees 524 343,642 170 503,076 164 525,650 (6) 22,574 -3.53% 4.49%

Recovery from Prior Years - 27,751 - 4,773 - - - (4,773) N/A -100.00%

Unobligated Balances from Prior Years - 451,869 - 374,465 - 268,875 - (105,590) N/A -28.20%

Transfers In/Out3 - 126 - - - - - - N/A N/A

Resources from Other Accounts4 2 - - - - - - - N/A N/A

Subtotal Other Resources 1,166 $946,958 854 $1,026,734 875 $946,165 21 ($80,569) 2.46% -7.85%

Total Budgetary Resources 78,566 $12,181,958 77,692 $12,240,376 71,910 $11,921,165 (5,782) ($319,211) -7.44% -2.61%

% Change

FY 2016

Enacted1

FY 2017

Annualized CR2

FY 2018

Request

FY 2017 to FY 2018 

Request

FY 2017 to FY 

2018 Request

Change
IRS-4

1B – Summary of the Request 

FY 2018 Budget Request

The IRS FY 2018 President’s Budget request is $10.975 billion, $239.6 million or 2.1 percent

below the FY 2017 Annualized Continuing Resolution level. The IRS will continue to seek 

less costly ways of delivering taxpayer service and maintaining enforcement using 

technology, training, and internal efficiencies. The IRS will:

• Assist taxpayers with tax questions before they file to prevent inadvertent 

noncompliance and reduce burdensome post-filing notices and other correspondence 

from the IRS. 

• Print forms and publications, process tax returns, offer filing and account services, 

ensure the availability of taxpayer assistance, and provide taxpayer advocacy services.

• Review tax returns, both domestic and international. Leverage data and behavioral 

analytics to target the most effective non-compliance work in collection and 

enforcement while delivering a compressed, efficient enforcement cycle with early, 

upfront error detection and resolution. 

• Address the increasing number of cybersecurity threats by modernizing systems to 

protect taxpayer information.

• Refresh aged IT infrastructure to ensure the integrity and continued operation of the 

tax administration system. 

• Recruit top talent and retain our most valuable resource, our people, using tools like 

the requested streamlined critical pay authority (see section 1E – Legislative 

Proposals). 

The Budget includes resources to retain key personnel and align the IRS workforce for the 

future. There is no more critical challenge at the IRS than delivering a smooth filing season. 

This is achieved each year because of the dedication, talent, and experience of IRS 

employees. 

The Budget invests in IT infrastructure modernization. With the growing reliance on IT as an 

integral part of the solution to provide improved taxpayer services and enforcement, the IRS 

must continue to modernize to harness new information delivery models and manage data. 

Infrastructure modernization is necessary to increase agility, efficiency, and service quality, 

ultimately reducing operational cost. 

The IRS will strive to modernize infrastructure using business process reengineering, system 

virtualization, data center consolidation, and adherence to hardware and software standards. 

The long-term dividends of upgrading the infrastructure and systems include: reducing the 

number of computer rooms by replacing old servers with new, energy efficient, more compact 

servers; advancing IT hardware and software development for creating a web-based, digital 
IRS-5

communications channel that allows taxpayers and the IRS to communicate directly via 

secure messages and secure live capabilities; allowing the IRS to improve the management 

and tracking of records; allowing real time access to records for quicker response times;

improving security and safeguard records from loss; providing reliable disaster recovery 

capabilities through automation; and allowing the IRS to keep pace with new industry 

standards.

Strategic Plan 

The Department of the Treasury is in the process of developing a new strategic plan for fiscal 

years 2018 – 2022 in accordance with the Government Performance and Results Act (GPRA) 

Modernization Act of 2010. The IRS will publish its FY 2018 - FY 2022 Strategic Plan by 

June 2018. The IRS is soliciting input on the plan from its employees as well as from external 

stakeholders. The plan will serve as a roadmap to guide its operations to meet the changing 

needs and expectations of taxpayers and those in the tax community who serve them. 

Return on Investment

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

resources invested in the IRS increase revenue collections. This unique and critical role is 

vital to the functioning of the U.S. Government and to keeping the nation and economy 

strong. In FY 2016, the IRS collected more than $3.3 trillion in tax revenue, processed more 

than 244 million tax returns and other forms, and issued more than $426 billion in tax refunds. 

As collections continue to increase, the IRS remains one of the most efficient tax 

administrators in the world. For every $100 collected in taxes, the IRS spends only thirty-five 

cents. The IRS enforcement programs collected more than $54.3 billion in FY 2016, a return

on investment (ROI) of about $5 to $1. The ROI estimate does not include the revenue effect 

of the deterrence value of these investments and other IRS enforcement programs

2016 Filing Season

Through months of planning and collaboration with key stakeholders, the IRS delivered a 

successful 2016 filing season and opened on time on January 19, 2016. The IRS increased its 

staffing for taxpayer telephone service operations to address demand and provide a higher 

level of service (LOS) during the filing season. To prepare for the 2016 filing season, during 

the summer and fall of 2015, the IRS revised 635 tax products, including the tax provisions in

Protecting Americans from Tax Hikes (PATH) Act of 2015, and implemented more than 

400 changes to more than 150 different tax products. 
IRS-6

Other highlights from the 2016 filing season include: 

• Delivered a filing season telephone LOS of 72.1 percent, a substantial improvement 

over the 37.4 percent delivered during the 2015 filing season.

• Answered more than 13.1 million calls, 5.3 million more calls than in 2015. The 

average speed of answer was 11 minutes, compared to 23 minutes in the 2015.

• Received more than 136.5 million individual returns, 1.7 percent more than last year. 

Electronically filed returns increased by 2.6 percent and accounted for 89.8 percent of

the returns filed.

• Received more than 29.9 million business returns, 3.2 percent more than in 2015.

• Filed more than 17.5 million business returns electronically, an increase of 7.6 percent 

from 2015.

• Issued more than 97 million refunds for a total of $263 billion, with an average refund 

of $2,711, of which 83.7 percent were direct-deposit.

• Worked with our Security Summit partners from state tax agencies and the broader tax 

community to add extra layers of security protection for the filing season.

• Launched Finding Out How Much You Owe on IRS.gov, which provides information 

to taxpayers with straightforward balance inquiries in a secure, easy, and convenient 

way. In the first month after its launch in late 2016, taxpayers checked their account 

balance nearly 54,000 times, and made more than 6,700 tax payments, worth more 

than $21 million, through Direct Pay. 

• Released the 100th IRS eBook for mobile devices in the ePub format.

• Expanded appointment services to all IRS Taxpayer Assistance Centers (TAC). 

Before 2015, TACs served taxpayers face to-face on a first-come, first-served model 

resulting in long lines of taxpayers waiting for service, especially during tax filing 

season. The IRS initiated an appointment-service by expanding appointments to 

376 TAC sites and 28 virtual sites located in external partner offices. This expansion 

resulted in fewer on-site contacts and shorter wait times with more than 91 percent of 

Total Returns Processed 202 million

Total Returns and Other Forms Processed 244.9 million

Total Revenue Collected $3.3 trillion

Enforcement Revenue Collected $54.3 billion

Total Refunds and Outlays $426 billion

Average Individual Refund $2,795

E-File Rate – Individual 86.4%

E-File Rate – Business 50.0%

IRS.gov Page Views 1.9 billion

“Where’s My Refund?” Usage 299.6 million

Number of Downloads from IRS.gov 121.5 million

FY 2016 Tax Stats At-A-Glance
IRS-7

taxpayers receiving help within 30 minutes. In addition, more than half of the 

taxpayers who called to make an appointment were able to resolve their issue 

immediately, thereby saving a visit to the assistance center. 

• Launched new online tools allowing taxpayers and third parties to communicate and 

transact with the IRS securely and faster.

• Stopped $4 billion in fraudulent refunds claimed by identity thieves on 787,000 tax 

returns through new screening criteria. 

• Registered nearly 190,000 financial institutions in compliance with the Foreign 

Account Tax Compliance Act (FATCA), while more than 5,000 financial institutions 

have enrolled in the International Data Exchange Service to submit FATCA returns to 

the IRS.

2017 Filing Season

The IRS recently completed a successful 2017 filing season on April 22, 2017. During this 

filing season, the IRS received more than 135 million individual tax returns, and issued over 

97 million refunds totaling over $268 billion. Over 90 percent of individual returns received 

were filed electronically. The IRS.gov web site was visited more than 312 million times and 

taxpayers used the Where’s My Refund? tool over 246 million times. Filing season LOS 

reached 79 percent, its highest level since 2007. Assistors answered nearly 10 million calls, 

and another 18 million calls were answered through automated systems. 
IRS-8

1.2 – Budget Adjustments Table

Dollars in Thousands

Internal Revenue Service FTE Amount

FY 2017 Annualized CR 76,838 $11,213,642 

Changes to Base:

Maintaining Current Levels (MCLs) - $220,035 

Pay Raise - 122,449 

Pay Annualization - 44,877 

Non-Pay Inflation Adjustment - 52,709 

Resource Adjustments - -

Base Realignment for Support Services - -

Adjustments for Administrative Provision Section 113 - -

Subtotal Changes to Base - $220,035 

Total FY 2018 Base 76,838 $11,433,677 

Program Changes:

Program Increase:

Realignment to Support Aging IT Infrastructure 266 179,449 

Program Decreases:

Realignment to Support Aging IT Infrastructure (355) (179,449)

Actions to Achieve Workforce Management Goals (5,714) (458,677)

Subtotal Program Changes (5,803) ($458,677)

Total FY 2018 Request 71,035 $10,975,000 

1C – Budget Increases and Decreases Description

Maintaining Current Levels (MCLs).....................................+$220,035,000 / 0 FTE

Pay Raise +122,449,000 / 0 FTE 

Funds are requested for the proposed January 2018 pay raise. 

Pay Annualization +$44,877,000 / 0 FTE 

Funds are requested for annualization of the January 2017 pay raise.

Non-Pay +$52,709,000 / 0 FTE 

Funds are requested for non-labor expenses such as travel, contracts, rent, supplies, and 

equipment.

Resource Adjustment 

Base Realignment for Support Services $0 / 0 FTE

In recent years, the IRS has relied on transfers of resources from the Enforcement

appropriations account to maintain core functions, information technology, and related 
IRS-9

support services. These transfers have enabled the IRS to provide front-line employees with 

the tools, equipment, analytics, secure facilities, and technology support necessary to serve

taxpayers and to maintain taxpayer customer service. In lieu of a similar transfer in FY 2018, 

the IRS proposes to permanently realign $145 million from Enforcement to Operations 

Support ($55 million) and Taxpayer Services ($90 million). 

Adjustment for Administrative Provisions Section 113 $0 / 0 FTE

Section 113 of the Consolidated Appropriations Act, 2016 at the FY 2017 annualized 

continuing resolution level provides $289.5 million to improve the customer service 

representative LOS rate, improve the identification and prevention of refund fraud and 

identity theft, and enhance cybersecurity to safeguard taxpayer data. This funding is assumed 

in the FY 2018 base and includes $208.9 million in Taxpayer Services (an increase of 

$32.1 million over FY 2016) and $80.6 million in Operations Support (a decrease of 

$27.6 million) for customer service. 

Program Increase.........................................................+$179,449,000 / +266 FTE

Aging IT Infrastructure +$179,449,000 / +266 FTE

The IRS will make progress towards decreasing the backlog of deferred software and 

hardware updates by realigning $179 million and 266 FTE from the BSM appropriation to the 

Operations Support appropriation in FY 2018. 63 percent of IRS IT hardware systems are 

aged and out of warranty and 32 percent of software products are two or more releases behind 

the industry standard, with 15 percent more than four releases behind. Every year, another 

20 percent of hardware moves to a status of aged beyond the manufacturers recommended 

useful life, if not replaced. This aging infrastructure puts the American tax system at risk of 

failure. Such conditions introduce security risks, excessive system downtime, systems and 

hardware no longer supported by the vendor, and incompatibilities across systems and 

programs. Aging IRS infrastructure was elevated by the IRS Enterprise Risk Council has 

elevated aging IRS infrastructure to the highest priority corporate risk. 

Program Decreases...................................................-$638,126,000 / -6,069 FTE

Realignment to Support Aging IT Infrastructure -$179,449,000 / -355 FTE

An estimated $179 million will be realigned to the Operations Support appropriation to 

decrease the backlog of deferred software and hardware updates, which are a critical priority 

and must be prioritized before development and modernization of new systems. With the 

FY 2018 request, the IRS will pause the development of Enterprise Case Selection, Event 

Driven Architecture, and Modernized eFile. The IRS will continue development of Customer 

Account Data Engine 2, Return Review Program and Web Applications, supported by

Architecture Integration and Management, Core Infrastructure. In addition, IRS will continue 

to explore alternative Enterprise Case Management solutions.

Actions to Achieve Workforce Management Goals -$458,677,000 / -5,714 FTE

The IRS will realize reductions in Taxpayer Services, Enforcement, Operations Support, and 

Business Systems Modernization (BSM) by reducing costs and streamlining operations. The 

IRS will mitigate the effect of this reduction by allocating funding from user fees to critical

performance areas. The IRS will reduce staffing, supply, and contractual cost in all four 
IRS-10

accounts by an estimated $220 million. Additionally, Taxpayer Services seasonal staffing 

costs will be reduced by an estimated by $239 million. The IRS will continue to provide 

service to taxpayers via a range of channels from the internet to telephones to face-to-face 

field assistance. The use and delivery of more online tools and other improved service 

channels, such as virtual tax assistance sites, will help the IRS operate in a cost effective 

manner.
IRS-11

1.3 – Operating Levels Table

Dollars in Thousands

Internal Revenue Service

Object Classification

FY 2016

Actual

FY 2017

Annualized CR

FY 2018

Request

11.1 Full-Time Permanent Positions 5,818,431 5,825,793 5,721,269

11.3 Other than Full-Time Permanent Positions 75,720 79,141 50,034

11.5 Other Personnel Compensation 210,281 197,772 196,652

11.8 Special Personal Services Payments 26,219 24,603 24,698

11.9 Personnel Compensation (Total) 6,130,651 6,127,309 5,992,653

12.1 Personnel Benefits 2,097,850 2,177,172 2,108,974

13.0 Benefits to Former Personnel 46,199 50,344 51,357

Total Personnel and Compensation Benefits $8,274,700 $8,354,825 $8,152,984

21.0 Travel 75,292 90,506 91,394

22.0 Transportation of Things 19,131 21,735 21,954

23.1 Rental Payments to GSA 592,529 587,370 597,175

23.2 Rent Payments to Others 12,323 12,495 12,679

23.3 Communications, Utilities, & Misc 296,236 350,714 352,957

24.0 Printing & Reproduction 28,353 27,866 28,380

25.1 Advisory & Assistance Services 785,522 913,116 732,898

25.2 Other Services 94,161 102,607 103,440

25.3 Purchase of Goods & Services from Govt. Accounts 172,185 180,423 176,548

25.4 Operation & Maintenance of Facilities 174,913 190,134 188,971

25.6 Medical Care 14,095 14,213 13,310

25.7 Operation & Maintenance of Equipment 70,418 75,298 75,995

26.0 Supplies and Materials 34,827 34,946 35,303

31.0 Equipment 313,749 206,399 347,309

32.0 Land and Structures 6,164 9,840 2,038

41.0 Grants, Subsidies 28,502 33,502 34,001

42.0 Insurance Claims & Indemnities 1,496 1,381 1,392

91.0 Unvouchered 2,484 6,272 6,272

Total Non-Personnel $2,724,380 $2,858,817 $2,822,016

New Appropriated Resources $10,999,080 $11,213,642 $10,975,000

Appropriations:

Taxpayer Services 2,321,956 2,328,940 2,212,311

Enforcement 4,674,272 4,855,688 4,706,500

Operations Support 3,811,907 3,739,565 3,946,189

Business Systems Modernization 190,945 289,449 110,000

New Appropriated Resources $10,999,080 $11,213,642 $10,975,000

FTE 77,400 76,838 71,035

This table includes total annually appropriated funding (actuals for FY 2016 and estimates for FY 2017 Annualized CR and FY 

2018).
IRS-12

1D – Appropriations Language and Explanation of Changes 

Appropriations Language Explanation of Changes

DEPARTMENT OF THE TREASURY

INTERNAL REVENUE SERVICE

TAXPAYER SERVICES

For necessary expenses of the Internal Revenue Service to 

provide taxpayer services, including pre-filing assistance and 

education, filing and account services, taxpayer advocacy 

services, associated support costs, and other services as 

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

determined by the Commissioner, $2,212,311,000, of which 

not less than $6,500,000 shall be for the Tax Counseling for 

the Elderly Program, of which not less than $12,000,000 

shall be available for low-income taxpayer clinic grants, and 

of which not less than $15,000,000, to remain available until 

September 30, 2019, shall be available for a Community 

Volunteer Income Tax Assistance matching grants program 

for tax return preparation assistance, of which not less than 

$206,000,000 shall be available for operating expenses of the 

Taxpayer Advocate Service: Provided, That of the amounts 

made available for the Taxpayer Advocate Service, not less 

than $5,000,000 shall be for identity theft casework.

Note.—A full-year 2017 appropriation for this account was 

not enacted at the time the budget was prepared; therefore, 

the budget assumes this account is operating under the 

Further Continuing Appropriations Act, 2017 (P.L. 114–

254). The amounts included for 2017 reflect the annualized 

level provided by the continuing resolution.

ENFORCEMENT

For necessary expenses for tax enforcement activities of the 

Internal Revenue Service to determine and collect owed 

taxes, to provide legal and litigation support, to conduct 

criminal investigations, to enforce criminal statutes related 

to violations of internal revenue laws and other financial 

crimes, to purchase and hire passenger motor vehicles (31 

U.S.C. 1343(b)), associated support costs, and to provide 

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

as may be determined by the Commissioner, $4,706,500,000, 

of which not to exceed $50,000,000 shall remain available 

until September 30, 2019, and of which not less than 

The IRS proposes a change in 

the Taxpayer Services 

appropriation language to allow 

some additional support costs to 

be incurred in the Taxpayer 

Services appropriations account 

so that the more accurate cost of 

providing taxpayer services is 

accurately reflected in the 

account. 

To help improve cost accounting 

the IRS proposes a change in the 

Enforcement appropriation 

language to allow some 

additional support costs for 
IRS-13

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

Enforcement program.

Note.—A full-year 2017 appropriation for this account was 

not enacted at the time the budget was prepared; therefore, 

the budget assumes this account is operating under the 

Further Continuing Appropriations Act, 2017 (P.L. 114–

254). The amounts included for 2017 reflect the annualized 

level provided by the continuing resolution.

OPERATIONS SUPPORT

For necessary expenses of operating the Internal Revenue 

Service, including rent payments; facilities services; 

printing; postage; physical security; oversight and 

management of IRS-wide 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)); the operations of the Internal Revenue Service 

Oversight Board; and other services as authorized by 5 

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

Commissioner; $3,946,189,000, of which not to exceed 

$100,000,000 shall remain available until September 30, 

2019; of which not to exceed $10,000,000 shall remain 

available until expended for acquisition of equipment and 

construction, repair and renovation of facilities; of which not 

to exceed $1,000,000 shall remain available until September 

30, 2020, for research; of which not to exceed $20,000 shall 

be for official reception and representation expenses: 

Provided, That not later than 30 days after the end of each 

quarter, the Internal Revenue Service shall submit a report to 

the Committees on Appropriations of the House of 

Representatives and the Senate and the Comptroller General 

of the United States detailing the cost and schedule 

performance for its major information technology 

investments, including the purpose and life-cycle stages of 

the investments; the reasons for any cost and schedule 

variances; the risks of such investments and strategies the 

Internal Revenue Service is using to mitigate such risks; and 

the expected developmental milestones to be achieved and 

costs to be incurred in the next quarter: Provided further, 

That the Internal Revenue Service shall include, in its budget 

justification for fiscal year 2019, a summary of cost and 

schedule performance information for its major information 

technology systems.

enforcement to be incurred in the 

Enforcement appropriations 

account so that the more accurate 

cost of providing enforcement 

activities is accurately reflected 

in the account. 

The IRS proposes a change in the 

Operations Support 

appropriation language to allow 

to allow some additional support 

costs to be funded in the 

Taxpayer Services and 

Enforcement accounts.

 

An increase of $50 million to 

$100 million in two-year 

authority is requested to 

correspond with the availability 

of the closely-linked BSM 

appropriation; to provide 

sufficient time for a robust IT 

lifecycle process including 

vision, strategy, solution, design, 

and development, thereby 

improving contracting outcomes; 

and to comply with a recent 

recommendation from the 

Treasury Inspector General for 

Tax Administration, “While 

Improvements Continue in 

Contract Negotiation Methods 

and Management Practices, 

Inconsistencies Need to Be 

Addressed.” 
IRS-14

Note.—A full-year 2017 appropriation for this account was 

not enacted at the time the budget was prepared; therefore, 

the budget assumes this account is operating under the 

Further Continuing Appropriations Act, 2017 (P.L. 114–

254). The amounts included for 2017 reflect the annualized 

level provided by the continuing resolution.

BUSINESS SYSTEMS MODERNIZATION

For necessary expenses of the Internal Revenue Service's 

business systems modernization program, $110,000,000, to 

remain available until September 30, 2020, for the capital 

asset acquisition of information technology systems, 

including management and related contractual costs of said 

acquisitions, including related Internal Revenue Service 

labor costs, and contractual costs associated with operations 

authorized by 5 U.S.C. 3109: Provided, That not later than 

30 days after the end of each quarter, the Internal Revenue 

Service shall submit a report to the Committees on 

Appropriations of the House of Representatives and the 

Senate and the Comptroller General of the United States 

detailing the cost and schedule performance for CADE 2 and 

Modernized e-File information technology investments, 

including the purposes and life-cycle stages of the 

investments; the reasons for any cost and schedule 

variances; the risks of such investments and the strategies the 

Internal Revenue Service is using to mitigate such risks; and 

the expected developmental milestones to be achieved and 

costs to be incurred in the next quarter.

Note.—A full-year 2017 appropriation for this account was 

not enacted at the time the budget was prepared; therefore, 

the budget assumes this account is operating under the 

Further Continuing Appropriations Act, 2017 (P.L. 114–

254). The amounts included for 2017 reflect the annualized 

level provided by the continuing resolution.

ADMINISTRATIVE PROVISIONS –

INTERNAL REVENUE SERVICE

(INCLUDING TRANSFER OF FUNDS)

SEC. 101. Not to exceed 5 percent of any appropriation made 

available in this Act to the Internal Revenue Service may be 

transferred to any other Internal Revenue Service 

appropriation upon the advance notification of the 
IRS-15

Committees on Appropriations.

SEC. 102. The Internal Revenue Service shall maintain an 

employee training program, which shall include the 

following topics: taxpayers' rights, dealing courteously with 

taxpayers, cross-cultural relations, ethics, and the impartial 

application of tax law.

SEC. 103. The Internal Revenue Service shall institute and 

enforce policies and procedures that will safeguard the 

confidentiality of taxpayer information and protect taxpayers 

against identity theft. 

SEC. 104. Funds made available by this or any other Act to 

the Internal Revenue Service shall be available for improved 

facilities and increased staffing to provide sufficient and 

effective 1–800 help line service for taxpayers. The 

Commissioner shall continue to make improvements to the 

Internal Revenue Service 1–800 help line service a priority 

and allocate resources necessary to enhance the response 

time to taxpayer communications, particularly with regard to 

victims of tax-related crimes.

SEC. 105. The Internal Revenue Service shall issue a notice 

of confirmation of any address change relating to an 

employer making employment tax payments, and such notice 

shall be sent to both the employer's former and new address 

and an officer or employee of the Internal Revenue Service 

shall give special consideration to an offer-in-compromise 

from a taxpayer who has been the victim of fraud by a third 

party payroll tax preparer.

SEC. 106. None of the funds made available under this Act 

may be used by the Internal Revenue Service to target 

citizens of the United States for exercising any right 

guaranteed under the First Amendment to the Constitution of 

the United States.

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

be used by the Internal Revenue Service to target groups for 

regulatory scrutiny based on their ideological beliefs. 

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

amended by striking the clause "Before September 30, 

2013" and inserting "before September 30, 2021".

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

is amended by inserting before the semicolon the following:

", but are renewable for an additional two years, based on a 

critical organizational need". 

The IRS requests Streamlined 

Critical Pay authority through 

September 30, 2021 to ensure 

the IRS is able to quickly recruit 

and retain IT professionals who 

can help protect taxpayer data 

from cyberattacks and modernize 

the IRS’s IT infrastructure.
IRS-16

1E – Legislative Proposals

Streamlined Critical Pay Authority

The IRS requests Streamlined Critical Pay (SCP) authority through September 30, 2021. This 

authority allowed the IRS to recruit and retain IT and other senior professionals and limited 

this authority to 40 positions. The authority to make new SCP appointments expired 

September 30, 2013. Currently there are seven senior employees under SCP appointments, 

down from a high of 30. If the SCP is not renewed, the IRS will face additional challenges 

recruiting and retaining top-level talent as the remaining SCP term appointments expire, 

especially IT professionals who can help protect taxpayer data from cyberattacks and who can 

assist with modernizing the IRS's IT infrastructure. According to Treasury Inspector General 

for Tax Administration report 2015-IE-R001, The Internal Revenue Service’s Use of Its 

Streamlined Critical Pay Authority, “private sector expertise had been crucial to introducing 

new leadership to supplement in-house expertise, and the IRS had taken advantage of the 

private sector expertise by retaining the critical pay appointees whenever feasible.”

IRS-17

Section II – Budget and Performance Plan

Taxpayer Services 

Appropriation Description

The Taxpayer Services appropriation provides funding for taxpayer service activities and 

programs. This includes printing forms and publications, processing tax returns and related 

documents, offering filing and account services, taxpayer assistance, and providing taxpayer 

advocacy services.

The Taxpayer Services budget request for FY 2018 is $2,212,311,000 in direct appropriations 

and 24,392 FTE. This is a decrease of $116,629,000, or 5 percent, and 4,063 fewer FTE than 

the FY 2017 Annualized Continuing Resolution level of $2,328,940,000 and 28,455 FTE.

The Department of the Treasury is developing a new strategic plan for FYs 2018 – 2022 in 

accordance with the GPRA Modernization Act of 2010. The plan is scheduled for publication 

in 2018. The Annual Performance Plan will be updated in the FY 2019 President’s Budget to 

reflect new departmental strategic goals and objectives. The IRS will publish a component 

plan by summer 2018.
IRS-18

2.1 – Budget Adjustments Table 

Dollars in Thousands

Taxpayer Services FTE Amount

FY 2017 Annualized CR 28,455 $2,328,940 

Changes to Base:

Maintaining Current Levels (MCLs) - $46,342 

Pay Raise - 31,005 

Pay Annualization - 11,363 

Non-Pay Inflation Adjustment - 3,974 

Resource Adjustments - $122,378 

Base Realignment for Support Services - 90,000 

Adjustments for Administrative Provision Section 113 - 32,378 

Subtotal FY 2018 Changes to Base - $168,720 

Total FY 2018 Base 28,455 $2,497,660 

Program Changes:

Program Decrease

Actions to Achieve Workforce Management Goals (4,063) (285,349)

Subtotal Program Changes (4,063) ($285,349)

Total FY 2018 Request 24,392 $2,212,311 
IRS-19

2.2 – Operating Levels Table

Dollars in Thousands

Taxpayer Services

Object Classification

FY 2016

Actual

FY 2017

Annualized CR

FY 2018

Request

11.1 Full-Time Permanent Positions 1,514,435 1,485,932 1,433,368

11.3 Other than Full-Time Permanent Positions 39,271 42,311 12,760

11.5 Other Personnel Compensation 84,246 67,128 68,444

11.8 Special Personal Services Payments 57 - -

11.9 Personnel Compensation (Total) 1,638,009 1,595,371 1,514,572

12.1 Personnel Benefits 529,434 562,795 526,482

13.0 Benefits to Former Personnel 517 344 350

Total Personnel and Compensation Benefits $2,167,960 $2,158,510 $2,041,404

21.0 Travel 8,751 12,464 12,335

22.0 Transportation of Things 713 621 635

23.3 Communications, Utilities, & Misc 1,204 1,246 1,275

24.0 Printing & Reproduction 9,114 8,158 8,285

25.1 Advisory & Assistance Services 32,459 32,802 32,961

25.2 Other Services 6,796 13,676 13,869

25.3 Purchase of Goods & Services from Govt. Accounts 61,262 61,903 61,497

25.4 Operation & Maintenance of Facilities 6 7 7

25.7 Operation & Maintenance of Equipment 75 211 216

26.0 Supplies and Materials 4,726 5,136 5,106

31.0 Equipment 94 428 438

32.0 Land and Structures 1 - -

41.0 Grants, Subsidies 28,502 33,502 34,001

42.0 Insurance Claims & Indemnities 293 276 282

Total Non-Personnel $153,996 $170,430 $170,907

New Appropriated Resources $2,321,956 $2,328,940 $2,212,311

Budget Activities:

Pre-filing Taxpayer Assistance & Education 609,445 625,829 600,717

Filing & Account Services 1,712,511 1,703,111 1,611,594

New Appropriated Resources $2,321,956 $2,328,940 $2,212,311

FTE 28,316 28,455 24,392
IRS-20

2.3 – Appropriation Detail Table

2A – Pre-Filing Taxpayer Assistance and Education ($600,717,000 in direct 

appropriations, and an estimated $15,000 from reimbursable programs). This budget activity 

funds direct labor and non-labor expenses to assist with tax return preparation, including tax 

law interpretation, publication, production, and advocate services. The program activities 

include:

• Pre-Filing Services Management supports headquarters staffing and support for 

Taxpayer Advocate Service and Customer Assistance Relationship and Education 

(CARE) program activities. CARE provides pre-filing taxpayer assistance and 

education.

• Taxpayer Communication and Education researches customer needs; develops and 

manages educational programs; establishes partnerships with stakeholder groups; and 

disseminates tax information to taxpayers and the general public through a variety of 

media, including publications and mailings, websites, broadcasting, and advertising.

• Media and Publications develops and produces notices, forms, and publications for 

printed and electronic tax materials, and provides media production services to 

taxpayers.

• Taxpayer Advocacy provides advocate services to taxpayers by identifying the 

underlying causes of taxpayer problems and participating in the development of 

systematic and/or procedural remedies.

• Account Management and Assistance – Field Assistance provides face-to-face 

assistance, education, and compliance services to taxpayers. It includes return 

preparation, answering tax questions, resolving account and notice inquiries, and 

supplying forms and publications to taxpayers.

Taxpayer Advocate Case Processing provides advocate services to taxpayers to 

resolve taxpayer problems through prompt identification, referral, and settlement.

Dollars in Thousands

Taxpayer Services

Appropriated Resources

FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

New Appropriated Resources:

Pre-Filing Taxpayer Assistance and 

Education 5,009 $620,338 4,978 625,829 4,458 600,717 (520) (25,112) -10.45% -4.01%

Filing and Account Services 23,307 1,713,038 23,477 1,703,111 19,934 1,611,594 (3,543) (91,517) -15.09% -5.37%

Subtotal New Appropriated 

Resources 28,316 $2,333,376 28,455 $2,328,940 24,392 $2,212,311 (4,063) ($116,629) -14.28% -5.01%

Other Resources:

Reimbursables 488 34,918 507 36,664 527 38,497 20 1,833 3.94% 5.00%

User Fees 360 69,987 77 43,900 71 67,600 (6) 23,700 -7.79% 53.99%

Recovery from Prior Years - - - 8 - - - (8) N/A -100.00%

Unobligated Balances from Prior 

Years - 13,914 - 8,596 - 15,000 - 6,404 N/A 74.50%

Subtotal Other Resources 848 $118,819 584 $89,168 598 $121,097 14 $31,929 2.40% 35.81%

Total Budgetary Resources 29,164 $2,452,195 29,039 $2,418,108 24,990 $2,333,408 (4,049) ($84,700) -13.94% -3.50%

FY 2016

Enacted

FY 2017

Annualized CR

FY 2018

Request

FY 2017 to FY 2018 

Request

FY 2017 to FY 2018 

Request

Change % Change
IRS-21

• W&I HQ Management and Administration provides staffing, training, and direct 

support for Wage and Investment management activities of strategic planning, 

communications and liaison, finance, human resources, equity, diversity and inclusion, 

business modernization, and embedded training.

Description of Performance

In FY 2016, the IRS delivered 92.5 percent (98 out of 106) of the Critical Individual Filing 

Season Tax Products to the public by the fifth workday of January. After the PATH Act, the 

IRS implemented planned actions to ensure the availability of tax products for the start of 

Filing Season 2016. The immediate focus was aimed at completing the required analysis of 

the legislation and development and finalization of affected forms, instructions and 

publications. In all, more than 400 changes were required for more than 150 different tax 

products. In FY 2017 and FY 2018, the target is set at 89 percent but significant changes in 

tax law late in the year could affect this target. 

In FY 2016, the IRS Timeliness of Critical Tax Exempt and Government Entities (TEGE) and 

Business Filing Season Tax products to the Public was 98 percent (99 of 101). The IRS 

exceeded its FY 2016 target of 87 percent by more than 12 percent due to the exceptional 

planning and employee efforts in anticipation of the PATH Act. For FY 2017 and FY 2018 

the target is set at 91 percent but significant changes in tax law late in the year could affect 

this target as tax products for multiple years are developed concurrently.

The Taxpayer Self-Assistance Rate reached 89 percent in FY 2016, slightly below the 

90 percent target. This may be due in part to the disabling of the Electronic Filing PIN (EFP) 

in mid-June 2016 and a significant decline in the use of the Interactive Tax Assistant. 

Beginning in FY 2017, the IRS changed the Taxpayer Self-Assistance Rate to the Enterprise

Taxpayer Self-Assistance Rate. The revised metric now includes additional applications 

including Get Transcript and payment applications, such as Direct Pay and Online Payment 

Agreement. This demonstrates IRS’s progress toward providing expanded service options and 

taxpayers’ increased adoption of self-assistance options. 
IRS-22

FY 2018 Changes by Budget Activity

Dollars in Thousands

Pre-Filing Taxpayer Assistance & Education FTE Amount

FY 2017 Annualized CR Level 4,978 $625,829 

Changes to Base:

Maintaining Current Levels (MCLs) - $12,553 

Pay Raise - 7,940 

Pay Annualization - 2,910 

Non-Pay - 1,703 

Resource Adjustments

Base Realignment for Support Services - -

Adjustments for Administrative Provision Section 113 - -

Subtotal Changes to Base - $12,553 

Total FY 2018 Base 4,978 $638,382 

Program Changes:

Program Decreases

Actions to Achieve Workforce Management Goals (520) (37,665)

Subtotal Program Changes (520) ($37,665)

Total FY 2018 Request 4,458 $600,717 

Dollar/FTE Change FY 2018 Budget Request over FY 2017 Annualized CR (520) ($25,112)

Percent Change FY 2018 Budget Request over FY 2017 Annualized CR -10.45% -4.01%

2.1.1 – Budget and Performance Report and Plan 

Dollars in Thousands

Pre-Filing Taxpayer 

Assistance & Education FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Resource Level Actual Actual Actual Actual Actual Annualized 

CR Request

Appropriated Resources1 $611,653 $586,896 $595,168 $609,196 $609,445 $625,829 $600,717 

Reimbursable Resources2 96 45 51 13 14 15 

User Fees2 22,460 6,400 22,400 4,141 - - -

Budget Activity Total $634,209 $593,296 $617,613 $613,388 $609,458 $625,843 $600,732 1

The FY 2012 - FY 2016 appropriated resources represents the approved operating plan including any inter-BAC transfers and 

inter-appropriation transfers.

2

The FY 2012 - FY 2016 columns represent realized resources for reimbursables and user fees.

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target FY 2016

Trend

Timeliness of Critical 

Individual Filing Season 

Tax Products to the Public 

(%)

97.2 58.9 99.1 89.0 92.5 87.0 89.0 89.0

Timeliness of Critical 

TE/GE and Business Tax 

Products to the Public (%)

94.5 83.6 98.7 92.6 98.0 87.0 91.0 91.0

Enterprise Taxpayer SelfAssistance Rate 178.5 83.3 84.7 88.7 89.0 90.0 Indicator N/A N/A

1

Starting in FY 2017, the IRS modified the Taxpayer Self Assistance Rate measure to include additional self-service channels. 

As new self-assistance applications are provided to the public, they will be added to the methodology.
IRS-23

2B – Filing and Account Services ($1,611,594,000 in direct appropriations, an estimated 

$38,482,000 from reimbursable programs, and an estimated $67,600,000 from user fees): 

This budget activity funds direct labor and non-labor expenses that provide filing and account 

services to taxpayers, process paper and electronically-submitted tax returns, issue refunds, 

and maintain taxpayer accounts. The IRS continues to make progress in decreasing paper 

returns (with more than 90 percent of individual returns being filed electronically during the 

FY 2017 filing season) and increasing the use of electronic filing and payment methods. The 

program activities include:

• Filing and Account Services Management administers filing and account services 

programs.

• Submission Processing processes paper and electronically submitted tax returns and 

supplemental documents, accounts for tax revenue, processes information documents, 

and issues refunds and tax notices.

• Account Management and Assistance – Electronic/Correspondence Assistance

provides education and assistance to taxpayers and resolves accounts and notice 

inquiries through telephone, paper, and internet correspondence.

• Electronic Products and Services Support (EPSS) provides centralized operations and 

support capabilities for the IRS suite of electronic products, including e-help desk, 

technology support, and operations support.

• Electronic Tax Administration (ETA) markets and administers electronic tax 

administration products and services.

• Business Performance Lab initiates, recommends, and manages systemic solutions for 

the detection and treatment of improper refunds while ensuring effective treatment for 

payment of valid refund claims leads the development of innovative business 

processes and technology solutions and represents Return Integrity & Compliance 

Services (RICS) interest in support of the service-wide revenue protection strategy.

• Joint Operations Center (JOC) provides service, support, and technology for 

telephone, correspondence, and electronic media inquiries; real time monitoring and 

routing of inbound calls; monitoring of Customer Service Representative accuracy; 

and management of the enterprise telephone database.

Description of Performance

Millions of individual and business taxpayers file their returns electronically. In FY 2016, the 

IRS achieved an 86.4 percent individual e-file rate and a 50 percent business e-file rate. Both 

the individual and business e-file rates exceed the FY 2016 targets. The overall benefits of 

e-file (i.e. faster refunds, greater accuracy, secure and confidential submission, and quick 

confirmation) continue to drive performance. The IRS also is using social media to promote

the benefits of e-filing. The IRS will increase the individual e-filing target to 87 percent for 

FY 2017 and 88 percent for FY 2018. The business e-filing target will increase to 51 percent 

for FY 2017 and 53 percent for FY 2018. 
IRS-24

In FY 2016, Customer Accuracy – Tax Law was 96.4 percent, exceeding the target of 

92 percent. For FY 2017 and FY 2018, the IRS will increase the tax law accuracy targets to 

95 percent, even though responding to legislative changes in tax laws will continue to be a 

challenge.

In FY 2016, the IRS correctly answered 96.1 percent of account questions over the telephone, 

exceeding the target of 94 percent. The IRS expects to maintain high performance on the 

Customer Accuracy – Accounts (Phones) and plans to achieve the FY 2017 and FY 2018 

target of 95 percent through product reviews and by providing training to managers and 

employees to ensure quality service. 

In FY 2016, the IRS Customer Contacts Resolved Per Staff Year measure reached 28,497, 

exceeding the FY 2016 target of 28,000. This measure includes activities such as automated

calls answered, assistor calls answered, and web services completed. The increase is 

attributed to a 24 percent increase in web usage, including an increase in Where’s My 

Refund? Due to modifications made to the Taxpayer Self-Assistance measure for FY 2017, 

several components of the Customer Contacts Resolved Per Staff Year measure changed,

including (1) the way IRS counts transcripts, from “requested” to now counting “delivered”;

(2) the addition of Get Transcript (Online & Mail); and (3) the discontinuation of Electronic 

Interactions. Because of these changes, the IRS will baseline the measure in FY 2017 and use

the results to determine an FY 2018 target. 

In FY 2016, the LOS was 53.4 percent, exceeding the FY 2016 target of 47 percent. The 

2016 filing season LOS was 72.1 percent. In 2016, the IRS received additional funding for 

taxpayer services, which allowed the IRS to focus resources on LOS and reduce paper 

correspondence inventories. This inventory totaled more than 850,000 pieces of 

correspondence with a 48 percent overage at the end of FY 2015, and is currently down to 

approximately 660,000 pieces of correspondence as of May 2017, with a 22 percent overage. 

The IRS has created and continues to create new web-based applications for taxpayers. The 

increase in self-assistance web applications, along with the high level of telephone service 

should reduce paper correspondence receipts. Due to decreased telephone demand, the IRS 

shifted available resources to processing paper, resulting in closing significantly more paper 

correspondence cases compared to FY 2015. The FY 2017 LOS target is 64 percent. This 

target includes funding from direct appropriations including $209 million from the 

administrative provision and $40 million from user fees. The FY 2018 target is 39 percent 

and assumes $58 million from user fees.

Refund timeliness is defined as the percentage of paper refunds issued within 40 days. In 

FY 2016, Refund Timeliness reached 98.7 percent, exceeding the FY 2016 target of 

97 percent as the number of paper refunds continued to decline. There was a 7 percent 

decrease in the number of paper refunds compared to the same period in 2015. For FY 2017 

and FY 2018, the IRS expects to achieve a target of 97 percent. 
IRS-25

FY 2018 Changes by Budget Activity

Dollars in Thousands

Filing and Account Services FTE Amount

FY 2017 Annualized CR 23,477 $1,703,111 

Changes to Base:

Maintaining Current Levels (MCLs) - $33,789 

Pay Raise - 23,065 

Pay Annualization - 8,453 

Non-Pay - 2,271 

Resource Adjustments $122,378 

Base Realignment for Support Services - 90,000 

Adjustments for Administrative Provision Section 113 - 32,378 

Subtotal Changes to Base - $156,167 

Total FY 2018 Base 23,477 $1,859,278 

Program Changes:

Program Decreases

Actions to Achieve Workforce Management Goals (3,543) (247,684)

Subtotal Program Changes (3,543) ($247,684)

Total FY 2018 Request 19,934 $1,611,594 

Dollar/FTE Change FY 2018 Budget Request over FY 2017 Annualized CR (3,543) ($91,517)

Percent Change FY 2018 Budget Request over FY 2017 Annualized CR -15.09% -5.37%

2.1.2 – Budget and Performance Report and Plan 

Dollars in Thousands

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target FY 2016

Trend

Percent Individual Returns 

Processed Electronically 

(%) 

80.5 82.5 84.1 85.3 86.4 86.0 87.0 88.0

Percent of Business 

Returns Processed 

Electronically 

36.7 40.2 43.1 47.0 50.0 48.0 51.0 53.0

Customer Accuracy - Tax 

Law Phones (%) 

93.2 95.7 95.0 95.0 96.4 92.0 95.0 95.0

Customer Accuracy -

Accounts (Phones) 

95.6 96.0 96.2 95.5 96.1 94.0 95.0 95.0

Customer Contacts 

Resolved Per Staff Year1

16,320 20,767 21,018 26,245 28,497 28,000 Baseline TBD

Customer Service 

Representative (CSR) 

Level of Service (LOS) 

(%)2

67.6 60.5 64.4 38.1 53.4 47.0 64.0 39.0

Filing and Account Services FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Resource Level Actual Actual Actual Actual Actual Annualized 

CR Request

Appropriated Resources1 $1,610,904 $1,532,963 $1,550,027 $1,564,488 $1,712,511 $1,703,111 $1,611,594

Reimbursable Resources2 20,759 37,535 28,555 30,147 34,905 36,650 38,482

User Fees2 152,136 184,599 160,342 40,553 69,987 43,900 67,600

Budget Activity Total $1,783,799 $1,755,097 $1,738,924 $1,635,188 $1,817,403 $1,783,661 $1,717,676

1

The FY 2012 - FY 2016 appropriated resources represents the approved operating plan including any inter-BAC transfers and interappropriation transfers.

2

The FY 2012 - FY 2016 columns represent realized resources for reimbursables and user fees.
IRS-26

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target FY 2016

Trend

Refund Timeliness -

Individual (Paper) 

99.7 99.0 98.7 98.8 98.7 97.0 97.0 97.0

1

Due to modifications made to the Taxpayer Self-Assistance Rate measure for FY 2017, several components of the Customer 

Contacts Resolved Per Staff measure will change. As a result of these changes, the measure will be baselined in FY 2017.

2

Beginning in FY 2013, targets include an increase in base user fees.

IRS-27

Enforcement 

Appropriation Description

The Enforcement appropriation provides funding for the examination of tax returns, both 

domestic and international; administrative and judicial settlement of taxpayer appeals of

examination findings; technical rulings; monitoring of employee pension plans; determination 

of qualifications of organizations seeking tax-exempt status; examination of tax returns of 

exempt organizations; enforcement of statutes relating to detection and investigation of 

criminal violations of the internal revenue laws; identification of underreporting of tax 

obligations; securing of unfiled tax returns; and collection of unpaid accounts.

The Enforcement budget request for FY 2018 is $4,706,500,000 in direct appropriations and 

35,049 FTE. This is a decrease of $149,188,000 (3.1 percent) and 1,300 fewer FTE than the 

FY 2017 Annualized Continuing Resolution level of $4,855,688,000 and 36,349 FTE.

The Department of the Treasury is developing a new strategic plan for FYs 2018 – 2022 in 

accordance with the GPRA Modernization Act of 2010. The plan is scheduled for publication 

in 2018. The Annual Performance Plan will be updated in the FY 2019 President’s Budget to 

reflect new departmental strategic goals and objectives. The IRS will publish a component 

plan by summer 2018.
IRS-28

2.1 – Budget Adjustments Table

Dollars in Thousands

Enforcement FTE Amount

FY 2017 Annualized CR 36,349 $4,855,688 

Changes to Base:

Maintaining Current Levels (MCLs) - $96,845 

Pay Raise - 65,828 

Pay Annualization - 24,126 

Non-Pay Inflation Adjustment - 6,891 

Resource Adjustments - ($149,936)

Base Realignment for Support Services - (145,000)

Adjustments for Administrative Provision Section 113 - (4,936)

Subtotal Changes to Base - ($53,091)

Total FY 2018 Base 36,349 $4,802,597 

Program Changes:

Program Decrease:

Actions to Achieve Workforce Management Goals (1,300) (96,097)

Subtotal FY 2018 Program Changes (1,300) ($96,097)

Total FY 2018 Request 35,049 $4,706,500 
IRS-29

2.2 – Operating Levels Table

Dollars in Thousands

Enforcement

Object Classification

FY 2016

Actual

FY 2017

Annualized CR

FY 2018

Request

11.1 Full-Time Permanent Positions 3,141,237 3,168,939 3,137,409

11.3 Other than Full-Time Permanent Positions 29,922 30,904 31,369

11.5 Other Personnel Compensation 105,714 108,971 106,876

11.8 Special Personal Services Payments 25,486 24,201 24,288

11.9 Personnel Compensation (Total) 3,302,359 3,333,015 3,299,942

12.1 Personnel Benefits 1,136,662 1,159,565 1,128,398

Total Personnel and Compensation Benefits $4,439,021 $4,492,580 $4,428,340

21.0 Travel 55,662 69,941 70,965

22.0 Transportation of Things 7,914 9,909 9,921

23.1 Rental Payments to GSA 3 4 4

23.2 Rent Payments to Others 302 402 405

23.3 Communications, Utilities, & Misc 2,644 2,156 2,158

24.0 Printing & Reproduction 1,875 2,188 2,223

25.1 Advisory & Assistance Services 75,380 168,969 85,217

25.2 Other Services 28,047 35,647 36,461

25.3 Purchase of Goods & Services from Govt. Accounts 34,286 37,163 33,782

25.4 Operation & Maintenance of Facilities 15 2 2

25.5 Research & Development Contracts 2,000

 

-

 

-

25.6 Medical Care 8 47 48

25.7 Operation & Maintenance of Equipment 1,470 1,400 1,404

26.0 Supplies and Materials 15,071 23,190 23,462

31.0 Equipment 7,198 4,917 4,919

32.0 Land and Structures 2 4 4

42.0 Insurance Claims & Indemnities 890 897 913

91.0 Unvouchered 2,484 6,272 6,272

Total Non-Personnel $235,251 $363,108 $278,160

New Appropriated Resources $4,674,272 $4,855,688 $4,706,500

Budget Activities:

Investigations 591,449 624,462 606,747

Exam & Collections 3,945,578 4,083,908 3,967,808

Regulatory 137,245 147,318 131,945

New Appropriated Resources $4,674,272 $4,855,688 $4,706,500

FTE 37,564 36,349 35,049
IRS-30

2.3 – Appropriation Detail Table

2C – Investigations ($606,747,000 in direct appropriations, and an estimated $42,993,000 

from reimbursable programs): This budget activity funds the Criminal Investigation (CI) 

programs that explore potential criminal and civil violations of tax laws; enforce criminal

statutes relating to violations of tax laws and other financial crimes, and recommend 

prosecution as warranted. The program activities include:

• General Management and Administration supports the headquarters management 

activities of strategic planning, communications, finance, and human resources for 

CI activities.

• Criminal Investigations supports the enforcement of criminal statutes relating to 

violations of internal revenue laws and other financial crimes. CI investigates cases of 

suspected intent to defraud that involve both legal and illegal sources of income and 

recommends prosecution as warranted. This activity includes the investigation and 

prosecution of tax and money-laundering violations associated with narcotics 

organizations.

• Criminal Tax Legal Support provides legal advice and support from IRS Counsel to 

CI.

• International Investigations supports international investigations involving U.S. 

citizens residing abroad, non-resident aliens, expatriates, and investigations involving 

other international issues, including legal support (e.g., Foreign Tax Credit and 

Foreign Earned Income Exclusion, Corporations, Non-Profits, Pension Plans, etc.).

Dollars in Thousands

Enforcement

Appropriated Resources

FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

New Appropriated 

Resources:

Investigations 3,184 $596,417 3,126 624,462 2,893 606,747 (233) (17,715) -7.45% -2.84%

Exam and Collections 33,426 3,981,257 32,251 4,083,908 31,199 3,967,808 (1,052) (116,100) -3.26% -2.84%

Regulatory 954 137,262 972 147,318 957 131,945 (15) (15,373) -1.54% -10.44%

Subtotal New Appropriated 

Resources 37,564 $4,714,936 36,349 $4,855,688 35,049 $4,706,500 (1,300) ($149,188) -3.58% -3.07%

Other Resources:

Reimbursables 54 29,711 75 41,636 78 43,717 3 2,081 4.00% 5.00%

Offsetting Collections - Non 

Reimbursables - 19,212 - 28,134 - 29,541 - 1,407 N/A 5.00%

User Fees 81 9,405 93 13,452 93 16,150 - 2,698 - 20.06%

Recovery from Prior Years - 2,150 - 1,977 - - - (1,977) N/A -100.00%

Years - 20,306 - 52,789 - 18,321 - (34,468) N/A -65.29%

Transfers In/Out 126 - - - - - N/A N/A

Resources from Other Accounts 2 - - - - - - - N/A N/A

Subtotal Other Resources 137 $80,910 168 $137,988 171 $107,729 3 ($30,259) 1.79% -21.93%

Total Budgetary Resources 37,701 $4,795,846 36,517 $4,993,676 35,220 $4,814,229 (1,297) ($179,447) -3.55% -3.59%

FY 2017 to FY 2018 

Request

FY 2017 to FY 2018 

Request

FY 2016

Enacted

FY 2017

Annualized CR

FY 2018

Request

Change % Change
IRS-31

Description of Performance

Criminal Investigations (CI) serves the American public by investigating potential criminal 

violations of the Internal Revenue Code and related financial crimes in a manner that fosters 

confidence in the tax system and compliance with the law. Criminal Investigations is the only 

federal law enforcement organization with jurisdiction over federal tax crimes. The following 

measures are used to evaluate the success of achieving its mission. CI utilized its 

performance projection model to establish its FY 2017 and FY 2018 year-end targets. 

In FY 2016, the number of criminal investigations completed was 3,720, 2.1 percent below 

the year-end target (3,800) and a 17.1 percent decrease compared to FY 2015. Overall 

performance in FY 2016 was affected by a significant decline in the number of Special 

Agents; the decision to focus on more complex tax cases, which take longer to complete; and 

working inventory still in the judicial process. The number of Cases of a Legal, Illegal and 

Narcotics nature completed in FY 2016 decreased (21.8 percent, 4.2 percent and 24.9 percent, 

respectively) compared to FY 2015. Criminal Investigations will continue to utilize proven 

case development strategies, expand case development efforts, and leverage interagency 

partnerships to identify, initiate, and complete criminal investigations in all program areas to 

meet the FY 2017 criminal investigation completed target of 3,100 and the FY 2018 target of 

3,000.

In FY 2016, the numbers of convictions (2,672) were 6.9 percent above the year-end target 

(2,500) but reflected a 7.2 percent decrease compared to FY 2015. The results exceeded the 

year-end target due to a higher- than- expected number of multi-defendant Narcotics related 

investigations. The number of Narcotics related cases convicted in FY 2016 increased 

13.7 percent compared to FY 2015. Overall quality investigations initiated and completed in 

previous years continue to be recommended for prosecution and processed by the Department 

of Justice (DOJ). CI management will continue to ensure appropriate and consistent contact 

with the DOJ Tax Division and U.S. Attorney Offices regarding prosecutorial priorities and 

appropriate movement of pipeline investigations to meet the FY 2017 number of convictions 

target of 2,100 and the FY 2018 target of 2,000. 

In FY 2016, the conviction rate was 92.1 percent, exceeding the FY 2016 target of 92 percent. 

Appropriate case selection and effective field performance continue to increase the number of 

cases that result in convictions. Since CI does not prosecute its own cases, it must depend on 

DOJ to accept its cases for prosecution and move such cases through the courts. CI 

management will continue its current efforts of appropriate and consistent contact with the 

DOJ Tax Division and U.S. Attorney Offices about prosecutorial priorities and appropriate 

movement of pipeline investigations, to ensure a high conviction rate and to meet the 

FY 2017 and FY 2018 targets of 92 percent.

The Conviction Efficiency Rate is determined by dividing the cost of the CI program by the 

number of convictions. The FY 2016 rate ($250,563) improved by 7.9 percent over the 

year-end target ($272,000) and by 4 percent compared to FY 2015, primarily due to an 

increase in the number of convictions. In FY 2017, the Conviction Efficiency Rate measure 

was discontinued for reporting purposes. The IRS will continue to report on Criminal 

Investigations Completed, Number of Convictions, and Conviction Rate.
IRS-32

FY 2018 Changes by Budget Activity

Dollars in Thousands

Investigations FTE Amount

FY 2017 Annualized CR Level 3,126 $624,462 

Changes to Base:

Maintaining Current Levels (MCLs) - $12,439 

Pay Raise - 8,142 

Pay Annualization - 2,984 

Non-Pay - 1,313 

Resource Adjustments - ($18,160)

Adjustments for Administrative Provision Section 113 - (18,160)

Subtotal Changes to Base - ($5,721)

Total FY 2018 Base 3,126 $618,741 

Program Changes:

Program Decrease:

Actions to Achieve Workforce Management Goals (233) (11,994)

Subtotal Program Changes (233) ($11,994)

Total FY 2018 Request 2,893 $606,747 

Dollar/FTE Change FY 2018 Budget Request over FY 2017 Annualized CR Level (233) ($17,715)

Percent Change FY 2018 Budget Request over FY 2017 Annualized CR Level -7.45% -2.84%

2.1.3 – Budget and Performance Report and Plan 

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target FY 2016

Trend

Criminal Investigations 

Completed

4,937 5,557 4,606 4,486 3,721 3,800 3,100 3,000

Number of Convictions 2,634 3,311 3,110 2,879 2,672 2,500 2,100 2,000

Conviction Rate (%) 93.0 93.1 93.4 93.2 92.1 92.0 92.0 92.0

2D – Exam and Collections ($3,967,808,000) in direct appropriations, and an estimated 

$502,000 from reimbursable programs): This budget activity funds programs that enforce the 

tax laws and increase compliance through examination and collection programs that ensure 

proper payment and tax reporting. This budget activity also includes campus support of the 

Questionable Refund program and appeals and litigation activities associated with exam and 

collection. The program activities include:

• Compliance Services Management supports management associated with exam and 

collection program activities.

Investigations FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Resource Level Actual Actual Actual Actual Actual Annualized 

CR Request

Appropriated Resources1 $637,846 $587,932 $601,740 $601,665 $591,449 $624,462 $606,747

Reimbursable Resources2 56,895 28,582 27,133 29,957 29,053 40,946 42,993

User Fees2 6,935 2,979 - - - - -

Budget Activity Total $701,676 $619,493 $628,873 $631,622 $620,502 $665,408 $649,740

Dollars in Thousands

1

The FY 2012 - FY 2016 appropriated resources represents the approved operating plan including any inter-BAC transfers and inter-appropriation transfers.

2

The FY 2012 - FY 2016 columns represent realized resources for reimbursables and user fees.
IRS-33

• Payment Compliance – Correspondence Collection supports IRS collection activities 

by initiating contact and collecting delinquent taxpayer liabilities through written 

notices and other means.

• Automated Collections and Support initiates contact and collects delinquent taxpayer 

liabilities through the centralized Automated Collection System (ACS). 

• Payment Compliance – Field Collection conducts field investigations and collection 

efforts associated with delinquent taxpayer and business entity liabilities, including 

direct taxpayer contact and outreach programs to protect the interest of the federal 

government in delinquent tax liability situations.

• Tax Reporting Compliance – Document Matching supports the Automated 

Underreporter (AUR), Combined Annual Wage Reporting (CAWR), Federal 

Unemployment Tax Act (FUTA), and other Document Matching Programs.

• Tax Reporting Compliance – Electronic/Correspondence Exam initiates written 

correspondence with taxpayers related to tax issues arising from claims on their tax 

returns.

• Tax Reporting Compliance – Field Exam compares taxpayer income levels and 

corresponding tax liabilities to ensure the accuracy of taxpayer returns.

• Fraud/Bank Secrecy Act enforces the anti-money laundering provisions of the Bank 

Secrecy Act of 1970 (BSA) and the USA Patriot Act of 2001. It examines non-bank 

financial institutions for compliance with these laws, receives and processes more than 

15 million financial reports annually, and manages a centralized database of that 

information for the Financial Crimes Enforcement Network. The Fraud program 

follows the “money trail” to support the criminal investigation of tax evasion 

operations. Fraud technical advisors and revenue agents provide investigative leads 

and referrals to federal, state, and local law enforcement agencies.

• Appeals provides an administrative review process that provides a channel for 

impartial case settlement before a case is docketed in a court of law.

• Litigation provides legal support for the IRS in litigation of cases, including 

interpretation of the tax law.

• Specialty Programs – Exams examines federal tax returns of businesses and 

individuals responsible for the filing and payment of employment, excise, estate, and 

gift taxes.

• International Collection supports international field collection efforts associated with 

delinquent taxpayer and business entity liabilities from U.S. Citizens residing abroad, 

non-resident aliens, expatriates, and those involving other international issues 

(e.g., Foreign Tax Credit and Foreign Earned Income Exclusion).

• International Exams supports the international exam program involving U.S. citizens 

residing abroad, non-resident aliens, expatriates, and other examinations involving 

other international issues including legal support (e.g., Foreign Tax Credit and Foreign 

Earned Income Exclusion, Corporations, Non-Profits, Pension Plans, etc.).
IRS-34

• Unit General Management and Administration provides staffing, training, and direct 

support for headquarters management activities of strategic planning, communication 

and liaison, finance, human resources, equity, diversity and inclusion, business system 

planning, and embedded training.

• EITC Management and Administration supports headquarters management associated 

with administering the Earned Income Tax Credit (EITC) program IRS-wide. 

• Integrity & Verification Operations supports civil fraud detection and prevention 

efforts in a pre-refund environment including monitoring program performance and 

developing policy and procedures and guidance for processing civil revenue protection 

program(s).

• ID Theft Victim Assistance has end-to-end responsibility and accountability for IDT 

victim assistance policy and operations, which will include paper inventories from 

tax-related ID theft, the Identity Theft Protection Specialized Unit (IPSU), and Return 

Preparer Misconduct.

• Whistleblower Office provides staffing, training, and direct support to process, assess, 

and analyze tips from individuals who identify potential tax problems.

• Communications and Liaison coordinates local government and liaison relationships; 

manages congressional, state, and national stakeholder relationships and issues; 

coordinates crosscutting issues, including audit management and legislative 

implementation; manages national media contacts and local media relationships; and 

ensures IRS compliance with disclosure and privacy laws.

Description of Performance – Exam

The Examination program helps taxpayers understand and meet their tax responsibilities and 

applies the tax law with integrity and fairness. Enforcement of the tax laws is an integral 

component of the IRS’s effort to enhance voluntary compliance. During FY 2016, the IRS 

maintained its international enforcement presence, continued actions to leverage the tax return 

preparer community, and continued prioritizing the prevention of refund fraud.

The IRS met its FY 2016 Individual Exam Coverage target of 0.7 percent. In FY 2016, the 

IRS audited about 193,000 fewer individuals, a 15.8 percent decrease compared to FY 2015. 

Examination sets its individual exam coverage rate by ensuring resources are appropriately 

planned for, proper inventory levels are maintained, and efficiencies are monitored to achieve 

planned targets. The IRS has reduced the coverage rate target for FY 2017 to 0.6 percent and 

FY 2018 to 0.5 percent, because the new hiring done in FY 2017 and changes in the mix of 

work affect productivity. In order to mitigate this decrease, Examination will increase its 

monitoring of starts and the mix of discretionary inventory in FY 2017. 

In FY 2016, the Field Exam National Quality Review Score (NQRS) was 86.8 percent, 

exceeding the target of 86.7 percent. The IRS expects to achieve a quality score of 

86.7 percent in FY 2017 and FY 2018.

In FY 2016, Office Exam Quality was 88.4 percent, exceeding the target of 88.3 percent. The 

IRS expects to achieve a target of 86.7 percent in FY 2017 and 88.3 percent in FY 2018. 
IRS-35

In FY 2016, Examination Quality – Large Business was 83 percent, 7 percentage points 

below the target of 90 percent. The decline in the quality score is a result of low scores in the 

Planning and Execution technical standards. The measure is calculated through a review of a 

statistically valid random sample of closed Large Business Return cases. Case scores are 

based on the percentage of elements passed within each of the three audit standards (Planning, 

Executing, and Resolving). In FY 2016, Large Business &International (LB&I) reduced the 

number of audit standard categories from four to three. The FY 2017 and FY 2018 targets

were set at 90 percent.

In FY 2016, Examination Coverage – Business (Assets > $10 million) was 3 percent, falling 

short of the target of 3.5 percent. The measure is calculated by taking the total number of 

LB&I returns with assets of more than $10 million (including all partnerships) examined and 

closed by LB&I during the current fiscal year, divided by total filings for the preceding 

calendar year. The FY 2017 and FY 2018 targets were lowered to 2.7 percent, based on fewer 

staff and a projected increase in business returns filed.

The Automated Underreporter (AUR) Efficiency rate was 2,196 through FY 2016, above the 

target of 2,032. The measure is calculated by taking the total number of Wage & Investment 

and SB/SE contact closures divided by the total FTEs, including overtime. SB/SE Campus 

Automated Underreporter realized efficiency gains in FY 2016 from new processes that

allowed work to close more quickly. The inclusion of the Premium Tax Credit (PTC) in 

FY 2016 required manual calculations for a significant number of cases, resulting in fewer

closures compared to FY 2015 (2,196 vs. 2,209). Based on the most recent operational data, 

the IRS set the FY 2017 and FY 2018 Automated Underreporter Efficiency targets at 2,133. 

In FY 2016, AUR Coverage was 2.3 percent, exceeding the target of 2.2 percent. The 

measure is calculated by taking the total number of contact closures divided by total prior 

calendar year individual filings. A 10 percent decrease in FTE and a 1 percent increase in 

filings over the last two years resulted in an AUR Coverage rate of 2.3 percent for FY 2016 

and FY 2015. The IRS expects to achieve an FY 2017 and FY 2018 target of 2.0 percent. 

In 2016, Individual Exam Efficiency - Individual was 143, exceeding the target of 122. 

Individual closures decreased 18 percent compared to FY 2015. The measure is calculated by 

taking the sum of all individual 1040 return examinations and audit reconsideration cases 

divided by the total staff years expended. Examination will continue to monitor the operating 

plan and adjust resources accordingly to ensure the planned target is met. The FY 2017

Individual Exam Efficiency target is set at 118 and the FY 2018 target is set at 126 as the IRS 

expects new staff to require time for training before reaching full efficiency. 

Description of Performance ‒ Collection

The Collection program collects delinquent taxes, secures delinquent tax returns through the 

fair and equitable application of tax laws, and provides education to promote future 

compliance, thereby protecting and instilling public confidence in the American tax system. 

The performance goals that the IRS uses to gauge collection program performance are

discussed below.
IRS-36

In FY 2016, Collection Coverage was 43.4 percent, exceeding the target of 41.8 percent. For 

FY 2016, total net dispositions decreased 8 percent, while FTE were 1 percent lower 

compared to FY 2015. The Collection Coverage measure is calculated by taking the total 

volume of collection work disposed divided by total collection work available. The 

Collection Coverage FY 2017 target is 37.5 percent and the FY 2018 target is 34.2 percent.

In FY 2016, Collection Efficiency was 2,266, exceeding the target of 2,208. The Collection 

Efficiency measure is calculated by dividing total collection case closures by the total number

of FTEs devoted to working the closures. The IRS has improved Collection Efficiency over 

the past five years while FTEs have declined by 25 percent and collection closures declined 

by only 14 percent. The IRS expects to achieve the Collection Efficiency FY 2017 target of 

2,117 and the FY 2018 target of 2,147, as the FY 2016 and 2017 new hires are trained.

In FY 2016, the Field Collection National Quality Review Score (NQRS) was 79.2 percent, 

below the target of 79.7 percent. The Field Collection Quality measure is the percentage of 

quality attributes reviewed by an independent quality reviewer that are determined to be 

correct. The IRS expects to achieve an FY 2017 and FY 2018 Field Collection National 

Quality Review Score target of 79.7 percent.

In FY 2016, Automated Collection System (ACS) Accuracy was 95.4 percent, above the 

target of 95 percent. The ACS Accuracy measure reflects the percentage of correct responses 

from a weighted random sampling of calls selected for quality review by the Centralized

Quality Review System (CQRS). Periodic performance reviews were conducted on the 

campus program and communicated to the sites. IRS has set the FY 2017 and FY 2018

Automated Collection System Accuracy targets at 95 percent. 
IRS-37

FY 2018 Changes by Budget Activity

Dollars in Thousands

Exam and Collections FTE Amount

FY 2017 Annualized CR Level 32,251 $4,083,908 

Changes to Base:

Maintaining Current Levels (MCLs) - $81,466 

Pay Raise - 55,635 

Pay Annualization - 20,390 

Non-Pay - 5,441 

Resource Adjustments - ($116,077)

Base Realignment for Support Services - (111,141)

Adjustments for Administrative Provision Section 113 - (4,936)

Subtotal Changes to Base - ($34,611)

Total FY 2018 Base 32,251 $4,049,297 

Program Changes:

Program Decreases

Actions to Achieve Workforce Management Goals (1,052) (81,489)

Subtotal Program Changes (1,052) ($81,489)

Total FY 2018 Request 31,199 $3,967,808 

Dollar/FTE Change FY 2018 Budget Request over FY 2017 Annualized CR Level (1,052) ($116,100)

Percent Change FY 2018 Budget Request over FY 2017 Annualized CR Level -3.26% -2.84%

2.1.4 – Budget and Performance Report and Plan 

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target FY 2016

Trend

Examination Coverage -

Individual (1040)

1.0 1.0 0.9 0.8 0.7 0.6 0.6 0.5

Field Examination 

National Quality Review 

Score

87.4 89.2 88.4 86.7 86.8 86.7 86.7 86.7

Office Examination 

National Quality Review 

Score

91.3 90.3 90.6 88.3 88.4 88.3 86.7 88.3

Examination Quality -

LB&I - Large Business1

N/A 92.0 83.0 86.0 83.0 90.0 90.0 90.0

Examination Coverage -

Business Assets >$10 

million (%)

6.2 5.6 4.3 3.9 3.0 3.5 2.7 2.7

Automated Underreporter 

(AUR) Efficiency

2,041 2,025 1,935 2,209 2,196 2,036 2,133 2,133

Exam and Collections FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Resource Level Actual Actual Actual Actual Actual Annualized 

CR Request

Appropriated Resources1 $4,482,881 $4,188,328 $4,154,342 $4,018,292 $3,945,578 $4,083,908 $3,967,808

Reimbursable Resources2 6,385 804 640 456 478 502

User Fees2 - - - - 36 -

Budget Activity Total $4,489,266 $4,189,132 $4,154,342 $4,018,932 $3,946,070 $4,084,386 $3,968,310

Dollars in Thousands

1

The FY 2012 - FY 2016 appropriated resources represents the approved operating plan including any inter-BAC transfers and 

inter-appropriation transfers.

2

The FY 2012 - FY 2016 columns represent realized resources for reimbursables and user fees.
IRS-38

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target FY 2016

Trend

Automated Underreporter 

(AUR) Coverage (%)

3.2 2.8 2.6 2.3 2.3 2.2 2.0 2.0

Examination Efficiency -

Individual (1040)

142 142 138 148 143 122 118 126

Collection Coverage 

(Units)

48.1 47.0 45.9 46.3 43.4 41.8 37.5 34.2

Collection Efficiency 

(Units)

1,997 2,057 2,051 2,448 2,266 2,208 2,117 2,147

Field Collection National 

Quality Review Score

80.4 81.4 81.6 79.2 79.2 79.7 79.7 79.7

Automated Collection 

System (ACS) Accuracy 

(%)

94.7 94.4 95.2 95.3 95.4 95.0 95.0 95.0

1. As a result of program changes that occurred in the Large Business and International (LB&I) organization, starting in FY 

2013, a new Examination Quality - Large Business measure will replace the two previous LB&I quality measures - Examination 

Quality - Industry and Coordinated Industry.

2E – Regulatory ($131,945,000 in direct appropriations, an estimated $222,000 from 

reimbursable programs, and an estimated $16,150,000 from user fees): This budget activity 

funds the development of published IRS guidance materials; interpretation of tax laws; 

internal advice to IRS on general non-tax legal issues; enforcement of regulatory rules, laws, 

and approved business practices; and support for taxpayers in the areas of pre-filing 

agreements, determination letters, and advance pricing agreements. The program activities 

include:

• Tax Law Interpretation and Published Guidance interpret tax law through published 

guidance, technical advice, and other technical legal services.

• General Legal Services provides advice to the IRS on non-tax legal issues, including 

procurement, personnel, labor relations, equal employment opportunity, fiscal law, tort 

claims and damages, ethics, and conflict of interest.

• Rulings and Agreements applies the tax law to specific taxpayers in the form of

pre-filing agreements, determination letters, advance pricing agreements, and other 

pre-filing determinations and advice.

• International Regulatory Legal Support supports Counsel’s work in tax law 

interpretation and rulings and agreements related to international issues.

• Return Preparer Strategy provides staffing, training, and direct support associated 

with the Return Preparer Strategy.

• Office of Professional Responsibility identifies, communicates, and enforces Treasury 

Circular 230 standards of competence, integrity, and conduct of those who represent 

taxpayers before the IRS, including attorneys, Certified Public Accountants (CPAs), 

enrolled agents, enrolled actuaries and appraisers, and other professionals.

Description of Performance
IRS-39

Tax Exempt and Government Entities (TEGE) Determination Closures includes both 

applications for tax-exempt status for employee retirement plans (EP) and applications from 

various charitable entities seeking tax-exempt status (EO). The IRS reviews applications to 

determine eligibility and closes them upon approval or disapproval. 

Total determination closures in FY 2016 completed was 99,973 below the target of 103,852. 

While TEGE exceeded the closure goal for applications from organizations seeking 

tax-exempt status by more than 1,200 cases, employee plan determination application closures 

were about 5,100 cases short of the fiscal year goal because fewer applications were received 

than planned, and EO case processing to improve timeliness and maintain consistent case 

treatment. The IRS lowered the FY 2017 Determination Closures target to 95,791 to reflect 

the employee plan determination changes, but will increase the FY 2018 target to 99,840 for 

the anticipated increase in applications. 

FY 2018 Changes by Budget Activity

Dollars in Thousands

Regulatory FTE Amount

FY 2017 Annualized CR 972 $147,318 

Changes to Base:

Maintaining Current Levels (MCLs) - $2,940 

Pay Raise - 2,051 

Pay Annualization - 752 

Non-Pay - 137 

Resource Adjustments - ($15,699)

Adjustments for Administrative Provision Section 113 - (15,699)

Subtotal Changes to Base - ($12,759)

Total FY 2018 Base 972 $134,559 

Program Changes:

Program Decreases:

Actions to Achieve Workforce Management Goals (15) (2,614)

Subtotal Program Changes (15) ($2,614)

Total FY 2018 Request 957 $131,945 

Dollar/FTE Change FY 2018 Budget Request over FY 2017 Annualized CR Level (15) ($15,373)

Percent Change FY 2018 Budget Request over FY 2017 Annualized CR Level -1.54% -10.44%

2.1.5 – Budget and Performance Report and Plan 

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Regulatory FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Resource Level Actual Actual Actual Actual Actual Annualized 

CR Request

Appropriated Resources1 150,903 147,411 158,415 147,605 137,245 147,318 131,945

Reimbursable Resources2 660 631 792 363 202 212 222

User Fees2 12,482 14,521 13,241 18,485 9,233 13,452 16,150

Budget Activity Total $164,045 $162,563 $172,448 $166,453 $146,680 $160,982 $148,317

Dollars in Thousands

1

The FY 2012 - FY 2016 appropriated resources represents the approved operating plan including any inter-BAC transfers 

and inter-appropriation transfers.

2

The FY 2012 - FY 2016 columns represent realized resources for reimbursables and user fees.
IRS-40

Actual Actual Actual Actual Actual Target Target Target FY 2016

Trend

TE/GE Determination 

Case Closures

87,000 65,877 136,746 111,940 99,973 103,852 95,791 99,840

IRS-41

Operations Support 

Appropriation Description

The Operations Support appropriation provides funding for overall planning, direction, and 

support for the IRS, including shared service support related to facilities services, rent 

payments, printing, postage, and security. This appropriation funds headquarters policy and 

management activities such as corporate support for strategic planning; communications and 

liaison; finance; human resources; equity, diversity and inclusion; research and statistics of 

income; and necessary expenses for information systems and telecommunication support, 

including development, security, and maintenance of the IRS’s information systems.

The Operations Support budget request for FY 2018 is $3,946,189,000 in direct 

appropriations and 11,365 FTE. This is an increase of $206,624,000, or 5.5 percent, and 

76 fewer FTE than the FY 2017 Annualized Continuing Resolution of $3,739,565,000 and 

11,441 FTE.

The Department of the Treasury is developing a new strategic plan for FYs 2018 – 2022 in 

accordance with the GPRA Modernization Act of 2010. The plan is scheduled for publication 

in 2018. The Annual Performance Plan will be updated in the FY 2019 President’s Budget to 

reflect new departmental strategic goals and objectives. The IRS will publish a component 

plan in summer 2018.
IRS-42

2.1 – Budget Adjustments Table

Dollars in Thousands

Operations Support FTE Amount

FY 2017 Annualized CR 11,441 $3,739,565 

Changes to Base:

Maintaining Current Levels (MCLs) - $75,423 

Pay Raise - 24,573 

Pay Annualization - 9,006 

Non-Pay Inflation Adjustment - 41,844 

Resource Adjustments - $27,558 

Base Realignment for Support Services - 55,000 

Adjustments for Administrative Provision Section 113 - (27,442)

Subtotal Changes to Base - $102,981 

Total FY 2018 Base 11,441 $3,842,546 

Program Changes:

Program Increase:

Realignment to Support Aging IT Infrastructure 266 179,449 

Subtotal Program Increase 266 $179,449 

Program Decreases

Actions to Achieve Workforce Management Goals (342) (75,806)

Subtotal Program Changes (76) $103,643 

Total FY 2018 Request 11,365 $3,946,189 
IRS-43

2.2 – Operating Levels Table

Dollars in Thousands

Operations Support

Object Classification

FY 2016

Actual

FY 2017

Annualized CR

FY 2018

Request

11.1 Full-Time Permanent Positions 1,109,315 1,099,853 1,122,911

11.3 Other than Full-Time Permanent Positions 6,102 5,733 5,843

11.5 Other Personnel Compensation 19,754 20,669 21,033

11.8 Special Personal Services Payments 676 402 410

11.9 Personnel Compensation (Total) 1,135,847 1,126,657 1,150,197

12.1 Personnel Benefits 415,262 432,951 445,736

13.0 Benefits to Former Personnel 45,682 50,000 51,007

Total Personnel and Compensation Benefits $1,596,791 $1,609,608 $1,646,940

21.0 Travel 10,709 7,910 7,982

22.0 Transportation of Things 10,504 11,205 11,398

23.1 Rental Payments to GSA 592,526 587,366 597,171

23.2 Rent Payments to Others 12,021 12,093 12,274

23.3 Communications, Utilities, & Misc 292,388 347,312 349,524

24.0 Printing & Reproduction 17,364 17,520 17,872

25.1 Advisory & Assistance Services 567,856 539,118 550,534

25.2 Other Services 59,309 53,125 53,052

25.3 Purchase of Goods & Services from Govt. Accounts 76,637 81,345 81,263

25.4 Operation & Maintenance of Facilities 174,892 190,125 188,962

25.6 Medical Care 14,087 14,166 13,262

25.7 Operation & Maintenance of Equipment 66,241 72,253 73,711

26.0 Supplies and Materials 15,028 6,599 6,726

31.0 Equipment 299,080 179,776 333,287

32.0 Land and Structures 6,161 9,836 2,034

42.0 Insurance Claims & Indemnities 313 208 197

Total Non-Personnel $2,215,116 $2,129,957 $2,299,249

New Appropriated Resources $3,811,907 $3,739,565 $3,946,189

Budget Activities:

Infrastructure 838,048 861,229 860,643

Shared Services & Support 1,090,192 1,014,139 1,011,411

Information Services 1,883,667 1,864,197 2,074,135

New Appropriated Resources $3,811,907 $3,739,565 $3,946,189

FTE 11,078 11,441 11,365
IRS-44

2.3 – Appropriation Detail Table

2F – Infrastructure ($860,643,000 in direct appropriations and an estimated $690,000 from 

reimbursable programs): These budget activity funds administrative services related to space

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

non-IT equipment. The program activities include:

• Building Delegation oversees and manages the IRS GSA-delegated buildings, 

including cleaning, maintenance, utilities, protection, administrative, and recurring and 

one-time repair costs.

• Rent provides resources for all IRS rent needs. 

• Space and Housing/Non-IT Equipment provides management of all IRS building 

services, maintenance, space alterations, guard services, custodial overtime, utility 

service needs, and non-IT equipment.

• Security covers building security costs related to contract guard services.

Description of Performance 

The IRS continued efforts to realize operational efficiencies and manage costs effectively by 

improving enterprise-wide resources and streamlining processes. 

Other than payroll, rent is the IRS's largest operating expense. IRS has identified

opportunities to reduce the high cost of rent and improve usage of office space across the 

country. In FY 2016, the IRS completed 61 projects to release more than 558,000 square feet 

of rented space from inventory for an annual rent reduction of about $16 million. In order to

contain costs and improve space usage, the IRS is developing Strategic Facility Plan process

that focuses on closing or consolidating workspace at the time of lease expiration. 

Dollars in Thousands

Operations Support

Appropriated Resources

New Appropriated Resources: FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

Infrastructure - $848,191 - 861,229 - 860,643 - (586) N/A -0.07%

Shared Services and Support 4,861 1,110,811 4,981 1,014,139 4,871 1,011,411 (110) (2,728) -2.21% -0.27%

Information Services 6,217 1,937,686 6,460 1,864,197 6,494 2,074,135 34 209,938 0.53% 11.26%

Subtotal New Appropriated Resources 11,078 $3,896,688 11,441 $3,739,565 11,365 $3,946,189 (76) $206,624 -0.66% 5.53%

Other Resources:

Reimbursables 98 39,729 102 37,986 106 39,885 4 1,899 3.92% 5.00%

User Fees 83 264,250 - 409,724 - 441,900 - 32,176 N/A 7.85%

Recovery from Prior Years - 21,318 - 2,022 - - (2,022) N/A -100.00%

Unobligated Balances from Prior Years - 141,205 - 126,898 - 49,970 - (76,928) N/A -60.62%

Subtotal Other Resources 181 $466,502 102 $576,630 106 $531,755 4 ($44,875) 3.92% -7.78%

Total Budgetary Resources 11,259 $4,363,190 11,543 $4,316,195 11,471 $4,477,944 (72) $161,749 -0.62% 3.75%

FY 2017 to FY 

2018 Request

FY 2017 to FY 2018 

Request

FY 2016

Enacted

FY 2017

Annualized CR

FY 2018

Request

Change % Change
IRS-45

FY 2018 Changes by Budget Activity

Dollars in Thousands

Infrastructure FTE Amount

FY 2017 Annualized CR $861,229 

Changes to Base:

Maintaining Current Levels (MCLs) - $17,383 

Non-Pay - 17,383 

Subtotal Changes to Base - $17,383 

Total FY 2018 Base - $878,612 

Program Changes:

Program Decrease:

Actions to Achieve Workforce Management Goals - (17,969)

Subtotal Program Changes - ($17,969)

Total FY 2018 Request - $860,643 

Dollar/FTE Change FY 2018 Budget Request over FY 2017 Annualized CR Level ($586)

Percent Change FY 2018 Budget Request over FY 2017 Annualized CR Level -0.07%

2.1.6 – Budget and Performance Report and Plan 

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target FY 2016

Trend

Rentable Square Feet Per 

Person (new for FY 2017)

Indicator N/A

2G – Shared Services and Support ($1,011,411,000 in direct appropriations, an estimated 

$17,520,000 from reimbursable programs, and an estimated $11,900,000 from user fees): 

This budget activity funds policy management, IRS-wide support for research, strategic 

planning, communications and liaison, protection of sensitive information and the privacy of 

taxpayers and employees, finance, human resources, and equity, diversity, and inclusion 

programs. It also funds printing and postage, business systems planning, physical security, 

corporate training, legal services, procurement, and employee benefits programs. The

program activities include: 

• National Headquarters Management and Administration directs the management 

activities of strategic planning, communications and liaison, finance, human resources, 

equity, diversity and inclusion programs, business systems planning, embedded 

training, and the Treasury Franchise Fund. It sets policies and goals, provides 

leadership and direction for the IRS, and builds partner relationships with key 

Infrastructure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Resource Level Actual Actual Actual Actual Actual Annualized 

CR Request

Appropriated Resources1 894,365 874,627 845,558 833,846 838,048 861,229 860,643

Reimbursable Resources2 1,016 701 16,694 928 626 657 690

User Fees2 57,477 5,414 17,137 - - - -

Budget Activity Total $952,858 $880,742 $879,389 $834,774 $838,674 $861,886 $861,333

Dollars in Thousands

1

The FY 2012 - FY 2016 appropriated resources represents the approved operating plan including any inter-BAC 

transfers and inter-appropriation transfers.

2

The FY 2012 - FY 2016 columns represent realized resources for reimbursables and user fees.
IRS-46

stakeholders (Congress, GAO, and OMB). It provides policy guidance for conducting 

planning and budgeting strategies, conducting analyses of programs and investments 

to support strategic decision-making, and developing and managing human resources. 

It also includes official reception and representation expenses.

• Facilities Management & Security Services provides facilities and security services to 

deliver a safe, secure and optimal work environment to IRS customers and employees.

• Procurement supports the procurement function of the IRS and Treasury’s 

Departmental Offices.

• Equity, Diversity and Inclusion Field Services provides staffing, training, and direct 

support to plan and manage the IRS’s Equity, Diversity and Inclusion program.

• Communications and Liaison handles congressional, national, and local stakeholder 

relationships and issues; coordinates and addresses crosscutting issues, including 

legislative implementation; works with representatives of the national and local tax 

community; communicates with individual and business taxpayers by developing 

information on IRS.gov and providing other taxpayer-facing content; handles national 

and local media contacts and relationships; and oversees internal employee 

communications.

• Employee Support Services plans and manages financial services, including relocation, 

travel, purchase cards, corporate express, and employee clearances. 

• Treasury Complaint Centers plan and manage the Treasury Complaint Centers.

• Shared Support not provided by Agency-Wide Shared Services provides resources for 

shared cross-functional support, such as postage meters, shredders, courier services, 

and post office boxes.

• Printing and Postage – Media and Publications provides operating divisions with 

printing and postage, including shipping of taxpayer and internal use materials.

• Statistics of Income provides resources for researching annual income, financial, and 

tax data from tax returns filed by individuals, corporations, and tax-exempt 

organizations.

• Research provides resources for market-based research to identify compliance issues, 

for conducting tests of treatments to address noncompliance, and for the 

implementation of successful strategies to address taxpayer noncompliance.

• Security Administration and Management manages and oversees the staffing, training, 

equipment, and direct support for the protection of IRS employees, facilities, and 

assets, and the protection and proper use of identity information. 

• Wage and Investment (W&I) Business Modernization Support provides staffing, 

training, and direct support for W&I’s enterprise-wide business modernization efforts, 

including CADE 2, and Account Management Services (AMS) technology solutions, 

and re-engineered business processes.

• Shared Services provides support services for all IRS employees, including Treasury 

Franchise Fund, Indemnity payments, Mailrooms, Logistics, Shredding and 

Uninterrupted Power Systems. 
IRS-47

Description of Performance

Through support activities that include management and administration of human resources, 

security, and research, Operations Support continues to provide shared services to all IRS 

programs.

Human Capital 

The IRS workforce is our most important resource. By providing improved training and tools 

to all employees and developing future leaders, the IRS helps its workforce better serve 

taxpayer needs and guide the next generation of IRS employees. 

Security

Security of taxpayer data and providing a secure environment for employees are of utmost 

importance to the IRS. In FY 2016, the IRS:

• Continued efforts to protect the integrity of taxpayer data, minimize opportunities for 

fraud, and protect employees and facilities. 

• Engaged in activities with external stakeholders to promote data protection and 

minimize the potential mistreatment of taxpayers. The IRS expanded the Suspicious 

Filer Exchange to include 43 states and 6 municipalities, whereby the states and the 

IRS share information for confirmed identity theft and questionable returns through 

secure data transfers, for use with filter and authentication processes. The IRS also 

established a process to expedite the sharing of significant tax incidents or threats

amongst Security Summit partners.

• Refined and developed new identity theft filters based on analytical models and data 

validation. As a result, the IRS stopped potentially fraudulent returns much earlier in 

processing, allowing it to resolve cases for ID theft victims more quickly. 

Research 

The IRS gains further understanding of compliance through its National Research Program 

(NRP). The NRP analyzes reporting compliance data for various taxpayer populations, 

including Individual Income Tax, Corporate Income Tax, Employment Taxes, and Fuel 

Excise Taxes. Using data from the NRP individual income tax reporting compliance study, 

the IRS updated and implemented IRS Discriminant Function (DIF) models. The updates 

implemented for processing year 2016 were the latest in a series of updates to DIF models 

made possible because of new data available annually from NRP. The IRS expects that these 

improved models will reduce the selection of compliant taxpayers for audit, thereby focusing 

limited examination resources on returns with noncompliance, particularly returns with larger 

expected tax changes. The result will be a reduction in the number of audits for fully 

compliant taxpayers, while ensuring that problematic returns receive the necessary scrutiny. 

The IRS conducts research studies and analytics on behavioral responses to IRS taxpayer 

service operations and enforcement activities and provides measures of taxpayer compliance 

and the tax gap. 
IRS-48

FY 2018 Changes by Budget Activity

Dollars in Thousands

Shared Services and Support FTE Amount

FY 2017 Annualized CR 4,981 $1,014,139 

Changes to Base:

Maintaining Current Levels (MCLs) - $20,629 

Pay Raise - 9,383 

Pay Annualization - 3,439 

Non-Pay - 7,807 

Subtotal Changes to Base - $20,629 

Total FY 2018 Base 4,981 $1,034,768 

Program Changes:

Program Decrease:

Actions to Achieve Workforce Management Goals (110) (23,357)

Subtotal Program Changes (110) ($23,357)

Total FY 2018 Request 4,871 $1,011,411 

Dollar/FTE Change FY 2018 Budget Request over FY 2017 Annualized CR Level (110) ($2,728)

Percent Change FY 2018 Budget Request over FY 2017 Annualized CR Level -2.21% -0.27%

2.1.7 – Budget and Performance Report and Plan 

2H – Information Services ($2,074,135,000 in direct appropriations, $21,675,000 in 

reimbursable resources, and an estimated $430,000,000 from user fees): This budget activity 

funds staffing, equipment, and related costs to manage, maintain, and operate the information 

systems critical to the support of the tax administration programs. This includes the design 

and operation of Information Technology (IT) security controls and disaster recovery 

planning. This budget activity funds the development and maintenance of the millions of 

lines of programming code that support all aspects and phases of tax processing and the 

operation and administration of mainframes, servers, personal computers, networks, and a 

variety of management information systems. IT systems and data are key to all IRS functions. 

IT is responsible for information systems and technology, ranging from cyber security and 

networks to applications development and end user equipment and services. The program 

activities include:

• Application Development performs the analysis, design, development, testing, and 

implementation of about 550 applications supporting critical tax processing, 

management information reporting, and financial management support systems. This 

program supports external trading partner data exchanges with federal government 

agencies, state and local governments, and other third party entities. The program 

Shared Services and Support FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Resource Level Actual Actual Actual Actual Actual Annualized 

CR Request

Appropriated Resources1 $1,187,959 $1,097,565 $1,127,931 $1,126,230 $1,090,192 $1,014,139 $1,011,411

Reimbursable Resources2 31,486 17,175 19,886 17,126 19,443 16,686 17,520

User Fees2 14,938 31,644 7,819 1,768 1,000 1,000 11,900

Budget Activity Total $1,234,383 $1,146,384 $1,155,636 $1,145,124 $1,110,635 $1,031,825 $1,040,831

Dollars in Thousands

1

The FY 2012 - FY 2016 appropriated resources represents the approved operating plan including any inter-BAC transfers and inter-appropriation 

transfers.

2

The FY 2012 - FY 2016 columns represent realized resources for reimbursables and user fees.
IRS-49

controls application source code and deploys applications to the production 

environment.

• Cybersecurity delivers IT security services to ensure IRS compliance with federal 

statutory and regulatory requirements governing confidentiality, integrity, and 

availability of IRS electronic systems, services, and data. Cybersecurity tracks 

compliance, continuously monitors risk, and provides remediation to manage the IRS's 

IT Security Program in accordance with the Federal Information Security 

Management Act.

• Enterprise Operations designs, develops, and maintains IT that supports critical tax 

processing, management information reporting, and financial management support 

systems for the IRS. It supports data exchanges with external organizations, such as 

other federal agencies, state and local governments, and external entities (e.g., 

employers and banks), and includes a comprehensive disaster recovery capability to 

ensure continued operations in the event of a major interruption of service. 

• Enterprise Program Management Office (EPMO) is responsible for the delivery of 

integrated solutions for several of the IRS’s large-scale programs. It plays a key role 

in establishing change, configuration, and release plans and implementing new 

information system functional capabilities. The EPMO is the primary partner with the 

business for programs under their purview and works with IT delivery partners (AD, 

ES, EOPS and the other ACIO areas) to deliver required capabilities. This structure 

positions each organization to maintain a strong core function to optimize their 

operations. 

• Enterprise Services plans and manages service and delivery methods used across the 

IT organization, including demand analysis, enterprise architecture, configuration 

management, project reporting, enterprise life cycle management, release 

management, systems engineering, dashboard reporting, and internal management.

• IT Executive Oversight supports the continued transformation of the IT organization 

while helping drive the successful implementation of multiple initiatives and is 

responsible for overseeing day-to-day operations of the organization and providing 

strategic and operational oversight for many functions within IT. 

• IT Infrastructure provides a centrally managed investment program for the 

replacement of IRS IT infrastructure that has reached or surpassed its useful life cycle. 

• Strategy and Planning collaborates with IT leadership to provide policy, direction, and 

administration of essential programs, including strategy and capital planning, strategic 

planning and performance measurement, financial management services, vendor and 

contract management, requirements and demand management, and risk management. 

The organization partners with IRS leadership and external stakeholders to ensure 

selection, planning and management of an IT investment portfolio that is driven by the 

strategic priorities of the IRS and demonstrates business value. 

• Treasury Franchise Fund (TFF) is a centralized functional area that pays for services 

provided through the Treasury Franchise Fund. 

• User and Network Services (UNS) provides end-user support in accordance with 

negotiated service level agreements, strategic direction, forecasting, planning and 
IRS-50

oversight of IT business needs, and ensures compliance with government security 

regulations. UNS supplies and maintains all desk-side technology, equips the 

Volunteer Income Tax Assistance Program; establishes and provides oversight of 

hardware and software standards; and manages the architecture, design, and 

engineering of the IRS network infrastructure.

Description of Performance

The IRS taxpayer service and enforcement programs rely heavily on information systems 

funded in this account. These systems 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 telecommunication services for all business activities. It also 

funds the disaster recovery activities to ensure continued operations in the event of a major 

interruption of service. 

In FY 2016, the IRS:

• Processed more than 126,000 Forms 1094-B, Transmittal of Health Coverage 

Information Returns and more than 108 million Forms 1095-C, Employer-Provided 

Health Insurance Offer and Coverage Insurance, through the ACA Information 

Returns (AIR) system.

• Continued to deliver new capabilities and enhancements to the Foreign Account Tax 

Compliance Act (FATCA) system. The IRS deployed the FATCA registration system 

releases 3.0, 4.0, and 4.1, and updated the FATCA Compliance Roadmap with 

activities for identifying noncompliance by foreign financial institutions. Nearly 

190,000 financial institutions registered with the IRS, while more than 5,000 financial 

institutions enrolled in the International Data Exchange Service to submit FATCA 

returns to the IRS.

• Worked with Security Summit partners from state tax agencies and the broader tax 

community to add extra layers of security protection for the filing season; processed 

more than 200 million returns and billions of dollars in tax refunds with these security 

protections in place.

• Conducted continuity of operations exercises testing organizational readiness in 

response to emergency events. These exercises allow the IRS to test its ability to 

support and render services to taxpayers by ensuring the three mission essential 

functions, Processing Tax Returns, Processing Remittances, and Processing Refunds, 

remain operational during an emergency event. Exercises centered not only on natural 

disasters (hurricanes, tornadoes, earthquakes, wild fires, etc.) but also on man-made 

disasters (bombs, biohazard situations, riots, etc.) that could affect IRS operations. 

The continuity exercises required extensive coordination with IRS leadership and 

assessed continuity readiness at all levels of the organization. 

• Continued to build robust cybersecurity programs to improve the identification and 

prevention of refund fraud and identity theft and to enhance cybersecurity to safeguard 

taxpayer data. 
IRS-51

• Identified and mitigated 678 cyber incidents and blocked the transmission of 

66,378 unencrypted emails from leaving the IRS network, preventing the possible 

inadvertent disclosure of sensitive data such as social security numbers and passwords. 

The IRS also completed the first release of its Short Messaging Service Platform 

(SMSP), which allowed for the issuance of a one-time password to a taxpayer via text 

messaging services, paving the way for two-factor authentication for taxpayers trying 

to access their tax records.

FY 2018 Changes by Budget Activity

Dollars in Thousands

Information Services FTE Amount

FY 2017 Annualized CR 6,460 $1,864,197 

Changes to Base:

Maintaining Current Levels (MCLs) - $37,411 

Pay Raise - 15,190 

Pay Annualization - 5,567 

Non-Pay - 16,654 

Resource Adjustments - $27,558 

Base Realignment for Support Services - 55,000 

Adjustments for Administrative Provision Section 113 - (27,442)

Subtotal FY 2018 Changes to Base - $64,969 

FY 2018 Current Services 6,460 $1,929,166 

Program Changes:

Program Increase:

Realignment to Support Aging IT Infrastructure 266 179,449 

Program Decrease:

Actions to Achieve Workforce Management Goals (232) (34,480)

Subtotal FY 2018 Program Changes 34 $144,969 

Total FY 2018 Budget Request 6,494 $2,074,135 

Dollar/FTE Change FY 2018 Budget Request over FY 2017 Annualized CR Level 34 $209,938 

Percent Change FY 2018 Budget Request over FY 2017 Annualized CR Level 0.53% 11.26%

2.1.8 – Budget and Performance Report and Plan 

Information Services FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Resource Level Actual Actual Actual Actual Actual Annualized 

CR Request

Appropriated Resources1 1,681,195 1,722,172 1,749,110 1,641,360 1,883,667 1,864,197 2,074,135

Reimbursable Resources2 5,154 8,850 4,734 24,262 19,660 20,643 21,675

User Fees2 59,824 145,027 198,206 373,610 263,250 408,724 430,000

Budget Activity Total $1,746,173 $1,876,049 $1,952,050 $2,039,232 $2,166,577 $2,293,564 $2,525,810

Dollars in Thousands

1

The FY 2012 - FY 2016 appropriated resources represents the approved operating plan including any inter-BAC transfers and interappropriation transfers.

2

The FY 2012 - FY 2016 columns represent realized resources for reimbursables and user fees.

IRS-52

Business Systems Modernization 

Appropriation Description

The Business Systems Modernization (BSM) appropriation provides resources for the 

planning and capital asset acquisition of IT to modernize the IRS business systems.

The BSM budget request for FY 2018 is $110,000,000 in direct appropriations and 229 FTE. 

This is a decrease of $179,449,000, or 62 percent, and 364 fewer FTE than the FY 2017 

Annualized Continuing Resolution level of $289,449,000 and 593 FTE. 

The IRS is moving $179,449,000 and 266 FTE from BSM to Operations Support to fund 

operations and maintenance for the existing infrastructure, including addressing a backlog of 

infrastructure past its useful life. As of right now, 63 percent of IT hardware systems are aged 

and out of warranty and 32 percent of software products are two or more releases behind the 

industry standard, with 15 percent more than four releases behind. Additionally, the 

increasing number of cybersecurity threats and the need to modernize systems to protect one 

of the world’s most valuable data caches cannot be overstated. These funds and FTE will be 

used to replace about 20 percent of the inventory.

BSM will continue to operate the Return Review Program (RRP), which has significantly 

enhanced fraud detection capabilities; Web Applications, which has provided increased and 

secure Internet-based services to taxpayers; CADE2, which has provided the foundation for a 

more efficient and effective tax administration; Architecture, Integration and Management

(AI&M), which has provided management abilities essential to IRS systems strategy, 

architecture, and engineering capabilities for the major modernization projects across all 

technology platforms; and Core Infrastructure which has provided shared infrastructure that 

leverages reusable engineering design patterns and best practices for standardized, virtual, and 

secure environments.

The Department of the Treasury is developing a new strategic plan for FYs 2018 – 2022 in 

accordance with the GPRA Modernization Act of 2010. The plan is scheduled for publication 

in 2018. The Annual Performance Plan will be updated in the FY 2019 President’s Budget to 

reflect new departmental strategic goals and objectives. The IRS will publish a component 

plan by summer 2018.
IRS-53

2.1 – Budget Adjustments Table 

Dollars in Thousands

Business Systems Modernization FTE Amount

FY 2017 Annualized CR 593 $289,449 

Changes to Base:

Maintaining Current Levels (MCLs) - $1,425 

Pay Raise - 1,043 

Pay Annualization - 382 

Subtotal Changes to Base - $1,425 

Total FY 2018 Base 593 $290,874 

Program Changes:

Program Decreases:

Realignment to Support Aging IT Infrastructure (355) (179,449)

Actions to Achieve Workforce Management Goals (9) (1,425)

Subtotal Program Changes (364) ($180,874)

Total FY 2018 Request 229 $110,000 
IRS-54

2.2 – Operating Levels Table 

Dollars in Thousands

Business Systems Modernization

Object Classification

FY 2016

Actual

FY 2017

Annualized CR

FY 2018

Request

11.1 Full-Time Permanent Positions 53,444 71,069 27,581

11.3 Other than Full-Time Permanent Positions 425 193 62

11.5 Other Personnel Compensation 567 1,004 299

11.9 Personnel Compensation (Total) 54,436 72,266 27,942

12.1 Personnel Benefits 16,492 21,861 8,358

Total Personnel and Compensation Benefits $70,928 $94,127 $36,300

21.0 Travel 170 191 112

25.1 Advisory & Assistance Services 109,827 172,227 64,186

25.2 Other Services 9 159 58

25.3 Purchase of Goods & Services from Govt. Accounts 12 6

25.7 Operation & Maintenance of Equipment 2,632 1,434 664

26.0 Supplies and Materials 2 21 9

31.0 Equipment 7,377 21,278 8,665

Total Non-Personnel $120,017 $195,322 $73,700

New Appropriated Resources $190,945 $289,449 $110,000

Budget Activities:

IT Investments 190,945 289,449 110,000

New Appropriated Resources $190,945 $289,449 $110,000

FTE 442 593 229
IRS-55

2.3 – Appropriation Detail Table 

2I – Business Systems Modernization (BSM) ($110,000,000 in direct appropriations): This 

budget activity funds the planning and capital asset acquisition of information technology (IT) 

to modernize IRS business systems, including labor and related contractual costs.

BSM uses best practices and expertise in business solutions and internal management to 

develop a world-class tax administration system. The following projects are supported by the 

FY 2018 BSM request of $110 million:

Customer Account Data Engine 2 (CADE2) (+$30 million / +102 FTE): These funds will be 

used to re-engineer components of the Individual Master File (IMF) by applying modern 

programming languages and establish CADE 2 as the legal and financial authoritative source 

of individual taxpayer data. 

Return Review Program (RRP) (+$36 million / +41 FTE): The RRP system became the 

system of record in October, 2016 for tax return fraud and anomaly detection. The current 

focus is on individual tax return data. Investment in RRP will continue to improve and 

expand analytical capabilities, that protect increasing levels of revenue from individual and 

business tax return fraud, non-compliance, and other enterprise anomaly detection. IRS will 

implement value-driven enhancements based on Business priorities, enabling additional 

business customers to explore and use RRP for anomaly detection business processes. In 

FY 2018, RRP will make a wider array of data available to other systems, for expanded 

anomaly detection throughout the processing pipeline. RRP will also increase the amount of 

revenue protected by improving existing screening rules and models for individual returns and 

by developing and implementing new rules and models for emerging schemes for business 

returns. RRP will upgrade hardware and analytics software and other infrastructure 

capabilities, to enable superior processing performance and reliability

 

Web Applications (+$24 million / +49 FTE) will simplify the taxpayer’s online experience, 

provide secure digital communications, and add more interactive capabilities to existing web 

self-service products. This will allow taxpayers to resolve more issues online, requiring fewer 

direct interactions with the IRS over the telephone and in person. 

In early FY 2018, Web Applications will substantially complete development of initial Online 

Account capabilities. These initial capabilities will allow a taxpayer to check if they have a 

Dollars in Thousands

Business Systems Modernization

Appropriated Resources

FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

New Appropriated Resources:

Business Systems Modernization 442 $290,000 593 289,449 229 110,000 (364) (179,449) -61.38% -62.00%

Subtotal New Appropriated Resources 442 $290,000 593 $289,449 229 $110,000 (364) ($179,449) -61.38% -62.00%

Other Resources:

User Fees - - 36,000 - - - (36,000) N/A -100.00%

Recovery from Prior Years - 4,283 - 766 - - - (766) N/A -100.00%

Unobligated Balances from Prior Years - 276,444 - 186,182 - 185,584 - (598) N/A -0.32%

Subtotal Other Resources - $280,727 - $222,948 - $185,584 - ($37,364) N/A -16.76%

Total Budgetary Resources 442 $570,727 593 $512,397 229 $295,584 (364) ($216,813) -61.38% -42.31%

FY 2017 to FY 2018 

Request

FY 2016

Enacted

FY 2017

Annualized CR

FY 2018

Request

FY 2017 to FY 2018 

Request

Change % Change
IRS-56

balance due, make a payment, and see prior payments and other tax records. Additionally, 

Web Apps will start to plan, develop and deploy new capabilities selected by the Web Apps 

product prioritization process. Anticipated functionalities include: allowing third parties 

(i.e., tax preparers and tax software companies) to interface with IRS systems to directly

provide refund data to their customers; allowing taxpayers to validate their identity for 

questionable tax returns to enhance identity protection and reduce fraud; allowing taxpayers 

access to self-service their public determination applications and return filings; and allowing

taxpayers to initiate and modify installment agreements in the Account application. 

Architecture, Integration and Management (AI&M) (+$10 million / +16 FTE) will provide 

engineering management capabilities essential to delivering a program of BSM’s magnitude 

and complexity. It will also deliver essential IRS systems strategy, architecture, and 

engineering capabilities for the major modernization projects across all technology 

platforms-IT Infrastructure, Business Applications, Data Management, and IT Security. The 

AI&M program translates enterprise and project objectives into targeted, actionable 

investments to provide the necessary framework and direction for a cohesive, successful 

modernization.

Core Infrastructure (+$10 million / +21 FTE) provides mission-critical services for 

designing, engineering, testing, and deploying standardized, consolidated, virtual, and secure 

modernized development and production environments for use by BSM projects. This 

support effort scales with the development projects in the BSM portfolio. 

The IRS is modernizing taxpayer applications to use of web-based technologies that allow 

taxpayers to communicate with the IRS using commercially available technology. The 

modernized infrastructure provides a complete environment (hardware, software, processes, 

and management) for developing, testing, deploying, operating, and monitoring both customer 

and internal applications in support of business practices. This includes continuing to update 

the web portal environment and standardizing services, security, and operations management. 

This approach facilitates the IRS’s ability to develop a shared infrastructure and common 

business service solutions that are usable across multiple BSM projects. 
IRS-57

Description of Performance

The IRS’s modernization efforts focus on building and deploying advanced information 

technology systems, processes, and tools to improve efficiency and productivity. IRS 

performance metrics are described quarterly and in greater detail in the BSM IT 

Modernization report. 

Dollars in thousands

Business Systems Modernization 

FY 2016 

Operating 

Plan

FY 2017 

CR Level

FY 2018 

Budget 

Request

Difference

2017 to 2018

CADE 2 92,231 121,846 30,000 (91,846)

Capital1 62,854 90,000 15,000 (75,000)

Support2 2,372 150 (150)

Labor 27,005 31,696 15,000 (16,696)

FTE 183 202 102 (100)

Enterprise Case Management 38,517 46,324 (46,324)

Capital 28,991 7,100 (7,100)

Support 154 32 (32)

Labor 9,372 14,192 (14,192)

U. Fees 25,000 (25,000)

FTE 32 92 (92)

Enterprise Case Selection 1,492 23,707 (23,707)

Capital 1,492 10,000 (10,000)

Support 25 (25)

Labor 8,682 (8,682)

U. Fees 5,000 (5,000)

FTE 54 (54)

Event Driven Architecture 8,962 4,766 (4,766)

Capital 7,500 2,000 (2,000)

Support 39 5 (5)

Labor 1,423 2,761 (2,761)

FTE 11 17 (17)

Modernized e-File 11,014 3,507 (3,507)

Capital 7,700

Support 39

Labor 3,275 3,507 (3,507)

FTE 12

Return Review Program 40,402 40,215 36,000 (4,215)

Capital 32,000 32,000 29,030 (2,970)

Support 201 55 70 15

Labor 8,201 8,160 6,900 (1,260)

FTE 56 50 41 (9)

Web Applications 22,160 29,253 24,000 (5,253)

Capital 16,272 14,000 15,625 1,625

Support 124 30 75 45

Labor 5,764 9,223 8,300 (923)

U. Fees 6,000 (6,000)

FTE 36 58 49 (9)

Architecture, Integration, and Management 31,560 19,679 10,000 (9,679)

Capital 25,400 15,000 7,380 (7,620)

Support 180 26 20 (6)

Labor 5,980 4,653 2,600 (2,053)

FTE 33 27 16 (11)

Core Infrastructure 26,171 33,450 10,000 (23,450)

Capital 15,000 22,000 6,480 (15,520)

Support 258 60 20 (40)

Labor 10,913 11,390 3,500 (7,890)

FTE 73 70 21 (49)

Management Reserve 17,491 2,702

Total BSM $290,000 $325,449 $110,000 ($212,747)

Total FTE 436 570 229 (341) 1 Capital Investments funding consists of capital and labor costs.

2 Support funding consists of training, travel, supplies, etc.

Ensuring Taxpayer data is secure. CADE2 will re-engineer components of the Individual Master File (IMF) by applying 

modern programming languages and establish CADE 2 as the legal and financial authoritative source of individual 

taxpayer data. 

Working the right cases so taxpayer burden is lessened requires an implementation strategy to consolidate and retire 

legacy systems. Funding ECM will: provide an enterprise-wide strategic approach to case management that will 

implement standard case management functions, an infrastructure platform, and common services that a case 

management application will leverage. The anticipated results are to streamline processes, reduce the number of 

duplicative applications and improve data accessibility and usability.

Funding ECS will: provide the main integration point between the Return Review Program (RRP) and Enterprise Case 

Management (ECM). The ECS program will implement an enterprise solution for performing case selection functions 

using a common infrastructure platform and common services that will be leveraged across the IRS. The ECS program 

will increase operational efficiencies by consolidating separate case selection functions and by identifying the best cases 

allowing the IRS to utilize resources more effectively. 

Enabling online account self-service, including self correction. Funding EDA allows: a framework that processes the tax 

return immediately upon arrival. Just-in-time processing will allow each individual return to flow independently through the 

system at its own pace. This will allow the IRS to move away from batch processing, view returns dynamically, and 

understand the status of a return as it is processed.

Ensuring faster, more efficient tax processing. Providing labor funding to complete MeF Release 10, enables e-filing of 

Form 1040-NR (U.S. Nonresident Alien Income Tax Return) and Form 1040-NR-EZ (U.S. Income Tax Return for Certain 

Nonresident Aliens With No Dependents).

Providing leading-edge technologies to advance the IRS effectiveness in detecting, addressing, and preventing tax refund 

fraud and protecting U.S. Treasury revenue. The RRP fraud framework is critical for IRS’ success in tackling everevolving tax schemes in a sophisticated, scalable and adaptable manner. Funding will: provide leading-edge 

technologies to advance IRS effectiveness in detecting, addressing, and preventing tax refund fraud and protecting US 

Treasury revenue. The RRP system contains multiple data sources combined with sophisticated modeling and business 

rule analytics to support pre-refund revenue protection, compliance and post-refund criminal investigation and prosecution. 

Providing easy access to taxpayer information via digital channels. Funding will: drive the IRS transition to digital 

government and supports the long-term vision of migrating services from expensive traditional channels to the internet. To 

keep pace with the ever changing state of web technology and increasing taxpayer demand for IRS service, the IRS must 

create and enhance online self-service capabilities for taxpayers, tax practitioners, and internal IRS stakeholders. Web 

Applications will continue to enhance the taxpayer’s experience by providing additional self-service options within a 

Provide system engineering management capabilities, including systems strategy, architecture, and engineering 

capabilities, across IT Infrastructure, Business Applications, Data Management, and IT Security. Provide portfolio control 

and management processes and tools, including governance, enterprise lifecycle support, tiered program management, 

and configuration/change management.

Provide shared infrastructure that leverages reusable engineering design patterns and best practices for standardized, 

virtual, and secure environments. These environments allow multiple BSM projects to develop, test, deploy, operate, and 

monitor in a common approach. 

Fiscal Year

Percent within +/- 10% 

Cost Variance

Percent within +/- 10% 

Schedule Variance

2016 76.2% 85.7%

Major IT (BSM and Non-BSM) Investments
IRS-58

IRS IT will continue to monitor program activities closely and address any issues associated 

with cost/schedule on a timely basis to meet the FY 2017 and FY 2018 target of 90 percent. 

FY 2018 Changes by Budget Activity

Dollars in Thousands

Business Systems Modernization FTE Amount

FY 2017 Annualized CR 593 $289,449 

Changes to Base:

Maintaining Current Levels (MCLs) - $1,425 

Pay Raise - 1,043 

Pay Annualization - 382 

Subtotal Changes to Base - $1,425 

Total FY 2018 Base 593 $290,874 

Program Changes:

Program Decreases

Realignment to Support Aging IT Infrastructure (355) (179,449)

Actions to Achieve Workforce Management Goals (9) (1,425)

Subtotal Program Changes (364) ($180,874)

Total FY 2018 Request 229 $110,000 

Dollar/FTE Change FY 2018 Budget Request over FY 2017 Annualized CR Level (364) ($179,449)

Percent Change FY 2018 Budget Request over FY 2017 Annualized CR Level -61.38% -62.00%

2.1.9 – Budget and Performance Report and Plan

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target FY 2016

Trend

Percent of Major IT 

Investments within +/-10% 

Cost Variance at the 

Investment Level

50.0 .0 66.7 73.7 76.2 90.0 90.0 90.0

Percent of Major IT 

Investments within +/-10% 

Schedule Variance at the 

Investment Level1

90.0 83.3 100.0 89.5 85.7 90.0 90.0 90.0

1. Starting in FY 2015, the measure includes all major investments (BSM and non-BSM).

Business Systems 

Modernization FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Resource Level Actual Actual Actual Actual Actual Annualized 

CR Request

Appropriated Resources1 250,537 198,205 145,235 107,746 190,945 289,449 110,000

Reimbursable Resources2 0 0 0 0 0 0 0

User Fees 0 0 0 0 0 36,000 0

Budget Activity Total $250,537 $198,205 $145,235 $107,746 $190,945 $325,449 $110,000

Dollars in Thousands

1

The FY 2012 - FY 2016 appropriated resources represents the approved operating plan including any inter-BAC 

transfers and inter-appropriation transfers.

2

The FY 2012 - FY 2016 columns represent realized resources for reimbursable resources and user fees.
Department of the Treasury – Budget in Brief 

IRS-59

Section III

3.1 – Summary of Capital Investments

A summary of capital investment resources, including major information technology and 

non-technology investments, can be viewed/downloaded at:

http://www.treasury.gov/about/budget-performance/pages/summary-of-capitalinvestments.aspx.

This website also contains a digital copy of this document.

3A – Capital Investment Strategy

The Information Technology (IT) office is a key facilitator of efficient and effective tax 

administration. IT continues to provide critical support as the IRS faces increasingly complex 

tax administration, evolving taxpayer expectations, greater media scrutiny, and growing 

challenges in combating refund fraud and identity theft. In FY 2018, the IRS plans to 

strengthen its IT infrastructure. 

The IRS needs new technologies to deliver comprehensive IT solutions that improve electronic 

tax filing returns, enhance services to taxpayers and third party practitioners, and strengthen 

criminal enforcement of tax laws. With increases in electronic data, online interactions, and 

related security risks, the IRS must make significant investments to secure infrastructure, data, 

and applications. To ensure the IRS invests wisely in new technology, it implemented a 

collaborative Capital Investment Strategy with the business units. The collaboration includes

translating business vision and strategy into effective enterprise change by creating, 

communicating, and improving the key requirements, principles, and models that describe the 

IRS's future and enable its evolution. 

The outcome of this collaboration is the Technology Roadmap, which creates a visual depiction 

of the future of IT and promotes dialogue between IT and business leaders on the priorities, 

direction and alignment of investments and resources. The roadmap provides conceptual, 

logical, technical, transitional, and detailed multi-level views of business requirements that 

provide increased granularity with each subsequent level. The transitional view demonstrates 

the current, transition, and next state for major business concepts, including the Intake, Account 

Management, Compliance, Case Management, and Internal Operations processes.

The IRS uses the Technology Roadmap to guide its capital investment strategy. It is a living 

document that is continuously reviewed and updated as appropriate. Below is the conceptual, 

top-level view of the Technology Roadmap, identifying the major services that support each

core business area along with the major architectural principles and structures. 
IRS-60
IRS-61

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

The actual cost and actual revenue collected for FY 2012 through FY 2016 for the three major 

enforcement programs, Examination, Collection, and Automated Underreporter (AUR) are 

provided below. The activities included in these programs include:

Examination Program conducts examinations of tax returns of individual taxpayers, 

businesses, and other types of organizations to verify that the tax reported is correct. This 

includes examinations of individuals, small business, self-employed, large corporate business, 

partnerships, international, estate and gift, excise tax and employment tax, and tax-exempt, 

qualified pension benefit plans, and Government entities. The examination costs include the 

cost of the Field Exam, Correspondence Exam, IRS Chief Counsel, and Appeals functions.

Collection Program collects delinquent taxes and secures delinquent tax returns through the 

appropriate use of enforcement tools, such as lien, levy, seizure of assets, installment 

agreement, offer in compromise, substitute for return, summons, and IRC 6020(b) (which 

allows the IRS to prepare returns if a taxpayer neglects or refuses to file), and provides 

education to taxpayers to enable future compliance. The cost of the Collection program 

includes Automated Collection System (ACS), Field Collection, and Payment 

Compliance/Correspondence Collection.

Automated Underreporter (AUR) Program matches payer information returns (Forms 1099, 

W-2, etc.) against data reported to the IRS on individual tax returns. The information is verified 

to identify any discrepancies. If a discrepancy is found, the case is given to a tax examiner for 

research and analysis. If the tax examiner is unable to resolve the discrepancy, the IRS issues a 

proposed notice and generates a proposed assessment. 

ROI is calculated by dividing revenue by cost. This information provides an indication of the 

ROI for the three major enforcement programs over time, but it is important to note that 

enforcement revenue collected in a fiscal year includes tax, interest, and penalties from multiple 

tax years. Some enforcement activities can take more than a year to close and may generate 

revenue over several years, so it is generally inappropriate to compare revenue collected in a 

given fiscal year to the staffing available for that same year. 

In addition, it is important to note that these data reflect the average return on investment for 

these programs and do not include indirect effects of IRS enforcement activities on voluntary 

compliance. As such, they are not intended to be used to allocate resources or maximize 

revenue. Net revenue is maximized only when resources are allocated according to marginal 

direct and indirect return on investment, but those ratios are much more challenging to estimate 

than the average ROI shown here. As a result, the IRS will continue to allocate enforcement 

resources across a range of enforcement activities to ensure taxpayers pay the taxes they owe. 
IRS-62

Return on Investment for IRS Major Enforcement Programs

Dollars in millions

Enforcement Program Cost1 Revenue ROI Cost1 Revenue ROI Cost1 Revenue ROI Cost1 Revenue ROI Cost1 Revenue ROI

IRS Total $6,242 $50,187 8.0 $5,883 $53,345 9.1 $5,839 $57,146 9.8 $5,644 $54,203 9.6 $5,592 $54,291 9.7

Examination 4,232 14,476 3.4 3,965 16,662 4.2 3,965 18,983 4.8 3,974 13,320 3.4 3,782 12,023 3.2

Collection 1,742 30,442 17.5 1,660 31,396 18.9 1,618 33,198 20.5 1,419 35,740 25.2 1,576 37,259 23.6

Automated Underreporter (AUR) 267 5,269 19.7 258 5,287 20.5 256 4,965 19.4 251 5,143 20.5 234 5,009 21.4

FY 2015 FY 2016

1

The cost of the enforcement programs was calculated using budget data from the IRS Integrated Financial System (IFS) and includes direct dollars and FTE from the 

Enforcement appropriation, Exam and Collections budget activity, and dollars from the Operations Support appropriation prorated using actual FTE realized for each major 

FY 2012 FY 2013 FY 2014
IRS-63

3.3 – IRS Performance Measure Table

Changes in Performance Measures

The following are changes in performance measures or indicators from the FY 2017 Annualized 

CR level. 

Performance Measure or Indicator Proposed Change and Justification

1. Conviction Efficiency Rate –

discontinue

The budget component of the measure – which 

makes up the numerator to calculate this rate –

fluctuates year to year and Criminal Investigation has 

limited control over funding. CI will continue to 

report three measures in the budget submission.

2. Enterprise Taxpayer Self-Assistance 

Rate (ETSAR) – modify

Starting in FY 2017, the IRS modified the Taxpayer 

Self Assistance Rate measures to include additional 

self-assistance applications, including Get 

Transcripts and payment applications, such as Direct 

Pay and Online Payment Agreements. As new 

self-assistance applications are provided to the 

public, they will be added to the methodology.

Because of these changes, IRS will use ETSAR as an 

indicator in FY 2017. 

3. Customer Contacts Resolved per Staff 

Year (CCRPSY) – modify

Due to the modifications made to the Taxpayer 

Self-Assistance Rate measure for FY 2017, several 

components of the Customer Contacts Resolved Per 

Staff Year measure changed including: the way IRS 

counts transcripts, from “requested” to now counting 

“delivered”; the addition of Get Transcripts (Online 

& Mail); the discontinuation of Electronic 

Interactions; and, the moving of balance due calls to 

SB/SE.

IRS will baseline CCRPSY in FY 2017.

4. Rentable Square Feet per Person 

(RSFPP) – new measure for FY 2017

A new measure was added to support the Operations 

Support Appropriation. This indicator will help IRS 

better manage rental costs. 

IRS will use RSFPP as an indicator in FY 2017. 
IRS-64

3.3 – IRS Performance Measure Table (Continued)

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target FY 2016

Trend

Timeliness of Critical 

Individual Filing Season 

Tax Products to the Public 

(%)

97.2 58.9 99.1 89.0 92.5 87.0 89.0 89.0

Timeliness of Critical 

TE/GE and Business Tax 

Products to the Public (%) 

94.5 83.6 98.7 92.6 98.0 87.0 91.0 91.0

Enterprise Taxpayer SelfAssistance Rate 178.5 83.3 84.7 88.7 89.0 90.0 Indicator N/A N/A

Percent Individual Returns 

Processed Electronically 

(%) 

80.5 82.5 84.1 85.3 86.4 86.0 87.0 88.0

Percent of Business 

Returns Processed 

Electronically 

36.7 40.2 43.1 47.0 50.0 48.0 51.0 53.0

Customer Accuracy - Tax 

Law Phones (%) 

93.2 95.7 95.0 95.0 96.4 92.0 95.0 95.0

Customer Accuracy -

Accounts (Phones) 

95.6 96.0 96.2 95.5 96.1 94.0 95.0 95.0

Customer Contacts 

Resolved Per Staff Year2

16,320 20,767 21,018 26,245 28,497 28,000 Baseline TBD

Customer Service 

Representative (CSR) 

Level of Service (LOS) 

(%)3

67.6 60.5 64.4 38.1 53.4 47.0 64.0 39.0

Refund Timeliness -

Individual (Paper) 

99.7 99.0 98.7 98.8 98.7 97.0 97.0 97.0

Criminal Investigations 

Completed

4,937 5,557 4,606 4,486 3,721 3,800 3,100 3,000

Number of Convictions 2,634 3,311 3,110 2,879 2,672 2,500 2,100 2,000

Conviction Rate (%) 93.0 93.1 93.4 93.2 92.1 92.0 92.0 92.0

Examination Coverage -

Individual (1040)

1.0 1.0 0.9 0.8 0.7 0.6 0.6 0.5

Field Examination 

National Quality Review 

Score

87.4 89.2 88.4 86.7 86.8 86.7 86.7 86.7

Office Examination 

National Quality Review 

Score

91.3 90.3 90.6 88.3 88.4 88.3 86.7 88.3

Examination Quality -

LB&I - Large Business

N/A 92.0 83.0 86.0 83.0 90.0 90.0 90.0

Examination Coverage -

Business Assets >$10 

million (%)

6.2 5.6 4.3 3.9 3.0 3.5 2.7 2.7

Automated Underreporter 

(AUR) Efficiency

2,041 2,025 1,935 2,209 2,196 2,036 2,133 2,133
IRS-65

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target FY 2016

Trend

Automated Underreporter 

(AUR) Coverage (%)

3.2 2.8 2.6 2.3 2.3 2.2 2.0 2.0

Examination Efficiency -

Individual (1040)

142 142 138 148 143 122 118 126

Collection Coverage 

(Units)

48.1 47.0 45.9 46.3 43.4 41.8 37.5 34.2

Collection Efficiency 

(Units)

1,997 2,057 2,051 2,448 2,266 2,208 2,117 2,147

Field Collection National 

Quality Review Score

80.4 81.4 81.6 79.2 79.2 79.7 79.7 79.7

Automated Collection 

System (ACS) Accuracy 

(%)

94.7 94.4 95.2 95.3 95.4 95.0 95.0 95.0

TE/GE Determination 

Case Closures

87,000 65,877 136,746 111,940 99,973 103,852 95,791 99,840

Rentable Square Feet Per 

Person (new for FY 2017)

Indicator N/A

Percent of Major IT 

Investments within +/-10% 

Cost Variance at the 

Investment Level

50.0 .0 66.7 73.7 76.2 90.0 90.0 90.0

Percent of Major IT 

Investments within +/-10% 

Schedule Variance at the 

Investment Level4

90.0 83.3 100.0 89.5 85.7 90.0 90.0 90.0

1. Starting in FY 2017, the IRS modified the Taxpayer Self Assistance Rate measure to include additional self-service channels. 

As new self-assistance applications are provided to the public, they will be added to the methodology.

2. Beginning in FY 2013, targets include an increase in base user fees.

3. As a result of program changes that occurred in the Large Business and International (LB&I) organization, starting in FY 2013, a 

new Examination Quality - Large Business measure will replace the two previous LB&I quality measures - Examination Quality -

Industry and Coordinated Industry.

4. Starting in FY 2015, the measure includes all major investments (BSM and non-BSM).
IRS-66

3.3 – IRS Performance Measure Table (Continued)

Customer Service Representative (CSR) Level of 

Service

The number of toll free callers that either speak to a Customer Service Representative or receive informational 

messages divided by the total number of attempted calls.

Customer Contacts Resolved per Staff Year The number of Customer Contacts resolved in relation to staff years expended. 

Customer Accuracy – Tax Law Phones The percentage of correct answers given by a live assistor on Toll-free tax law inquiries.

Customer Accuracy – Customer Accounts 

(Phones) The percentage of correct answers given by a live assistor on Toll-free account inquiries.

Timeliness of Critical Individual Filing Season Tax 

Products to the Public

The percentage of critical individual filing season tax products (tax forms, schedules, instructions, publications, tax 

packages, and certain notices required by a large number of filers to prepare a complete and accurate tax return) 

available to the public in a timely fashion.

Timeliness of Critical TE/GE & Business Tax 

Products to the Public Percentage of critical other tax products, paper and electronic, available to the public in a timely fashion. 

Percent Individual Returns Processed 

Electronically The percentage of electronically filed individual tax returns divided by the total individual returns filed.

Percent Business Returns Processed 

Electronically The percentage of electronically filed business tax returns divided by the total business returns filed.

Refund Timeliness – Individual (Paper) The percentage of refunds resulting from processing Individual Master File paper returns issued within 40 days or less. 

Enterprise Taxpayer Self Assistance Rate The percentage of taxpayer assistance requests resolved using self-assisted automated services. IRS will use this as 

an indicator for FY 2017.

Examination Coverage – Individual (1040)

The sum of all individual 1040 returns closed by Small Business/Self Employed (SB/SE), Wage & Investment (W&I), 

Tax Exempt and Government Entities (TE/GE), and Large Business and International (LB&I) (Field Exam and 

Correspondence Exam programs) divided by the total individual return filings for the prior calendar year.

Field Exam Nat'l Quality Review Score The score awarded to a reviewed field examination case by a Quality Reviewer using the National Quality Review 

System (NQRS) quality attributes.

Office Exam Nat'l Quality Review Score The score awarded to a reviewed office examination case by a Quality Reviewer using the NQRS quality attributes.

Examination Quality – Large Business Average of the scores of the Large Business Return (LBR) cases reviewed by LB&I Quality Measurement System 

(LQMS). Case scores are based on the percentage of elements passed within each of the four auditing standard.

Examination Coverage – Business Assets >$10 

Million)

The number of LB&I returns (C and S Corporations with assets over $10 million and all partnerships) examined and 

closed by LB&I during the current fiscal year divided by the number of filings for the preceding calendar year.

Examination Efficiency – Individual (1040) The sum of all individual 1040 returns closed by SB/SE, W&I, TE/GE, and LB&I (Field Exam and Correspondence 

Exam programs) divided by the total Full-Time Equivalent (FTE) expended in relation to those individual returns.

Automated Underreporter (AUR) Efficiency The total number of W&I and SB/SE contact closures (a closure resulting from a case where we made contact) divided 

by the total FTE, including overtime.

Automated Underreporter (AUR) Coverage A percentage representing the total number of W&I and SB/SE contact closures (a closure resulting from a case where 

SBSE and W&I made contact) divided by the total return filings for the prior year.

Collection Coverage – Units The volume of collection work disposed compared to the volume of collection work available.

Collection Efficiency – Units The volume of collection work disposed divided by total collection FTE.

Field Collection Nat'l Quality Review Score The score awarded to a reviewed collection cases by a Quality Reviewer using the NQRS quality attributes.

Automated Collection System (ACS) Accuracy The percent of taxpayers who receive the correct answer to their ACS question.

Criminal Investigations Completed

The total number of subject criminal investigations completed during the fiscal year, including those that resulted in 

prosecution recommendations to the Department of Justice as well as those discontinued due to a lack of prosecution 

potential. 

Number of Convictions The number of criminal convictions.

Conviction Rate The percent of adjudicated criminal cases that result in convictions.

TE/GE Determination Case Closures The number of cases closed in the Employee Plans or Exempt Organizations Determination programs, regardless of 

type of case or type of closing.

Rentable Square Feet per Person The amount of Rentable Square Feet the IRS maintains per Personnel requiring space. IRS will use this as an indicator 

for FY 2017.

Percent of Major IT Investments within +/- 10% 

Cost Variance at the Investment Level 

Number of major IT investments within +/-10 percent variance between planned total cost and projected/actual cost 

within a fiscal year divided by the total number of major IT investments in that fiscal year.

Percent of Major IT Investments within +/- 10% 

Schedule Variance at the Investment Level 

Number of major IT investments within +/-10 percent variance between planned days and projected/actual days within a 

fiscal year divided by the total number of major IT investments in that fiscal year.

Budget Level Performance Measure Descriptions
IRS-67

3.4 – Reducing the Tax Gap

The IRS remains committed to increasing compliance and reducing the tax gap, while 

minimizing the burden on the vast majority of taxpayers who pay their taxes accurately and on 

time. The tax gap represents the difference between taxes owed and taxes paid on time. In 

FY 2016, the IRS released updated tax gap estimates for tax years 2008 through 2010 and found

that the annual average gross tax gap was an estimated $458 billion. 

The current estimated voluntary compliance rate is 

81.7 percent. There are three components of the 

$458 billion gross tax gap: Underreporting tax 

liability ($387 billion), which comprises 84 percent 

of the gross tax gap, and nonfiling ($32 billion, 

7 percent) and underpaying ($39 billion, 9 percent). 

Underreporting

84% 

Underpayment

9%

Nonfiling

7%
IRS-68

3.5 – Summary of IRS FY 2018 Budget Request

Amount FTE Amount FTE Amount FTE Amount FTE Amount FTE

FY 2017 Annualized CR $2,328,940 28,455 $4,855,688 36,349 $3,739,565 11,441 $289,449 593 $11,213,642 76,838

Changes to Base:

Maintaining Current Levels (MCLs) $46,342 - $96,845 - $75,423 - $1,425 - $220,035 -

Pay Raise 31,005 - 65,828 - 24,573 - 1,043 - 122,449 -

Pay Annualization 11,363 - 24,126 - 9,006 - 382 - 44,877 -

Non-Pay Inflation Adjustment 3,974 - 6,891 - 41,844 - - - 52,709 -

Resource Adjustments $122,378 - ($149,936) - $27,558 - - - - -

Base Realignment for Support Services 90,000 - (145,000) - 55,000 - - - - -

Adjustments for Administrative Provision 

Section 113 32,378 - (4,936) - (27,442) - - - - -

Subtotal Changes to Base $168,720 - ($53,091) - $102,981 - $1,425 - $220,035 -

Total FY 2018 Base $2,497,660 28,455 $4,802,597 36,349 $3,842,546 11,441 $290,874 593 $11,433,677 76,838

Program Changes:

Program Increase:

Realignment to Support Aging IT 

Infrastructure - - - - 179,449 266 - - 179,449 266

Program Decreases:

Actions to Achieve Workforce 

Management Goals (285,349) (4,063) (96,097) (1,300) (75,806) (342) (1,425) (9) (458,677) (5,714)

Realignment to Support Aging IT 

Infrastructure - - - - - - (179,449) (355) (179,449) (355)

Subtotal Program Changes ($285,349) (4,063) ($96,097) (1,300) $103,643 (76) ($180,874) (364) ($458,677) (5,803)

Total FY 2018 Request $2,212,311 24,392 $4,706,500 35,049 $3,946,189 11,365 $110,000 229 $10,975,000 71,035

Dollar/FTE Change FY 2018 Request over FY 

2017 Annualized CR ($116,629) (4,063) ($149,188) (1,300) $206,624 (76) ($179,449) (364) ($238,642) (5,803)

Percent Change FY 2018 Request over FY 2017 

Annualized CR -5.01% -14.28% -3.07% -3.58% 5.53% -0.66% -62.00% -61.38% -2.13% -7.55%

Taxpayer Services Enforcement Operations Support Business Systems 

Modernization Total

Internal Revenue Service 

Department of the Treasury

Departmental Offices

Salaries and Expenses

Congressional Justification 

for Appropriations and 

Annual Performance 

Report and Plan

FY 2018 
DO - 2

Table of Contents

Section I – Budget Request........................................................................................................... 3

A – Mission Statement................................................................................................................ 3

B – Summary of the Request ...................................................................................................... 3

1.1 – Appropriations Detail Table.........................................................................................................3

1.2 – Budget Adjustments Table...........................................................................................................4

C – Budget Increases and Decreases Description....................................................................... 4

1.3 – Operating Levels Table................................................................................................................5

D – Appropriations Language and Explanation of Changes ...................................................... 6

E – Legislative Proposals............................................................................................................ 6

Section II – Annual Performance Plan and Report................................................................... 7

A – Strategic Alignment ............................................................................................................. 7

B – Budget and Performance by Budget Activity ...................................................................... 7

2.1.1 Executive Direction Resources and Measures.............................................................................7

2.1.2 International Affairs and Economic Policy Resources and Measures .........................................8

2.1.3 Domestic Finance and Tax Policy Resources and Measures.....................................................12

2.1.4 Treasury-wide Management and Programs Resources and Measures.......................................14

Section III – Additional Information ........................................................................................ 19

A – Summary of Capital Investments....................................................................................... 19
DO - 3

Section I – Budget Request

A – Mission Statement

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

that enable economic growth and stability at home and abroad and manage the U.S. 

Government’s finances and resources effectively.

B – Summary of the Request 

By streamlining its workforce and finding more efficient ways to manage its programs, 

Departmental Offices (DO) will achieve savings of $20,326,000 in FY 2018. This budget 

request supports the Presidential Executive Order on a comprehensive plan for reorganizing the 

Executive Branch to improve the efficiency, effectiveness, and accountability of federal 

agencies. Within the reduced funding level, DO will maintain its commitments to tax reform, 

cybersecurity, and critical infrastructure protection for both Treasury information technology 

systems and the U.S. financial sector, while promoting economic growth in the U.S., advancing 

U.S. economic and financial policy priorities around the world, enhancing U.S. competitiveness 

and job creation, and promoting international financial stability. DO also expects to maintain 

effective managerial and administrative support to DO offices and the Department of the 

Treasury.

1.1 – Appropriations Detail Table

Note: Due to a change in accounting methodology, FTE providing administrative support to the Office of Terrorism and Financial Intelligence 

(TFI) were realigned from reimbursable to direct resources in FY 2017. This change did not affect the level of support to TFI.

FY 2016 FTE and Other Resources are Actual.

Dollars in Thousands

DO Salaries and Expenses

Appropriated Resources

 FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

New Appropriated Resources 16FTE 16Amt 17FTE 17Amt 18FTE 18Amt ChgFTE ChgAmt pctFTE pctAmt

Executive Direction 151 $37,943 159 38,102 143 34,578 (16) ($3,524) -10.06% -9.25%

Domestic Finance and Tax Policy 299 $84,591 331 81,215 301 73,804 (30) ($7,411) -9.06% -9.13%

International Affairs and Economic Policy 247 $58,520 241 57,951 227 52,875 (14) ($5,076) -5.81% -8.76%

Treasury-w ide Management and Programs 117 $41,446 160 44,809 140 40,494 (20) ($4,315) -12.50% -9.63%

Subtotal New Appropriated Resources 814 $222,500 891 $222,077 811 $201,751 (80) ($20,326) -8.98% -9.15%

Other Resources: 16FTE 16Amt 17FTE 17Amt 18FTE 18Amt ChgFTE ChgAmt pctFTE pctAmt

Offsetting Collections - Reimbursables 189 $102,882 107 $102,882 107 $102,882 0 $0 0.00% 0.00%

Subtotal Other Resources 189 $102,882 107 $102,882 107 $102,882 0 $0 0.00% 0.00%

Total Budgetary Resources 1,003 $325,382 998 $324,959 918 $304,633 (80) ($20,326) -8.02% -6.25%

FY 2016 FY 2017 FY 2017 to FY 2018

Enacted Annualized CR Request Change % Change

FY 2018
DO - 4

1.2 – Budget Adjustments Table

C – Budget Increases and Decreases Description

Maintaining Current Levels (MCLs) ......................................................+$4,284,000 / +0 FTE

Pay Raise +$2,129,000 / +0 FTE 

Funds are requested for the proposed January 2018 pay-raise.

Pay Annualization +$780,000 / +0 FTE 

Funds are requested for annualization of the January 2017 pay-raise.

Non-Pay +$1,375,000 / +0 FTE 

Funds are requested for non-labor expenses such as travel, contracts, rent, supplies, and 

equipment.

Program Decreases ..................................................................................-$24,610,000 / -80 FTE

Streamline Staffing -$14,697,000 / -80 FTE

To align with the administration’s initiative to improve government efficiency and effectiveness, 

Departmental Offices is implementing a staffing streamlining effort to ensure appropriate levels 

for meeting Treasury’s mission and objectives, and maximum effectiveness and efficiency. 

Reduce Contracts, Supplies, and Equipment -$9,913,000 / +0 FTE

Departmental Offices will achieve savings through reductions to non-labor activities, such as 

service contracts, equipment, and supplies. These include potential reductions in advisory 

services, electronic data and periodical subscriptions, warehouse footprint, janitorial and 

landscaping services, FOIA assistance, internal controls support and contractual support to the 

American Recovery and Reinvestment Act.

DO Salaries and Expenses FTE Amount

FY 2017 Annualized CR 891 $222,077

Changes to Base:

Maintaining Current Levels (MCLs): 0 $4,284

Pay-Raise 0 $2,129

Pay Annualization 0 $780

Non-Pay 0 $1,375

Subtotal Changes to Base 0 $4,284

Total FY 2018 Base 891 $226,361

Program Changes:

Program Decreases (80) ($24,610)

 Streamline Staffing (80) ($14,697)

 Reduce Contracts, Supplies, and Equipment 0 ($9,913)

Subtotal Program Changes (80) ($24,610)

Total FY 2018 Request 811 $201,751

Dollars in Thousands
DO - 5

1.3 – Operating Levels Table

Note: This table includes total annually appropriated funding (actuals for FY 2016, FY 2017 Annualized CR and FY 2018).

Dollars in Thousands

DO Salaries and Expenses FY 2016 FY 2017 FY 2018

Object Classification Actual Annualized CR Request

11.1 - Full-time permanent 100,821 113,165 104,519

11.3 - Other than full-time permanent 1,850 2,077 1,918

11.5 - Other personnel compensation 2,301 2,583 2,385

11.9 - Total personnel compensation 104,972 117,824 108,822

12.0 - Personnel benefits 32,490 36,468 33,682

Total Personnel and Compensation Benefits $137,462 $154,292 $142,504

21.0 - Travel and transportation of persons 4,156 4,239 4,059

22.0 - Transportation of things 360 367 265

23.1 - Rental payments to GSA 840 850 618

23.2 - Rental payments to others 875 893 644

23.3 - Communication, utilities, and misc charges 399 407 294

24.0 - Printing and reproduction 132 135 97

25.1 - Advisory and assistance services 23,057 19,076 16,962

25.2 - Other services from non-Federal sources 10,516 8,676 7,736

25.3 - Other goods and services from Federal sources 27,020 22,500 19,877

25.4 - Operation and maintenance of facilities 78 80 57

25.7 - Operation and maintenance of equipment 601 613 442

26.0 - Supplies and materials 3,742 3,817 3,253

31.0 - Equipment 6,012 6,132 4,943

32.0 - Land and structures 2,746 0 0

43.0 - Interest and dividends 2 0 0

Total Non-Personnel $80,536 $67,785 $59,247

Total Budgetary Resources $217,998 $222,077 $201,751

FTE 814 891 811
DO - 6

D – Appropriations Language and Explanation of Changes

Appropriations Language Explanation of 

Changes

DEPARTMENT OF THE TREASURY

DEPARTMENTAL OFFICES

Federal Funds

SALARIES AND EXPENSES

(INCLUDING TRANSFER OF FUNDS)

For necessary expenses of the Departmental Offices including

operation and maintenance of the Treasury Building and Freedman's 

Bank Building; hire of passenger motor vehicles; maintenance, 

repairs, and improvements of, and purchase of commercial insurance 

policies for, real properties leased or owned overseas, when 

necessary for the performance of official business; executive 

direction program activities; international affairs and economic 

policy activities; domestic finance and tax policy activities, including 

technical assistance to state and local entities; and Treasury-wide 

management policies and programs activities, $201,751,000: 

Provided, That of the amount appropriated under this heading— (1) 

not to exceed $350,000 is for official reception and representation 

expenses; (2) not to exceed $258,000 is for unforeseen emergencies 

of a confidential nature to be allocated and expended under the 

direction of the Secretary of the Treasury and to be accounted for 

solely on the Secretary's certificate; and (3) not to exceed 

$24,000,000 shall remain available until September 30, 2019, for—

(A) the Treasury-wide Financial Statement Audit and Internal 

Control Program;(B) information technology modernization 

requirements; (C) the audit, oversight, and administration of the Gulf 

Coast Restoration Trust Fund; (D) the development and 

implementation of programs within the Office of Critical 

Infrastructure Protection and Compliance Policy, including entering 

into cooperative agreements; (E) operations and maintenance of 

facilities; and (F) international operations.

Note.—A full-year 2017 appropriation for this account was not

enacted at the time the budget was prepared; therefore, the budget 

assumes this account is operating under the Further Continuing

Appropriations Act, 2017 (P.L. 114–254). The amounts included for 

2017 reflect the annualized level provided by the continuing 

resolution.

The Administration 

proposes “state and 

local entities” because 

Treasury needs broad 

authority to provide 

technical assistance. 

The Administration 

requests two-year 

funding for the 

operations and 

maintenance of 

facilities to allow the 

ability to execute multiyear contracts.

The Administration 

requests two-year 

funding for 

international operations 

to facilitate invoicing, 

receipt of 

reimbursements, and 

obligation of funds for 

staff assigned to 

overseas posts 

including at 

international financial 

institutions pursuant to 

5 U.S.C. § 3343.

E – Legislative Proposals

Treasury has no legislative proposals for DO Salaries and Expenses.
DO - 7

Section II – Annual Performance Plan and Report

A – Strategic Alignment

Departmental Offices (DO) is the headquarters bureau for the Department of the Treasury. It 

provides leadership in economic and financial policy, financial intelligence and enforcement, and 

general management. Treasury utilizes effective management, policies, and leadership to protect 

our national security through targeted financial actions, to promote the stability of the nation’s 

financial markets, and to ensure the Government’s ability to collect revenue and fund its 

operations.

The FY 2018–2022 strategic plan is currently under development. The annual performance plan 

will be updated in the FY 2019 budget to reflect the new priorities.

B – Budget and Performance by Budget Activity

2.1.1 Executive Direction Resources and Measures

Executive Direction Budget and Performance

($34,578,000 from direct appropriation, $29,632,000 from reimbursable resources): 

The Executive Direction program area provides direction and policy formulation to the 

Department and DO and interacts with Congress and the public on Departmental policy matters. 

No specific performance goals/measures are presented for this budget activity as the work of 

these offices is captured within the other budget activities.

Dollars in Thousands

 Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Annualized 

CR Request

Column1 Column32 Column4 Column5 Column6 Column7 Column8 Column9

Appropriated Resources $37,219 $35,763 $34,588 $35,313 $37,778 $38,102 $34,578

Other Resources $4,545 $4,691 $15,137 $21,677 $29,632 $29,632 $29,632

Budget Activity Total $41,764 $40,454 $49,725 $56,990 $67,410 $67,734 $64,210

FTE 160 156 162 189 209 193 177
DO - 8

2.1.2 International Affairs and Economic Policy Resources and Measures

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target FY 2016

Trend

IA - Monitor Quality and 

Enhance Effectiveness of 

International Monetary 

Fund (IMF) Lending 

Through Review of IMF 

Country Programs

100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0

IA - Monitor Quality and 

Enhance Effectiveness of 

MDB Lending Through 

Review of MDB Grant and 

Loan Proposals

N/A 100.0 100.0 100.0 100.0 100.0 100.0 100.0

IA - Percentage of MDB 

Grant and Loan Proposals 

Containing Satisfactory 

Frameworks for Results 

Measurement

94.0 92.0 93.0 93.0 89.0 94.0 94.0 95.0

IA - Timely Review of 

CFIUS Cases

N/A 100.0 100.0 100.0 100.0 100.0 100.0 100.0

OTA - Program 

Engagement

3.9 3.8 3.7 3.8 3.9 3.6 3.6 3.6

International Affairs and Economic Policy Budget and Performance 

($52,875,000 from direct appropriation, $14,680,000 from reimbursable resources): 

The offices in this budget activity promote economic growth in the U.S. by producing technical 

economic analyses for the Secretary and advancing U.S. economic and financial policy priorities 

around the world. 

During the past year, Economic Policy staff in the Office of Macroeconomic Analysis closely 

monitored U.S. economic performance, producing many hundreds of succinct, quick-turn reports 

on more than 50 recurring economic indicators. The office’s high-quality analytic updates

served as DO’s main internal source of information on U.S. macroeconomic developments and 

informed a wide range of high-level engagements and official publications. The office also 

served as Treasury’s lead in the “Troika” process, a semi-annual exercise in which Treasury, the 

Office of Management and Budget (OMB), and the Council of Economic Advisers (CEA)

develop the economic assumptions that drive the Administration’s ten-year forecast and directly 

determines the Administration’s annual budget proposals. Finally, the office continued to deliver 

the High-Quality Market Corporate Yield Curve (a set of daily rates issued on a monthly basis) 

Dollars in Thousands

 Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Annualized 

CR Request

Column1 Column32 Column4 Column5 Column6 Column7 Column8 Column9

Appropriated Resources $59,277 $56,804 $56,265 $57,362 $59,061 $57,951 $52,875

Other Resources $1,293 $2,275 $4,891 $5,896 $14,680 $14,680 $14,680

Budget Activity Total $60,570 $59,079 $61,156 $63,258 $73,741 $72,631 $67,555

FTE 237 232 226 259 272 255 241
DO - 9

as mandated under the Pension Protection Act and to produce a Treasury Real Coupon-Issue 

Yield Curve, a companion to the Treasury Nominal Coupon-Issue Yield Curve, and several other 

yield curves. These yield curve data are used by federal agencies that administer federal pension 

programs and other future payment programs to calculate their annual liabilities.

Economic Policy staff in the Office of Microeconomic Analysis also produced an estimate of 

state Total Taxable Resources, which estimates the relative fiscal capacity of states and is used in 

determining the allocation of funds for the Community Mental Health Services and Substance 

Abuse Prevention and Treatment block grant programs. The Office of Microeconomic Analysis

has been actively engaged in helping the public and policymakers understand important 

economic policy issues through several white papers: 

• A series of Economic Security issue briefs, covering earnings and income, young adults, 

older women, and the safety net.

• A framework for comparing public-private partnerships and conventional procurement in 

infrastructure finance.

• An examination of the economic effects of non-compete contracts.

These white papers complemented the office’s contributions to intra-agency and inter-agency 

policy development on these subjects.

In FY 2016, the Office of International Affairs (IA) helped ensure a favorable external 

environment for sustained job growth and financial stability in the U.S. by prioritizing its work 

around five themes: Trade and Investment; Global Rebalancing; International Financial 

Stability; Management; and International Development.

In its role as lead for international negotiations on non-insurance financial services and transfers, 

Treasury pursued critical financial services commitments and robust transfers provisions of trade 

and investment negotiations. Treasury developed a new provision prohibiting data localization 

measures in the financial services sector and negotiated provisions to address unfair currency 

practices by promoting transparency and accountability. Treasury will continue working with 

our trading partners to promote the Administrations’ trade agenda in all these areas. Treasury 

also plays an important U.S. Government role on broader trade issues such as State Owned 

Enterprises, Customs, and other trade related disciplines that impact Treasury equities. Treasury 

is playing a lead role in analyzing the implications of the United Kingdom’s exit from the 

European Union for U.S. financial services firms. In addition, as the U.S. lead in negotiating 

reductions of export finance subsidies, Treasury continues to press China and other major 

providers of export finance to agree to disciplines on government support, so that U.S. exporters 

can compete globally on a level playing field. These efforts serve not only to enhance U.S. 

competitiveness but also move export credit financing to a more market basis consistent with 

Congressional mandates.

Treasury works to address the large and persistent global imbalances and unfair currency 

practices that threaten strong and sustainable U.S. economic growth. Treasury does this through 

multilateral and bilateral activities working through the International Monetary Fund (IMF), the 

G-20, and the U.S.-China Comprehensive Economic Dialogue (CED). Treasury has successfully 

gotten other G-20 Finance Ministers to agree to a new IMF report that will regularly assess the 

G-20’s progress toward achieving strong, sustainable, and balanced growth, as well as regularly 

assess potential for policy development and policy issues related to achieving faster and more 
DO - 10

sustainable adjustment of external imbalances. Treasury is focused on combatting unfair 

currency practices that disadvantage U.S. industry and workers, and to this end, has strengthened 

the semi-annual surveillance of the exchange rate practices of U.S. major trading partners. 

Treasury also continues to press for stronger exchange rate surveillance in the IMF. 

In the 2016 bilateral economic dialogue with China, Treasury secured new and strengthened 

commitments that will ensure that China’s economic growth continues to deliver concrete 

benefits for the American people, including addressing excess industrial capacity; promoting 

non-discriminatory trade and investment measures; improving economic transparency; and 

advancing policies to shift China’s growth model to one driven by household consumption rather 

than investment and exports.

In FY 2016, Treasury continued to support the U.S. economy’s recovery by mitigating the threat 

from weak growth in the euro area and working to limit negative economic and financial 

spillovers from the crisis in Greece and the conflict in Ukraine. Specific activities included: 

working with European counterparts to help maintain long-term sustainability of the euro; 

advancing the establishment of a centralized European banking union; working with the IMF and 

others to monitor progress towards economic stabilization in vulnerable, strategically important 

countries; and implementing technical assistance and loan guarantee programs for Ukraine.

Treasury leverages multilateral mechanisms to advance inclusive economic growth worldwide 

through IA’s work in support of the Multilateral Development Banks’ (MDBs) financing in 

developing countries; G-20 initiatives on financial inclusion and infrastructure finance; and the 

Paris Club’s targeted debt treatments. In FY 2015, Treasury led the U.S. negotiating team for the 

Addis Ababa Action Agenda (AAAA), the outcome document of the Third International 

Conference on Financing for Development. The AAAA serves as the foundational document to 

guide the financing and implementation of the “Sustainable Development Goals”; this shifted the 

focus for development financing to a greater attention on developing countries’ own domestic 

resource mobilization efforts and private sector investment, in addition to official bilateral and 

multilateral development assistance. 

Treasury also enhanced its oversight of the MDBs’ policies and programs, including completing 

negotiations for replenishments of the World Bank’s International Development Association 

(IDA), the African Development Fund, and the Inter-American Development Bank Group’s 

Multilateral Investment Fund; monitoring implementation of the World Bank’s new 

environmental and social safeguards framework; and continuing reviews of the World Bank’s 

shareholding and capital. Treasury also worked with the MDBs to make more optimal use of 

their balance sheets, including IDA’s plans to leverage its equity by borrowing from the markets 

for the first time and implementation of the merger of concessional and non-concessional lending 

windows at the Asian Development Bank and Inter-American Development Bank.

IA rebalanced resource allocations to reflect changing mission requirements. Areas addressed in 

the reallocation include the increasing demands associated with coordinating international 

financial regulatory reform and chairing the Committee on Foreign Investment in the United 

States (CFIUS). IA continued implementation of the results of a strategic review to improve 

CFIUS’s ability to timely identify, assess, and resolve any national security concerns that may be 

posed by foreign acquisitions of U.S. businesses. At the same time, IA began to direct additional 

staffing resources to increase its capacity to manage a record-breaking caseload in terms of 

volume and complexity. 
DO - 11

Treasury, as chair of CFIUS, coordinates an interagency process to review certain foreign 

investments for national security risks in accordance with the procedures and tight deadlines 

specified in law and regulation. 

• Timely Review of CFIUS Cases: This measure tracks compliance with statutory deadlines 

for completing national security reviews of transactions notified to the Committee on Foreign 

Investment in the United States (CFIUS) to ensure that the CFIUS process is timely and 

efficient. The target (100 percent) was met in FY 2016. Office of International Affairs’ 

target for this measure in FY 2017 and FY 2018 is 100 percent. 

Treasury promotes economic growth by managing U.S. participation and leveraging U.S. 

leadership positions in the International Financial Institutions in order to mitigate emerging 

threats to the U.S. and global economies; support international trade and investment; and 

reinforce U.S. national security interests in key countries around the world. 

• Monitor Quality and Enhance Effectiveness of International Monetary Fund (IMF) Lending 

through Review of IMF Country Programs: This measure tracks efforts by IA staff to 

monitor the quality of IMF country programs and ensure the application of appropriately 

high standards for the use of IMF resources. The target (100 percent) was met in FY 2016. 

In FY 2017 and FY 2018, IA’s target for this measure remains 100 percent.

• Monitor Quality and Enhance Effectiveness of MDB Lending through Timely Review of 

MDB Grant and Loan Proposals: IA reviews MDB loan and grant proposals to ensure that 

funded projects meet several key goals, which include supporting long-term U.S. objectives, 

having a measurable development impact, and being consistent with congressional mandates. 

The target (100 percent) was met in FY 2016. In FY 2017 and FY 2018, IA aims to continue 

its review of 100 percent of MDB loan and grant proposals prior to the date of the relevant 

Executive Board meeting and increase its oversight of projects during implementation.

• Percentage of MDB Grant and Loan Proposals Containing Satisfactory Frameworks for 

Results Measurement: This measure tracks the percentage of grant and loan project proposals 

that contain a satisfactory framework for measuring project results (such as outcome 

indicators, quantifiable and time-bound targets, etc.) This information is measured on an 

annual basis. In FY 2016, 89 percent of MDB grant and loan project proposals had excellent 

or satisfactory ratings for the results matrices. The decrease in the MDB results frameworks 

ratings is attributed to a slight increase in large complex MDB projects where the results 

targets were not adequately robust based on our analysis. To address this going forward, 

Treasury continues to engage with MDBs to improve their focus on stronger investment 

outcomes. The FY 2017 target is 94 percent and the FY 2018 target is 95 percent.

Treasury’s Office of Technical Assistance (OTA) complements Treasury’s international 

economic and terrorist financing policy work. Treasury’s offices of International Affairs and 

Terrorism and Financial Intelligence advocate for improvements in economic and terrorist 

financing policies internationally. OTA helps the governments of developing and transition 

countries build the human and institutional capacity to implement such policy improvements. 

Finance ministries and central banks of developing countries that have demonstrated a strong 

commitment to reforming their financial systems or public financial management can receive 

direct assistance from OTA through its cadre of expert advisors. The technical assistance team 

leverages its funding to increase transparency and accountability, reduce corruption, and 

strengthen the development of market-based policies and practices in these economies. 
DO - 12

OTA support promotes more effective use of a country’s own resources and helps reduce 

dependency on foreign aid. This work also supports stabilization of financial sectors in national 

security/foreign policy priority countries (e.g., Ukraine), more transparent and accountable 

financial sectors for U.S. investors overseas, and the expansion of markets for U.S. exporters, 

thus promoting jobs and economic growth at home. 

• Office of Technical Assistance (OTA) Program Engagement (Traction): measures the degree 

to which foreign counterparts are engaging proactively and constructively with OTA 

advisors, at the working and policy levels. Counterpart engagement is both a key outcome of 

OTA efforts to structure and execute effective technical assistance projects that support host 

country ownership as well as the most crucial input to the successful achievement of the 

intermediate goals and ultimate outcomes described in the project’s terms of reference and 

work plan during the fiscal year – such as passage of law or regulation, an increase in 

government revenues, an improvement in a government’s credit rating, or a reduction in 

economic crimes. The measure is scored on a 5-point scale and averaged across all projects 

to provide one overall measure of OTA’s performance. In FY 2016, the Traction score was 

3.9, exceeding the target of 3.6. In FY 2017 and FY 2018, IA’s target for Traction is 3.6.

2.1.3 Domestic Finance and Tax Policy Resources and Measures

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target FY 2016

Trend

DF-Variance Between 

Estimated and Actual 

Receipts (Annual 

Forecast)(%)

3.8 2.5 3.25 2.8 3.1 4.25 4.25 4.25

Domestic Finance and Tax Policy Budget and Performance 

($73,804,000 from direct appropriation, $55,231,000 from reimbursable resources): 

The Offices of Domestic Finance and Tax Policy monitor and provide advice and assistance to 

the Secretary in their respective areas, including about financial markets and the regulation of 

financial institutions.

In FY 2016, the Office of Tax Policy (OTP) developed proposals for tax reform and budget 

proposals to streamline and modernize existing tax laws and procedures. The office also

developed and implemented regulations and procedures for new programs established by 

Congress, including guidance relating to the Kline-Miller Multiemployer Pension Reform Act 

(MPRA), new centralized partnership audit rules, and State-sponsored and federally tax-free

Dollars in Thousands

 Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Annualized 

CR Request

Column1 Column32 Column4 Column5 Column6 Column7 Column8 Column9

Appropriated Resources $71,451 $68,351 $81,783 $76,520 $79,748 $81,215 $73,804

Other Resources $11,629 $12,804 $24,977 $40,240 $55,231 $55,231 $55,231

Budget Activity Total $83,080 $81,155 $106,760 $116,760 $134,979 $136,446 $129,035

FTE 288 326 339 364 398 386 356
DO - 13

Achieving a Better Life Experience (ABLE) Act accounts. OTP also led interagency and 

intergovernmental efforts for coordination and cooperation regarding tax policy. This includes:

• Work with the Organization for Economic Co-operation and Development (OECD) and the 

United Nations that led to adoption by both bodies of new tax treaty policies;

• Coordination with the Department of Education in modeling student loan defaults.

OTP continued to provide leadership for the OECD, Global Forum, and G-20, advocating for the 

interests of U.S. based businesses. Further, the office published a new U.S. model tax treaty that 

contains technical improvements to protect against abuse. In FY 2017 and FY 2018, OTP plans 

to continue engaging in bilateral tax treaty negotiations to modernize existing treaties, establish 

key new treaty relationships, and actively engage international organizations to protect the fiscal 

and business interests of the U.S.

The Office of Domestic Finance (DF) continued working in FY 2016 to promote America’s 

long-term economic strength and stability by preserving confidence in the U.S. Treasury 

securities market, managing federal fiscal operations and the U.S. government’s debt, advising 

state and local governments about their finances, supporting small businesses, strengthening 

financial institutions and markets, promoting access to credit, and improving financial access 

and financial independence. 

During FY 2016, DF led 10 cybersecurity exercises involving government and private-sector 

participants. The exercises explored a variety of threat scenarios, how the participants would 

respond, and developed after action reports for future improvement. Also in 2016, Treasury, as 

chair of the Financial and Banking Information Infrastructure Committee (FBIIC), coordinated 

among the FBIIC to reach agreements to permit the sharing of cybersecurity information among 

its member financial regulatory agencies. This information-sharing is augmented with monthly 

briefings from Treasury and its partners to regulators and the financial sector on cyber threats 

and actionable information. Taken together, these actions help organizations prevent security 

incidents, respond faster when they occur, and strengthen overall network resilience and defense. 

The DF Office of Debt Management (ODM) seeks to fund the federal government at the least 

cost over time by working to maintain predictable issuance of Treasury debt, minimizing the 

amount of interest the government must pay, and managing debt maturity over time. In 

FY 2016, ODM determined for more than 260 auctions the amount and maturity of debt that the 

Bureau of the Fiscal Service issued. These debt issuances totaled $8.0 trillion and raised $795 

billion in new cash to fund the U.S. government.

In May 2017, DF launched the new USAspending.gov website. It allows taxpayers to examine 

nearly $4 trillion in annual federal spending and see how this money flows from congressional 

and presidential actions to local communities and businesses. The new site is the culmination of 

a nearly three-year collaborative effort led by the Treasury Department and the Office of 

Management and Budget. The data is compiled from federal agencies and published quarterly.

The DF Office of Financial Stability (OFS) continued to wind down investments in the Troubled 

Asset Relief Program (TARP) while continuing its housing programs. OFS has made significant 

progress towards winding down TARP investment programs and continues to implement 

housing programs to help struggling families avoid foreclosure. As of March 31, 2017, OFS had

recovered nearly 98 percent of the $435.9 billion in total program funds disbursed under TARP,
DO - 14

as well as an additional $17.6 billion from Treasury’s equity in AIG. When all of Treasury’s 

AIG investments are included, the amount recovered is greater than the funds disbursed by 

$6.6 billion.

DF has one performance measure:

• Variance between estimated and actual receipts (annual forecast) (percent): As part of 

managing the federal government’s central operating account and cash position, the DF 

Office of Fiscal Projections (OFP) forecasts net cash flows (e.g., federal receipts, outlays, 

and other miscellaneous flows) to ensure that adequate funds are available daily to cover 

federal payments. To determine its overall effectiveness, one of OFP’s metrics is to measure 

the variance between actual and projected federal receipts. A lower variance is better.

The actual variance for FY 2016 was 3.1 percent, which is significantly lower than the

4.25 percent target for FY 2016. The target for both FY 2017 and FY 2018 is 4.25 percent.

2.1.4 Treasury-wide Management and Programs Resources and Measures

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target FY 2016

Trend

Percent of Procurement 

Dollars Spent on Small 

Business

38.52 39.15 36.91 35.11 36.17 37.0 35.0 35.0

Treasury-wide 

Engagement Index of the 

FEVS

70.0 68.0 66.0 67.0 67.0 67.0 67.0 68.0

Treasury-wide Footprint 

(Square Footage)

37,998 37,320 36,411 35,439 34,894 34,927 34,310 33,650

Treasury-wide Leaders 

Lead Index of the Federal 

Employee Viewpoint 

Survey (FEVS)

N/A N/A 53.0 54.0 55.0 55.0 55.0 56.0

Dollars in Thousands

 Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Annualized 

CR Request

Column1 Column32 Column4 Column5 Column6 Column7 Column8 Column9

Appropriated Resources $40,441 $35,223 $31,802 $35,971 $41,112 $44,809 $40,494

Other Resources $17,478 $15,320 $30,858 $55,213 $3,339 $3,339 $3,339

Budget Activity Total $57,919 $50,543 $62,660 $91,184 $44,451 $48,148 $43,833

FTE 151 123 139 171 124 164 144
DO - 15

Treasury-wide Management and Programs Budget and Performance 

($40,494,000 from direct appropriation, $3,339,000 from reimbursable resources): 

This budget activity includes offices that are responsible for the internal management and policy 

of the Department: the Office of the Assistant Secretary for Management; the Office of the 

Chief Information Officer; the Office of Privacy, Transparency, and Records; the Office of the 

Senior Procurement Executive; the Office of the Chief Human Capital Officer; the Office of 

Emergency Programs; the Office of the Deputy Chief Financial Officer; the Office of Civil 

Rights and Diversity; the Office of Minority and Women Inclusion; and the Office of the Deputy 

Assistant Secretary for Management and Budget. 

Treasury-wide Management and Program’s performance metrics are: 

• Percentage of Procurement Dollars Spent on Small Business: In FY 2016, Treasury aimed to 

meet or exceed all small business contracting goals. While Treasury did not meet its overall 

small business goal of 37 percent, missing the mark by 0.83 percent, it met or exceeded all 

other prime-contract small business goals. The following Treasury bureaus were included in 

the goaling report, with no exclusions: Office of the Comptroller of the Currency, Office of 

Thrift Supervision, and the Bureau of Engraving and Printing (BEP). The preponderance of 

the negative impact, on the goals, lies with BEP, which continues to face unique challenges. 

Because of the highly specialized nature of BEP in producing U.S. banknotes and the fixed 

costs associated with creating currency, there are a limited number of vendors globally who 

are able to supply key raw materials and highly specialized printing equipment to perform the 

work. Unless a waiver can be granted or the exclusions are considered in the goaling report, 

both the small business prime and subcontracting goals will continue to be a challenge. 

Treasury attended and conducted outreach activities to provide small business (SB), small 

and disadvantaged business (SDB), women-owned small business (WOSB), HUBZone small 

business (HZ), and service-disabled veteran-owned small business (SDVOSB) with 

information about specific contract opportunities and technical assistance about conducting 

business with Treasury. This outreach work will continue in FY 2017 and FY 2018. 

Particularly noteworthy is that Treasury far exceeded the contracting goals for the following 

socioeconomic groups: SDB at five percent, WOSB at five percent, HZ at three percent, and 

SDVOSB at three percent. Contract obligations tripled for SDB to 15.29 percent, 11.59 

percent for WOSB, 4.49 percent for HZ, 4.17 percent for SDVOSB. Throughout FY 2017, 

Treasury will continue to employ the successful strategies of targeted outreach, enhanced 

leadership accountability, policies, tools and resources, and increased intra-agency 

communication with the expectation of achieving its goals. The FY 2017 overall small 

business goal has been set at 35 percent. Treasury’s FY 2016 small business contract 

achievements are expected to be announced by the Small Business Administration in the 

spring or early summer 2017. 

• Treasury-wide “Engagement” Index of Federal Employee Viewpoint Survey (FEVS): 

Treasury’s strategy focused on improving employee engagement in a number of areas,

thereby creating an opportunity to improve the effectiveness of our workforce while

improving our ranking among other Federal Agencies. Strategic efforts were focused on 

Overall Satisfaction, Leaders Lead, and the Inclusion Quotient – Fairness. Treasury 

conducted two Treasury-wide Engagement review sessions for high-level leadership during 

FY 2016 in addition to bureau-level reviews. Treasury’s scores for the Engagement Index 

increased from 66 percent for FY 2015 to 67 percent for FY 2016. 

• Treasury-wide Footprint (Square Footage): This goal measures the total square footage 

occupied by Treasury’s owned and leased buildings. To reduce the Department’s real 
DO - 16

property footprint and maximize the use of existing real property assets, the Department 

maximized space utilization by undertaking space realignments, consolidations, and 

improved work station standards. 

• Treasury-wide “Leaders Lead” Index of Federal Employee Viewpoint Survey (FEVS): 

Treasury also set the goal to increase the “Leaders Lead” index above FY 2015 results. 

Treasury’s score for the Leaders Lead Index increased from 54 percent in FY 2015 to 55 

percent in FY 2016, and Treasury’s score led the government-wide average by two 

percentage points.

Office of the Chief Human Capital Officer

In FY 2016, Treasury continued execution of its FY 2014 – FY 2017 Human Capital Strategic 

Plan, focusing efforts on improving quality in the delivery of human capital services and 

increasing workforce engagement, performance, development, and diversity. The Department 

obtained the 2302(c) Compliance Certification from the Office of the Special Counsel, becoming 

the second largest federal agency to achieve certification for strengthening awareness of the 

Merit System Principles and Prohibited Personnel Practices with supervisors, managers, and 

executives. Treasury successfully converted to the government-wide executive performance 

management framework and achieved full Office of Personnel Management (OPM) certification 

of the Treasury Executive Performance Management System. The Treasury Executive Institute 

(TEI) increased its subscriber base by a total of eight additional agencies/components and 

reduced the TEI member assessment fee for the second year in a row. TEI nearly tripled the 

number of its remotely accessible programs (from 62 to 171) and more than doubled (from 2,057 

to 4,276) total attendance over FY 2015. The Department also improved the hiring process at 

Departmental Offices, resulting in a decrease in average Time-to-Hire from 119 days in FY 2015 

to 98 days in FY 2016. In FY 2017, Treasury will continue to focus on building workforce 

planning capabilities in support of federal efforts to expand the strategic management of federal 

human capital and close skills gaps in Federal and Treasury mission-critical occupations.

Treasury will also begin implementation of an enterprise Integrated Talent Management system 

that will, when fully deployed at the end of FY 2018, provide employees a single, modern 

system for learning, performance, and career planning; give leadership a consolidated view of 

the Department’s human capital; and consolidate 24 stand-alone legacy systems into a single, 

cloud-based system.

Office of Civil Rights and Diversity

In FY 2017, Treasury developed a new Diversity and Inclusion Strategic Plan, which mapped to 

both the Department's Strategic Plan and the Human Capital Plan. The bureaus have developed

implementation plans specific to each bureau. The Office of Civil Rights and Diversity (OCRD)

coordinated with the Human Resources Engagement Strategy to improve the morale of the 

workforce as reflected in the Federal Employee Viewpoint Survey (FEVS), with a specific focus 

on the new Inclusion Quotient portion of the survey. Treasury’s scores in the Diversity and 

Inclusion portion of the FEVS have remained stable, but the scores in the area of Fairness have 

declined. Focus groups will be held to determine what is driving those numbers. OCRD also 

coordinated a number of major studies, including a barrier analysis of the Senior Executive 

Service at Treasury and a gender pay equity study. Additionally, this office continues to work 

with the Treasury Executive Institute to develop programming for executives and senior level 

staff in the areas of diversity and inclusion.
DO - 17

Office of the Deputy Chief Financial Officer

For FY 2016, the Department received its seventeenth consecutive unmodified audit opinion on 

its Treasury-wide financial statements. Treasury anticipates unmodified audit opinions for the 

consolidated audit for FY 2017 and FY 2018. Overall, the Department has made strong progress 

in enhancing its internal control environment and remains committed to ensuring high standards 

of integrity and transparency in reporting its financial performance.

Office of Small and Disadvantaged Business Utilization

The Department is proud of the collective effort that led to the outstanding achievement of 

exceeding four out of five small business prime goals and three out of five subcontracting goals. 

The “A” score is a testament to the hard work and professionalism of the procurement and 

acquisition teams across Treasury’s bureaus and the serious commitment to utilizing small 

businesses that emanates from Treasury’s leadership. To comply with Section 15 (k), Small 

Business Act, the Department focused on small business prime and subcontracting goal 

achievements. 

Office of the Senior Procurement Executive

In FY 2016, Treasury initiated a comprehensive acquisition transformation strategy designed to 

facilitate innovation, strategic management, efficiency, and effective mission outcomes. Central 

to the strategy is early planning and broad stakeholder participation as well as accelerated 

transition to strategic acquisition vehicles. In support of the Federal Information Technology 

Acquisition Reform Act (FITARA), the Department has placed significant focus on IT 

acquisition across all procurement programs.

In FY 2016 and FY 2017, Treasury continued successful execution of its Major Acquisition 

Program (MAP) reviews in which primary and senior stakeholders (to include procurement, 

customer, program management, and legal representatives) jointly and periodically review 

procurement strategy and progress for critical acquisitions. These reviews provide a forum for 

development of effective acquisition strategies; early identification and resolution of problems; 

and sharing of experience and expertise among various stakeholder personnel. FY 2016 reviews 

focused on pre-award actions and were designed to facilitate successful award of critical 

contracts. To help ensure successful contract performance outcomes, FY 2017 MAP reviews 

were expanded to include existing critical contracts. In FY 2016, Treasury reviewed 40 

acquisitions, valued at $3.8 billion; reviews included 21 IT acquisitions valued at $1.5 billion. 

The Department anticipates a similar level of oversight and collaboration in FY 2017 and 

FY 2018.

Treasury has achieved both savings and efficiencies through aggregating requirements and 

leveraging its purchasing power via enterprise-level management of common spend categories. 

By fully utilizing category management, Treasury seeks to save the federal government money 

through smarter purchasing and greater collaboration across stakeholder organizations and to 

achieve greater efficiency with fewer resources. For example, Treasury’s enterprise contract 

vehicles for wireless services and devices, awarded in April 2016, provide pricing more 

advantageous than available via General Services Administration (GSA) contracts, saving the 

Department over $4 million (21 percent) annually. In June 2016, Treasury awarded an agencywide, mandatory use ordering vehicle for Adobe Enterprise Licenses anticipated to achieve 

savings of approximately 10 percent over GSA published prices. In FY 2015 – FY 2016, 

Treasury achieved total savings of $6.3 million on its Domestic Delivery contracts against 
DO - 18

GSA’s government-wide ordering vehicle. FY 2017 and FY 2018 strategy extends and expands 

Treasury’s transition to government-wide Best In Class contract vehicles, reducing the need to 

establish department level contracts and freeing associated resources for focus on other 

acquisition priorities. 

In FY 2016, Treasury implemented an initiative to reduce non-value added and/or conflicting 

procurement policy within the Department’s operational contracting organizations. Treasury’s 

strategy to reduce procurement policy resulted in an overall 17.9 percent reduction of policy as

measured by pages of policy eliminated within a defined timeline in FY 2016. The reductions 

were made by four of five primary contracting offices; a significant policy reduction by the fifth 

and largest contracting organization within Treasury (Internal Revenue Service) is anticipated in 

FY 2017. The policy reduction initiative will continue through FY 2017 and FY 2018.
DO - 19

Section III – Additional Information

A – Summary of Capital Investments

Information Technology Capital Investments 

DO is focused on leveraging Treasury enterprise data centers to provide flexible, customized 

information technology support for its customers. At the same time, a hybrid cloud strategy is 

being pursued to provide a secure alternative to traditional data centers. This strategy will 

securely facilitate enterprise mobile applications, increase support for telework, and drive longterm cost efficiencies through data center consolidation. 

DO continues to strengthen its governance through DO and an enterprise-wide investment 

review process. The investment review process is comprised of both senior business and 

technology leaders who help to ensure that all technology investment decisions align with the 

mission and goals of the Department. The investment review process helps the CIO prioritize 

opportunities for commodity IT and improved mission outcomes. 

Non-Information Technology Capital Investments 

The Main Treasury Building and Freedman’s Bank Building, formerly the Treasury Annex, are 

the recipients of DO’s major non-IT capital investments. The Treasury Building is the oldest 

departmental building and the third oldest federally occupied building in Washington, preceded 

only by the Capitol and the White House. The Main Treasury Building covers five stories and a 

raised basement and sits on five acres of ground. It was dedicated as a National Historic 

Landmark on October 18, 1972. The Freedman’s Bank Building, also owned by the Department, 

is part of the Lafayette Square National Register Historic District. On January 7, 2016, the 

Treasury Department renamed the Treasury Annex building to mark the 150th anniversary of the 

Freedman’s Savings and Trust Company (Freedman’s Bank).

A summary of capital investment resources, including major information technology and nontechnology investments can be found at:

http://www.treasury.gov/about/budget-performance/Pages/summary-of-capital-investments.aspx

This website also contains a digital copy of this document.

Department of the Treasury

Cybersecurity Enhancement 

Account

Congressional Justification 

for Appropriations and 

Annual Performance 

Report and Plan

FY 2018 
CEA - 2

Table of Contents

Section I – Budget Request........................................................................................................... 3

A – Mission Statement................................................................................................................ 3

B – Summary of the Request ...................................................................................................... 3

1.1 – Appropriations Detail Table.........................................................................................................3

1.2 – Budget Adjustments Table...........................................................................................................4

C – Budget Increases and Decreases Description....................................................................... 4

1.3 – Operating Levels Table................................................................................................................7

D – Appropriations Language and Explanation of Changes ...................................................... 7

E – Legislative Proposals............................................................................................................ 7

Section II – Annual Performance Plan and Report................................................................... 8

A – Strategic Alignment ............................................................................................................. 8

B – Budget and Performance by Budget Activity ...................................................................... 8

2.1 Cybersecurity Enhancement Account Resources and Measures.....................................................8

Section III – Additional Information .......................................................................................... 8

A – Summary of Capital Investments......................................................................................... 8
CEA - 3

Section I – Budget Request

A – Mission Statement

Bolster the Department’s cybersecurity posture and mitigate cybersecurity threats to the U.S. 

financial infrastructure. 

B – Summary of the Request 

Trillions of dollars are accounted for and processed by the Department of the Treasury's 

information technology (IT) systems and therefore, they are a constant target for sophisticated

threat actors. To more proactively and strategically protect Treasury systems against

cybersecurity threats, the Budget requests $27.264 million for the Cybersecurity Enhancement 

Account (CEA). The account identifies and supports Department-wide investments for critical 

IT improvements including the systems identified as High Value Assets (HVAs). Furthermore, 

the centralization of funds allows Treasury to more nimbly respond in the event of a 

cybersecurity incident as well as leverage enterprise-wide services and capabilities across the 

components of the Department.

By managing CEA centrally, Treasury elevates the importance of such initiatives and provides 

Treasury leadership, OMB, and Congress with better transparency into cybersecurity activities 

across the Department. Enhanced transparency also improves Department-wide coordination of 

cybersecurity efforts and improves the Department’s response and recovery capabilities. With 

high-level support, the program provides a platform to enhance efficiency, communication, 

transparency, and accountability around the mission.

The CEA strengthens cybersecurity at Treasury and the nation’s financial sector. This request is 

in addition to current bureau-level cybersecurity activities which remain in the base budgets of 

each Treasury bureau. As the CEA matures, Treasury will continue to look for targeted 

opportunities to provide shared and cost-effective enterprise solutions to improve cybersecurity 

defenses of Treasury and the U.S. financial sector. 

1.1 – Appropriations Detail Table

FY 2016 FTE and Other Resources are Actual

Dollars in Thousands

Cybersecurity Enhancement Account

Appropriated Resources

 FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

New Appropriated Resources 16FTE 16Amt 17FTE 17Amt 18FTE 18Amt ChgFTE ChgAmt pctFTE pctAmt

Cybersecurity Enhancement Account 0 $0 0 $0 19 $27,264 19 $27,264 NA NA

Subtotal New Appropriated Resources 0 $0 0 $0 19 $27,264 19 $27,264 NA NA

Other Resources: 16FTE 16Amt 17FTE 17Amt 18FTE 18Amt ChgFTE ChgAmt pctFTE pctAmt

Offsetting Collections - Reimbursables 0 $0 0 $0 0 $0 0 $0 NA NA

Subtotal Other Resources 0 $0 0 $0 0 $0 0 $0 NA NA

Total Budgetary Resources 0 $0 0 $0 19 $27,264 19 $27,264 NA NA

FY 2016 FY 2017 FY 2017 to FY 2018

Enacted Annualized CR Request Change % Change

FY 2018
CEA - 4

1.2 – Budget Adjustments Table

C – Budget Increases and Decreases Description

Program Increases .................................................................................+$27,264,000 / +19 FTE

Malware Content Filter +$2,474,000 / +0 FTE

Treasury will fund web and email traffic inspection in virtual environments at the Treasury 

Enterprise Trusted Internet Connections. This allows dynamic analysis of potentially harmful 

email and web traffic in a controlled environment, enabling the Treasury enterprise security 

operations center to identify and remove malicious attachments and links before they reach the 

Treasury network. This will reduce the risk of compromise for the entire Treasury network, as 

well as systems housed on that network, including High Value Assets.

Data Loss Protection at the Fiscal Service Trusted Internet Connections (TIC) +$2,135,000 / 

+0 FTE

Funds will expand and accelerate implementation of Data Loss Protection at Treasury’s 

Enterprise TICs and at select High Value Assets, enabling Treasury to detect the exfiltration of 

sensitive information by either threat actors or malicious insiders. This will allow Treasury to 

directly counter the threat of data loss through episodic/coordinated exfiltration. This will 

enhance Treasury’s ability to detect, investigate, and respond to unauthorized attempts to access 

and remove sensitive taxpayer and financial data from the Treasury and bureau networks. 

Enhanced Incident Response and Recovery Capabilities +$5,046,000 / +4 FTE

This request funds enhancements to response and recovery capabilities at Treasury’s enterprise 

security operations center (SOC), the lead entity for Department-wide cybersecurity incident 

Cybersecurity Enhancement Account FTE Amount

FY 2017 Annualized CR 0 $0

FY 2018 Base 0 $0

Program Changes:

Program Increases: 19 $27,264

Malware Content Filter 0 $2,474

Data Loss Protection at the Fiscal Service Trusted Internet 

Connections (TIC) 0 $2,135

Enhanced Incident Response and Recovery Capabilities 4 $5,046

Cybersecurity Enhancements for Classified Networks 3 $1,050

Encrypted Traffic Inspection at the Fiscal Service Trusted Internet 

Connections (TIC) 0 $805

Enhancements to the Treasury Secure Data Network 0 $5,000

Proactive Cyber Risk and Threat Identification 3 $1,948

Improving the Cybersecurity of High Value Assets (HVA) 1 $3,537

Enhancements to Cybersecurity Infrastructure 0 $3,618

Mitigation of Cyber Threats to United States Financial Services 

Sector 8 $1,651

Subtotal Program Changes 19 $27,264

Total FY 2018 Request 19 $27,264

Dollars in Thousands
CEA - 5

response and recovery actions, resulting in a faster response and recovery time. Traditionally 

this entails: retroactive examination of network traffic; assessment of adversarial movement 

within the network; determination of the level of information compromise; implementation of 

mitigations and countermeasures; and reconstitution/resurrection of damaged systems. This 

request also includes funding for deployment of an endpoint incident response capability, giving 

the enterprise SOC the ability to respond to incidents at the workstation level throughout the 

Department in a matter of minutes and hours rather than days and weeks. 

Cybersecurity Enhancements for Classified Networks +$1,050,000 / +3 FTE

This request supports enhanced monitoring for the Treasury-wide collateral classified network, 

including security controls testing, monitoring of system security to include detection of and 

response to unauthorized user or anomalous network activity, as well as the secure implementation of 

identity and credential access management that provides a more secure environment for processing 

highly sensitive information. Funding also improves Treasury’s ability to continuously monitor the 

network and detect and remediate security vulnerabilities, thereby reducing the risk of security 

incidents. 

Encrypted Traffic Inspection at the Fiscal Service Trusted Internet Connections (TIC) 

+$805,000 / +0 FTE 

Encryption is required to protect the confidentiality of sensitive network transactions. However, 

adversaries use encryption to conceal their command/control traffic and exfiltration activity. 

Treasury must be able to inspect encrypted network traffic for these threats. Enterprise TICs, 

housed at Fiscal Service, enhance Treasury’s ability to detect, investigate, and respond to 

unauthorized attempts to access and remove sensitive data from the enterprise-wide Treasury 

network.

Enhancements to the Treasury Secure Data Network +$5,000,000 / +0 FTE

Funding will be allocated to the Treasury-wide SECRET collateral network to: increase overall 

stability; increase the timeliness of incident response and recovery; enhance security monitoring 

by the Government Security Operations Center; and provide advanced toolsets for automated 

monitoring, as well as analyst review of outputs from these toolsets. 

Proactive Cyber Risk and Threat Identification +$1,948,000 / +3 FTE

The foundation of a strong cybersecurity program is proper identification of risk and threat 

vectors, and appropriate documentation of those risks and threats to enable decision making. 

This will be accomplished in part through strong security assessment and authorization of 

enterprise systems. Treasury will also establish a dedicated group of security experts to validate 

that systems across Treasury have been engineered and developed securely from the outset. 

Additionally, this group will carry out penetration tests to uncover vulnerabilities in systems 

throughout Treasury, including High Value Assets, before they are discovered or exploited by 

adversaries.

Improving the Cybersecurity of High Value Assets (HVA) +$3,537,000 / + 1 FTE

HVAs are information systems that Treasury has systematically designated as mission-critical 

and are the most common targets for computer network attacks. Cybersecurity improvements 

include the implementation of encryption for data in-transit—including public-facing web traffic 

in accordance with OMB M-15-13— and data at-rest. For FY 2018, this request includes 
CEA - 6

funding to increase the resiliency of Treasury’s HVA population through Risk and Vulnerability 

Assessments and Security Architecture Reviews. Funding will also be used to validate that, in 

the event of an intrusion, the affected HVAs have been properly cleaned and secured. 

Enhancements to Cybersecurity Infrastructure +$3,618,000 / +0 FTE

Treasury will implement user access controls for sensitive applications and High Value Assets, 

including greater use of multi-factor authentication through Personal Identity Verification (PIV) 

cards. This funds operation and maintenance for those activities, and includes funding for 

improved security architecture design in conjunction with the Department of Homeland 

Security’s Continuous Diagnostics and Mitigation program, Phase II. This design will result in 

enhanced security for privileged users across the Department, as well as identify and reduce 

operational risks in Treasury’s access control architecture.

Mitigation of Cyber Threats to United States Financial Services Sector +$1,651,000 / +8 FTE 

Increasing cyber-attacks against financial institutions could lead to a loss in confidence in these 

institutions and to significant economic impacts. As the government agency charged with 

coordinating with the financial sector on cybersecurity issues, Treasury seeks to expand its role 

as the Sector Specific Agency for the financial services sector under Executive Order 13636 

Improving Critical Infrastructure Cybersecurity. The goal is to improve the public-private 

sharing of cybersecurity information, promote the use of best practices, and respond to 

cybersecurity incidents. In contrast with other initiatives in this budget request that support 

cybersecurity enhancements to Treasury Information Technology systems, this initiative seeks to 

mitigate cybersecurity threats to the U.S. financial infrastructure.
CEA - 7

1.3 – Operating Levels Table

D – Appropriations Language and Explanation of Changes

Appropriations Language Explanation of Changes

DEPARTMENT OF THE TREASURY

DEPARTMENTAL OFFICES

Federal Funds

CYBERSECURITY ENHANCEMENT ACCOUNT

(INCLUDING TRANSFER OF FUNDS)

For salaries and expenses for enhanced cybersecurity for 

systems operated by the Department of the Treasury, 

$27,264,000, to remain available until September 30, 2020: 

Provided, That amounts made available under this heading shall 

be in addition to other amounts available to Treasury offices and 

bureaus for cybersecurity.

E – Legislative Proposals

The Cybersecurity Enhancement Account has no legislative proposals.

Dollars in Thousands

Cybersecurity Enhancement Account FY 2016 FY 2017 FY 2018

Object Classification Actual Annualized CR Request

11.1 - Full-time permanent 0 0 2,480

11.5 - Other personnel compensation 0 0 38

11.9 - Total personnel compensation 0 0 2,518

12.0 - Personnel benefits 0 0 727

Total Personnel and Compensation Benefits $0 $0 $3,245

21.0 - Travel and transportation of persons 0 0 24

23.3 - Communication, utilities, and misc charges 0 0 55

25.1 - Advisory and assistance services 0 0 6,271

25.2 - Other services from non-Federal sources 0 0 1,836

25.3 - Other goods and services from Federal sources 0 0 2,503

25.7 - Operation and maintenance of equipment 0 0 500

26.0 - Supplies and materials 0 0 173

31.0 - Equipment 0 0 12,657

Total Non-Personnel $0 $0 $24,019

Total Budgetary Resources $0 $0 $27,264

FTE 0 0 19
CEA - 8

Section II – Annual Performance Plan and Report

A – Strategic Alignment

The FY 2018-2022 strategic plan is currently under development. The annual performance plan 

will be updated in the FY 2019 budget to reflect the new priorities.

B – Budget and Performance by Budget Activity

2.1 Cybersecurity Enhancement Account Resources and Measures

Cybersecurity Enhancement Account (CEA) Budget and Performance

($27,264,000 from direct appropriations):

The purpose of CEA is to strategically mitigate cybersecurity risks through a centralized 

program with Department-wide impact. Due to the increasing number and sophistication of 

cyberattacks, Treasury leadership has prioritized cybersecurity and supports the centralization of 

department-wide cybersecurity initiatives through the CEA account and budget activity. Current 

bureau-level cybersecurity spending remains in the base budgets of each bureau. 

With the exception of the project to mitigate cybersecurity threats to the U.S. financial 

infrastructure, all projects have the common purpose of strengthening the security of Treasury’s 

IT assets. Additionally, these projects will ensure compliance with both OMB and Executive 

Orders involving the security of government IT assets. To achieve these objectives, Treasury is 

deploying a multi-pronged approach of strategically procuring hardware and software, 

streamlining business processes while expanding security monitoring, and ensuring

accountability at all levels. Treasury will work with OMB to select performance measures.

Section III – Additional Information

A – Summary of Capital Investments

A summary of capital investment resources, including major information technology and nontechnology investments can be found at:

http://www.treasury.gov/about/budget-performance/Pages/summary-of-capital-investments.aspx

This website also contains a digital copy of this document.

Dollars in Thousands

 Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Annualized CR Request

Column1 Column32 Column4 Column5 Column6 Column7 Column8Column2 Column9

Appropriated Resources 0 0 0 0 0 0 $27,264

Budget Activity Total 0 0 0 0 0 0 $27,264

FTE 0 0 0 0 0 0 19

Department of the Treasury

Department-wide Systems and 

Capital Investments Program 

Congressional Justification 

for Appropriations and 

Annual Performance 

Report and Plan

FY 2018 
DSCIP - 2

Table of Contents

Section I – Budget Request........................................................................................................... 3

A – Mission Statement................................................................................................................ 3

B – Summary of the Request ...................................................................................................... 3

1.1 – Appropriations Detail Table ........................................................................................... 3

1.2 – Budget Adjustments Table ............................................................................................. 3

C – Budget Increases and Decreases Description....................................................................... 4

1.3 – Operating Levels Table .................................................................................................. 5

D – Appropriations Language and Explanation of Changes ...................................................... 5

E – Legislative Proposals............................................................................................................ 5

Section II – Annual Performance Plan and Report................................................................... 6

A – Strategic Alignment ............................................................................................................. 6

B – Budget and Performance by Budget Activity ...................................................................... 6

2.1.1 Department-wide Systems and Capital Investments Program Resources and Measures6

Section III – Additional Information .......................................................................................... 6

A – Summary of Capital Investments......................................................................................... 6
DSCIP - 3

Section I – Budget Request

A – Mission Statement

Improve infrastructure, modernize business processes, and increase efficiency through capital

investments that support the missions of all Treasury bureaus and programs.

B – Summary of the Request 

Treasury owns and operates two historic office buildings in downtown Washington, D.C. – the 

Main Treasury Building and the Freedman’s Bank Building. Annually, the Department 

completes a condition assessment review of the infrastructure of these buildings. This year’s 

assessment highlights elements and infrastructure that has exceeded its expected life and has 

become too costly to continually repair. The Department plans to work through these 

accumulated needs over time. The FY 2018 request of $4.426 million begins this process by 

focusing on life safety renovations, improved electrical service, and roof replacement to address 

systemic and mechanical failure, and building modernization, while preserving the historic fabric

of the buildings.

1.1 – Appropriations Detail Table

1.2 – Budget Adjustments Table

Dollars in Thousands

Department-wide Systems and Capital 

Investments Program

Appropriated Resources

 FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

New Appropriated Resources 16FTE 16Amt 17FTE 17Amt 18FTE 18Amt ChgFTE ChgAmt pctFTE pctAmt

Department-w ide Systems and Capital 

Investments Program

0 $5,000 0 $4,990 0 $4,426 0 ($564) NA -11.30%

Total Budgetary Resources 0 $5,000 0 $4,990 0 $4,426 0 ($564) NA -11.30%

FY 2016 FY 2017 FY 2017 to FY 2018

Enacted Annualized CR Request Change % Change

FY 2018

Department-wide Systems and Capital Investments Program FTE Amount

FY 2017 Annualized CR 0 $4,990

Changes to Base:

Non-Recurring Costs 0 ($4,990)

Zero based budget 0 ($4,990)

Subtotal Changes to Base 0 ($4,990)

Total FY 2018 Base 0 $0

Program Changes:

Program Increases: 0 $4,426

Add smoke evacuation to stairwells in the Freedman's Bank Building 0 $350

Complete delivery of new electric service to tenant spaces in 

Freedman's Bank Building

0 $1,000

Phase I Main Treasury Roof Replacement 0 $3,076

Subtotal Program Changes 0 $4,426

Total FY 2018 Request 0 $4,426

Dollars in Thousands
DSCIP - 4

C – Budget Increases and Decreases Description

Non-Recurring Costs ................................................................................ -$4,990,000 / +0 FTE 

Zero-Based Budget -$4,990,000 / +0 FTE 

In the FY 2017 Annualized Continuing Resolution, $2,995,000 is provided for Digital Accountability 

and Transparency Act implementation, and $1,995,000 is provided for renovation of Treasury 

buildings.

Program Increases .....................................................................................+$4,426,000 / +0 FTE

Add Smoke Evacuation to Freedman’s Bank Building Stairwells +$350,000 / +0 FTE

The Freedman’s Bank Building has two existing stairwells for emergency egress. Neither 

stairwell is properly pressurized in order to deter smoke infiltration in the case of a fire. 

Complete Delivery of New Electric Service to Freedman’s Bank Building +$1,000,000 / +0 FTE

A renovation project in 2013 provided new electrical feeders to the building and replaced the 

main switchgear. The project resulted in more efficient building service, however, further 

renovations are required to fully take advantage of this service within the secondary electrical 

distribution. The building also possesses some older aluminum branch wiring that needs to be 

replaced to meet current codes, and there is a unit that supplies uninterrupted power to the 

network which is approximately 15 years old and needs to be replaced. A new primary 

distribution system was installed in 2013, but older transformers and distribution panels from the 

older service still exist and will need to be removed as the secondary distribution systems are 

updated as part of floor-by-floor renovation. Finally, the typical lighting fixtures do not meet 

current federal energy standards and will need to be replaced with LED lighting. 

Phase 1 Main Treasury Roof Replacement +$3,076,000 / +0 FTE

The Main Treasury Building roof has reached its normal life expectancy and routine 

maintenance can no longer prevent leaks. New roofing options are being explored including 

removal and replacement of the existing roof. Preliminary research suggests that a newer 

technology may have advantages that outweigh the current roofing system. The new technology 

can be applied directly over the existing roofing system at a fraction of the cost and offer the 

same warranty period as conventional systems. In addition to lower costs and similar warranty 

periods, these systems also offer shorter installation periods, reduced odors, a UL fire rating, and 

manageable maintenance programs.
DSCIP - 5

1.3 – Operating Levels Table

D – Appropriations Language and Explanation of Changes

Appropriations Language Explanation of 

Changes

DEPARTMENT OF THE TREASURY

DEPARTMENTAL OFFICES

Federal Funds

DEPARTMENT-WIDE SYSTEMS AND

CAPITAL INVESTMENTS PROGRAM

(INCLUDING TRANSFER OF FUNDS)

For development and acquisition of automatic data processing 

equipment, software, and services and for repairs and renovations to 

buildings owned by the Department of the Treasury, $4,426,000, to 

remain available until September 30, 2020: Provided, That these 

funds shall be transferred to accounts and in amounts as necessary to

satisfy the requirements of the Department's offices, bureaus, and 

other organizations: Provided further, That this transfer authority 

shall be in addition to any other transfer authority provided in this 

Act: Provided further, That none of the funds appropriated under this 

heading shall be used to support or supplement "Internal Revenue 

Service, Operations Support" or "Internal Revenue Service, Business 

Systems Modernization".

Note.—A full-year 2017 appropriation for this account was not 

enacted at the time the budget was prepared; therefore, the budget 

assumes this account is operating under the Further Continuing

Appropriations Act, 2017 (P.L. 114–254). The amounts included for 

2017 reflect the annualized level provided by the continuing 

resolution.

E – Legislative Proposals

The DSCIP has no legislative proposals.

Dollars in Thousands

Department-wide Systems and Capital Investments FY 2016 FY 2017 FY 2018

Program - Object Classification Actual Annualized CR Request

25.1 - Advisory and assistance services 639 0 0

25.2 - Other services from non-Federal sources 401 2,995 0

31.0 - Equipment 210 0 0

32.0 - Land and structures 0 1,995 4,426

Total Non-Personnel $1,250 $4,990 $4,426

Total Budgetary Resources $1,250 $4,990 $4,426
DSCIP - 6

Section II – Annual Performance Plan and Report

A – Strategic Alignment

The FY 2018-2022 strategic plan is currently under development. The annual performance plan 

will be updated in the FY 2019 budget to reflect the new priorities.

B – Budget and Performance by Budget Activity

2.1.1 Department-wide Systems and Capital Investments Program Resources and 

Measures

Department-wide Systems and Capital Investments Program 

($4,426,000 from direct appropriations): 

Department-wide Systems and Capital Investments Program (DSCIP) enables the Department to 

make investments in capital improvements that support the missions of all Treasury bureaus and 

programs. 

Department-wide Information Technology Systems. The FY 2016 Consolidated 

Appropriations Act provided $4,350,000 to support mission-critical Treasury functions by 

investing in computing resources and security infrastructure. Investments were geared to meet 

the demand from multiple entities for the architecture needed to support big data.

Treasury Building - Repairs and Renovations. The Main Treasury Building and the 

Freedman’s Bank Building are owned by the Department and are Departmental Offices’ capital 

investments. The age and historical significance of the buildings create special conditions that 

do not exist in many other Federal office facilities. Continual upkeep, with close attention to 

historic preservation, is necessary in order to continue occupying these buildings. Funds in the 

amount of $650,000 were provided in the FY 2016 Consolidated Appropriations Act to repair the 

South Plaza paver stones and underlying setting bed that were causing an unstable walking 

surface and a hazard to employees. FY 2017 funds will be used for continued repair and 

renovations. The FY 2018 request focuses on life safety, improved electrical service, and roof 

replacement.

Section III – Additional Information

A – Summary of Capital Investments

A summary of capital investment resources, including major information technology and nontechnology investments can be found at:

http://www.treasury.gov/about/budget-performance/Pages/summary-of-capital-investments.aspx

This website also contains a digital copy of this document.

Dollars in Thousands

Department-wide Systems and 

Capital Investments Program FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Resource Level Actual Actual Actual Actual Actual Annualized CR Request

Column1 Column32 Column4 Column5 Column6 Column7 Column8Column2 Column9

Appropriated Resources 0 0 $2,725 $2,725 $1,250 $4,990 $4,426

Budget Activity Total 0 0 $2,725 $2,725 $1,250 $4,990 $4,426

FTE 0 0 0 0 0 0 0

Department of the Treasury

Office of Terrorism and 

Financial Intelligence

Congressional Justification 

for Appropriations and 

Annual Performance 

Report and Plan

FY 2018 
TFI - 2

Table of Contents

Section I – Budget Request........................................................................................................... 3

A – Mission Statement................................................................................................................ 3

B – Summary of the Request ...................................................................................................... 3

1.1 – Appropriations Detail Table.........................................................................................................3

1.2 – Budget Adjustments Table...........................................................................................................3

C – Budget Increases and Decreases Description....................................................................... 4

1.3 – Operating Levels Table................................................................................................................5

D – Appropriations Language and Explanation of Changes ...................................................... 6

E – Legislative Proposals............................................................................................................ 6

Section II – Annual Performance Plan and Report................................................................... 7

A – Strategic Alignment ............................................................................................................. 7

B – Budget and Performance by Budget Activity ...................................................................... 7

2.1 Terrorism and Financial Intelligence Resources and Measures......................................................7

Section III – Additional Information .......................................................................................... 9

A – Summary of Capital Investments......................................................................................... 9
TFI - 3

Section I – Budget Request

A – Mission Statement

Strengthen national security by using targeted financial measures to combat threats and protect 

the integrity of the financial system.

B – Summary of the Request 

The Office of Terrorism and Financial Intelligence (TFI) requests $116.778 million, which is 

level with the FY 2017 Annualized Continuing Resolution funding level. The budget prioritizes 

funding for Treasury’s array of targeted financial tools. Key Treasury programs that freeze the 

accounts of terrorists and proliferators, implement sanctions on rogue nations, and link law 

enforcement agencies with financial institutions are critical to the continued safety and financial 

stability of the Nation.

1.1 – Appropriations Detail Table

FY 2016 FTE and Other Resources are Actual

1.2 – Budget Adjustments Table

Dollars in Thousands

Salaries and Expenses

Appropriated Resources

 FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

New Appropriated Resources 16FTE 16Amt 17FTE 17Amt 18FTE 18Amt ChgFTE ChgAmt pctFTE pctAmt

Terrorism and Financial Intelligence 383 $117,000 391 $116,778 386 $116,778 (5) $0 -1.28% 0.00%

Subtotal New Appropriated Resources 383 $117,000 391 $116,778 386 $116,778 (5) $0 -1.28% 0.00%

Other Resources: 16FTE 16Amt 17FTE 17Amt 18FTE 18Amt ChgFTE ChgAmt pctFTE pctAmt

Offsetting Collections - Reimbursables 31 $6,329 31 $6,329 31 $6,329 0 $0 0.00% 0.00%

Subtotal Other Resources 31 $6,329 31 $6,329 31 $6,329 0 $0 0.00% 0.00%

Total Budgetary Resources 414 $123,329 422 $123,107 417 $123,107 (5) $0 -1.18% 0.00%

FY 2016 FY 2017 FY 2017 to FY 2018

Enacted Annualized CR Request Change % Change

FY 2018

Terrorism and Financial Intelligence FTE Amount

FY 2017 Annualized CR 391 $116,778

Changes to Base:

Maintaining Current Levels (MCLs): 0 $2,315

Pay-Raise 0 $851

Pay Annualization 0 $312

Non-Pay 0 $1,152

Efficiency Savings (5) ($2,315)

Streamline Staffing (5) ($574)

Consolidations and Travel, Supplies, and 

Equipment Savings 0 ($1,741)

Subtotal Changes to Base (5) 0

Total FY 2018 Base 386 $116,778

Total FY 2018 Request 386 116,778

Dollars in Thousands
TFI - 4

C – Budget Increases and Decreases Description

Maintaining Current Levels (MCLs) ......................................................+$2,315,000 / +0 FTE

Pay Raise +$851,000 / +0 FTE 

Funds are requested for the proposed January 2018 pay-raise.

Pay Annualization +$312,000 / +0 FTE 

Funds are requested for annualization of the January 2017 pay-raise.

Non-Pay +$1,152,000 / +0 FTE 

Funds are requested for non-labor expenses such as travel, contracts, rent, supplies, and 

equipment.

Efficiency Savings ........................................................................................-$2,315,000 / -5 FTE

Streamline Staffing -$574,000 / 5 FTE

To align with the administration’s initiative to improve government efficiency and effectiveness, 

the Office of Terrorism and Financial Intelligence is implementing a staffing streamlining effort 

to ensure appropriate levels for maximum efficiency. 

Consolidations and Travel, Supplies, and Equipment Savings -$1,741,000/ +0 FTE

The office proposes to decrease foreign travel, reduce supplies and equipment purchases, 

consolidate FOIA contracts, and re-organize management functions.
TFI - 5

1.3 – Operating Levels Table

Note: This table includes total annually appropriated funding (actuals for FY 2016, estimates for FY 2017 Annualized CR and 

FY 2018).

Dollars in Thousands

Salaries and Expenses FY 2016 FY 2017 FY 2018

Object Classification Actual Annualized CR Request

11.1 - Full-time permanent 42,734 43,906 44,500

11.3 - Other than full-time permanent 159 200 200

11.5 - Other personnel compensation 660 800 800

11.9 - Total personnel compensation 43,553 44,906 45,500

12.0 - Personnel benefits 13,626 14,368 14,337

Total Personnel and Compensation Benefits $57,179 $59,274 $59,837

21.0 - Travel and transportation of persons 2,010 2,200 2,100

22.0 - Transportation of things 20 22 20

23.1 - Rental payments to GSA 71 73 73

23.2 - Rental payments to others 13 14 14

24.0 - Printing and reproduction 102 110 100

25.1 - Advisory and assistance services 8,085 8,125 8,125

25.2 - Other services from non-Federal sources 7,812 7,950 7,950

25.3 - Other goods and services from Federal sources 33,910 35,000 34,799

25.7 - Operation and maintenance of equipment 351 360 360

26.0 - Supplies and materials 1,840 2,200 2,000

31.0 - Equipment 1,361 1,450 1,400

Total Non-Personnel $55,575 $57,504 $56,941

Total Budgetary Resources $112,754 $116,778 $116,778

FTE 383 391 386
TFI - 6

D – Appropriations Language and Explanation of Changes

Appropriations Language Explanation of 

Changes

DEPARTMENT OF THE TREASURY

OFFICE OF TERRORISM AND FINANCIAL INTELLIGENCE

Federal Funds

SALARIES AND EXPENSES

For the necessary expenses of the Office of Terrorism and Financial 

Intelligence to safeguard the financial system against illicit use and to 

combat rogue nations, terrorist facilitators, weapons of mass 

destruction proliferators, money launderers, drug kingpins, and other 

national security threats, $116,778,000: Provided, That of the 

amounts appropriated under this heading, up to $5,000,000 shall 

remain available until September 30, 2019.

Note.—A full-year 2017 appropriation for this account was not 

enacted at the time the budget was prepared; therefore, the budget 

assumes this account is operating under the Further Continuing

Appropriations Act, 2017 (P.L. 114–254). The amounts included for 

2017 reflect the annualized level provided by the continuing 

resolution.

DO proposes to 

remove the cap on 

administrative 

support for TFI and 

changing the multiyear language to 

provide TFI 

maximum spending 

flexibility. 

E – Legislative Proposals

The Office of Terrorism and Financial Intelligence has no legislative proposals.
TFI - 7 

Section II – Annual Performance Plan and Report

A – Strategic Alignment

The FY 2018-2022 strategic plan is currently under development. The annual performance plan 

will be updated in the FY 2019 budget to reflect the new priorities.

B – Budget and Performance by Budget Activity

2.1 Terrorism and Financial Intelligence Resources and Measures

Terrorism and Financial Intelligence Budget and Performance

($116,778,000 from direct appropriations, $6,329,000 from reimbursable resources):

The Office of Terrorism and Financial Intelligence (TFI) marshals 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 proliferators, 

money launderers, drug kingpins, and other national security threats. Under Executive Order and 

legislation umbrellas, TFI supports Treasury’s strategic and priority goals by implementing 

specific sanctions tailored to block assets or impose trade restrictions. 

Office of Terrorist Financing and Financial Crimes (TFFC)

In FY 2016, TFFC facilitated the Financial Action Task Force (FATF) Mutual Evaluation of the 

United States and participated in or reviewed approximately 14 mutual assessment reports of 

FATF countries’ compliance with international AML/CFT standards, often leading to 

substantive changes in some countries’ AML/CFT standards and laws. TFFC also provided 

training to its counterparts abroad, which focused on creating effective AML/CFT frameworks 

and financial regulations capable of combating terrorist financing. In FY 2017, TFFC designed 

and implemented strategies to combat national security concerns such as ISIS, North Korea, Iran, 

and Russia. TFFC also worked to increase global financial transparency by strengthening global 

standards to combat and prevent broad illicit finance. For FY 2018, TFFC will continue efforts 

to develop conduct-based sanctions and executive orders targeting illicit actors that support 

narco-traffickers, weapons of mass destruction proliferators, and transnational criminal 

organizations. TFFC will also develop regulatory AML/CFT initiatives and collaborate with 

Dollars in Thousands

 Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Annualized

CR Request

Column1 Column32 Column4 Column5 Column6 Column7 Column8 Column2 Column9

Appropriated Resources $100,000 $96,116 $101,305 $112,160 $112,754 $116,778 $116,778

Other Resources $31,225 $30,832 $31,293 $6,966 $6,329 $6,329 $6,329

Budget Activity Total $131,225 $126,948 $132,598 $119,126 $119,083 $123,107 $123,107

FTE 391 388 376 385 414 422 417

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target FY 2016

Actual

Impact of TFI Programs 

and Activities

8.1 8.3 8.5 8.8 8.7 8.5 8.5 8.5
TFI - 8

Federal law enforcement on financial crime investigations and third party money laundering 

coordination and efforts. Additionally, TFFC will participate in or review mutual assessment 

reports conducted to evaluate FATF members’ adoption of international AML/CFT standards.

Office of Intelligence and Analysis (OIA)

The Office of Intelligence and Analysis is responsible for the receipt, analysis, collation, and 

dissemination of foreign intelligence and foreign counterintelligence information related to the 

operation and responsibilities of the Department of the Treasury. OIA’s mission is to support the 

formulation of policy and execution of Treasury authorities. OIA executes this mission by 

producing expert intelligence analysis and driving collection on support networks of terrorists, 

weapons of mass destruction weapons proliferators, and other key national security threats and 

by providing timely, accurate, and focused intelligence on the full range of economic, political, 

and security issues. OIA also leads Treasury’s Insider Threat Program on the classified network 

system.

Office of Foreign Assets Control (OFAC)

The Office of Foreign Assets Control administers and enforces economic and trade sanctions 

based on U.S. foreign policy and national security goals against over 30 targeted foreign 

countries and regimes, terrorists, international narcotics traffickers, those engaged in activities 

related to the proliferation of weapons of mass destruction, and other threats to the national 

security, foreign policy or economy of the United States. OFAC acts under Presidential national 

emergency powers, as well as authority granted by specific legislation, to impose controls on 

transactions and freeze assets under US jurisdiction. Many of the sanctions are based on United 

Nations and other international mandates, are multilateral in scope, and involve close 

cooperation with allied governments.

In FY 2016, TFI maintained unified cross-organizational priorities and successfully increased 

intelligence reports production on the Democratic People’s Republic of Korea (North Korea), 

Russia, Iran, and the Islamic State of Iraq and Syria (ISIS). Further, TFI produced numerous 

quick turnaround analyses on Iran nuclear negotiations for Treasury and the Administration. 

Throughout FY 2017 and FY 2018, TFI will continue to focus on assessing and improving 

internal clearance processes, developing new performance measures that align to the new TFI 

strategic plan published in FY 2016 Q2, and clarifying roles and responsibilities to better 

coordinate within the organization. 

FY 2017 and FY 2018 priorities for TFI include:

• Increasing focus on targeted financial measures that address threats from ISIS, North Korea, 

Iran, and Russia. 

• Increasing focus on Cybersecurity and Intellectual Property activities.

• Increasing focus on promoting financial transparency.

• Collecting, analyzing, and disseminating information concerning illicit financing and national 

security threats.

• Assisting partner countries in the development and implementation of anti-money laundering 

and counter-terrorist financing (AML/CFT) standards. TFI provides direct support and 

assistance, ensuring compliance with these internationally approved standards.
TFI - 9

• Identifying opportunities for Treasury to use its authorities to combat and counter terrorist 

financing in Africa and the Middle East. 

• Increasing the capabilities of Treasury’s program for deterring, detecting, and mitigating 

insider threats by leveraging counterintelligence, security, information assurance, and other 

relevant resources.

Description of Performance:

Impact of TFI Programs and Activities: In order to gauge its performance, TFI created a 

composite measure consisting of three program office focus areas related to its mission and 

strategic goals, including customer outreach, increasing production and dissemination of 

intelligence products, and implementing IT modernization projects. In FY 2016, TFI exceeded 

its performance goal of 8.5 with a score of 8.7 and expects to achieve its FY 2017 and FY 2018

target of 8.5. TFI and Treasury will work with OMB on developing new performance measures 

that align to the new TFI Strategic Plan.

Section III – Additional Information

A – Summary of Capital Investments

TFI capital investment resources are part of the Departmental Offices. 

A summary of capital investment resources, including major information technology and nontechnology investments can be found at:

http://www.treasury.gov/about/budget-performance/Pages/summary-of-capital-investments.aspx

This website also contains a digital copy of this document.

Department of the Treasury

Office of Inspector General

Congressional Justification 

for Appropriations and 

Annual Performance 

Report and Plan

FY 2018 
OIG - 2

Table of Contents

Section I – Budget Request........................................................................................................... 3

A – Mission Statement................................................................................................................ 3

B – Summary of the Request ...................................................................................................... 3

1.1 – Appropriations Detail Table.........................................................................................................4

1.2 – Budget Adjustments Table...........................................................................................................4

C – Budget Increases and Decreases Description....................................................................... 5

1.3 – Operating Levels Table................................................................................................................6

D – Appropriations Language and Explanation of Changes ...................................................... 7

E – Legislative Proposals............................................................................................................ 7

Section II – Annual Performance Plan and Report................................................................... 8

A – Strategic Alignment ............................................................................................................. 8

B – Budget and Performance by Budget Activity .................................................................... 12

2.1.1 Audit Resources and Measures........................................................................................ 12

Audit Budget and Performance................................................................................................. 12

Section III – Additional Information ........................................................................................ 14

A – Summary of Capital Investments....................................................................................... 14
OIG - 3

Section I – Budget Request

A – Mission Statement

To promote the integrity, efficiency, and effectiveness of Treasury programs and operations. 

B – Summary of the Request 

The FY 2018 request for $34,112,000 for the OIG will be used to fund critical audit, 

investigative, and mission support activities to meet the requirements of the Inspector General 

Act of 1978, and other statutes including, but not limited to: the Cybersecurity Act of 2015;

Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank); Federal 

Information Security Modernization Act (FISMA); Government Management Reform Act;

Improper Payments Elimination and Recovery Act; Digital Accountability and Transparency Act 

of 2014 (DATA Act); Federal Deposit Insurance Act; Small Business Jobs Act of 2010; and 

Resources and Ecosystems Sustainability, Tourist Opportunities, and Revived Economies of the 

Gulf Coast States Act of 2012 (RESTORE Act). Specific mandates include audits of the 

Department’s financial statements, the Department’s compliance with FISMA, the Department’s 

actions in implementing cyber security information sharing, failed insured depositary institutions 

regulated by Treasury, and spending data submitted by the Department to USASpending.gov. 

With the resources available after mandated requirements are met, the OIG will conduct audits of 

the Department’s highest risk programs and operations, and respond to stakeholder requests for 

specific work as appropriate. Some of the Department’s highest risk programs and operations 

include: (1) Cyber Threats, (2) Efforts to Promote Spending Transparency and to Prevent and 

Detect Improper Payments, (3) Anti-Money Laundering and Terrorist Financing/Bank Secrecy 

Act Enforcement, and (4) Management of Treasury’s Authorities Intended to Support and 

Improve the Economy including administration of the Gulf Coast Restoration Trust Fund.

In support of Treasury’s mission, the OIG established the following strategic goals:

• Promote the integrity, efficiency, and effectiveness of programs and operations across 

Treasury OIG’s jurisdictional boundaries through audits and investigations

• Proactively support and strengthen the ability of programs across Treasury OIG’s 

jurisdictional boundaries to identify challenges and manage risks 

• Fully and currently inform stakeholders of Treasury OIG findings, recommendations, 

investigative results, and priorities

• Enhance, support, and sustain a workforce and strengthen internal operations to achieve the 

Treasury OIG mission, vision, and strategic goals
OIG - 4

Office of Inspector General’s FY 2018 Budget Request

In accordance with the requirements of Section 6(f)(1) of the Inspector General Act of 1978, the 

Treasury Inspector General submits the following information relating to the OIG’s requested 

budget for FY 2018:

• The aggregate budget request for the operations of the OIG is $44,112,000 comprised of 

$34,112,000 from direct appropriations, and $10,000,000 from reimbursable collections;

• The portion of this amount needed for OIG training is $400,000; and

• The portion of this amount needed to support the Council of Inspectors General on Integrity 

and Efficiency (CIGIE) is $68,224.

The amount requested for training satisfies all OIG training needs for FY 2018.

It must be noted that meeting the FY 2018 funding level will mean a reduction in audits 

conducted (down from 86 to 74), and an impact on OIG’s ability to meet investigative needs. 

OIG will look at all possible operational and personnel options to meet the OIG mission in 

FY 2018. 

1.1 – Appropriations Detail Table

Dollars in Thousands

Note: FY 2016 FTE and Other Resources are Actual

1.2 – Budget Adjustments Table

Dollars in Thousands

Office of Inspector General FTE Amount

FY 2017 Annualized CR 194 $35,349

Changes to Base:

Maintaining Current Levels (MCLs): $729

Pay-Raise - $401

Pay Annualization - $147

Non-Pay - $180

Subtotal Changes to Base - -

Total FY 2018 Base 194 $36,078

Program Changes:

Program Decreases: (19) ($1,966)

Reduce Audit Staffing (19)

 

($1,966)

Subtotal Program Decreases (19) ($1,966)

Total FY 2018 Request 175 $34,112

OIG

Appropriated Resources

 FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

New Appropriated Resources 16FTE 16Amt 17FTE 17Amt 18FTE 18Amt ChgFTE ChgAmt pctFTE pctAmt

Audit 131 $28,304 151 $27,219 132 $26,266 (19) ($953) -12.58% -3.50%

Investigations 33 $7,112 43 $8,130 43 $7,846 0 ($284) 0.00% -3.49%

Subtotal New Appropriated Resources 164 $35,416 194 $35,349 175 $34,112 (19) ($1,237) -9.79% -3.50%

Other Resources: 16FTE 16Amt 17FTE 17Amt 18FTE 18Amt ChgFTE ChgAmt pctFTE pctAmt

 Reimbursables 6 $6,726 19 $10,500 5 $10,000 (14) ($500) -73.68% -4.76%

Subtotal Other Resources 6 $6,726 19 $10,500 5 $10,000 (14) ($500) -73.68% -4.76%

Total Budgetary Resources 170 $42,142 213 $45,849 180 $44,112 (33) ($1,737) -15.49% -3.79%

FY 2016 FY 2017 FY 2017 to FY 2018

Enacted Annualized CR Request Change % Change

FY 2018
OIG - 5

C – Budget Increases and Decreases Description

Maintaining Current Levels (MCLs) .........................................................+$729,000 / +0 FTE

Pay Raise +$401,000 / +0 FTE 

Funds are requested for the proposed January 2018 pay-raise.

Pay Annualization +$147,000 / +0 FTE 

Funds are requested for annualization of the January 2017 pay-raise.

Non-Pay +$180,000 / +0 FTE 

Funds are requested for non-labor expenses such as travel, contracts, rent, supplies, and 

equipment.

Program Decreases ................................................................................. ($1,966,000) / (19) FTE

Reduce Audit Staffing ($1,966,000 / (19) FTE

Reduce Audit Staffing.
OIG - 6

1.3 – Operating Levels Table

Dollars in Thousands

Office of Inspector General FY 2016 FY 2017 FY 2018

Object Classification Actual Annualized CR Request

11.1 - Full-time permanent 17025 20,500 17,955 

11.3 - Other than full-time permanent 13 10 10 

11.5 - Other personnel compensation 940 675 750 

11.9 - Personnel Compensation (Total) 17,978 21,185 18,715 

12.0 - Personnel benefits 6,584 6,834 6,000 

13.0 - Benefits for former personnel 12 15 15 

Total Personnel and Compensation Benefits $24,562 $28,034 $24,730 

21.0 - Travel and transportation of persons 602 1,025 700 

23.1 - Rental payments to GSA 1,375 500 3,002 

23.3 - Communication, utilities, and misc charges 189 200 200 

24.0 - Printing and reproduction 2 7 5 

25.0 - Other contractual Services 1,960 2,500 2,500 

25.3 - Other purchases of goods & serv frm Govt accounts 3,108 2,200 2,500 

25.6 - Medical care 55 58 60 

25.7 - Operation and maintenance of equip 35 35 35 

26.0 - Supplies and materials 166 170 160 

31.0 - Equipment 453 600 200 

91.2 - Unvouchered Expenditures 11 20 20 

Total Non-Personnel $7,956 $7,315 $9,382 

Subtotal New Budgetary Resources $32,518 $35,349 $34,112 

FTE 170 194 175

Note: This table includes total annually appropriated funding (actuals for FY 2016, FY 2017 Annualized CR and FY 2018).
OIG - 7

D – Appropriations Language and Explanation of Changes

Appropriations Language Explanation of Changes

DEPARTMENT OF THE TREASURY

OFFICE OF INSPECTOR GENERAL

Federal Funds

SALARIES AND EXPENSES

For necessary expenses of the Office of Inspector General in 

carrying out the provisions of the Inspector General Act of 1978, 

$34,112,000, including hire of passenger motor vehicles; of 

which not to exceed $100,000 shall be available for unforeseen 

emergencies of a confidential nature, to be allocated and 

expended under the direction of the Inspector General of the 

Treasury; of which up to $2,800,000 to remain available until 

September 30, 2019, shall be for audits and investigations

conducted pursuant to section 1608 of the Resources and 

Ecosystems Sustainability,Tourist Opportunities, and Revived 

Economies of the Gulf Coast States Act of 2012(33 U.S.C. 1321 

note); and of which not to exceed $1,000 shall be available for 

official reception and representation expenses.

Note.—A full-year 2017 appropriation for this account was not 

enacted at the time the budget was prepared; therefore, the budget 

assumes this account is operating under the Further Continuing

Appropriations Act, 2017 (P.L. 114–254). The amounts included 

for 2017 reflect the annualized level provided by the continuing 

resolution.

E – Legislative Proposals

The OIG has no legislative proposals.
OIG - 8

Section II – Annual Performance Plan and Report

A – Strategic Alignment

The FY 2018 - 2022 strategic plan is currently under development. The annual performance plan 

will be updated in the FY 2019 budget to reflect the new priorities. The FY 2018 requested 

resources will enable the OIG to perform audits and investigations of Treasury programs and 

operations under its jurisdiction, except for those of the Internal Revenue Service (IRS) and the 

Troubled Asset Relief Program (TARP), and keeps the Secretary of the Treasury and Congress 

fully informed of problems, deficiencies, and the need for corrective action. By statute, the OIG 

also performs oversight of the Gulf Coast Ecosystem Restoration Council, an independent 

Federal agency. Major Treasury programs and related risks and challenges include: 

Cyber Threats

Cybersecurity represents one of the most serious challenges facing the Nation today. A reliable 

critical infrastructure, including information systems and networks, is vital to our national 

security and economic stability. Cyber threats are a persistent concern as Treasury’s information 

systems are critical to the core functions of government and the Nation’s financial infrastructure. 

As cyber threats continue to evolve and become more sophisticated and subtle, they pose an 

ongoing challenge for Treasury to fortify and safeguard its internal systems and operations and 

the financial sector it oversees, and investigate exploitations of those systems and operations.

Attackers frequently exploit vulnerable networks in a string of trusted connections to gain access 

to government systems. Cyber-attacks against Federal agencies are increasing in frequency and 

severity. Effective public-private coordination continues to be required to address the cyber 

threat against the Nation’s critical infrastructure. In this regard, Treasury is looked upon to

provide effective leadership to financial institutions in particular, and the financial sector in 

general, to strengthen awareness and preparedness against cyber threats. 

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

The Digital Accountability and Transparency Act of 2014 (DATA Act) requires the Federal 

Government to provide consistent, reliable, and useful online data about how it spends taxpayer 

dollars. 

To fulfill its purpose, the DATA Act imposed certain requirements on the Treasury Secretary, 

the Director of the Office of Management and Budget (OMB), the Inspectors General of each 

Federal agency, and the Comptroller General of the United States. In brief, the DATA Act 

required Treasury and OMB to (1) establish Government-wide financial data standards for 

reporting spending by Federal agencies and entities receiving Federal funds by May 2015; (2) by 

May 2017, ensure this financial data is accurately posted and displayed on USASpending.gov, or 

a successor system; and (3) by May 2018, ensure the data standards established are applied to the 

data made available on the website. Implementing the DATA Act is a complex undertaking 

requiring a significant level of interagency coordination and cooperation to develop, establish,

and apply new financial data standards and to develop new data handling methodologies within a 

short timeframe.

In light of the continuing problem with improper payments (estimated at $136.77 billion, or 4.8 

percent of all program outlays, for fiscal year 2015), the Federal Government has intensified 
OIG - 9

efforts to reduce improper payments in major Federal programs. The Do Not Pay Initiative, and 

the Treasury Bureau of the Fiscal Service’s (Fiscal Service) Do Not Pay Business Center, are 

chief components of efforts designed to prevent and detect improper payments to individuals and 

entities. With its potential to reduce improper payments, the Do Not Pay Program is a major and 

important undertaking by Fiscal Service and Treasury.

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

Preventing criminals and terrorists from using financial networks to sustain their operations 

and/or launch attacks against the U.S. continues to be a challenge. Treasury’s Office of 

Terrorism and Financial Intelligence (TFI) is dedicated to disrupting the ability of terrorist 

organizations to fund their operations. TFI brings together intelligence gathering and analysis, 

economic sanctions, international cooperation, and private-sector cooperation to identify donors, 

financiers, and facilitators supporting terrorist organizations, and disrupt their ability to fund 

such organizations. Enhancing the transparency of the financial system is one of the cornerstones 

of this effort. Treasury carries out its responsibilities to enhance financial transparency through 

the laws collectively known as the Bank Secrecy Act (BSA). The Financial Crimes Enforcement 

Network is the Treasury bureau responsible for administering BSA, while the Office of the 

Comptroller of the Currency has oversight responsibility for the BSA/AML programs for 

Nationally Chartered Banks, and Treasury’s Office of Foreign Assets Control administers U.S. 

foreign sanction programs. Given the criticality of this challenge to the Department’s mission, 

and notwithstanding the efforts described above, we continue to consider anti-money laundering 

and combating terrorist financing programs and operations as inherently high-risk.

Management of Treasury’s Authorities Intended to Support and Improve the Economy 

Congress provided Treasury with broad authorities to address the financial crisis under the 

Housing and Economic Recovery Act (HERA) and the Emergency Economic Stabilization Act 

enacted in 2008, the American Recovery and Reinvestment Act of 2009 (Recovery Act), and the 

Small Business Jobs Act of 2010. In response to the call for further financial reform, Congress 

passed Dodd-Frank in July 2010. To address the more specific economic and environmental 

damage caused by the Deepwater Horizon oil spill in the Gulf Coast, Treasury was given 

authority to administer the Gulf Coast Restoration Trust Fund established by the Resources and 

Ecosystems Sustainability, Tourist Opportunities, and Revived Economies of the Gulf Coast 

States Act. While Treasury’s program administration under these acts has, for the most part 

matured, challenges remain in managing these programs and their investments. 

This challenge focuses on the administration of the following broad authorities given to 

Treasury:

• Dodd-Frank established the Financial Stability Oversight Council (FSOC), which is chaired 

by the Treasury Secretary. FSOC’s mission is to identify risks to financial stability that 

could arise from the activities of large, interconnected financial companies; promote market 

discipline; and respond to any emerging threats to the financial system. 

• The Small Business Jobs Act of 2010 created the Small Business Lending Fund (SBLF) 

within Treasury through which $4 billion was invested in financial institutions intended to

increase the availability of credit to small businesses. 

• The Small Business Jobs Act also provided Treasury with authority to guarantee bonds

issued for eligible community and economic development activities. As the program 

administrator, Treasury’s Community Development Financial Institutions (CDFI) Fund 
OIG - 10

experienced challenges in standing up the program, which was eventually established in June 

2013. CDFI Fund oversees the issuance of the bonds and the use of the bond proceeds by 

eligible CDFIs to make financing more accessible in underserved communities.

• Under the HERA, Treasury supports the financial solvency of the Federal National Mortgage 

Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac) 

which are under the conservatorship of the Federal Housing Finance Agency. To maintain 

the positive net worth of these two government sponsored enterprises (GSE), Treasury has 

invested approximately $187 billion in senior preferred stock in the two enterprises. While 

the GSEs have not required additional support since fiscal year 2012, their futures remain 

uncertain and further assistance may be required. If such support is needed, the current 

funding capacity available to Fannie Mae is $117.6 billion and available to Freddie Mac is 

$140.5 billion

• The American Recovery and Reinvestment Act of 2009 (Recovery Act) provided Treasury 

with approximately $30 billion in non-Internal Revenue Service funding for low-income 

housing and specified energy properties for which OIG provides oversight. The level of risk 

involved in this program is evidenced by the fact that the Office of Investigations has 

successfully investigated several matters leading to prosecution and has several additional 

open matters involving program participants.

• In response to the 2010 Deepwater Horizon oil spill, Congress enacted the RESTORE Act. 

This law established within Treasury the Gulf Coast Restoration Trust Fund (Trust Fund) and 

requires Treasury to deposit into the Trust Fund 80 percent of administrative and civil 

penalties paid by responsible parties pursuant to the Federal Water Pollution Control Act 

(Clean Water Act). The funds are to be distributed for environmental and economic 

restoration activities affecting the Gulf Coast States (Alabama, Florida, Louisiana, 

Mississippi, and Texas). As of December 2016, the Trust Fund received approximately 

$947 million from the Federal Government’s settlement with the Transocean and Anadarko

defendants as well as interest payments. In July 2015, BP Exploration & Production Inc. ,

agreed to settle with the Federal Government and the Gulf Coast States resulting in 

approximately $4.4 billion plus interest expected to be deposited into the Trust Fund over a 

15-year period. Going forward it is expected that demands for technical assistance from the 

Office of Gulf Coast Restoration will increase now that several Direct Component Multiyear 

Implementation Plans have been accepted by Treasury and a number of Direct Component 

planning assistance and construction greants have been awarded. 

In the Investigations operational area, OIG has established four priorities for FY 2017:

Criminal and Serious Employee Misconduct

The OIG Office of Investigation’s highest priority is investigating complaints involving alleged 

criminal and other serious misconduct by Treasury employees. OIG investigates allegations of 

the general crimes enumerated in Title 18 of the U.S. Code, other federal crimes, alleged 

violations of the Ethics in Government Act, and allegations of serious misconduct prohibited by 

the Standards of Ethical Conduct for Employees of the Executive Branch. Several Treasury 

bureaus and offices have additional rules and regulations relating to ethical standards for their 

own employees, and OIG also investigates complaints of alleged violations of these rules and 

regulations.
OIG - 11

Fraud Involving Contracts, Grants, Guarantees, and Funds

The OIG Office of Investigations conducts investigations into allegations of fraud and other 

crimes involving Treasury contracts, grants, loan guarantees, and federal funds, including 

investigations made in accordance with Sections 1602 and 1603 of the Recovery Act. Such 

allegations often involve contractors, entities, and individuals who are providing or seeking to 

provide goods or services to the Department. The Office of Investigations receives complaints 

alleging criminal or other misconduct from employees, contractors, members of the public, and 

the Congress.

Financial Programs and Operations Crime

Investigations relating to Treasury financial programs and operations that involve Tresaury 

bureaus issuing licenses, providing benefits, and exercising oversight of U.S. financial 

institutions; frauds involving improper Federal payments such as those involving stolen, 

counterfeit, altered or fraudulently obtained Treasury checks and ACH payments; frauds 

involving improper Federal payments such as those involving Treasury checks and the Check 

Forgery Insurance Fund; crimes involving the improperly-redirected benefits of federal 

government payees; and false claims of any kind that generate inappropriate Federal payments, 

including federal income tax refunds, Social Security benefits, and Veterans’ Administration 

payments. These problems, particularly the production of counterfeit and altered Treasury 

checks, have significantly increased in the last few years. These matters require prompt attention 

to protect the public and the integrity of the department.

Threats Against Treasury Employees and Facilities

Investigative efforts into threats against Treasury employees and facilities are critical in ensuring 

safety for the Department. These matters require prompt attention and coordination with federal, 

state, and local authorities in order to protect those involved.

Treasury Employee and Bureau Impersonation Scams

Investigations relating to scammers who represent themselves as Treasury employees in order to 

defraud the citizens of the U.S. and other countries by the impersonation of Treasury employees 

and/or the fraudulent use of the Treasury and Bureau seals. This is a problem that has 

significantly increased in the last few years. These matters require prompt attention to protect 

the public and the integrity of the Department.
OIG - 12

B – Budget and Performance by Budget Activity

2.1.1 Audit Resources and Measures

Dollars in Thousands

 Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Annualized 

CR Request

Column1 Column32 Column4 Column5 Column6 Column7 Column8 Column9

Appropriated Resources $22,327 $21,801 $24,947 $27,653 $26,014 $27,219 $26,266 

Other Resources 

(Reimbursables) $10,870 $8,671 $8,525 $7,299 $6,726 $10,500 $10,000 

Budget Activity Total $33,197 $30,472 $33,472 $34,952 $32,740 $37,719 $36,266 

FTE 136 139 135 133 137 151 132

Note: FY 2016 Appropriated Resources are Actual

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target

FY 2016

Trend

Number of Completed 

Audit Products

91 72 75 86 98 77 86 74

Percent of Statutory Audits 

Completed by the 

Required Date

100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0

Key: DISC - Discontinued, B - Baseline

Audit Budget and Performance

($26,266,000 from direct appropriations, and $10,000,000 from reimbursable resources):

The Office of Audit conducts audits intended to ensure the accountability of resources, protect 

information, and provide recommendations for improving the integrity, economy, efficiency, 

effectiveness, and integrity of programs and operations under its jurisdiction, which include 

those of Treasury and the Gulf Coast Ecosystem Restoration Council. The requested funding for 

FY 2018 is necessary to perform mandated work and maintain an appropriate level of oversight 

of these programs and operations consistent with the OIG’s responsibilities under the Inspector 

General Act of 1978. In FY 2018, OIG will also continue to provide oversight of Treasury’s 

government-wide role and responsibilities under the DATA Act. Reimbursable funding 

agreements support financial audits of Treasury and oversight of SBLF. The SBLF program 

oversight and expected performance is detailed in the SBLF Program Office budget submission.

Description of Performance:

The Office plans to complete 86 audit products in FY 2017, and 74 in FY 2018. The reduced 

number of audit products in FY 2018 is the result of a significant rent increase in FY 2018 that 

will consume resources that would otherwise be used to fully staff the Office of Audit. In FY

2016, the Office of Audit completed 98 audit products, exceeding the target by 21, and met all 

statutory audit timelines. Audit products include audit reports, evaluation reports, the Inspector 

General’s Semi-Annual Reports to the Congress, and the Inspector General’s annual memoranda 

to the Secretary of the Treasury and the Secretary of Agriculture, as the designated Chairperson 

of the Gulf Coast Ecosystem Restoration Council, on the most significant management and 

performance challenges facing the Department and Gulf Coast Ecosystem Restoration Council, 

respectively. Audit products can also include responses to specific information requests by the 

Congress. By completing independent and timely assessments of programs and operations under 
OIG - 13

its jurisdiction, the Office supports the OIG’s mission of promoting efficiency, effectiveness, and 

integrity of those programs and operations. The recommendations for improvement in programs 

and operations noted through OIG’s assessments directly support the Treasury Department in 

achieving its strategic goals and the Gulf Coast Ecosystem Restoration Council in meeting its 

mission. 

The OIG has a mature audit operation that uses historical performance to estimate future 

performance. It has, over time, demonstrated agility at redirecting resources as necessary to 

address new challenges and mandates of its stakeholders.

In keeping with the OIG’s strategy to maintain a highly skilled and motivated workforce, the 

OIG plans and executes a meaningful body of work designed to help ensure the integrity and 

effectiveness of programs and operations across its jurisdiction while looking for opportunities to 

improve them.

2.1.2 Investigations Resources and Measures

Dollars in Thousands

 Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Annualized 

CR Request

Column1 Column2 Column3 Column4 Column5 Column6 Column7 Column8 Column9

Appropriated 

Resources $5,582 $5,451 $6,237 $6,913 $6,504 $8,130 $7,846 

Other Resources 0 0 0 0 0 0 0

Budget Activity 

Total $5,582 $5,451 $6,237 $6,913 $6,504 $8,130 $7,846 

FTE 34 35 34 33 33 43 43

Note: FY 2016 Appropriated Resources are Actual

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target

FY 2016

Trend

Percentage (%) of All 

Cases Closed During 

Fiscal Year that were 

Referred for Criminal/Civil 

Prosecution or Treasury 

Administrative Action

91.0 84.0 84.0 87.0 84.0 80.0 80.0 80.0

Key: DISC - Discontinued, B - Baseline

Investigations Budget and Performance 

($7,846,000 from direct appropriations, and none from reimbursable resources): 

The Office of Investigations prevents, detects, and investigates complaints of fraud, waste, and 

abuse impacting Treasury programs and operations. This includes the detection and prevention 

or deterrence of employee misconduct and fraud, or related financial crimes within or directed 

against Treasury. The Office of Investigations refers its cases to the Department of Justice, state 

or local prosecutors for criminal prosecution or civil litigation, or to agency officials for 

corrective administrative action. 

With the increased risk of the Recovery Act grant programs for low-income housing and specific 

energy properties, the Office of Investigations faces greater challenges and anticipated increases 

in grant fraud. In addition, with the establishment of Gulf Coast Restoration Trust Fund outreach 
OIG - 14

efforts are being made in an effort to prepare for future investigative referrals and complaints 

aimed at suspected fraud involving the funds with this program.

In addition to the grant programs listed above, the Office of Investigations has seen a noted 

increase in fraud impacting other significant Treasury programs and operations including fraud 

impacting the myRA program, Treasury Direct program and the Treasury payment processing 

service operated by the Bureau of Fiscal Service. The Office of Investigations has seen 

substantial increases in improper payment fraud including redirected benefit fraud and stolen, 

altered and counterfeit Treasury checks and payments.

Additionally, the Office of Investigations remains committed to investigating benefit, improper 

payment and other monetary fraud associated with the programs and operations of the Treasury 

Department. 

Description of Performance:

In FY 2016 the Office of Investigations exceeded the Investigative Performance Measure target

(Target – 80 percent; Actual – 84 percent), and opened 144 new investigations and closed 72

investigations. The OIG also referred 43 investigations that substantiated administrative 

violations against a Treasury employee to the appropriate regulated bureau for action. In 

addition, the OIG referred 159 investigations for criminal prosecution and 46 investigations for 

civil prosecution. The Investigative Performance Measure is a percentage of all cases closed by 

Office of Investigations during the fiscal year referred to Department Bureaus for administrative 

action or for criminal or civil prosecution by Federal or local prosecutors. The goal for Office of 

Investigations is that at least 80 percent of closed cases meet the aforementioned criteria of 

closed cases in this fiscal year. Meeting or exceeding this goal demonstrates that Office of 

Investigations is responsive to allegations and complaints referred to Office of Investigations and 

that when these referrals require investigation, the cases are timely, thoroughly and accurately 

reported to assist the Department in maintaining the integrity of its programs and operations, 

subsequently ferreting out fraud, waste, and abuse. The Office is working to meet or exceed this 

measure in both FY 2017 and FY 2018.

Section III – Additional Information

A – Summary of Capital Investments

OIG has no capital investments. Capital investments that support OIG are included in the 

Departmental Offices plan

A summary of capital investment resources, including major information technology and nontechnology investments can be found at:

http://www.treasury.gov/about/budget-performance/Pages/summary-of-capital-investments.aspx

This website also contains a digital copy of this document.

Office of the Special Inspector 

General for TARP

(SIGTARP)

Congressional Justification 

for Appropriations and 

Annual Performance 

Report and Plan

FY 2018 
SIGTARP - 2

Table of Contents

Section I – Budget Request........................................................................................................... 3

A – Mission Statement................................................................................................................ 3

B – Summary of the Request ...................................................................................................... 3

1.1 – Appropriations Detail Table.........................................................................................................4

Note: FY 2016 Appropriated Resources are Actual .............................................................................4

1.2 – Budget Adjustments Table...........................................................................................................4

C – Budget Increases and Decreases Description....................................................................... 4

1.3 – Operating Levels Table................................................................................................................7

D – Appropriations Language and Explanation of Changes ...................................................... 8

E – Legislative Proposals.......................................................................................................... 8

Section II – Annual Performance Plan and Report................................................................... 9

A – Strategic Alignment ............................................................................................................. 9

B – Budget and Performance by Budget Activity ...................................................................... 9

2.1.1 – Investigations Resources and Measures....................................................................................9

Investigations Budget and Performance ................................................................................... 10

2.1.2 – Audit Resources and Measures...............................................................................................10

Audit Budget and Performance................................................................................................. 10

Section III – Additional Information ........................................................................................ 11

A – Summary of Capital Investments....................................................................................... 11

Comments of the Honorable Christy Goldsmith Romero....................................................... 11
SIGTARP - 3

Section I – Budget Request

A – Mission Statement: 

The Office of the Special Inspector General for the Troubled Asset Relief Program (SIGTARP) 

is a federal law enforcement agency and is an independent watchdog protecting taxpayer dollars

that fund TARP. 

B – Summary of the Request 

The FY 2018 Budget proposes $20,297,000, which is 50 percent below the FY 2017 Annualized 

CR level.

1

 Treasury has committed $38 billion for TARP housing programs, of which more than 

$8 billion remains outstanding for payments scheduled to occur through FY 2023.2 Currently, 

TARP spending is approximately $1 billion per quarter. Of the amount proposed, 81 percent is 

for investigations and 19 percent is for audits.

SIGTARP’s criminal investigations of TARP recipients counter threats to public safety and 

Government interests, including public corruption, antitrust (unfair competition), contract fraud, 

financial institution fraud, and mortgage fraud. SIGTARP’s audits identify costly waste, abuse, 

risk of fraud, and inefficiency. SIGTARP has ongoing criminal investigations into TARP 

recipients, and ongoing audits requested by members of Congress. Under TARP’s Hardest Hit 

Fund, which was scheduled to end in FY 2018, but was extended and expanded by $2 billion in 

the Consolidated Appropriations Act, 2016 (P.L. 114-113), recipients of TARP dollars include 

19 state housing finance agencies, 38 cities/counties, 147 individuals, eight for-profit companies, 

158 non-profits, 39 land banks, hundreds of demolition contractors, homebuyers, and 

homeowners. Separately, recipients of TARP dollars through the Making Home Affordable 

Program include Ocwen Loan Servicing, Wells Fargo Bank, JPMorgan Chase Bank, Bank of 

America, Nationstar Mortgage, Select Portfolio Servicing, CitiMortgage, and more than 130 

other mortgage servicers.

SIGTARP’s investigations have recovered $10 billion, which translates to a 40-times return on 

investment from its annual appropriations through FY 2016.

3

 This is in addition to $2 billion in 

cost-saving audit recommendations, including $161 million in savings that will be realized from 

implemented recommendations this year. For the last three fiscal years, recoveries to the 

Government exceeded SIGTARP’s budget proposal and offset taxpayer losses. SIGTARP has 

developed a deep expertise in identifying crime in TARP, with 394 defendants criminally 

charged, nearly 100 of which were charged in FY 2016-2017. SIGTARP investigations have 

also resulted in significant Department of Justice enforcement actions against TARP recipients 

Bank of America, JPMorgan Chase Bank, Goldman Sachs, Morgan Stanley, Ally Financial, 

SunTrust Bank, Fifth Third Bank, and General Motors. SIGTARP audits in FY 2016-2017 

identified costly waste, abuse, and risk of criminal behavior in ongoing TARP programs.

 1 Including $200,000 for training and $40,000 to the Council of the Inspectors General on Integrity and Efficiency. 2 Of this amount, $7.01 billion is obligated to be paid and $3.93 billion committed in the Making Home Affordable 

Program and $3.2 billion is obligated to be paid in the Hardest Hit Fund program.

3 Includes fines, restitution, forfeiture, and full homeowner relief by a large financial institution.
SIGTARP - 4

1.1 – Appropriations Detail Table

Dollars in Thousands

Note: FY 2016 Appropriated Resources are Actual

1.2 – Budget Adjustments Table

Dollars in Thousands

Special Inspector General for TARP FTE Amount

FY 2017 Annualized CR 184 $40,594 

Changes to Base:

Maintaining Current Levels (MCLs): $809 

Pay raise 465 

Pay annualization 170 

Non-pay 174 

Program Reductions (92) ($21,106)

Technical FTE Adjustment (92) (14,600)

Reduce Support Services (6,506)

Subtotal Changes to Base (92) ($20,297)

Total FY 2018 Base 92 $20,297 

Total FY 2018 Request 92 $20,297 

C – Budget Increases and Decreases Description

Maintaining Current Levels (MCLs) .........................................................+$809,000 / +0 FTE

Pay Raise +$465,000 / +0 FTE 

Funds are requested for the proposed January 2018 pay-raise.

Pay Annualization +$170,000 / +0 FTE 

Funds are requested for annualization of the January 2017 pay-raise.

Non-Pay +$174,000 / +0 FTE 

Funds are requested for non-labor expenses such as travel, contracts, rent, contracts, supplies, 

and equipment.

Program Decreases ..................................................................................-$21,106,000 / -92 FTE

Special Inspector General for TARP

Appropriated Resources

FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

New Appropriated Resources

Investigations 101 31,801 136 32,069 73 16,441 (63) (15,628) -46.32% -48.73%

Audit 34 8,870 48 8,525 19 3,856 (29) (4,669) -60.42% -54.77%

Subtotal New Appropriated Resources 135 $40,671 184 $40,594 92 $20,297 (92) $(20,297) -50.00% -50.00%

Other Resources

Unobligated Balances from Prior Years 0 0 0 4,000 0 11,090 0 7,090 N/A 177.25%

Resources from Other Accounts 2 475 8 1,548 8 1,613 0 65 N/A 4.20%

Subtotal Other Resources 2 $475 8 $5,548 8 $12,703 0 $ 7,155 N/A 128.97%

Total Budgetary Resources 137 $41,146 192 $46,142 100 $33,000 (92) $(13,142) -47.92% -28.48%

FY 2016 FY 2017 FY 2018 FY 2017 to FY 2018

Enacted Annualized CR Request Change % Change
SIGTARP - 5

Technical FTE Adjustment -$14,600,000 / -92 FTE

The technical FTE adjustment reduces the appropriated FTE level.

Reduce Support Services -$6,506,000 / -0 FTE

SIGTARP will also seek to reduce non-personnel costs.

Quantifiable Results: SIGTARP’s Return on Investment & Government Cost Savings

With $10 billion in recoveries from SIGTARP investigations (nearly $9 billion of which was 

recovered last year), SIGTARP has a 40 times return on investment compared to its annual 

appropriations through FY 2016.

4 In FY 2017, SIGTARP’s investigation in one case alone 

already resulted in the Government recovering $52 million, which is more than the $41 million 

FY 2017 Annualized CR level. Recoveries from SIGTARP’s investigations can be used for 

other Government spending or to reduce the federal budget deficit. Government recoveries 

resulting from SIGTARP investigations help offset losses that taxpayers suffered on certain 

TARP investments. SIGTARP auditors save the Government money, and have identified $2 

billion in cost savings. SIGTARP is currently auditing how 19 state housing finance agencies 

spent nearly $700 million. In September 2016, SIGTARP caught and exposed $8.2 million in 

waste by a Nevada state agency contractor who spent federal dollars earmarked for homeowners 

on parties, a cocktail bar, employee gifts, a Mercedes Benz for the CEO, and more. SIGTARP 

also achieves additional Government cost savings by deterring fraud and waste. SIGTARP’s 

exposure of waste in Nevada, and our publicly-announced audit, serve to deter waste and fraud 

for the approximately $30 million per quarter that Treasury pays to state housing finance 

agencies for their expenses in administering TARP.

Countering Threats to Public Safety & Government Interests

SIGTARP brings accountability through law enforcement, as Congress authorized SIGTARP 

with the power to arrest. With concurrent responsibility with the Federal Bureau of Investigation

(FBI) over TARP-related crime, SIGTARP saves FBI resources. SIGTARP counters threats to 

public safety and Government interests by investigating criminal actors, and neutralizing the 

threat they pose. With more than 200 people sentenced to prison, at an average of a nearly fiveyear prison sentence, the threat these crimes pose is significant.

not of an agency but a program: 

Public corruption: State and local officials award contracts under various HFA blight elimination

programs using TARP dollars. The corruption of local officials threatens public safety. 

Antitrust violations: Unfair competitive practices for demolition contracts, like bid rigging and 

contract steering, threatens the quality of work, harming public safety, and threatens competition, 

harming the Government’s interests.

Contract fraud: Fraud in charges for demolition, expenses by state housing finance agencies, or

by HAMP servicers harms Government interests. 

Financial institution fraud: SIGTARP investigates fraud in current TARP banks and banks 

where taxpayers suffered a loss in TARP. Our record reflects 96 bankers charged with a crime, 

including 75 who have already been convicted while others await trial. A recent SIGTARP 

 4 Includes fines, restitution, forfeiture, and full homeowner relief by a large financial institution.
SIGTARP - 6

investigation into a bank still in TARP resulted in the Department of Justice (DOJ) indicting the 

former bank CEO for allegedly orchestrating a money laundering scheme for international 

narcotics trafficking involving a drug cartel. Charges are not evidence of guilt and trial is 

scheduled for FY 2018. In FY 2017, a jury found the CEO of a failed TARP bank guilty of bank 

fraud and the vice president pled guilty. When the bank failed, taxpayers lost $7.5 million in 

TARP. Also in FY 2017, DOJ criminally charged a senior officer of another failed TARP bank 

with deceiving regulators about bank losses. Taxpayers lost $30 million in TARP when that

bank failed.5

 

Mortgage fraud: Mortgage fraud cases typically involve false representations to homeowners 

and/or Treasury. We are prioritizing investigations of mortgage servicers.

Proactive Investigative Efforts to Speed Up the Identification of Crime

With TARP currently spending $1 billion each quarter, SIGTARP is mining data to find crime 

quickly, including in the HFA blight elimination programs. SIGTARP looks for anomalies that, 

when paired with red flags identified in its ongoing investigations, speed up investigative efforts 

to identify persons of interest and potential corruption, antitrust violations, and fraud.

 5 Criminal charges contain an allegation that a defendant committed a crime. Every defendant is presumed innocent 

until and unless proven guilty.
SIGTARP - 7

1.3 – Operating Levels Table

Dollars in Thousands

Note: This table includes total annually appropriated funding (actuals for FY 2016, FY 2017 Annualized CR and FY 2018).

Special Inspector General for TARP FY 2016 FY 2017 FY 2018

Object Classification Actual Annualize

d CR Request

11.1 - Full-time permanent 15,408 21,788 11,761

11.3 - Other than full-time permanent 1,526 1,799 942

11.5 - Other personnel compensation 1,646 2,120 1,207

11.9 - Total personnel compensation 18,580 25,707 13,910

12.0 - Personnel benefits 6,013 8,184 4,790

Total Personnel and Compensation Benefits $24,593 $33,891 $18,700

21.0 - Travel and transportation of persons 838 1,000 1,000

23.2 - Rental payments to others 262 272 330

23.3 - Communication, utilities, and misc charges 93 103 87

24.0 - Printing and reproduction 201 162 0

25.1 - Advisory and assistance services 2,726 2,676 1,391

25.2 - Other services from non-Federal sources 130 68 121

25.3 - Other goods and services from Federal sources 10,796 7,044 10,534

25.6 - Medical care 100 100 100

25.7 - Operation and maintenance of equipment 50 48 43

26.0 - Supplies and materials 472 448 347

31.0 - Equipment 276 260 277

42.0 - Insurance claims and indemnities 34 60 60

91.0 - Unvouchered 0 10 10

Total Non-Personnel $15,978 $12,251 $14,300

Total Budgetary Resources $40,571 $46,142 $33,000

FTE 135 184 92
SIGTARP - 8

D – Appropriations Language and Explanation of Changes

Appropriations Language Explanation of Changes

DEPARTMENT OF THE TREASURY

SPECIAL INSPECTOR GENERAL FOR THE TROUBLED

ASSET RELIEF PROGRAM

Federal funds

SALARIES AND EXPENSES

For necessary expenses of the Office of the Special Inspector 

General in carrying out the provisions of the Emergency 

Economic Stabilization Act of 2008 (Public Law 110–343),

$20,297,000.

Note.—A full-year 2017 appropriation for this account was not 

enacted at the time the budget was prepared; therefore, the budget 

assumes this account is operating under the Further Continuing 

Appropriations Act, 2017 (P.L. 114–254). The amounts included 

for 2017 reflect the annualized level provided by the continuing 

resolution.

E – Legislative Proposals

PPIP Funds

The Public-Private Investment Program (PPIP) Improvement and Oversight Act of 2009 (12 

U.S.C. § 5231a) provided $15 million in no-year appropriations to SIGTARP for the purpose of 

providing oversight to PPIP and the Term Asset-Backed Securities Loan Facility. As both 

programs have closed, SIGTARP is currently using these funds to support limited investigative 

activities where taxpayers suffered a loss in PPIP. SIGTARP is requesting that these PPIP funds 

be made available to also support SIGTARP’s oversight of ongoing TARP programs. 

PROPOSED LANGUAGE

Sec. 128 Notwithstanding paragraph (2) of section 402(c) of the Helping Families Save their 

Homes Act of 2009, in utilizing funds made available by paragraph (1) of section 402(c) of such 

Act, the Special Inspector General for the Troubled Asset Relief Program shall prioritize the 

performance of audits or investigations of any program that is funded in whole or in part by 

funds appropriated under the Emergency Economic Stabilization Act of 2008, to the extent that 

such priority is consistent with other aspects of the mission of the Special Inspector General.
SIGTARP - 9

Section II – Annual Performance Plan and Report

A – Strategic Alignment

The Investigations budget activity supports SIGTARP’s priority of law enforcement of crimes 

related to TARP. The Audit budget activity supports SIGTARP’s priority of being an 

independent watchdog over TARP dollars. Both activities support and complement Treasury’s 

efforts to safeguard and protect the integrity of the financial system. SIGTARP coordinates with 

other law enforcement agencies, leveraging its unique position and expertise by forming law 

enforcement partnerships. 

The FY 2018-2022 Strategic Plan is currently under development. The Annual Performance Plan 

will be updated in the FY 2019 Budget to reflect the new priorities.

B – Budget and Performance by Budget Activity

2.1.1 – Investigations Resources and Measures

Dollars in Thousands

Note: FY 2016 Appropriated Resources are Actual

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target FY 2016

Trend

Percentage of Cases 

Accepted for Consideration 

by Civil or Criminal 

Authorities Resulting in a 

Positive Final Outcome

N/A N/A N/A N/A 77.0 60.0 70.0 70.0 N/A

Percentage of Cases 

Presented to Civil or 

Criminal Authorities within 

Eight Months of the Case 

Being Opened

N/A N/A N/A N/A 80.0 70.0 70.0 50.0 N/A

Percentage of Cases That 

are Joint Agency/Task 

Force Investigations

65.0 79.0 75.5 69.65 71.0 70.0 70.0 50.0

Percentage of Preliminary 

Investigations Converted to 

Full Investigations within 

180 Days

77.0 82.0 95.75 100.0 99.0 80.0 80.0 60.0

Key: DISC - Discontinued; B - Baseline

 Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Annualized 

CR Request

Appropriated Resources $25,618 $29,230 $27,382 $27,295 $32,478 $32,069 $16,441

Other Resources 920 1,516 5,656 6,354 376 4,701 10,289

Budget Activity Total $26,538 $30,746 $33,038 $33,649 $32,854 $36,770 $26,730

FTE 102 110 119 115 103 144 81
SIGTARP - 10

Investigations Budget and Performance

($16,441,000 from direct appropriations)

SIGTARP exceeded all metrics in FY 2016. The “Percentage of Cases Accepted for 

Consideration by Civil or Criminal Authorities Resulting in a Positive Final Outcome” in 

FY 2016 was 77 percent, exceeding the target of 60 percent. During FY 2016, the “Percentage 

of Cases Presented to Civil or Criminal Authorities within Eight Months of the Case Being 

Opened,” was 80 percent, exceeding the target of 70 percent. In FY 2016, the “Percentage of 

Cases That are Joint Agency/Task Force Investigations” with other law enforcement agencies 

was 71 percent. In FY 2016, “Percentage of Preliminary Investigations Converted to Full 

Investigations within 180 days” was 99 percent, exceeding the target of 80 percent. 

2.1.2 – Audit Resources and Measures

Dollars in Thousands

Note: FY 2016 Appropriated Resources are Actual

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target FY 2016

Trend

Number of Completed 

Audit Products including 

Referral to Investigations 

Division (Units)

N/A N/A N/A N/A 11 7 7 3 N/A

Percentage of 

Congressional Inquiries 

Responded to within 45 

Days of Receipt

N/A N/A N/A 85.0 100.0 85.0 85.0 85.0

Key: DISC - Discontinued; B - Baseline

Audit Budget and Performance

($3,856,000 from direct appropriations)

SIGTARP exceeded its performance measure “Number of Completed Audit Products including 

Referrals to Investigations Division” of seven in FY 2016, with 11 products. SIGTARP 

exceeded its 85 percent goal of “Percentage of Congressional Inquiries Responded to within 45 

Days of Receipt,” at 100 percent.

 Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Annualized 

CR Request

Appropriated Resources $13,789 $10,376 $7,219 $6,824 $7,618 $8,525 $3,856

Other Resources 1,947 1,069 99 847 2,414

Budget Activity Total $13,789 $10,376 $9,166 $7,893 $7,717 $9,372 $6,270

FTE 60 57 45 35 34 48 19
SIGTARP - 11

Section III – Additional Information

A – Summary of Capital Investments

SIGTARP has limited non-major IT investments that allow for routine updates, modifications, 

maintenance, and equipment refreshment of its existing systems. 

A summary of capital investment resources can be found at:

http://www.treasury.gov/about/budget-performance/Pages/summary-of-capital-investments.aspx

This website also contains a digital copy of this document.

Comments of the Honorable Christy Goldsmith Romero 

Special Inspector General Troubled Asset Relief Program

on the FY 2018 Proposed Funding Level

Under the provisions of section 6(f)(3)(E) of the Inspector General Act of 1978, as amended, as 

applied through the Emergency Economic Stabilization Act of 2008, the Special Inspector 

General has provided the following comments regarding FY 2018 proposed funding:

The FY 2018 budget request substantially inhibits the Office of the Special Inspector General 

(OIG) for TARP from performing the duties of the office, including audits and criminal 

investigations. The proposed funding represents a 50% reduction ($20 million) from the FY 

2017Annualized CR level enacted by the Congress, despite the Federal Government’s 

continued ownership or control of troubled assets in TARP housing programs that are $38 

billion in size – the same size as last year. This year alone (FY 2018), Treasury will spend $4 

billion in TARP. This spending is in two programs: (1) the recently expanded and extended 

Housing Finance Agency Innovation Fund for the Hardest Hit Housing Markets (Hardest Hit 

Fund or HHF); and (2) TARP’s Making Home Affordable Program (MHA), which has spent 

just over half (60%) of obligated/committed TARP dollars. 

In the Consolidated Appropriations Act of 2016, the Congress authorized an extension and 

an additional $2 billion in the Hardest Hit Fund. With that authorization, Treasury extended 

the spending of Federal dollars in HHF from FY 2018 to FY 2022. There are $3.2 billion in 

unspent Federal dollars in HHF. Recipients of these Federal TARP dollars are 19 state 

agencies, 38 cities/counties, 147 individuals, 8 for-profit companies, 158 non-profits, 39 land 

banks, hundreds of demolition contractors and subcontractors (including asbestos,

inspection and removal, waste disposal, fill dirt, grading, greening, site inspection, 

maintenance), homebuyers, and homeowners. 

The OIG’s investigations and audits have revealed risks of criminal behavior, fraud, waste, 

and abuse in the Hardest Hit Fund program. The OIG’s FY 2016 audit revealed that the 

HHF blight demolition program is significantly vulnerable to the substantial risk of unfair 

competitive practices, including favoritism, undue influence, contract steering, bid-rigging, 

and other closed-door contracting processes, as well as fraudulent overcharging. Only two 

of 20 recommendations in that audit have been implemented. Other FY 2016 audits revealed 
SIGTARP - 12

abuse related to evicting people out of their homes to qualify for TARP-funded demolition, 

and $8.2 million in waste of TARP dollars by a state agency contractor. 

Additionally, in the Consolidated Appropriations Act of 2016, the Congress terminated MHA, 

but exempted homeowners who applied before December 31, 2016. Just over half (60%) of 

these federal dollars have been paid to Ocwen, Wells Fargo, JPMorgan Chase, Bank of 

America, Nationstar, SPS, CitiMortgage, and more than 130 mortgage servicers, investors 

and homeowners. Treasury is obligated or committed to pay a remaining $10.94 billion 

through FY 2023. Program participation has remained steady at about one million 

homeowners in FY 2015, FY 2016 and FY 2017. The OIG’s investigations with the Justice 

Department, and audits, have revealed a track record of violations of TARP rules and the 

law by some servicers in MHA and warned of risk of fraud, waste, and abuse to the Federal 

Government and homeowners. 

The OIG has a significant number of ongoing criminal investigations of recipients of Federal 

dollars in TARP, in addition to audits of TARP recipients. The proposed budget effectively 

removes the resources necessary for the OIG to: (1) identify costly waste and abuse, as well 

as cost savings through ongoing and future audits, and (2) conduct ongoing and future 

criminal investigations that (a) counter threats, including public corruption, antitrust (unfair 

competition), contract fraud, financial institution fraud, and mortgage fraud, and (b) lead to 

indictments, convictions, prison sentences, and recoveries. This places critical Federal 

Government interests at risk, and substantially inhibits the OIG in carrying out its duties and 

responsibilities.

Department of the Treasury 

Treasury Inspector General for 

Tax Administration 

Congressional Justification 

for Appropriations and Annual 

Performance Report and Plan 

FY 2018
TIGTA - 2 

Table of Contents

Section I – Budget Request........................................................................................................... 3

A – Mission Statement ................................................................................................................ 3

B – Summary of the Request ...................................................................................................... 3

1.1 – Appropriations Detail Table .............................................................................................. 4

1.2 – Budget Adjustments Table ................................................................................................. 4

C – Budget Increases and Decreases Description ....................................................................... 5

1.3 – Operating Levels Table ...................................................................................................... 6

D – Appropriations Language and Explanation of Changes ...................................................... 7

E – Legislative Proposals ............................................................................................................ 7

Section II – Annual Performance Report and Plan ................................................................... 8

A – Strategic Alignment ............................................................................................................. 8

B – Budget and Performance by Budget Activity ...................................................................... 9

2.1.1 – Audit Resources and Measures ....................................................................................... 9

Audit Budget and Performance ................................................................................................... 9

2.1.2 – Investigations Resources and Measures ........................................................................ 11

Investigations Budget and Performance ................................................................................... 11

Key Accomplishments and Budget Savings ............................................................................. 13

Section III – Additional Information ........................................................................................ 15

A – Summary of Capital Investments ....................................................................................... 15

 
TIGTA - 3 

Section I – Budget Request 

A – Mission Statement 

Provide quality professional audit, investigative, and inspection and evaluation services that 

promote integrity, economy, and efficiency in the administration of the Nation’s tax system. 

B – Summary of the Request 

The Treasury Inspector General for Tax Administration’s (TIGTA) Fiscal Year (FY) 2018 

budget request of $161,113,000 represents a decrease of 3.5 percent below its FY 2017 

Annualized Continuing Resolution (CR) amount. Funding TIGTA’s FY 2018 budget request 

will enable TIGTA to attempt to address its expansive workload of emerging Internal Revenue 

Service (IRS) challenges and congressional requests while conducting its oversight 

responsibilities. These resources will fund critical audit, investigative, and inspection and 

evaluation services to protect the integrity of the Nation’s system of tax administration. In 

accordance with the requirements of Section 6(f)(1) of the Inspector General Act of 1978 (as 

amended),1

 TIGTA submits the following information related to its FY 2018 budget request: 

 The aggregate budget request for TIGTA operations is $161,113,000; 

 The portion of the request needed for TIGTA training is $1,800,000; and 

 The portion of the request needed to support the Council of the Inspectors General on 

Integrity and Efficiency is $491,000. 

TIGTA’s vision is to maintain a highly skilled, proactive, and diverse Inspector General 

organization dedicated to working in a collaborative environment with key stakeholders to foster 

and promote fair tax administration. TIGTA’s strategic goals and activities support its vision. 

TIGTA’s Strategic Goals: 

 Promote the economy, efficiency, and effectiveness of tax administration; 

 Protect the integrity of tax administration; and 

 Be an organization that values its people. 

TIGTA’s audit, investigative, and inspection and evaluation activities include: 

 Identifying opportunities to improve the administration of the Nation’s tax laws, improve tax 

compliance, and achieve program efficiencies and cost savings; 

 Mitigating security risks affecting taxpayer data, tax systems, and IRS employees; 

 Protecting the integrity of the IRS by effectively investigating the international IRS 

impersonation scam that has impacted more than 1.9 million Americans; 

 Conducting criminal investigations of individuals and groups who impersonate the IRS in 

order to victimize senior citizens and other vulnerable Americans; 

 Developing advanced analytics and innovative approaches to help prevent and detect the 

flow of dollars fraudulently obtained by criminals and IRS employees; 

 Providing the IRS with the investigative coverage and the information necessary to mitigate 

domestic and foreign threats against its employees, facilities, and data systems; 

 

1

 5 U.S.C. app. 3 § 6(f)(1). 
TIGTA - 4 

 Improving the integrity of IRS operations by detecting and deterring waste, fraud, abuse, and 

misconduct, including the unauthorized disclosure of confidential taxpayer information by 

IRS employees; 

 Conducting comprehensive audits and inspections and evaluations that provide 

recommendations for achieving monetary benefits, addressing erroneous and improper 

payments, and enhancing the service the IRS provides to taxpayers; 

 Rapidly and effectively responding to attempts to impersonate the IRS for fraudulent 

purposes; 

 Overseeing the IRS’s efforts to administer tax law changes related to health care; and 

 Overseeing the IRS’s efforts to increase international tax compliance. 

1.1 – Appropriations Detail Table 

Dollars in Thousands

Treasury Inspector General for 

Tax Administration FY 2016 FY 2017 FY 2018 FY 2017 to FY 2018

Appropriated Resources Enacted Annualized CR Request $ Change % Change

FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTEAMOUNT

New Appropriated Resources:

Audit 331 $65,100 358 $64,976 341 $62,704 (17) ($2,272) -4.75% -3.50%

Investigations 456 $102,175 501 $101,981 478 $98,409 (23) ($3,572) -4.59% -3.50%

Subtotal New Appropriated Resources 787 $167,275 859 $166,957 819 $161,113 (40) ($5,844) -4.66% -3.50%

Other Resources:

Reimbursables 2 $535 2 $1,500 2 $600 0 ($900) 0.00% -60.00%

Subtotal Other Resources 2 $535 2 $1,500 2 $600 0 ($900) 0.00% -60.00%

Total Budgetary Resources 789 $167,810 861 $168,457 821 $161,713 (40) ($6,744) -4.65% -4.00%

Note: FY 2016 FTE & Other Resources are Actual 

1.2 – Budget Adjustments Table

Dollars in Thousands 

Treasury Inspector General for Tax Administration FTE Amount 

FY 2017 Annualized CR 859 $166,957 

Changes to Base: 

Maintaining Current Levels (MCLs): - $3,335 

Pay-Raise - $1,951 

Pay Annualization - $715 

Non-Pay - $669 

Subtotal Changes to Base - $3,335 

Total FY 2018 Base 859 $170,292 

Program Changes: 

 Program Decreases: (40) ($9,179) 

 Reduce Audit and Investigation Activity Levels for Labor Costs and Staffing (40) ($6,595) 

 Operating Cost Reductions - ($2,584) 

Total FY 2018 Request 819 $161,113 
TIGTA - 5 

C – Budget Increases and Decreases Description 

Maintaining Current Levels (MCLs) .................................................... +$3,335,000 / +0 FTE 

Pay-Raise +$1,951,000 / +0 FTE 

Funds are requested for the proposed January 2018 pay-raise. 

Pay Annualization +$715,000 / +0 FTE 

Funds are requested for annualization of the January 2017 pay-raise. 

Non-Pay +$669,000 / +0 FTE 

Funds are requested for non-labor expenses such as travel, contracts, rent, supplies, 

and equipment. 

Program Decreases ............................................................................... -$9,179,000 / -40 FTE 

Reduce Audit and Investigation Activity Levels for Labor Costs and Staffing -$6,595,000 / -40 

FTE 

Audit and Investigations Activity levels will be reduced for labor costs and FTE. Reaching this 

savings target without impacting the quality of TIGTA’s programs will require a combination 

of actions to include balancing mission and workload with available FTE. The reduction of 40 

FTE will result in a reduced number of investigations and audits in FY 2018. Since FY 2015, 

the number of mandated audits increased from 17 to 22. Therefore, for the Office of Audit 

(OA), a reduction of FTE will result in a higher percentage of resources being devoted to 

mandated audits versus the high-risk audits that are more likely to result in quantifiable 

outcomes, such as cost savings, revenue protection, and taxpayer privacy and security. For the 

Office of Investigations (OI), staffing reductions will limit TIGTA’s ability to respond to every 

allegation of IRS employee misconduct, and it will extend the amount of time it takes to 

investigate all of the allegations received by TIGTA. 

Operating Cost Reductions -$2,584,000 / +0 FTE 

TIGTA has closely scrutinized its operational requirements for the impact of budget 

reductions. With the reduction in FTE levels in Audit and Investigations Activities, there will 

be a corresponding reduction in operational costs. TIGTA continues to identify cost-savings 

in travel, training, and contracts. Further cuts will be made in these areas to reduce budget 

impact on TIGTA’s staffing levels. TIGTA will look for contract efficiencies from continued 

evaluation of contracts for strategic sourcing and negotiation of more advantageous contract 

terms. Additionally, TIGTA has aggressively implemented its telework program in order to 

reduce its footprint. 
TIGTA - 6 

1.3 – Operating Levels Table 

Dollars in Thousands 

Treasury Inspector General for Tax Administration FY 2016 FY 2017 FY 2018 

Object Classification Actual Annualized CR Request 

 

11.1 - Full-time permanent 85,481 87,619 85,060 

11.3 - Other than full-time permanent 378 399 385 

11.5 - Other personnel compensation 8,326 8,534 8,158 

11.9 - Total personnel compensation 94,185 96,552 93,603 

12.0 - Personnel benefits 36,944 37,856 36,876 

Total Personnel and Compensation Benefits $131,129 $134,408 $130,479 

21.0 - Travel and transportation of persons 4,839 3,135 2,662 

22.0 - Transportation of things 14 15 15 

23.1 - Rental payments to GSA 8,881 9,400 9,400 

23.2 - Rental payments to others 182 200 200 

23.3 - Communication, utilities, and misc charges 472 500 400 

24.0 - Printing and reproduction 11 7 7 

25.1 - Advisory and assistance services 2,042 1,900 1,800 

25.2 - Other services from non-Federal sources 1,359 1,100 1,000 

25.3 - Other goods and services from Federal sources 9,603 9,200 9,100 

25.4 - Operation and maintenance of facilities 6 15 15 

25.7 - Operation and maintenance of equipment 2,657 2,000 1,730 

26.0 - Supplies and materials 1,221 1,000 700 

31.0 - Equipment 5,326 4,000 3,500 

42.0 - Insurance claims and indemnities 1 52 5 

91.0 - Unvouchered 115 25 100 

Total Non-Personnel $36,729 $32,549 $30,634 

New Budgetary Resources $167,858 $166,957 $161,113 

FTE 787 859 819 

Note: This table includes total annually appropriated funding (actuals for FY 2016, FY 2017 Annualized CR and FY 2018). 
TIGTA - 7 

D – Appropriations Language and Explanation of Changes 

Appropriations Language Explanation of Changes 

DEPARTMENT OF THE TREASURY 

TREASURY INSPECTOR GENERAL FOR TAX 

ADMINISTRATION 

Federal funds 

SALARIES AND EXPENSES

For necessary expenses of the Treasury Inspector General for Tax 

Administration in carrying out the Inspector General Act of 1978, 

as amended, including purchase and hire of passenger motor 

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

3109, at such rates as may be determined by the Inspector 

General for Tax Administration; $161,113,000, of which 

$5,000,000 shall remain available until September 30, 2019; of 

which not to exceed $6,000,000 shall be available for official 

travel expenses; of which not to exceed $500,000 shall be 

available for unforeseen emergencies of a confidential nature, to 

be allocated and expended under the direction of the Inspector 

General for Tax Administration; and of which not to exceed 

$1,500 shall be available for official reception and representation 

expenses. 

Note.—A full-year 2017 appropriation for this account was not 

enacted at the time the budget was prepared; therefore, the budget 

assumes this account is operating under the Further Continuing 

Appropriations Act, 2017 (P.L. 114-254). The amounts included 

for 2017 reflect the annualized level provided by the continuing 

resolution. 

E – Legislative Proposals 

TIGTA has no legislative proposals. 
TIGTA - 8 

Section II – Annual Performance Report and Plan 

A – Strategic Alignment 

TIGTA, an independent office within the Department of the Treasury, was created by Congress 

as a part of the Internal Revenue Service Restructuring and Reform Act of 1998 (RRA 98).2 It 

provides independent oversight of IRS activities by conducting independent audits, 

investigations, and inspections and evaluations necessary to prevent and detect waste, fraud, and 

abuse in IRS programs and operations. TIGTA makes recommendations designed to improve 

the administration of the Federal tax system; conducts administrative and criminal investigations 

of allegations of waste, fraud, and abuse; and helps to ensure that the IRS protects and secures 

taxpayers’ data. TIGTA also has the unique responsibility of protecting the IRS and its 

employees. TIGTA’s role is important, given the current economic environment and the 

increased emphasis by the Administration, Congress, and the American people on the Federal 

Government’s accountability and efficient use of resources. TIGTA’s budget activities align 

with its vision and goals. 

The FY 2018 - 2022 strategic plan is currently under development. The annual performance plan 

will be updated in the FY 2019 budget to reflect the new priorities. 

 

2

 Pub. L. No. 105-206, 112 Stat. 685. 
TIGTA - 9 

B – Budget and Performance by Budget Activity 

2.1.1 – Audit Resources and Measures 

Dollars in Thousands 

 Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 

 Actual Actual Actual Actual Actual Annualized 

CR Request 

Column1 Column32 Column4 Column5 Column6 Column7 Column8 Column9 

 Appropriated Resources $57,306 $54,309 $53,763 $57,463 $59,752 $64,976 $62,704 

 Reimbursable Resources 0 $500 $600 $382 $60 $600 $0 

Budget Activity Total $57,306 $54,809 $54,363 $57,845 $59,812 $65,576 $62,704 

FTE 337 323 309 316 331 358 341 

Note: FY 2016 Appropriated and Reimbursable Resources are Actual 

  Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 - 

Actual Actual Actual Actual Actual Target Target Target FY 2016 

Trend

Percentage of Audit Products 

Delivered when Promised to 

Stakeholders

71.0 84.0 65.0 80.0 75.0 68.0 68.0 68.0

Percentage of 

Recommendations Made that 

Have Been Implemented

94.0 87.0 89.0 92.0 97.0 85.0 85.0 85.0

Key: DISC - Discontinued, B – Baseline 

Audit Budget and Performance 

($62,704,000 from direct appropriations): 

TIGTA’s OA identifies opportunities to improve the administration of the Nation’s tax laws by 

completing comprehensive and independent performance and financial audits of IRS programs 

and operations. TIGTA’s audit program incorporates both statutory audit requirements and 

specific audits identified through TIGTA’s risk assessment process. TIGTA’s audit work is 

concentrated on high-risk areas and on the IRS’s progress in achieving its strategic goals. 

TIGTA strategically evaluates IRS programs, activities, and functions, so that resources are spent 

in the areas of highest vulnerability to the Nation’s system of tax administration. In FY 2016, 

OA issued 89 final audit reports that included potential financial benefits totaling approximately 

$14.6 billion and affected approximately 1 million taxpayer accounts. 

TIGTA’s Annual Audit Plan communicates audit priorities to the IRS, Congress, and other 

interested parties. Many of the activities described in the Annual Audit Plan address the 

fundamental goals related to the IRS’s mission to administer its programs effectively and 

efficiently. Audits address a variety of high-risk issues, such as identity-theft detection and 

prevention, security of taxpayer data, tax compliance, tax law changes, fraudulent claims and 

improper payments, tax systems and online services, and globalization. TIGTA’s audits and 

recommendations help: 

 Promote the economy, efficiency, and effectiveness of IRS programs; 

 Ensure the fair and equitable treatment of taxpayers; and 

 Detect and deter waste, fraud, and abuse. 
TIGTA - 10 

By focusing on the most critical areas, TIGTA’s recommendations not only result in cost 

savings, but also have other quantifiable impacts, such as the protection of existing revenue, 

increased revenue, and reduction of the number of fraudulent refunds and improper payments. 

TIGTA’s reports for FY 2016, addressed issues that included: 

 Offset Refunds to Liquidate Existing Tax Debt – TIGTA identified 53,672 individual 

taxpayers who received approximately $74.5 million in tax refunds in Tax Year 2013 that the 

IRS could have offset against outstanding tax debts on the taxpayers’ associated business tax 

accounts. In addition, TIGTA identified 487 individual and 29 business taxpayers that 

received more than $2.9 million in tax refunds for TY 2013 that should have been offset to 

pay their outstanding tax debts. 

 Authentication Process – In FY 2016, TIGTA reported that its analysis of the eAuthentication processes used to authenticate users of the IRS online “Get Transcript” and 

“Identity Protection Personal Identification Number" applications found that these 

authentication methods provide only single-factor authentication, despite Government 

standards requiring multifactor authentication for such high-risk applications. As a result, 

unscrupulous individuals have gained unauthorized access to tax account information. 

 Federal Unemployment Tax – During FY 2016, TIGTA identified some discrepancies with 

the State Federal Unemployment Tax Act certification data files, as well as the IRS’s process 

related to multi-State employer accounts. Changes could potentially increase revenue by 

almost $92 million. 

Description of Performance: 

TIGTA uses two performance measures to gauge the success of the audit program. The first 

measure, Percentage of Audit Products Delivered when Promised to Stakeholder (see Table 2.1.1 

on page 9), indicates that TIGTA’s products are more likely to be used if they are delivered when 

needed to support congressional and IRS decision making. To determine whether products are 

timely, TIGTA tracks the percentage of products that are delivered on or before the date 

promised (contract date).

The second measure, Percentage of Recommendations Made that Have Been Implemented (see 

Table 2.1.1 on page 9), assesses TIGTA’s effect on improving the IRS’s accountability, 

operations, and services. TIGTA makes recommendations designed to improve the 

administration of the Federal tax system. The IRS must implement these recommendations to 

realize the financial or non-financial benefits. Since the IRS needs time to act on 

recommendations, TIGTA uses the Department of the Treasury’s Joint Audit Management 

Enterprise System to track the percentage of four-year-old recommendations that have been 

implemented, rather than the results of the activities during the fiscal year in which the 

recommendations are made. TIGTA tracks recommendations that have not been implemented 

by the IRS and has a formal process with the IRS to close out unimplemented recommendations 

in situations in which circumstances may have changed or when the IRS has taken alternative 

corrective measures to address TIGTA’s audit findings. 

In FY 2016, the actual Percentage of Audit Products Delivered when Promised to Stakeholders 

was 75 percent, which exceeded the full-year target of 68 percent. TIGTA exceeded this target as 
TIGTA - 11 

a result of ongoing supervisory monitoring of the execution of audits to ensure timely audit 

products to stakeholders. In FY 2016, the actual Percentage of Recommendations Made that 

Have Been Implemented was 97 percent, which exceeded the full-year target of 85 percent. 

TIGTA exceeded its target because of continuous discussions with the IRS throughout the audit 

process concerning both the findings and potential recommended solutions to ensure that feasible 

alternatives were identified. For FY 2018, the target for Percentage of Audit Products Delivered 

when Promised to Stakeholders will remain 68 percent. The target for Percentage of 

Recommendations Made that Have Been Implemented will remain at 85 percent.

2.1.2 – Investigations Resources and Measures 

Dollars in Thousands 

 Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 

 Actual Actual Actual Actual Actual Annualized 

CR Request 

Column1 Column32 Column4 Column5 Column6 Column7 Column8 Column9 

 Appropriated Resources $94,390 $89,452 $95,748 $101,476 $108,106 $101,981 $98,409 

 Reimbursable Resources 0 $400 $1,100 $429 $475 $900 $600 

Budget Activity Total $94,390 $89,852 $96,848 $101,905 $108,581 $102,881 $99,009 

FTE 470 451 433 442 456 501 478 

Note: FY 2016 Appropriated and Reimbursable Resources are Actual 

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 - 

Actual Actual Actual Actual Actual Target Target Target FY 2016 

Trend

Percentage of Results from 

Investigative Activities

89.0 90.0 92.0 93.0 90.0 81.0 81.0 81.0

Key: DISC - Discontinued, B - Baseline

Investigations Budget and Performance 

($98,409,000 from direct appropriations, and $600,000 from reimbursable resources): 

In addition to protecting the IRS’s ability to collect the majority of the revenue for the Federal 

Government’s operations, TIGTA, through its OI, has the statutory responsibility of protecting 

the integrity of tax administration, as well as the IRS’s employees. 

TIGTA’s investigative resources are allocated based 

upon a performance model that focuses on three 

primary areas of investigation: 

 Employee integrity; 

 Employee and infrastructure security; and 

 External attempts to corrupt tax administration. 

The performance model (Figure 1) uses a ratio of 

those investigations that have the greatest 

impact on IRS operations or the protection of Federal tax administration to the total number of 

investigations conducted. These performance measures guide OI’s activities and help to 

demonstrate the value of investigative accomplishments to TIGTA’s external stakeholders. 

Figure 1: Investigative Performance Model
TIGTA - 12 

Employee Integrity: IRS employee misconduct, real or perceived, erodes public trust and 

impedes the IRS’s ability to enforce tax laws effectively. In FY 2016, 45 percent of TIGTA’s 

investigative body of work involved alleged employee misconduct. TIGTA’s investigative 

results convey a message to IRS employees that these types of activities will not go unchecked. 

TIGTA processed 14,499 complaints, opened 2,879 investigations, and closed 2,887 

investigations in FY 2016. During this period, 122 cases of all types of investigations were 

accepted for criminal prosecution, and TIGTA referred for IRS action 1,032 cases of employee 

misconduct. As a result of one of TIGTA’s investigations into employee misconduct, a former 

IRS special agent was sentenced to more than five years in prison for his role in a stolen identity 

refund fraud scheme.3

 In another case, a former IRS revenue agent in Seattle, Washington, was 

found guilty by a jury of receiving a bribe and an illegal gratuity in his official capacity.4

Employee and Infrastructure Security: In FY 2016, TIGTA responded to 949 threat-related 

incidents. TIGTA has a statutory responsibility to identify, investigate, and respond to threats 

against IRS personnel and physical infrastructure. TIGTA also believes that through its 

investigations of threat-related incidents, it is creating a safe and secure environment for 

taxpayers who need to conduct business with the IRS. From FY 2011 through the end of 

FY 2016, TIGTA has processed more than 13,125 threat-related complaints and investigated 

more than 6,515 threats against IRS employees. 

External Attempts to Corrupt Tax Administration: TIGTA is statutorily mandated to 

investigate external attempts to corrupt tax administration, which include criminal misconduct by 

nonemployees, such as impersonation of the IRS, attempted bribery of IRS employees, 

international cybercrime and identity theft, and procurement fraud. 

Impersonation Scam: Since summer 2013, a significant part of TIGTA’s workload has 

consisted of investigating a telephone impersonation scam in which a victim receives an 

unsolicited telephone call from a person claiming to be an IRS agent. The caller, using a fake 

name, provides a “badge number” and claims the victim owes taxes and is criminally liable for 

the amount owed. The victim is threatened that if he or she fails to pay the tax immediately, the 

victim will be arrested, a suit will be filed, or some other form of adverse action will be taken. 

As of March 31, 2017, more than 1.9 million Americans reported that they have received one of 

these calls, and 10,300 victims have reported that they paid a total of more than $55 million to 

the scammers. As a direct result of TIGTA’s investigative efforts, in October 2016, 56 

individuals and five call centers located in India were indicted for the scam. Since the 

indictment, reports of impersonation calls have dropped by more than 90 percent. 

International Cybercrime and Identity Theft: By the end of Calendar Year 2013, the IRS had 

reported nearly 2.9 million identity-theft cases, 13 percent of which were reported by taxpayers, 

and 87 percent of which were detected by the IRS. The Office of Investigation’s highly 

specialized group of criminal investigators with technical expertise in investigating electronic 

 

3

 N.D. Ala. Judgment filed Nov. 16, 2015. 

4

 W.D. Wash. Verdict Form filed Feb. 12, 2016. 
TIGTA - 13 

crimes, including computer intrusions and Internet-based fraud schemes, will continue to combat 

cybercriminals. 

Procurement Fraud: In fiscal year 2016, the IRS awarded over $2.2 billion in contracts and 

grants involving over 11,000 contract transactions. The 2016 Association of Certified Fraud 

Examiners Report to the Nations on Occupational Fraud and Abuse estimates that on average, 

five percent of an organization’s revenue is lost as a result of fraud on an annual basis. In the 

case of the IRS, this projection translates to over $112 million lost to fraud in fiscal year 2016. 

 

Description of Performance: 

TIGTA’s OI has adopted one performance measure, Percentage of Results from Investigative 

Activities (see Table 2.1.2 on page 11), that identifies the percentage of results derived from 

investigative activities that most accurately align with the strategic goals of the organization and 

provide the greatest impact on the protection of the integrity of Federal tax administration. In 

FY 2016, the Percentage of Results from Investigative Activities was 90 percent, which 

exceeded the full-year target of 81 percent. OI exceeded the FY 2016 performance measure as a 

result of the hard work of experienced executives, managers, and special agents. With the FY 

2018 budget request, TIGTA will attempt to maintain its special agents’ skills and abilities in 

order to be able to respond to its mission requirements. For FY 2018, OI’s performance target is 

79 Percent of Results from Investigative Activities. For FY 2018, TIGTA is anticipating a high 

rate of turnover of its management team due to retirements. In addition, based on reduced 

resources, TIGTA is anticipating the inability to backfill special agent positions. As experienced 

special agents retire or transfer from the agency, it is anticipated that TIGTA’s ability to 

effectively produce results will decrease in FY 2018. 

Key Accomplishments and Budget Savings 

While the scope, complexity, and magnitude of the Nation’s economy and deficit continue to 

present significant challenges, TIGTA remains one of the best investments in the Federal 

Government. In FY 2016, through targeted and vigorous oversight efforts that addressed 

congressional concerns and its own audit and investigative priorities, TIGTA generated overall 

potential financial accomplishments of over $15 billion. 

During FY 2016, these financial accomplishments included: 

 Increased and/or protected revenue in the amount of $14.6 billion; 

 Cost savings of $40.8 million; and 

 Significant investigative accomplishments of $487 million. 

Funding for TIGTA allows its oversight efforts to 

continue, and in FY 2016 these efforts produced a 

return on investment of $90 for every $1 invested 

(Figure 2). During that period, TIGTA issued audit 

reports with recommendations that potentially 

increased and/or protected revenue of $14.6 billion. 

TIGTA also issued audit reports with 

recommendations that identified a potential cost 

savings of $40.8 million. The phrase “cost savings” Figure 2: TIGTA’s Return on Investment 
TIGTA - 14 

includes questioned costs and funds put to better use. 

Questioned costs are: 

 Costs that cannot be reimbursed because they represent a violation of law, regulation, or 

contract; 

 Expenditures that are not reasonable or necessary to accomplish the intended purpose; and 

 Costs that are appropriate, but for which the vendor cannot provide proof that the cost was 

incurred. 

Funds put to better use are funds that could be used more efficiently or effectively if 

management took actions to implement the recommendation(s), including but not limited to: 

 Reductions in outlays; 

 Avoidance of unnecessary expenditures noted in pre-award contract reviews; and 

 Prevention of erroneous payment of refundable tax credits. 

In addition to funds that could be put to better use, TIGTA’s investigative efforts resulted in over 

$25.5 million in court-ordered fines, penalties, and restitution. 

Office of Inspections and Evaluations Highlights

The Office of Inspections and Evaluations (I&E) identifies opportunities for improvement in IRS 

and TIGTA programs by performing inspections and evaluations that report timely, useful, and 

reliable information to decision makers and stakeholders. 

The Office of Inspections and Evaluations provides a range of specialized services and products, 

including quick reaction reviews, on-site office inspections, and in-depth evaluations of major 

functions, activities, or programs. These activities provide TIGTA with additional flexibility, 

capacity, and capability to improve tax administration. Inspections serve to: 

 Provide factual and analytical information; 

 Monitor compliance; 

 Measure performance; 

 Assess the effectiveness of programs and operations; 

 Share best practices; and 

 Inquire into allegations of waste, fraud, abuse, and mismanagement. 

Evaluations often result in recommendations to streamline IRS operations, enhance data quality, 

and minimize inefficient and ineffective procedures. In FY 2016, I&E produced 11 reports, 

including reviews of: the IRS taxpayer assistance centers, IRS reasonable accommodation 

requests for adaptive technology, and procedures to protect taxpayer information at offer in 

compromise public inspection file locations. 
TIGTA - 15 

Section III – Additional Information 

A – Summary of Capital Investments 

Technology Investments – TIGTA has no major IT investments; however, non-major 

investments include: 

 IT Applications and Collaboration – This investment represents an enterprise view of 

TIGTA's applications development which includes system design, development, testing, 

deployment, and maintenance of information applications systems.

 IT Infrastructure End-User Systems and Support – This investment is an enterprise view 

of TIGTA's end-user hardware, peripherals and software, and the helpdesk.

 IT Infrastructure Mainframe and Servers Services and Support – This investment 

represents an enterprise view of TIGTA's servers, including hardware and software 

operations, licensing, maintenance, back-up, continuity of operations, disaster recovery, 

virtualization, and data center consolidation.

 IT Infrastructure Telecommunications – This investment represents an enterprise view of 

TIGTA's data networks and telecommunications hardware and software operations, licenses, 

maintenance, back-up, continuity of operations, and disaster recovery.

 IT Security Systems and Enterprise Architecture – This investment represents TIGTA's 

IT investments responsible for enterprise architecture services.

The Office of Information Technology provides cost-effective and timely IT products and 

services that permit successful completion of TIGTA’s business goals, while at the same time 

meeting legislative and other executive mandates. The following are TIGTA’s FY 2018 

prioritized information technology requirements that directly support TIGTA operations: 

 Continuous Diagnostics and Mitigation (CDM) – CDM is a program sponsored by the 

Department of Homeland Security to meet the standard requirements set by the National 

Institutes of Standards and Technology. The program is intended to provide Federal agencies 

with the capabilities and tools to identify and address cybersecurity risks.

 Server and Storage Area Network Refresh 2018 – TIGTA’s infrastructure equipment will 

be eligible for refresh in FY 2018. 

 Increased Bandwidth – The bandwidth for TIGTA’s field offices must be upgraded to 

support the increased demand for improved transmission of data. 

Law Enforcement Vehicles – Effective FY 2014, TIGTA acquires its vehicles by lease through 

the General Services Administration. However, TIGTA will maintain ownership of 

approximately 8 surveillance/communications vehicles. These vehicles will remain part of 

TIGTA’s capital asset strategy. The vehicles will be used to support TIGTA’s investigations and 

must meet the mission-critical need to conduct criminal law enforcement activities. TIGTA 

communications vehicles also are used in support of its Continuity of Operations (COOP) Plan. 

COOP provides a mechanism for the organization to recover full operational capability following 

a critical incident, including the capability to communicate during a local or national emergency.

A summary of capital investment resources, including major IT and non-technology investments, 

can be viewed and downloaded at: 

http://www.treasury.gov/about/budget-performance/Pages/summary-of-capital-investments.aspx 

This website also contains a digital copy of this document. 

Department of the Treasury 

Community Development 

Financial Institutions Fund 

Congressional Justification 

for Appropriations and 

Annual Performance 

Report and Plan 

FY 2018 
CDFI Fund - 2 

Table of Contents

Section I – Budget Request........................................................................................................... 3

A – Mission Statement ................................................................................................................ 3

B – Summary of the Request ...................................................................................................... 3

1.1 – Appropriations Detail Table......................................................................................................... 4

1.3 – Operating Levels Table................................................................................................................ 5

C – Appropriations Language and Explanation of Changes ....................................................... 6

D – Legislative Proposals ........................................................................................................... 6

Section II – Annual Performance Plan and Report ................................................................... 7

A – Strategic Alignment ............................................................................................................. 7

B – Budget and Performance by Budget Activity ...................................................................... 8

2.1.1 Administration- Resources and Measures ......................................................................... 8

2A - Administration .................................................................................................................... 8

2.1.2 – Community Development Financial Institutions Program Resources and Measures ..... 9

2B - Community Development Financial Institutions Program ................................................. 9

2.1.3 – New Markets Tax Credit Program Resources and Measures ....................................... 10

2.1.4 – Bank Enterprise Award Program Performance and Measures ..................................... 11

2D – Bank Enterprise Award Program ..................................................................................... 11

2.1.5 – Native American CDFI Assistance Program Performance and Measures .................... 12

2E – Native American CDFI Assistance Program .................................................................... 12

2.1.6 - Healthy Food Financing Initiative Performance and Measures .................................... 13

2F – Healthy Food Financing Initiative .................................................................................... 13

2.1.7 - Capital Magnet Fund Program Resource Detail Table .................................................. 14

2G - Capital Magnet Fund Program.......................................................................................... 14

2.1.8 - Bond Guarantee Program Resource Detail Table ......................................................... 14

2.1.9 - Financing Accounts – Non-Budgetary Summary ......................................................... 14

2H - CDFI Bond Guarantee Program ....................................................................................... 14

Section III – Additional Information ........................................................................................ 17

A – Summary of Capital Investments ....................................................................................... 17
CDFI Fund - 3 

Section I – Budget Request 

A – Mission Statement 

To expand economic opportunity for underserved people and communities by supporting the 

growth and capacity of a national network of community development lenders, investors and 

financial service providers. 

B – Summary of the Request 

The Community Development Financial Intuitions Fund (CDFI Fund) requests the following for 

FY 2018: 

 $14 million in administrative funding to support: 

- Management of the Community Development Financial Intuitions (CDFI) Bond 

Guarantee (BG) Program and the New Markets Tax Credit (NMTC) Program; and 

- Ongoing certification and compliance monitoring for all programs, including the Bank 

Enterprise Award (BEA) Program, CDFI Program, Native American CDFI Assistance 

(NACA) Program and Healthy Food Financing Initiative (HFFI). 

 The Budget eliminates funding for the Fund's four discretionary grant and direct loan 

programs (i.e. the CDFI Program, the BEA Program, the NACA Program, and HFFI) and 

proposes to extend the CDFI BG Program, which offers CDFIs low-cost, long-term financing 

at no cost to taxpayers, as the program requires no credit subsidy. 

- The CDFI BG Program provides CDFIs access to a significant source of capital. The 

CDFI BG Program injects new and substantial capital into our nation’s most distressed 

communities by providing guarantees of bonds issued by Qualified Issuers. CDFIs 

benefit from the potential scale of the CDFI BG Program, which offers long-term credit 

at below-market interest rates. The BG Program incentivizes and empowers CDFIs to 

execute large-scale projects, including the development of charter schools, commercial 

real estate, rental housing, senior living, daycare or healthcare centers, small businesses, 

and rural infrastructure, among others. These benefits will be realized at no cost to 

taxpayers because the program requires no credit subsidy. 

- The Budget proposes an annual commitment authority of $500 million and program 

changes to (i) reduce the minimum bond issue size from $100 million to $50 million; and 

(ii) to correct a technical drafting error related to the calculation of the relending account 

maximum. 
CDFI Fund - 4 

1.1 – Appropriations Detail Table 

Dollars in Thousands

Community Development Fund 

Appropriated Resources

FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

New Appropriated Resources:

Community Development Fund Institutions 

Program 0 $153,423 0 $153,131 0 0 ($153,131) NA -100%

Bank Enterprise Award Program 0 $19,000 0 $18,964 0 0 ($18,964) NA -100.00%

Native American CDFI Assistance 

Program 0 $15,500 0 $15,471 0 0 ($15,471) NA -100.00%

Administration 77 $23,600 77 $23,555 42 $14,000 35 ($9,555) 45.45% -40.56%

Healthy Food Financing Program 0 $22,000 0 $21,958 0 0 ($21,958) NA -100.00%

Subtotal New Appropriated Resources 77 $233,523 77 $233,079 42 $14,000 35 ($219,079) 45.45% -93.99%

Other Resources*: NA NA

User Fees** 0 $220 0 $362 0 $619 0 $257 NA 70.99%

Recoveries from Prior Years 0 $3,375 0 $3,400 0 $3,400 0 $0 NA 0.00%

Unobligated Balances Brought Forward 0 $5,500 0 $21,545 0 $18,964 0 ($2,581) NA -11.98%

Subtotal Other Resources 0 $9,095 0 $25,307 0 $22,983 0 ($2,324) NA -9.18%

Total Budgetary Resources 77 $242,618 77 $258,386 42 $36,983 35 ($221,403) 45.45% -85.69%

* FY 2016 Other Resources are actual

**This request reflects authorization of the Bond Guranatee Program in FY 2016

Enacted Annualized Request $ Change % Change

FY 2016 FY 2017 FY 2018 FY 2017 to FY 2018

 
CDFI Fund - 5 

1.3 – Operating Levels Table 

Dollars in Thousands

Community Development Financial Institutions Fund FY 2016 FY 2017 FY 2018

Object Classification Actual* Annualized Request

 CR

11.1 - Full-time permanent $8,748 $9,311 $4,589

11.9 - Total personnel compensation $8,748 $9,311 $4,589

12.0 - Personnel benefits $2,866 $3,120 $2,160

Total Personnel and Compensation Benefits $11,614 $12,431 $6,749

21.0 - Travel and transportation of persons $72 $103 $37

22.0 - Transportation of things $0 $3 $1

24.0 - Printing and reproduction $5 $5 $2

25.1 - Advisory and assistance services $4,999 $3,355 $0

25.2 - Other services from non-Federal sources $170 $118 $63

25.3 - Other goods and services from Federal sources $5,726 $4,546 $5,518

25.7 - Operation and maintenance of equipment $523 $0 $1,603

26.0 - Supplies and materials $61 $59 $27

31.0 - Equipment $383 $2,935 $0

33.0 - Investments and loans $499 $0 $0

41.0 - Grants, subsidies, and contributions $188,466 $209,524 $0

Total Non-Personnel $200,904 $220,648 $7,251

Subtotal New Budgetary Resources $212,518 $233,079 $14,000

Budget Activities**: Column1 Column2 Column3

Community Development Financial Instituitions Program $156,798 $156,531 $3,400

Bank Enterprise Award Program** $24,500 $40,509 $18,964

Native American CDFI Assistance Program $15,500 $15,471 $0

Administration $23,820 $23,917 $14,619

Healthy Food Financing Program $22,000 $21,958 $0

Total Budgetary Resources $242,618 $258,386 $36,983

FTE 77 77 42

* FY 2016 actual includes FY 2015 awards made in FY 2016.

** All but Administration are funded with two-year appropriations.

*** The FY 2017 Bank Enterprise Award Program budget resource includes FY 2016 grant funding of $19 million 

to be awarded in FY 2017. The FY 2018 amount represents the FY 2017 grant funding that will be awarded in 

FY 2018.
CDFI Fund - 6 

C – Appropriations Language and Explanation of Changes 

Appropriations Language Explanation of Changes

DEPARTMENT OF THE TREASURY 

COMMUNITY DEVELOPMENT FINANCIAL 

INSTITUTIONS FUND 

To carry out the Riegle Community Development and Regulatory 

Improvements Act of 1994 (subtitle A of title I of Public Law 103–

325), including services authorized by section 3109 of title 5, 

United States Code, but at rates for individuals not to exceed the 

per diem rate equivalent to the rate for EX-3, $14,000,000, to be 

used for administrative expenses, including administration of 

CDFI fund programs and the New Markets Tax Credit Program: 

Provided, That during fiscal year 2018, none of the funds 

available under this heading are available for the cost, as defined 

in section 502 of the Congressional Budget Act of 1974, of 

commitments to guarantee bonds and notes under section 114A of 

the Riegle Community Development and Regulatory Improvement 

Act of 1994 (12 U.S.C. 4713a): Provided further, That 

commitments to guarantee bonds and notes under such section 

114A shall not exceed $500,000,000: Provided further, That such 

section 114A shall remain in effect until September 30, 2018. 

Note.—A full-year 2017 appropriation for this account was not 

enacted at the time the budget was prepared; therefore, the budget 

assumes this account is operating under the Further Continuing 

Appropriations Act, 2017 (P.L. 114–254). The amounts included 

for 2017 reflect the annualized level provided by the continuing 

resolution.

 

Extension of the Bond 

Guarantee Program 

through FY 2018.

D – Legislative Proposals 

The Budget requests extension of the CDFI Bond Guarantee Program through FY 2018 and 

elimination of new allocations into the Capital Magnet Fund effective in FY 2018. 

Suggested Legislative Language 

SEC. 126. AMENDMENTS TO COMMUNITY DEVELOPMENT FINANCIAL 

INSTITUTIONS BOND PROGRAM. Section 114A of the Riegle Community Development and 

Regulatory Improvement Act of 1994 (12 U.S.C. 4713a) is amended— (a) in subsection (c)(2) 

by striking ", multiplied by an amount equal to the outstanding principal balance of issued notes 

or bonds"; and (b) in subsection (e)(2)(B), by striking "$100,000,000" and inserting 

"$50,000,000". 

 
CDFI Fund - 7 

Section II – Annual Performance Plan and Report 

A – Strategic Alignment 

The CDFI Fund’s mission is to expand economic opportunity for underserved people and 

communities by supporting the growth and capacity of a national network of community 

development lenders, investors, and financial service providers. The FY 2018-2022 Strategic 

Plan is currently under development. The Annual Performance Plan will be updated in the FY 

2019 Budget to reflect the new Treasury priorities. 

The CDFI Fund’s award recipients include Community Development Financial Institutions 

(CDFIs), Community Development Entities (CDEs), Federal Deposit Insurance Corporation 

(FDIC)-insured banks, and nonprofit housing organizations that together and in partnership with 

traditional banks and other community organizations provide loans, investments, business 

counseling, basic banking services, and financial literacy training in some of the most distressed 

communities in the nation. These are the communities where job opportunities remain stagnant 

and that otherwise lack access to more mainstream forms of capital – the places and communities 

in the United States that are feeling “left behind” as other parts of our economy have improved. 

CDFI Fund award recipients use their awards to increase access to capital and help to improve 

the quality of life and the local economy in these communities. 

The primary goal of the CDFI Fund’s Strategic Plan is to “increase the impact of the CDFI Fund 

network by supporting the growth, reach, and performance of CDFI Fund awardees.” The 

requested budget will advance this goal by allowing the CDFI Fund to administer and fully staff 

the CDFI Fund’s programs that are authorized by Congress but do not require appropriated funds 

to make awards, i.e., the NMTC Program and CDFI BG Program. In addition, the CDFI Fund 

will continue to conduct ongoing program compliance for prior-year award recipients. 

The budget request is also intended to cover the cost to administer certification of CDFIs, as 

required by the Riegle Act, and of CDEs. CDFI certification is a prerequisite for eligibility for 

the BG Program and the Capital Magnet Fund (CMF), as well as other federal programs outside 

the CDFI Fund. CDE certification is a prerequisite for eligibility for NMTC. 

 
CDFI Fund - 8 

B – Budget and Performance by Budget Activity 

2.1.1 Administration- Resources and Measures 

Dollars in Thousands

Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Annualized 

CR Request

Appropriated Resources $21,965 $21,764 $24,636 $23,100 $23,544 $23,555 $14,000 

Budget Activity Total $21,965 $21,764 $24,636 $23,100 $23,544 $23,555 $14,000 

FTE 79 76 76 79 77 77 42

Administration Budget Activity

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 - 

Actual Actual Actual Actual Actual Target Target Target FY 2016 

Trend

ALL - Award Cycle Time 

(Months)

6.5 6.8 7.9 8.3 7.6 7.0 7.0 7.0

All - Time to Initial 

Disbursement (# Months) 

N/A N/A N/A N/A B 4.5 4.5 4.5 N/A

ALL - Number of Affordable 

Housing Units Developed or 

Produced 

27,433 26,391 32,621 27,004 35,251 29,000 27,433 28,000 

Key: B - Baseline

2A - Administration 

($14,000,000 from direct appropriations): 

This budget activity encompasses the CDFI Fund’s operational support and management 

activities for each of its ongoing award programs. This includes, among other activities, 

developing notices of award availability and application materials; reviewing and evaluating 

certification and award applications; selecting awardees; finalizing the terms of award 

agreements; making disbursements; collecting and evaluating performance data; monitoring 

awardees’ compliance; and award closeout processes. 

Description of Performance: 

The CDFI Fund’s two administrative measures are organization-wide efficiency measures based 

on how quickly awards are made and funds are disbursed. 

 The All-application-award Cycle Time measures the average time from the date when 

applications are received to the date of award announcement (calculated in months as an 

average across all programs). In FY 2016, the cycle time was 7.6 months, missing the target 

of 7 months as a result of higher-than-expected application volume and the combining of the 

2015 and 2016 allocation rounds of the New Markets Tax Credit Program. In FY 2018, as a 

result of implementation of the CDFI Fund’s Award Management Information System, it is 

expected that processing of applications for ongoing programs (i.e., NMTC, CMF, and BG 

Programs) will take 7 months from intake to award announcement. 
CDFI Fund - 9 

 The Time to Initial Disbursement is a new measure that indicates in months how quickly the 

CDFI Fund completes award agreements and makes the first disbursement of funds or issues 

tax credits. In FY 2016, the CDFI Fund developed new baseline data and targets for FY 

2017 and FY 2018, consistent with the award disbursement processes required by the Office 

of Management and Budget’s Uniform Administrative Requirements, Cost Principles, and 

Audit Requirements for Federal Awards (Uniform Requirements or UAR). 

The All-Affordable Housing measure captures the number of affordable housing units developed 

or produced as a result of CDFI Fund awards, as reported by CDFI, NMTC and CMF program 

awardees and allocatees. 

 

2.1.2 – Community Development Financial Institutions Program Resources and Measures 

Dollars in Thousands

Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Annualized 

CR Request

Appropriated Resources $146,035 $138,397 $146,364 $152,400 $153,423 $153,131 $0 

Budget Activity Total $146,035 $138,397 $146,364 $152,400 $153,423 $153,131 $0 

CDFI Program Budget Activity

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target FY 2016

Trend

CDFI - Percentage of Loans & 

Investments Originated in 

Eligible Distressed or 

Underserved Communities by 

Dollar Amount of Loans 

(Annual %)

84.9 77.1 70.8 80.1 80.9 60.0 60.0 N/A

CDFI - Percentage of Loans & 

Investments Originated in 

Eligible Distressed or 

Underserved Communities by 

Number of Loans

84.9 79.6 60.7 80.5 81.5 60.0 60.0 N/A

2B - Community Development Financial Institutions Program 

($0 from direct appropriations): 

The CDFI Program makes Financial Assistance (FA) awards to CDFIs that have comprehensive 

business plans for creating community development impact and that demonstrate the ability to 

leverage private sector sources of financing, as well as Technical Assistance (TA) grants to 

CDFIs and entities proposing to become CDFIs. CDFIs use FA awards to further goals such as: 

 Economic development (job creation, business development, and commercial real estate 

development); 

 Affordable housing (housing development and homeownership); and 

 Financial services (provision of basic banking services and financial literacy training to 

underserved people and communities). 
CDFI Fund - 10 

Description of Performance:

The CDFI Program has two measures: (1) percentage of loans and investments originated in 

eligible distressed communities or made to underserved populations, as measured against the 

total dollar amount of loans originated by awardees; and (2) the percentage of loans and 

investments originated in eligible distressed communities or to underserved populations, as 

measured against the total number of loans originated by awardees. 

Certification criteria require that all certified CDFIs originate at least 60 percent of their loans 

and investments in eligible distressed census tracts or to underserved populations. The target is 

set at a level that allows CDFIs to balance their mission to service distressed communities and 

underserved populations with their safety and soundness considerations. 

In FY 2016 the CDFI Program surpassed the 60 percent threshold for the percentage of both the 

dollar amount (80.9 percent) and the number (81.5 percent) of CDFI loans made to eligible 

distressed communities and underserved populations. 

For FY 2018 no target will be set for the program, although outcomes may still be reported for 

prior year awardees. 

2.1.3 – New Markets Tax Credit Program Resources and Measures 

Dollars in Thousands

New Market Tax Credit Program Budget Activity

Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Annualized 

CR Request

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

Budget Activity Total $0 $0 $0 $0 $0 $0 $0 

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2011 -

Actual Actual Actual Actual Actual Target Target Target FY 2016 

Trend

NMTC - Percentage of Loans 

and Investments That Went 

Into Severely Distressed 

Communities

70.4 78.5 73.8 75.2 74.5 72.0 74.0 N/A

Key: DISC - Discontinued, B - Baseline

2C – New Markets Tax Credit Program 

($0 from direct program appropriations):

The NMTC Program stimulates capital investment in low-income communities nationwide by 

permitting individual and corporate taxpayers to receive a non-refundable tax credit against 

federal income taxes for making equity investments in vehicles known as CDEs. CDEs that 

receive the tax credit allocation authority under the program are domestic corporations or 

partnerships that provide loans, investments, or financial counseling in low-income urban and 

rural communities. 

On December 18, 2015, Congress extended the authorization of the NMTC Program for $3.5 

billion per year through 2019. 
CDFI Fund - 11 

Description of Performance: 

The CY 2015 and CY 2016 NMTC investment authority was allocated in November 2016 as a 

combined round, in which the NMTC Program awarded $7 billion in NMTC investment 

authority to 120 CDEs, out of a pool of 238 applicants requesting $17.6 billion.

In FY 2016, 74.5 percent of NMTC investments were made in severely distressed communities 

exceeding the target by more than two percentage points. This performance indicates that CDEs 

continue to meet their commitments in severely distressed communities. 

2.1.4 – Bank Enterprise Award Program Performance and Measures 

Dollars in Thousands

Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Annualized 

CR Request

Appropriated Resources $18,000 $17,058 $18,000 $18,000 $19,000 $18,964 $0 

Budget Activity Total $18,000 $17,058 $18,000 $18,000 $19,000 $18,964 $0 

Bank Enterprise Award Program Budget Activity

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target FY 2016

Trend

BEA - Increase in Community 

Development Activities Over 

Prior Year For All BEA Program 

Applicants ($ million)

432 493 571 460 460 450 450 N/A

2D – Bank Enterprise Award Program 

($0 from direct appropriations):

The BEA Program provides monetary awards to regulated banks and thrifts for increasing their 

investments in CDFIs through grants, stock purchases, loans, deposits, and other forms of 

financial and technical assistance, and for increasing their lending, investment, and service 

activities in economically distressed communities where at least 30 percent of residents have 

incomes less than the national poverty level and where the unemployment rate is at least 1.5 

times the national unemployment rate. 

Description of Performance: 

The BEA Program measures applicants' increase in qualified community development activities 

over the prior year. The CDFI Fund expects to award up to $19 million in appropriated BEA 

Program funds in the award round for FY 2016, which was deferred to FY 2017. The award 

round for FY 2017 is currently scheduled to open in late September 2017 with award 

announcements to be made in February 2018. 

The performance target for the FY 2016 round is set at $450 million in increased qualified 

community development activities. 
CDFI Fund - 12 

In FY 2017 the CDFI Fund also expects to publish a third-party evaluation of the BEA Program 

and its effectiveness in increasing FDIC-insured bank investments in the nation’s most distressed 

communities. 

2.1.5 – Native American CDFI Assistance Program Performance and Measures 

Dollars in Thousands

Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Annualized 

CR Request

Appropriated Resources $12,000 $11,372 $15,000 $15,000 $15,000 $15,471 $0 

Budget Activity Total $12,000 $11,372 $15,000 $15,000 $15,000 $15,471 $0 

Native American CDFI Assistance Program Budget Activity

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target FY 2016

Trend

NACA - Percentage of NACA 

Loans and Investments in 

Native Areas ($ Amount of 

Loans)

N/A 75.5 57.9 65.0 48.4 50.0 50.0 N/A

NACA - Percentage of NACA 

Loans and Investments in 

Native Areas (# of Loans %)

N/A 93.3 87.0 95.9 94.9 50.0 50.0 N/A

2E – Native American CDFI Assistance Program 

($0 from direct appropriations):

Through the NACA Program, the CDFI Fund assists entities in overcoming barriers that prevent 

access to credit, capital, and financial services in American Indian, Alaska Native, and Native 

Hawaiian communities. The NACA Program makes monetary awards to increase the number 

and capacity of existing or new Native CDFIs (i.e., CDFIs that serve Native communities). In 

addition, the NACA Program provides training to help strengthen and develop Native CDFIs. 

Native CDFIs lend where other mainstream financial institutions have not, and serve the poorest 

individuals, families, and businesses in Native communities. 

Description of Performance: 

The CDFI Fund had created two new measures of performance for the NACA Program: the 

percentage of the number and the dollar amount of loans made in tribal lands based on Federal 

Designations of Tribal areas, or to Native people. In accordance with their Financial Assistance 

agreements, NACA awardees are required to originate 50 percent or more of their loans and 

investments in native areas or to native populations. As such, the target is a threshold that must 

be met or exceeded. The level of this threshold is set to allow the awardees to balance their 

mission of serving native areas and populations with safety and soundness considerations; hence 

this is not an increasing target. 

For FY 2018 no target will be set for the program because no funding is being requested, 

although outcomes still may be reported for prior year awardees. 
CDFI Fund - 13 

2.1.6 - Healthy Food Financing Initiative Performance and Measures 

Dollars in Thousands

Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Annualized 

CR Request

Appropriated Resources $22,000 $20,849 $35,000 $22,000 $22,000 $21,958 $0 

Budget Activity Total $22,000 $20,849 $35,000 $22,000 $22,000 $21,958 $0 

Healthy Food Financing Initiative Budget Activity

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target FY 2016

Trend

HFFI - Retail Outlets 

Created/Preserved

0 31 33 35 19 32 20 N/A

2F – Healthy Food Financing Initiative 

($0 from direct appropriations):

The Healthy Food Financing Initiative (HFFI) aims to eliminate “food deserts” – low-income 

urban and rural areas in the United States with limited access to affordable and nutritious food – 

by financing interventions that expand the supply of and demand for nutritious foods. This 

includes increasing the distribution of agricultural products, developing and equipping grocery 

stores, and strengthening producer-to-consumer relationships. 

Through the HFFI, the CDFI Fund awards CDFI Program funds to certified CDFIs to help 

address the need for healthy food in underserved and low-income communities. These 

organizations use federal grants, below market-rate loans, loan guarantees, and tax credits to 

attract private sector financing for projects that increase access to healthy food options. 

Description of Performance:

The primary HFFI performance measure is the number of healthy food retail stores created and 

maintained in low-income areas that have been identified through detailed census tract analysis 

as having limited access to healthy food options. In FY 2016, the number of HFFI Retail outlets 

created was 19, which fell short of the target of 32 outlets. There is considerable variation in 

both size and type of HFFI retail outlet investments, making accurate targeting difficult. 

For FY 2018 no target will be set for the program because no funding is being requested, 

although outcomes still may be reported for prior year awardees. 
CDFI Fund - 14 

2.1.7 - Capital Magnet Fund Program Resource Detail Table 

Dollars in Thousands

Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Annualized 

CR Request

GSE Distribution NA NA NA NA $100,292 $119,413 NA

Budget Activity Total NA NA NA NA $100,292 $119,413 NA

FTE 0 0 0 0 0 7 6 

Capital Magnet Fund Program Budget Activity

2G - Capital Magnet Fund Program 

($0 from direct appropriations):

The CMF program was authorized by the Housing and Economic Recovery Act of 2008 

(HERA), which calls for recurrent funding of the CMF through allocations from the 

Government-Sponsored Enterprises (GSEs) Fannie Mae and Freddie Mac. Through CMF, the 

CDFI Fund provides grants to CDFIs and qualified non-profit housing organizations to finance 

affordable housing, community service facilities, and economic development. Award recipients can 

use funds to create financing tools such as loan loss reserves, revolving loan funds, risk-sharing 

loans, and loan guarantees. The Budget proposes to suspend the new allocations into the CMF 

effective in FY 2018. 

2.1.8 - Bond Guarantee Program Resource Detail Table

Dollars in Thousands

Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Annualized 

CR Reqest

Obligations $0 $325,000 $200,000 $327,000 $265,000 $432,000 $500,000 

Loan Limitation 

Obligation Authority $0 $0 $750,000 $750,000 $750,000 $750,000 $500,000 

Bond Guarantee Program

2.1.9 - Financing Accounts – Non-Budgetary Summary 

Dollars in Thousands

Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Annualized 

CR Request

Obligations $0 $325,000 $200,000 $327,000 $265,000 $432,000 $500,000 

Collections $0 $0 $356 $2,966 $9,377 $29,813 $40,247 

Bond Guarantee Program

Includes the principal and interest repayments and a 10 basis point fee for administrative expenses pursuant to 

Section 1134 of the Small Business Jobs Act of 2010. These amounts assume a zero subsidy rate with bond loan 

disbursement of $121 million and $160 million, in FY 2017 and FY 2018, respectively.

2H - CDFI Bond Guarantee Program 

Through the CDFI Bond Guarantee Program, Treasury provides a 100 percent guarantee of 

bonds (including principal, interest, and call premiums) issued by Qualified Issuers. Bonds 

issued through the program support CDFI lending and investment activity in underserved 
CDFI Fund - 15 

communities by providing a source of long-term capital. Qualified Issuers use bond proceeds to 

finance loans to eligible CDFIs for community and economic development purposes. 

Since the inception of the program, the total amount of bonds guaranteed is $1.1 billion. A total 

of 17 Eligible CDFIs and three Qualified Issuers participate in the CDFI Bond Guarantee 

Program. Upon the closing of each bond, the eligible CDFIs have five years to lend or disburse 

the bond proceeds. 

The table below provides the year-to-date (YTD) and proposed disbursement for the top eight 

asset classes. 

Asset Class YTD Disbursements 

($ millions) 

YTD 

Disbursements 

(%) 

Proposed 

Disbursements 

($millions) 

Proposed 

Disbursements 

(%) 

Charter schools $150.2 35.8% $321.6 28.8% 

Rental housing $131.3 31.3% $270.5 24.2% 

Commercial real estate $ 86.5 20.6% $253.9 22.7% 

Not-for-profits $ 23.7 5.7% $ 92.7 8.3% 

Healthcare facilities $ 12.6 3.0% $ 68.4 6.1% 

Small business $ 7.7 1.8% $ 28.5 2.6% 

CDFI to financing entity $ 5.1 1.2% $ 15.6 1.4% 

Daycare centers $2.7 0.6% $ 28.5 2.6% 

C – Changes in Performance Measures 

Performance Measure or Indicator Proposed Changes and Justification 

1. All – Disbursement Cycle Time 

measured in months. (Discontinue) 

This measure of the efficiency of the grant 

disbursement process has been replaced by the 

Uniform Administrative Requirements (UAR) 

which limits award disbursements to the amount 

that can be expended by recipients for allowable 

uses during the year. 

2. Time to Initial Disbursement measured in 

months. (New measure) 

The new measure evaluates the amount of time 

between award announcements and the initial 

disbursement of funds, thereby measuring 

disbursement efficiency as defined by the UAR. 

Reported in Congressional Justification (CJ) and 

Quarterly Performance Review (QPR). 

3. Bank Enterprise Award (BEA) Program 

– Increase in community development 

activities over prior year for all Program 

Applicants measured in $ millions. 

(Change to indicator) 

The BEA Program measure is an indicator rather 

than an output measure. Office of Performance 

Budgeting will work with the CDFI Fund to 

develop an output or outcome measure. Continue 

reporting in CJ and QPR. 

4. Native American CDFI Award (NACA) 

– Amount of loans/investments 

The current measure is volatile and does not 

effectively measure program performance. 
CDFI Fund - 16 

originated measured in $ millions. 

(Discontinue) 

5. NACA – Number of loans/investments 

originated measure by number of loans. 

(Discontinue) 

The current measure is volatile and does not 

effectively measure program performance. 

6. Percentage of NACA loans and 

investments in Native Areas measured by 

dollar amount of loans. (New Measure) 

The new measure will quantify the extent to 

which eligible areas are being served by NACA 

awardees in relation to annual total dollar 

loan/investment amount. Report new measure in 

CJ and QPR. 

7. Percentage of NACA loans and 

investments in Native Areas measured by 

number of loans. (New measure) 

The new measure will quantify the extent to 

which eligible areas are being served by NACA 

awardees in relation to annual total number of 

loan/investment activity. Report new measure in 

CJ and QPR. 

8. New Market Tax Credit – Community 

Development Entities’ annual qualified 

equity investments in low income 

communities ($billions). (Change to 

indicator) 

Targets are largely dependent on the annual tax 

allocation levels authorized by Congress. 

9. Healthy Food Financing Initiative – 

Number of Retail outlets 

created/preserved. (Change to indicator) 

The variation in the size and scope of retail 

projects is considerable, making it difficult to 

forecast targets. Continue reporting in CJ and 

QPR. 
CDFI Fund - 17 

Section III – Additional Information 

A – Summary of Capital Investments 

As part of its FY 2018 capital investment strategy, the CDFI Fund plans to spend approximately 

$4 million for operations and maintenance of its Information Technology (IT). The CDFI Fund 

has no major IT investments, nor any capital investments other than IT. 

Non-Major IT Investments 

For FY 2018, the CDFI Fund has identified three non-major IT investments: Awards 

Management Information System (AMIS); Community Investment Impact System (CIIS); and 

the CDFI Fund public website. AMIS is an enterprise, commercial, cloud-based solution that 

supports the CDFI Fund certification, tax credit allocation, bond guarantee, and grant programs. 

The first AMIS deployment went live in September 2015 with full deployment planned for 

September 2017. CIIS is a web-based data collection system that provides CDFI Fund program 

performance and outcome reporting to the Administration, Congress and the public. The CDFI 

Fund public website, which is another cloud-based solution, provides access to general 

information about CDFI Fund and is used to ensure the public can obtain answers and guidance 

regarding CDFI Fund programs. For FY 2018, the CDFI Fund plans to provide Operations and 

Maintenance (O&M) support for these three IT investments. 

IT Infrastructure Investments 

The CDFI Fund’s IT infrastructure is managed via an Interagency Agreement with the Alcohol 

and Tobacco Tax and Trade Bureau (TTB). Treasury has seen numerous benefits from the CDFI 

Fund/TTB arrangement. It increases utilization of Treasury data centers and enables the CDFI 

Fund to leverage existing Disaster Recovery and Continuity of Operations capabilities. The 

CDFI Fund avoids software upgrade costs by using TTB’s enterprise software licenses. This 

stops duplicative services (such as Web monitoring and filtering) and eliminates contracts used 

to maintain the CDFI Fund’s IT infrastructure. 

A summary of capital investment resources, including major information technology and nontechnology investments can be found at: 

http://www.treasury.gov/about/budget-performance/Pages/summary-of-capital-investments.aspx

This website also contains a digital copy of this document.

Department of the Treasury

Financial Crimes Enforcement 

Network

Congressional Justification 

for Appropriations and 

Annual Performance 

Report and Plan

FY 2018 
FinCEN - 2

Table of Contents

Section I – Budget Request..........................................................................................................3

A – Mission Statement...............................................................................................................3

B – Summary of the Request .....................................................................................................3

1.1 – Appropriations Detail Table .............................................................................................3

1.2 – Budget Adjustments Table................................................................................................4

C – Budget Increases and Decreases Description......................................................................4

1.3 – Operating Levels Table.....................................................................................................5

D – Appropriations Language and Explanation of Changes .....................................................6

E – Legislative Proposals...........................................................................................................6

Section II – Annual Performance Plan and Report..................................................................7

A – Strategic Alignment ............................................................................................................7

B – Budget and Performance by Budget Activity .....................................................................8

2.1.1 BSA Administration and Analysis Resources and Measures...........................................8

BSA Administration and Analysis Budget and Performance....................................................9

C – Changes in Performance Measures...................................................................................10

Section III – Additional Information .......................................................................................11

A – Summary of Capital Investments......................................................................................11
FinCEN - 3

Section I – Budget Request

A – Mission Statement

Safeguard the financial system from illicit use and combat money laundering and promote 

national security through the collection, analysis, and dissemination of financial intelligence and 

strategic use of financial authorities.

B – Summary of the Request 

In carrying out its mission, FinCEN has numerous statutory areas of responsibility:

• Developing and issuing regulations under the Bank Secrecy Act (BSA); 

• Enforcing compliance with the BSA in partnership with law enforcement and other 

regulatory partners; 

• Serving as the U.S. Financial Intelligence Unit (FIU) and maintaining a network of 

information sharing with FIUs in 151 partner countries; 

• Receiving millions of new financial reports each year; 

• Securing and maintaining a database of over 190 million reports; 

• Analyzing and disseminating financial intelligence to federal, state, and local law 

enforcement, federal and state regulators, foreign FIUs, and industry; 

• Bringing together the disparate interests of law enforcement, FIUs, regulatory partners, 

and industry.

1.1 – Appropriations Detail Table

Dollars in Thousands

Financial Crimes Enforcement Network FY 2016 FY 2017 FY 2018 FY 2017 to FY 2018

Appropriated Resources Enacted Annualized CR Request Change % Change

 FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

New Appropriated Resources:

BSA Administration and Analysis 278 $112,979 338 $112,764 332 $112,764 (6) $0 -1.78% 0.00%

Subtotal New Appropriated Resources 278 $112,979 338 $112,764 332 $112,764 (6) $0 -1.78% 0.00%

Other Resources:

Reimbursables 1 $3,000 1 $3,000 1 $3,000 0 $0 0.00% -0.00%

Recovery from Prior Years 0 $500 0 $500 0 $500 0 $0 0.00% -0.00%

Subtotal Other Resources 1 $3,500 1 $3,500 1 $3,500 0 $0 0.00% -0.00%

Total Budgetary Resources 279 $116,479 339 $116,264 333 $116,264 (6) $0 1.77% -0.00%

Note: FY 2016 is showing actual FTE usage. The 338 Direct FTE in FY 2017 is a reduction from 343 enacted in FY 2016 due to 

the absorption of the 2017 pay raise and 2016 pay annualization.
FinCEN - 4

1.2 – Budget Adjustments Table

Dollars in Thousands

Financial Crimes Enforcement Network 

(FINCEN) FTE Amount

FY 2017 Annualized CR 338 $112,764 

Changes to Base:

Maintaining Current Levels (MCLs): - $2,276 

Pay-Raise - $783 

Pay Annualization - $287 

Non-Pay - $1,206 

Efficiency Savings - ($1,206)

Efficiency Savings - ($1,206)

Subtotal Changes to Base - $1,070

Total FY 2018 Base 338 $113,834 

Program Changes:

Program Decreases (6) ($1,070)

Program Staffing Reductions (6) ($1,070)

Subtotal Program Changes (6) ($1,070)

Total FY 2018 Request 332 $112,764 

Note: The 338 FTE in FY 2017 is a reduction from 343 enacted in FY 2016 due to the

absorption of the 2017 pay raise and 2016 pay annualization. 

C – Budget Increases and Decreases Description

Maintaining Current Levels (MCLs) ......................................................+$2,276,000 / +0 FTE

Pay Raise +$783,000 / +0 FTE 

Funds are requested for the proposed January 2018 pay-raise.

Pay Annualization +$287,000 / +0 FTE 

Funds are requested for annualization of the January 2017 pay-raise.

Non-Pay +$1,206,000 / +0 FTE 

Funds are requested for non-labor expenses such as travel, contracts, rent, contracts, supplies,

and equipment.

Efficiency Savings ......................................................................................-$1,206,000 / +0 FTE

Efficiency Savings -$1,206,000 / +0 FTE 

These efficiencies are a result of reductions in printing and savings realized through reevaluated or negotiated contracts.

Program Decreases ......................................................................................-$1,070,000 / -6 FTE

Program Staffing Reductions -$1,070,000 / -6 FTE

This reduction will be taken across several FinCEN program areas. FinCEN will evaluate open 

positions for possible absorption of workload associated with positions lost through attrition. 
FinCEN - 5

1.3 – Operating Levels Table

Dollars in Thousands

Financial Crimes Enforcement Network (FinCEN) FY 2016 FY 2017 FY 2018

Object Classification Enacted Annualized CR Request

11.1 - Full-time permanent 41,115 41,817 42,136 

11.3 - Other than full-time permanent 408 408 408 

11.5 - Other personnel compensation 205 205 205 

11.9 - Total personnel compensation 41,728 42,430 42,749 

12.0 - Personnel benefits 12,259 12,260 11,941 

Total Personnel and Compensation Benefits $53,987 $54,690 $54,690 

21.0 - Travel and transportation of persons 607 615 628 

23.1 - Rental payments to GSA 4,380 4,130 4,151 

23.2 - Rental payments to others 31 32 32 

23.3 - Communication, utilities, and misc charges 1,649 1,670 1,705 

24.0 - Printing and reproduction 200 207 172 

25.1 - Advisory and assistance services 1,097 1,097 1,097 

25.2 - Other services from non-Federal sources 14,864 15,873 15,778 

25.3 - Other goods and services from Federal sources 9,132 9,496 9,698 

25.4 - Operation and maintenance of facilities 740 0 0 

25.6 - Medical care 171 174 174 

25.7 - Operation and maintenance of equipment 18,629 17,979 17,811 

26.0 - Supplies and materials 319 326 333 

31.0 - Equipment 7,173 6,475 6,495 

Total Non-Personnel $58,992 $58,074 $58,074 

Subtotal New Budgetary Resources $112,979 $112,764 $112,764 

FTE 279 338 332

This table includes total annually appropriated funding (enacted for FY 2016, FY 2017 Annualized CR and FY 2018 request).
FinCEN - 6

D – Appropriations Language and Explanation of Changes

Appropriations Language Explanation of Changes

DEPARTMENT OF THE TREASURY

FINANCIAL CRIMES ENFORCEMENT NETWORK

Federal Funds

SALARIES AND EXPENSES

For necessary expenses of the Financial Crimes Enforcement 

Network, including hire of passenger motor vehicles; travel and 

training expenses of non-Federal and foreign government 

personnel to attend meetings and training concerned with 

domestic and foreign financial intelligence activities, law 

enforcement, and financial regulation; services authorized by 5 

U.S.C. 3109; not to exceed $10,000 for official reception and 

representation expenses; and for assistance to Federal law 

enforcement agencies, with or without reimbursement, 

$112,764,000, of which not to exceed $34,335,000 shall remain 

available until September 30, 2020.

Note.—A full-year 2017 appropriation for this account was not 

enacted at the time the budget was prepared; therefore, the budget 

assumes this account is operating under the Further Continuing 

Appropriations Act, 2017 (P.L. 114–254). The amounts included 

for 2017 reflect the annualized level provided by the continuing 

resolution.

E – Legislative Proposals

FinCEN has no legislative proposals.
FinCEN - 7

Section II – Annual Performance Plan and Report

A – Strategic Alignment

FinCEN develops and issues regulations under the BSA; enforces compliance with the BSA in 

partnership with regulatory partners and as the sole BSA regulator across numerous industries; 

receives BSA reports and maintains a database; analyzes and disseminates financial intelligence 

to federal, state, and local law enforcement, federal and state regulators, foreign FIUs, and 

industry; and serves as the U.S. FIU and maintains a network of information sharing with FIUs 

in partner countries. The FY 2018-2022 Treasury strategic plan is under development, and the 

FY 2019 annual performance report and plan will update FinCEN alignment to Treasury 

priorities.

In FY 2016 FinCEN had several noteworthy accomplishments. Some highlights are FinCEN: 

used financial intelligence to identify foreign terrorist fighters facilitation networks; proactively 

supported efforts to counter terror financing by supporting Paris and Brussels terrorist attack 

investigations and the Orlando shooting investigation; assisted DOJ in recovering $1.3 billion in 

tax-evasion penalties that started in 2014 and these recoveries lead to 78 non-prosecution 

agreements with 80 Swiss banks; launched a geographic targeting order in Florida that 

contributed to the arrests and pending arrests of 22 alleged co-conspirators in a complex money 

laundering scheme with ties to the Mexican Sinaloa drug cartel; issued final rule under section 

311 of the Patriot Act to further restrict North Korea’s access to the U.S. financial system; issued 

two Financial Action Task Force enhanced advisories that identified jurisdictions with antimoney laundering/countering the financing of terrorism (AML/CFT) deficiencies and two cyberthreat related advisories to financial institutions regarding e-mail compromise fraud schemes; 

produced the Customer Due Diligence final rule that requires identification of beneficial owners; 

and issued six penalties totaling $8,660,000. 

FinCEN’s FY 2017 and FY 2018 priorities include target examination and enforcement efforts

to high risk and priority areas, with increased focus on money services businesses; expand

understanding and analysis of illicit networks, institutions, jurisdictions, and schemes, with 

emphasis on national security threats and terrorist groups such as ISIS; ensure the BSA

regulatory structure effectively and efficiently targets illicit financing risks; manage the efficient

collection, processing, and retrieval of BSA data; and foster strong public-private partnerships 

with the financial industry.
FinCEN - 8

B – Budget and Performance by Budget Activity

2.1.1 BSA Administration and Analysis Resources and Measures

Dollars in Thousands

BSA Administration and Analysis Budget Activity

 Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Enacted Enacted Enacted Enacted Enacted Annualized 

CR Request

Appropriated Resources $110,788 $104,993 $112,000 $112,000 $112,979 $112,764 $112,764

Reimbursables

Resources $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000

Budget Activity Total $113,788 $107,993 $115,000 $115,000 $115,979 $115,764 $115,764

FTE (Actual) 301 302 279 276 279 339 333

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target FY 2016

Trend

Percentage of Users 

Finding That the Financial 

Intelligence Collected by 

FinCEN Pursuant its 

Regulations Provides 

Valuable Information to 

Safeguard the Financial 

System, Combat Money 

Laundering, and Counter 

Terrorist Financing

90.0 80.0 81.0 83.0 84.0 84.0 85.0 86.0

Percentage of AML/CFT 

Supervisors Who Indicate 

That FinCEN’s 

Enforcement Actions Have 

Resulted in Increased 

Compliance by Covered 

Financial Institutions

N/A N/A 81.0 88.0 94.0 89.0 94.0 95.0

Percentage of Customers 

Finding that FinCEN's 

Analytic Products and 

Advanced Research 

Positively Affected 

Investigations, Operations, 

or Understanding of 

Threats to the Financial 

System

N/A N/A N/A 95.0 95.0 95.0 95.0 95.0

Percentage of 

Stakeholders Finding 

FinCEN’s Information 

Sharing Has Contributed to 

Their Organization’s 

Responsibilities

N/A N/A 89.0 91.0 91.0 92.0 92.0 92.0

Percentage of Users 

Satisfied with FinCEN 

Information Sharing 

Systems

N/A N/A 78.0 80.0 83.0 80.0 84.0 84.0
FinCEN - 9

BSA Administration and Analysis Budget and Performance

($112,764,000 from direct appropriations, $3,000,000 from reimbursable resources):

Description of Performance:

FinCEN conducts annual surveys of users on the utility and value of FinCEN’s information, 

analysis, and systems. The results provide valuable feedback on FinCEN’s performance 

safeguarding the financial system from illicit use, combatting money laundering and promoting 

national security.

FinCEN tracks the percentage of users finding that financial intelligence collected by FinCEN 

pursuant to its regulations provides valuable information to safeguard the financial system, 

combat money laundering, and counter terrorist financing. This measure supports FinCEN 

Strategic Objective 1.1 to adopt strong AML/CFT regulatory safeguards. In FY 2016, FinCEN 

met its target of 84 percent, with 84 percent finding value. FinCEN attained this result by

continued emphasis on on-line training for users of the FinCEN Query tool for their unique 

cases and situations. The target increases to 85 percent and 86 percent in FY 2017 and FY 

2018.

FinCEN tracks the percentage of AML/CFT supervisors who indicate that FinCEN’s 

enforcement actions have resulted in increased compliance by covered financial institutions. 

This measure supports FinCEN Strategic Objective 1.2 to implement and enforce AML/CFT 

regulatory authorities and employ targeted financial measures against priority threats. In 

FY 2016, FinCEN surpassed its target of 89 percent with 94 percent finding enforcement 

actions have resulted in increased compliance. FinCEN was able to achieve this by successfully 

pursuing enforcement actions and outreach. The target is 94 percent in FY 2017 and increases 

to 95 percent in FY 2018. 

This new measure is the percentage of customers finding FinCEN’s analytic products and 

advanced research positively affected investigations, operations, or understanding of threats to 

the financial system. This measure supports FinCEN Strategic Objective 1.3 to use research, 

analysis, and advanced analytics to identify and explain priority threats to the financial system.

In FY 2015 and FY 2016, 95 percent of respondents found the analytic products and research 

had a positive impact. The FY 2017 and FY 2018 targets are set at 95 percent.

FinCEN measures the percentage of stakeholders finding FinCEN’s information sharing has 

contributed to their organization’s responsibilities. This supports FinCEN Strategic Objective 

2.1 to implement and manage programs to effectively network, coordinate, and share financial 

intelligence between FinCEN and its domestic and foreign partners in government and private 

industry. In FY 2016, FinCEN narrowly missed its target of 92 percent with 91 percent finding 

the information sharing helpful. FinCEN will maximize the sharing of financial intelligence 

between FinCEN and its domestic and foreign partners in government and private industry to 

attain future targets. The FY 2017 and FY 2018 targets are 92.

FinCEN tracks the percentage of users satisfied with FinCEN information sharing systems. 

This measure supports FinCEN Strategic Objective 2.2 to develop and support effective 

technology systems to collect and analyze financial intelligence from private industry and share 

it with domestic and foreign government partners. The measure is based on survey responses 
FinCEN - 10

and represents user satisfaction with the BSA E-Filing System, FinCEN Query, and the Egmont 

Secure Web. In FY 2016, FinCEN exceeded its target of 80 percent with 83 percent of the users 

satisfied with information sharing systems. FinCEN strives to provide systems with fast 

response times. FinCEN also continues to receive positive feedback on the usefulness of the 

data it provides, as well as knowledgeable and courteous user support. In FY 2017 and FY 

2018 targets are set at 84. 

C – Changes in Performance Measures 

Performance Measure or Indicator Proposed Change and Justification

1. Percentage of customers finding that 

FinCEN’s research, analysis, and 

advanced analytics contribute to the 

safeguarding of the financial system, 

combating money laundering, and 

counter terrorist financing (discontinue)

Propose to stop reporting this metric because

FinCEN refined the measure name and 

methodology to more accurately reflect what the 

analytics products are intended to do, i.e. be 

useful to a wide range of customers and have 

impact, such as identify new leads or provide 

previously unknown information. The 

discontinued measure will be replaced by the

percentage of customers finding FinCEN’s 

analytic products and advanced research 

positively affected investigations, operations, or 

understanding of threats to the financial system.
FinCEN - 11

Section III – Additional Information

A – Summary of Capital Investments

As the administrator of the BSA, FinCEN receives valuable information reported and collected 

under BSA requirements, which totaled approximately 18.5 million filings in FY 2016. To 

successfully fulfill its mission, FinCEN relies on secure, advanced IT to manage the collection, 

processing, storage, and dissemination of BSA information that contributes to the soundness 

and confidence in America’s financial system.

FinCEN’s IT strategy takes into account the growing need for financial institutions to meet 

obligations as efficiently as possible, while ensuring that FinCEN and law enforcement agencies 

receive accurate, timely, and reliable BSA information to track money trails, identify money 

laundering, and unravel terrorist financing networks. FinCEN’s IT strategy focuses on the 

critical need to improve the quality and accessibility of its data and increase responsiveness to 

stakeholders by maintaining and building upon flexible and innovative technical solutions. The 

BSA IT Modernization investment entire lifecycle cost, which includes the year the investment 

started (2010) through BY+4 (2021), is $332 million (including FTE) and the FY 2018 cost is 

$27.58 million (including FTE).

A summary of capital investment resources, including major information technology and nontechnology investments, can be viewed/downloaded at: http://www.treasury.gov/about/budgetperformance/pages/summary-of-capital-investments.aspx.

This website also contains a digital copy of this document.

Department of the Treasury

Alcohol and Tobacco Tax and 

Trade Bureau (TTB)

Congressional Justification 

for Appropriations and 

Annual Performance 

Report and Plan

FY 2018 
TTB - 2

Table of Contents

Section I – Budget Request........................................................................................................... 3

A – Mission Statement................................................................................................................ 3

B – Summary of the Request ...................................................................................................... 3

1.1 – Appropriations Detail Table.........................................................................................................4

1.2 – Budget Adjustments Table...........................................................................................................4

C – Budget Increases and Decreases Description....................................................................... 4

1.3 – Operating Levels Table................................................................................................................6

D – Appropriations Language and Explanation of Changes ...................................................... 7

E – Legislative Proposals............................................................................................................ 7

Section II – Annual Performance Plan and Report................................................................... 8

A – Strategic Alignment ............................................................................................................. 8

B – Budget and Performance by Budget Activity ...................................................................... 8

2.1.1 Collect the Revenue Resources and Measures................................................................... 8

Collect the Revenue Budget and Performance ........................................................................... 8

2.1.2 Protect the Public Resources and Measures..................................................................... 11

Protect the Public Budget and Performance ............................................................................. 12

Section III – Additional Information ........................................................................................ 15

A – Summary of Capital Investments....................................................................................... 15
TTB - 3

Section I – Budget Request

A – Mission Statement

To collect the taxes on alcohol, tobacco, firearms, and ammunition; protect the consumer by 

ensuring the integrity of alcohol products; and prevent unfair and unlawful market activity for 

alcohol and tobacco products.

B – Summary of the Request 

Supporting the nation’s economic vitality is at the core of the work performed by the Alcohol 

and Tobacco Tax and Trade Bureau (TTB). The Bureau’s role in permitting, regulating, and 

taxing the alcohol, tobacco, and firearms industries facilitates a compliant and fair marketplace

for those engaged in the manufacture and trade of these commodities, and ensures that the 

Federal Government has the resources needed to fund national priorities. TTB administers its 

mission according to two core strategic goals—“Collect the Revenue” and “Protect the Public”—

both of which support Treasury in promoting economic growth and stability and in fairly and 

effectively reforming and modernizing Federal tax systems. 

TTB is the third largest tax collection agency in the U.S. Government, after the Internal Revenue 

Service and U.S. Customs and Border Protection, collecting more than $22 billion in excise tax 

revenues annually. As the most efficient means of tax administration, facilitating voluntary 

compliance will remain a priority for TTB in FY 2018. To this end, TTB will enhance its 

guidance related to Federal alcohol, tobacco, firearms, and ammunition laws and regulations, and 

explore opportunities to streamline regulations and requirements to reduce compliance burden. 

TTB will also focus on improving internal processes to contribute to continued positive returns 

on the investment in TTB.

Alcohol and tobacco diversion remain long-term tax enforcement challenges given the high 

profits to be gained from illegal activity, the relative ease of diversion, and the substantial 

revenue loss that it represents. Failure to address illicit trade not only deprives governments of 

revenue, but also gives non-compliant actors an unfair competitive advantage over their lawful 

counterparts. Given this, TTB will maintain its efforts to employ risk modeling to target its

audits and investigationsto remain focused on the highest risk activity. TTB will also prioritize 

its enforcement cases to most effectively deploy its criminal agents to detect and deter illicit 

trade.

As demand for TTB services has grown in line with the expanding alcohol industries, TTB has 

responded through updated policies to reduce burden, systems modernization, and streamlined 

processes to ensure the timely turnaround of applications for new and existing wineries, 

breweries, and distilleries. Delays can cause financial hardships for these businesses and create a 

barrier to compliant commerce. In FY 2018, TTB will revise its service standards in line with 

anticipated staffing levels and ensure the new standards are clearly communicated to industry in 

order to manage expectations and allow appropriate operational planning. TTB will further 

adjust its strategy for systems modernization to align with resource levels, continuing to focus on 

clear and consistent guidance to industry to facilitate the submission of compliant applications. 
TTB - 4

1.1 – Appropriations Detail Table

Dollars in Thousands

TTB FY 2016 FY 2017 FY 2018 FY 2017 to FY 2018

Appropriated Resources Enacted Annualized CR Request $ Change % Change

 FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

New Appropriated Resources:

Collect the Revenue 229 $52,785 242 $53,458 223 $49,425 (19) ($4,034) -7.85% -7.55%

Protect the Public 241 $53,654 252 $52,779 233 $49,233 (19) ($3,545) -7.54% -6.72%

Subtotal New Appropriated Resources 470 $106,439 494 $106,237 456 $98,658 (38) ($7,579) -7.69% -7.13%

Other Resources:

Reimbursables 10 $6,992 10 $6,972 10 $6,972 0 $0 0.00% -00.00%

Subtotal Other Resources 10 $6,992 10 $6,972 10 $6,972 0 $0 0.00% -00.00%

Total Budgetary Resources 480 $113,431 504 $113,209 466 $105,630 (38) ($7,579) -7.54% -6.69%

Note: FY 2016 FTE and Other Resources are Actual

1.2 – Budget Adjustments Table

Dollars in Thousands

TTB FTE Amount

FY 2017 Annualized CR 494 $106,237 

Changes to Base:

Maintaining Current Levels (MCLs): $2,102 

Pay-Raise - $909 

Pay Annualization - $333 

Non-Pay - $860 

Efficiency Savings - ($570)

Reduce Infrastructure Footprint - ($250)

Reduce Support Services - ($320)

Subtotal Changes to Base - 1,532 

Total FY 2018 Base 494 $107,769 

Program Changes:

Program Decreases (38) ($9,111)

Program Staff Attrition and 

Incentives (38) ($4,150)

IT Development and Modernization - ($2,500)

Program Contract Reductions - ($2,461)

Subtotal Program Changes (38) (9,111)

Total FY 2018 Request 456 98,658 

C – Budget Increases and Decreases Description

Maintaining Current Levels (MCLs) ......................................................+$2,102,000 / +0 FTE

Pay Raise +$909,000 / +0 FTE 

Funds are requested for the proposed January 2018 pay-raise.

Pay Annualization +$333,000 / +0 FTE 

Funds are requested for annualization of the January 2017 pay-raise.
TTB - 5

Non-Pay +$860,000 / +0 FTE 

Funds are requested for non-labor expenses such as travel, contracts, rent, supplies, and 

equipment.

Efficiency Savings ...........................................................................................-$570,000 / -0 FTE

Reduce Infrastructure Footprint -$250,000 / -0 FTE

TTB has implemented an aggressive telework program that has enabled the bureau to close half 

of its field offices, with the remaining field offices being vital to TTB’s mission. TTB has also 

reconfigured and reduced the amount of office space needed to operate its headquarters in 

Washington, D.C., and the National Revenue Center in Cincinnati. In an ongoing effort to 

improve space utilization, TTB has identified additional opportunities to reduce leased space, 

resulting in additional savings of $250,000. 

Reduce Support Services -$320,000 / -0 FTE

TTB will reduce its operating costs through savings in administrative overhead and decreased 

program support operations in line with anticipated program staff attrition.

Program Deceases ......................................................................................-$9,111,000 / -38 FTE

Program Staff Attrition and Incentives -$4,150,000 / -38 FTE

TTB will implement a hiring freeze to achieve a workforce reduction of 38 FTE. This reduction, 

which equates to 8 percent of TTB’s full-time positions, will be taken across multiple program 

areas. TTB will continuously evaluate the capacity of its workforce to absorb the workload 

associated with those positions lost through attrition and, as necessary, adjust its service 

standards to reflect anticipated staffing levels. This reduction also reduces performance 

incentives recognizing special acts and high-performing employees in order to minimize staffing 

losses.

IT Development and Modernization -$2,500,000 / -0 FTE

TTB will cut IT development and modernization investments in its core business systems and 

focus on essential maintenance of existing systems. Planned system enhancements targeted at 

reducing compliance errors on permit, label, and formula applications and in tax filings will be 

postponed, which will impact timely service delivery and efficient tax enforcement. 

Program Contract Reductions -$2,461,000 / -0 FTE

TTB will reduce its contract services by reducing or re-scoping contracts for both its commercial

vendors and government suppliers. These reductions will require reprioritization of the criminal 

case pipeline to ensure effective case management and resolution. 
TTB - 6

1.3 – Operating Levels Table

Dollars in Thousands

TTB FY 2016 FY 2017 FY 2018

Object Classification Actual Annualized CR Request

11.1 - Full-time permanent 46,047 49,280 47,556

11.5 - Other personnel compensation 801 1,060 500

11.9 - Total personnel compensation 46,848 50,340 48,056

12.0 - Personnel benefits 14,976 14,720 13,981

13.0 - Benefits for former personnel 5 5 5

Total Personnel and Compensation Benefits $61,829 $65,065 $62,042

21.0 - Travel and transportation of persons 1,688 1,746 1,700

22.0 - Transportation of things 20 33 30

23.1 - Rental payments to GSA 3,941 4,303 4,053

23.3 - Communication, utilities, and misc charges 1,337 1,732 1,732

24.0 - Printing and reproduction 215 268 268

25.2 - Other services from non-Federal sources 27,728 23,880 20,136

25.3 - Other goods and services from Federal sources 6,892 7,129 6,616

26.0 - Supplies and materials 432 456 456

31.0 - Equipment 2,012 1,625 1,625

Total Non-Personnel $44,265 $41,172 $36,616

New Budgetary Resources $106,094 $106,237 $98,658 

FTE 470 494 456

Note: This table includes total annually appropriated funding (actuals for FY 2016 and estimates for FY 2017 Annualized CR 

and FY 2018).
TTB - 7

D – Appropriations Language and Explanation of Changes

Appropriations Language Explanation of Changes

DEPARTMENT OF THE TREASURY

ALCOHOL AND TOBACCO TAX AND TRADE BUREAU

Federal Funds

SALARIES AND EXPENSES

For necessary expenses of carrying out section 1111 of the 

Homeland Security Act of 2002, including hire of passenger 

motor vehicles, $98,658,000; of which not to exceed $6,000 for 

official reception and representation expenses; not to exceed 

$50,000 for cooperative research and development programs for 

laboratory services; and provision of laboratory assistance to 

State and local agencies with or without reimbursement.

Note.—A full-year 2017 appropriation for this account was not 

enacted at the time the budget was prepared; therefore, the budget 

assumes this account is operating under the Further Continuing

Appropriations Act, 2017 (P.L. 114–254). The amounts included 

for 2017 reflect the annualized level provided by the continuing 

resolution.

The 2018 Budget 

proposes to remove the 

$5 million earmark for 

accelerating the 

processing of formula 

and label applications. 

E – Legislative Proposals

TTB has no legislative proposals.
TTB - 8

Section II – Annual Performance Plan and Report

A – Strategic Alignment

TTB is responsible for administering and enforcing the 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 the alcohol 

beverage industry for the protection of U.S. consumers. TTB administers its jurisdiction 

according to two strategic goals—“Collect the Revenue” and “Protect the Public”—both of 

which serve to support economic growth and stability. TTB’s strategic goal to collect the 

revenue ensures that the Federal Government has the resources needed to fund national priorities 

and supports Treasury in improving the execution of the tax code. TTB’s strategic goal to protect 

the public ensures that lawful U.S. alcohol businesses are competitive and thriving in the global 

marketplace.

The FY 2018 - 2022 strategic plan is currently under development. The annual performance plan 

will be updated in the FY 2019 Budget to reflect the new priorities.

B – Budget and Performance by Budget Activity

2.1.1 Collect the Revenue Resources and Measures

Dollars in Thousands

Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actuals Actuals Actuals Actuals Actuals Annualized CR Request

Appropriated Resources $50,939 $48,927 $51,721 $50,976 $53,385 $53,458 $49,425

Reimbursable Resources $2,464 $3,277 $3,506 $3,681 $3,143 $3,835 $3,835

Transfer from TEOAF-Super 

Surplus Fund

$0 $0 $468 $0 $0 $0 $0

Budget Activity Total $53,403 $52,204 $55,695 $54,657 $56,528 $57,293 $53,260

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target FY 2016

Trend

Activity of Revenue Collected 

Per Program Dollar

449.0 457.0 457.0 437.0 414.0 400.0 400.0 400.0

Percent of Voluntary Compliance 

from Large Taxpayers in Filing 

Tax Payments Timely and 

Accurately (In Terms of 

Revenue)

92.0 92.0 90.0 88.0 87.0 92.0 90.0 90.0

Key: DISC - Discontinued, B - Baseline

Collect the Revenue Budget and Performance

($49,425,000 from direct appropriations, $3,835,000 from reimbursable resources):

This budget activity includes all tax processing, verification, enforcement, and outreach efforts 

related to administering the Federal tax code for alcohol, tobacco, firearms, and ammunition

products. TTB collects approximately $22 billion in Federal tax revenue annually from nearly 

13,000 businesses. TTB’s tax base includes distilleries, breweries, and wineries, which have 

boomed in recent years, as well as manufacturers and importers of tobacco and firearms. TTB 
TTB - 9

extends the reach of its enforcement resources through advanced analytics and risk-based audits 

and investigations. To ensure a level playing field for all those engaged in the trade of these 

strictly regulated commodities, TTB also takes appropriate enforcement action to detect and 

address diversion activity to ensure all products sold in the marketplace are properly taxpaid.

Other Resources (Offsetting Collections/Reimbursables).................................... $3,835,000

Other resources that fund this budget activity include reimbursement for the operating costs of 

the TTB Puerto Rico field office, which are offset against the roughly $400 million in taxes 

collected on the alcohol beverage products that are manufactured in Puerto Rico and imported to

the United States (cover-over payments); reimbursement by the Community Development 

Financial Institutions Fund (CDFI) for TTB’s IT services; and funding from the Department of 

the Treasury’s Executive Office for Asset Forfeiture (TEOAF) mandatory account to cover 

investigative expenses, data systems, and training.

Description of Performance – Collect the Revenue:

TTB’s measures of the Amount of Revenue Collected per Program Dollar and the Percent of 

Voluntary Compliance from Large Taxpayers in Filing Payments Timely demonstrate the 

effectiveness and efficiency with which TTB operates its revenue collection function. TTB’s 

strategies for achieving results for both measures include applying technology to streamline 

internal and external processes and leveraging data sources to direct our outreach and 

enforcement efforts. At the FY 2018 funding level, TTB will review these strategies and their 

timelines to ensure continued effectiveness in tax administration and to ensure resources are 

deployed efficiently to maximize the deterrent effect. 

Improve Efficiency of Tax Collection 

In FY 2016, TTB met this performance measure. The Amount of Revenue Collected per 

Program Dollar measure uses annual collections figures and the actual expenditures and 

obligations for collection activities to quantify the efficiency of the TTB tax collection program. 

In FY 2016, TTB achieved a return on investment of $414 for every program dollar spent on 

collection activities, which exceeded its annual performance target of $400. Tobacco revenues

have steadily declined in line with shifts in consumption patterns, product manufacturing, and 

trade. There was a significant increase in FY 2010 due to the tax increases in 2009, but the longterm trend is downward. 

In setting its FY 2018 performance target, TTB examined historical collections trends across 

each of its regulated commodities, as well as other predictors that influence consumer behaviors.

As illustrated by the below table, the 2009 changes to the Federal tax rates saw increases tobacco 

tax collections in dollar terms but even at the higher tax rate, these collections have generally 

declined each year since then. Accounting for these types of marketplace shifts, TTB established 

a targeted performance level of 400:1 for fiscal years 2017 – 2018. 
TTB - 10

Excise Tax and Other Collections by Fiscal Year

Dollars in Thousands

FAET – Firearms and Ammunition Excise Tax; SOT – Special Occupational Tax; FST – Floor Stocks Tax

In FY 2018, to meet its performance target of $400, TTB will continue to improve efficiencies 

and results in its tax enforcement program through process improvements related to tax 

verification. On the front end, TTB will evaluate and develop options to increase automation in 

the detection, notification, assessment, and collection of excise taxes due to preserve staff time 

for substantive tax analysis. On the back end, TTB will continue to use data analytics and other 

intelligence to efficiently deploy its enforcement resources. 

A primary focus for TTB tax enforcement continues to be exported alcohol and tobacco 

products. In FY 2016, TTB made significant inroads into identifying tax evasion schemes that 

involve the diversion of non-taxpaid products intended for export. In just over two years, TTB’s 

enforcement efforts into the export trade, including tobacco export warehouses that are permitted 

by TTB, have identified over $50 million in additional liabilities to date as well as numerous

criminal cases. 

In future years, TTB will develop a plan to modernize TTB’s tax systems to increase automation 

and improve tax verification and improve its capacity to develop and build risk models that 

support the identification of high-risk activity for audit, investigation, and criminal prosecution.

Increase Voluntary Compliance from Taxpayers

Fostering voluntary compliance among taxpayers is a primary tax administration strategy for 

TTB. The Percent of Voluntary Compliance from Large Taxpayers in Filing Tax Payments 

Timely metric shows the rate of compliance by large taxpayers (i.e., those that pay more than 

$50,000 in annual taxes) in voluntarily filing their tax payments on or before the scheduled due 

date. In FY 2016, TTB achieved a compliance rate of 87 percent from its large taxpayers, which 

fell below the performance target of 92 percent. The declining compliance rate in recent years is 

due to improvements in TTB’s tax reconciliation and enforcement functions related to 

identifying late, missing, and erroneous tax returns and payments. These efforts often result in 

identifying taxpayers who have not filed returns and have not previously been included in the 

compliance rate calculations. Including these taxpayers reduces the calculated compliance rate 

even when TTB succeeds in obtaining overdue returns. TTB anticipates that taxpayers targeted 

by enforcement efforts will begin filing timely returns in future years, and that, combined with 

Fiscal

Year Alcohol Tobacco FAET SOT FST Other Total

2007 $ 7,232,138 $ 7,194,081 $287,835 $ 2,808 $ - $ 32 $ 14,716,894

2008 7,420,576 6,851,705 312,622 448 - 634 14,585,985

2009 7,424,292 11,548,504 452,693 272 1,192,375 970 20,619,106

2010 7,476,789 15,913,479 360,813 300 8,558 180 23,760,119

2011 7,594,330 15,515,073 344,262 268 5,220 2,257 23,461,410

2012 7,856,391 15,002,616 514,622 249 5,942 61 23,379,881

2013 7,851,953 14,321,017 762,836 280 1,521 38 22,937,645

2014 7,924,951 13,552,711 768,927 332 465 2 22,247,388

2015 7,997,467 13,620,497 638,518 288 2,444 7 22,259,221

2016 8,075,476 13,274,371 749,789 258 245 505 22,100,644

Average $ 7,685,436 $ 12,679,405 $519,292 $ 550 $ 121,677 $ 469 $ 21,006,829
TTB - 11

planned enhancements to online guidance, will increase voluntary compliance rates going 

forward.

For FY 2018, TTB has set a performance target of a 90 percent voluntary compliance rate for its 

large taxpayers. TTB will focus on promoting electronic filing options to enable taxpayers to 

file complete, accurate, and timely tax returns and payments; improving online guidance, 

particularly for the large number of newly permitted industry members; and maintaining an 

enforcement presence to encourage voluntary compliance. Moving forward on all three fronts is 

required to ensure that TTB strikes the appropriate balance between supporting new businesses 

in establishing compliant operations while ensuring adequate coverage of the high-risk activity 

that undermines lawful business activity. 

A reduced enforcement presence may diminish the deterrent effect that results in voluntary 

compliance. In addition to fewer audits and investigations, TTB will need to curtail its criminal 

investigations. Since TTB commenced its criminal enforcement program in FY 2011, these 

investigations have resulted in nearly $600 million in tax liabilities (a 4:1 return on investment 

achieved with just a handful of agents) and criminal convictions, which are an essential 

component of tax enforcement. 

2.1.2 Protect the Public Resources and Measures

Dollars in Thousands

Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actuals Actuals Actuals Actuals Actuals Annualized CR Request

Appropriated Resources $48,939 $45,727 $47,279 $47,451 $52,709 $52,779 $49,233

Reimbursable Resources $2,464 $2,670 $3,236 $2,451 $2,577 $3,137 $3,137

Transfer from TEOAF-Super 

Surplus Fund

$0 $0 $432 $0 $0 $0 $0

Budget Activity Total $51,403 $48,397 $50,947 $49,902 $55,286 $55,916 $52,370

FTE 245 241 246 243 246 257 238

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target FY 2016

Trend

Percent of Electronically Filed 

Permit Applications (Note 1)

59.0 73.0 80.0 81.0 81.0 87.0 82.0 85.0

Percentage of Permit 

Applications Processed within 

Service Standards

61.0 50.0 58.0 47.0 32.0 85.0 85.0 85.0

Customer Satisfaction Rate 

with TTB Permitting Process

N/A N/A N/A 76.0 71.0 80.0 80.0 80.0

Percent of Electronically Filed 

Label and Formula Applications

88.0 90.0 93.0 94.0 97.0 95.0 95.0 95.0

Percentage of Alcohol 

Beverage Label and Formula 

Applications Processed within 

Service Standards

83.0 49.0 67.0 75.0 75.0 85.0 85.0 85.0

Key: DISC - Discontiued, B - Baseline

Note 1: Reported results revised for FY12–FY15 due to an error identified in the source data for paper-filed original permit 

applications.
TTB - 12

Protect the Public Budget and Performance

($49,233,000 from direct appropriations, and $3,137,000 from reimbursable resources): 

This budget activity funds the programs that ensure the integrity of the products and industry 

members in the marketplace; promote compliance with Federal laws and regulations by the 

approximately 82,000 businesses that TTB regulates; facilitate fair and lawful domestic and 

international trade in the alcohol and tobacco commodities; and provide full and accurate alcohol 

beverage product information to the public as a means to prevent consumer deception. 

Other Resources (Offsetting Collections/Reimbursables).................................... $3,137,000

Other resources that support this budget activity include reimbursement for the operating costs of 

the TTB Puerto Rico field office, which are offset against the roughly $400 million in taxes 

collected on the alcohol beverage products that are manufactured in Puerto Rico and imported 

into the United States (cover-over payments); reimbursement by the Community Development 

Financial Institutions Fund (CDFI) for TTB’s IT services; and funding from the Department of 

the Treasury’s Executive Office for Asset Forfeiture (TEOAF) mandatory account to cover 

investigative expenses, data systems and training.

Description of Performance – Protect the Public:

TTB has five principal performance measures of its public protection activities. These measures 

help TTB monitor the degree to which it is meeting the service standards it establishes for 

permit, label, and formula applications; the impact that electronic filing initiatives are having on 

improved service delivery; and the level of satisfaction that prospective industry members have 

with TTB’s permitting process. TTB’s strategies to achieve its performance targets include 

streamlining internal processes, implementing enhancements to online filing systems, 

modernizing filing requirements, and providing clearer guidance to industry members. At the 

FY 2018 funding level, TTB will review these strategies and their timelines, as well as adjust 

service standards, to set realistic expectations for the businesses that rely on TTB approvals.

Improve Efficiency and Effectiveness of Permitting Process

TTB protects consumers by screening permit applicants to ensure only qualified persons engage 

in the alcohol, tobacco, firearms, and ammunition industries. In FY 2016, TTB processed more 

than 8,500 original permit applications, performing investigations into high-risk applicants to 

meet TTB’s business integrity objective. TTB monitors its timeliness in processing permit 

applications through its measure of the Percentage of Permit Applications Processed within 

Service Standards. As businesses rely on accurate information related to TTB service delivery in 

their operational planning, this measure provides important data related to a key outcome for 

TTB and its stakeholders. In FY 2016, TTB met its 75-day service standard for 32 percent of 

original permit applications, a significant year-to-year decline and well below the 85 percent 

performance target. The increased volume of submissions, particularly in the more complex 

alcohol manufacturing application types, has caused processing times to increase.

Processing times are expected to worsen as the backlog of applications continues to grow, with 

particular challenges resulting from resource levels that have not kept up with industry 

expansion. In FY 2018, TTB will establish a new service standard of 130 days to represent its 

current and projected processing times based on staffing levels. TTB will strive to meet this new 
TTB - 13

standard for 85 percent of permit applications through internal workflow changes and industry 

education efforts to improve submission compliance and, therefore, reduce reprocessing work.

According to its measure of the Percent of Electronically Filed Permit Applications, which tracks 

the e-filing rate for new business applications, TTB has generally reached a plateau in 

performance, with approximately 81 percent of permit applications received via Permits Online. 

Although trending up slightly, this rate reflects marginal gains achieved over the past three years. 

TTB is reviewing its strategies to increase the benefits associated with electronic filing, including 

faster processing times and improved application compliance, and expects improvement on both 

fronts as a result of a major system release planned for the end of FY 2017. These system 

changes, combined with effective online guidance and training, will support TTB in achieving its 

targeted electronic filing rate of 85 percent in FY 2018.

Increase Customer Satisfaction with TTB Service Delivery 

TTB also measures its performance in its permitting function by surveying the businesses that 

apply for a TTB permit. TTB monitors the Customer Satisfaction Rate with TTB’s Permitting 

Process by using an e-mail survey to assess how satisfied businesses are when applying for a

permit through Permits Online. Satisfaction rates in FY 2016 were below the annual target of 80 

percent, with 71 percent of applicants filing for an original permit satisfied with the application 

process, including the level of service received and timeliness of TTB’s response. Satisfaction 

rates have declined year-to-year as processing times have lengthened, and they are expected to 

remain below target until timely service improves. In FY 2018, to achieve its performance target 

of 80 percent, TTB will continue to implement internal workflow improvements to reduce 

processing times. Further, TTB expects the release of a new version of Permits Online to 

increase satisfaction rates by improving system-based guidance as well as overall customer 

experience with the system. TTB will also aim to improve the level of service provided to 

customers seeking live assistance with the permit application process via TTB’s call center, 

although wait times may increase at the FY 2018 staffing levels.

Improve Efficiency and Effectiveness of Alcohol Beverage Label Processing

TTB protects U.S. consumers by ensuring that the alcohol beverage products sold at retail outlets 

are properly labeled and comply with federal production standards. In FY 2016, TTB received 

more than 161,000 label applications and more than 14,500 formula applications, an increase in 

submissions that reflects the ongoing expansion of the alcohol beverage industry. Given the 

importance of timely TTB approvals and the negative impact that delays have on U.S. 

businesses, TTB monitors its ability to provide timely and consistent service through its measure 

of the Percentage of Alcohol Beverage Label and Formula Applications Processed within 

Service Standards. TTB combines label and formula applications in this measure given the 

interdependent nature of these approvals. TTB set a service standard for a label approval at 30 

days and 45 days for a formula approval. 

In FY 2016, TTB met its service standards of 30 days and 45 days approximately 75 percent of 

the time. At these service levels, the majority of wineries, breweries, and distilleries waited three 

months on average from the time they filed for a formula approval to being able to bottle, label,

and distribute a new product. Performance in labeling declined slightly to 76 percent of label 

approvals meeting the 30-day service standard compared to the 80 percent achieved last year.
TTB - 14

TTB met its 45-day service standard for formula applications 63 percent of the time, compared to 

just 15 percent in FY 2015. TTB was able to lift certain filing requirements in areas deemed lowrisk to consumers and the revenue, but industry growth combined with market trends toward 

formulated products have resulted in increased submissions that have offset these reductions. 

TTB has begun to make significant progress to accelerate label and formula processing, and 

remains on track to achieve its performance goal of a 10-day turnaround for label and formula 

applications by the end of FY 2017. This progress was achieved through revised filing 

requirements, updated guidance, and system enhancements, as well as additional staff hired in 

FY 2016 to support performance improvements in the labeling program. 

For FY 2018, TTB will maintain its established target of 85 percent for the percentage of label 

and formula applications that meet the established service standards. However, TTB expects to 

adjust its service standards for both labels and formulas to a 30-day turnaround for FY 2018, 

rather than 10-day turnaround projected for FY 2017, based on projected staffing and the

projected growth in submissions. To meet the performance target, TTB will focus on facilitating 

compliance of initial applications, thus reducing the workload associated with processing

resubmissions. In FY 2018, TTB will focus exclusively on online guidance to improve compliant 

label and formula applications. This strategy is critical to managing the total workload associated 

with label and formula applications, which will be necessary to achieve the performance target. 

TTB also intends to proceed with its labeling modernization project, which will update and 

streamline the labeling regulations to reflect current TTB policy and modern industry practices.

Further, TTB will continue to employ its strategy to increase electronic filing to manage 

workloads and ensure service standards are met. These efforts include improving online and 

system guidance to help industry in filing label and formula applications, focusing on 

streamlining and clarifying communications between TTB and industry members each time a 

label or formula is returned due to application errors or other compliance issues. In FY 2016, 

TTB exceeded its target by achieving a combined electronic filing rate of 97 percent, as tracked 

by its measure of Percent of Electronically Filed Label and Formula Applications. TTB expects 

that these planned improvements will help TTB continue to attract new industry members to its 

online systems and maintain performance above its 95 percent target in FY 2018.
TTB - 15

Section III – Additional Information

A – Summary of Capital Investments

Information Technology

TTB’s Strategic Plan establishes the vision and objectives for the bureau. TTB’s Information 

Technology (IT) Strategic Plan is a five-year plan based on its business strategy, which includes 

the bureau’s mission, vision, goals, and objectives from an IT perspective. This plan charts the 

course the bureau will follow in the coming years to develop and implement IT solutions that are 

aimed at streamlining the collection of data, leveraging web technologies, and making the 

Internet the method of choice for the reporting and exchanging of information. By aligning 

business and technical strategy, TTB is able to leverage technology to enable the bureau to meet 

its objectives in the most efficient and cost-effective manner while identifying ways to minimize 

system redundancy. 

TTB has no major IT investments based on the OMB and the Department of Treasury criteria. 

Several non-major investments, however, directly support the mission, strategy, and day-to-day 

operations of the bureau. These include:

TTB Tax System: This investment consists of several component applications that ensure fair 

and proper collection of revenue from the industry members for alcohol, tobacco, firearms, and 

ammunition excise taxes and to ensure compliance with the excise tax regulations.

TTB Regulatory System: This investment includes applications that streamline the beverage 

and nonbeverage alcohol formula approval process and COLA issuance for tax and regulatory 

compliance.

TTB General Support Services: This investment provides TTB users with the infrastructure 

applications necessary to conduct daily business.

TTB Enterprise Architecture: This investment supports strategic management of IT operations 

(e.g., business process redesign efforts not part of an individual investment, enterprise 

architecture development, capital planning and investment control processes, procurement 

management, and IT policy development and implementation) and costs for Chief Information 

Officer functions.

In addition to leveraging IT to support the mission, strategy, and day-to-day operations of the 

bureau, TTB supports and maintains strategy alignment with OMB and Treasury through 

enterprise-wide IT initiatives. These include: Cyber Security; IT Infrastructure; Electronic 

Identity and Access Management (HSPD-12); Enterprise-wide Contracts and Services; and 

Program Metrics and Milestones.

Scientific Equipment for Laboratories

This investment will enable chemists to provide accurate and reproducible scientific data and 

laboratory results to support regulatory compliance, tax enforcement, tax classification, 

rulemaking, and investigations for both the alcohol and tobacco commodities. Laboratory 

instruments require periodic replacement, as they have finite lifecycles due to use and as 
TTB - 16

scientific advances continue to evolve. Technologies applied at these laboratories eventually 

become obsolete and the instruments are not serviceable as vendors stop carrying parts and 

software. Periodic replacement of the existing technologies is essential for TTB laboratories to 

remain state-of-the-art and effective to support the bureau’s mission, strategy, and day-to-day 

operations.

A summary of capital investment resources, including major information technology and nontechnology investments can be found at:

http://www.treasury.gov/about/budget-performance/Pages/summary-of-capital-investments.aspx

This website also contains a digital copy of this document.

Department of the Treasury

Bureau of the Fiscal Service

Congressional Justification 

for Appropriations and 

Annual Performance 

Report and Plan

FY 2018 
Fiscal Service - 2

Table of Contents

Section I – Budget Request........................................................................................................... 3

A – Mission Statement................................................................................................................ 3

B – Summary of the Request ...................................................................................................... 3

1.1 – Appropriations Detail Table.......................................................................................... 4

1.2 – Budget Adjustments Table ............................................................................................. 4

C – Budget Increases and Decreases Description....................................................................... 5

Non-Recurring Costs and Efficiency Savings ............................................................................ 5

1.3 – Operating Levels Table .................................................................................................. 7

D – Appropriations Language and Explanation of Changes ...................................................... 8

1.4 – Permanent, Indefinite Appropriations Table .................................................................. 9

E – Legislative Proposals............................................................................................................ 9

Section II – Annual Performance Plan and Report................................................................. 10

A – Strategic Alignment ........................................................................................................... 10

B – Budget and Performance by Budget Activity .................................................................... 14

2.1.1 – Accounting and Reporting Resources and Measures.................................................... 14

2.1.1 – Accounting and Reporting Budget and Performance ................................................... 14

2.1.2 – Collections Resources and Measures............................................................................ 16

2.1.2 – Collections Budget and Performance............................................................................ 16

2.1.3 – Payments Resources and Measures .............................................................................. 18

2.1.3 – Payments Budget and Performance .............................................................................. 18

2.1.4 – Retail Securities Services Resources and Measures..................................................... 21

2.1.4 – Retail Securities Services Budget and Performance..................................................... 21

2.1.5 – Wholesale Securities Services Resources and Measures.............................................. 22

2.1.5 – Wholesale Securities Services Budget and Performance.............................................. 22

2.1.6 – Debt Collection Resources and Measures..................................................................... 23

2.1.6 – Debt Collection Budget and Performance .................................................................... 24

Section III – Additional Information ........................................................................................ 25

A – Summary of Capital Investments....................................................................................... 25
Fiscal Service - 3

Section I – Budget Request

A – Mission Statement

Promote the financial integrity and operational efficiency of the Federal Government through 

exceptional accounting, financing, collections, payments, and shared services.

B – Summary of the Request 

Fiscal Service’s multi-faceted mission supports the National Critical Financial Infrastructure of 

the Federal Government. Specifically, Fiscal Service 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; conducts all Treasury 

debt financing operations; issues, services, and accounts for all Treasury marketable securities 

and non-marketable securities, including U.S. savings bonds; delivers reimbursable support 

services to FPAs; and manages the collection of delinquent debt. Fiscal Service regularly 

interacts with businesses and private citizens, through our payment, collection and debt 

collection programs; this relationship drives us to continually review our customer service 

guidelines to ensure our support is second to none in the Federal Government. 

Fiscal Service works with the federal financial community to identify improvements to core 

programs and streamline operations government-wide and is looked to as a leader in financial 

management. In addition, Fiscal Service supports the Department of Defense's (DoD) financial 

management requirements in austere and other unique environments at bases around the world 

and on Navy ships supporting the needs of service members.

Fiscal Service, through efficient and effective management of these critical programs, 

demonstrates high performance and achieves outcomes and results that includes:

• Making available $8 trillion to fund critical daily Federal Government operations and 

activities by hosting 269 auctions of marketable Treasury securities through our Wholesale 

Securities Program. 

• Supporting key government agencies by securely and timely disbursing 85 percent of all 

federal payments (1.2 billion payments, totaling more than $3.3 trillion per year in over 

100 currencies in over 170 countries).

• Financing federal operations by collecting $4 trillion in revenues including, for example,

Internal Revenue Service (IRS) tax revenues, National Park Service entrance fees, student 

loan debt, U.S. passport fees, and Customs and Immigration Service fees.

All of these accomplishments support Fiscal Service’s vision to “transform financial 

management and the delivery of shared services in the Federal Government” as well as the 

following bureau strategic goals:

• Serve as a catalyst for effective government through initiative and innovation

• Cultivate an engaged, highly effective and skilled workforce

• Deliver exceptional programs and services

• Promote data transparency and usefulness as a public good

• Move federal financial management and administrative services to an affordable, sustainable 

service provider
Fiscal Service - 4

1.1 – Appropriations Detail Table

Dollars in Thousands

Fiscal Service FY 2016 FY 2017 FY 2018 FY 2017 to FY 2018

Appropriated Resources Enacted Annualized CR Request $ Change % Change

 FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

New Appropriated 

Resources 16FTE 16Amt 17FTE 17Amt 18FTE 18Amt

Accounting and Reporting 423 $125,752 441 $124,352 437 $109,379 (4) ($14,973) -0.91% -12.04%

Collections 152 $38,798 159 $38,598 158 $33,951 (1) ($4,647) -0.63% -12.04%

Payments 537 $118,454 561 $117,362 556 $108,517 (5) ($8,845) -0.89% -7.54%

Retail Securities Services 436 $70,038 454 $69,038 451 $65,712 (3) ($3,326) -0.66% -4.82%

Wholesale Securities 

Services 78 $10,808 78 $13,808 78 $13,278 0 ($530) 0.00% -3.84%

Subtotal New 

Appropriated Resources 1,626 $363,850 1,693 $363,158 1,680 $330,837 (13) ($32,321) -0.77% -8.90%

Other Resources: 16FTE 16Amt 17FTE 17Amt 18FTE 18Amt

 Reimbursables 417 $349,801 427 $368,000 427 $377,980 0 $9,980 0.00% 2.71%

Subtotal Other Resources 417 $349,801 427 $368,000 427 $377,980 0 $9,980 0.00% 2.71%

Total Budgetary Resources 2,043 $713,651 2,120 $731,158 2,107 $708,817 (13) ($22,341) -0.61% -3.06%

Note: FY 2016 Appropriated Resources and Actual Other Resources 

1.2 – Budget Adjustments Table

Dollars in Thousands

Fiscal Service FTE Amount

FY 2017 Annualized CR 1,723 $363,158 

Changes to Base:

Maintaining Current Levels (MCLs): - $6,971 

Pay-Raise - $3,027 

Pay Annualization - $1,109 

Non-Pay - $2,835 

Non-Recurring Costs - ($14,890)

DATA Act - ($10,780)

Rent Savings - ($4,110)

Efficiency Savings (30) ($1,935)

Program Efficiencies (30) ($1,935)

Subtotal Changes to Base (30) (9,854)

Total FY 2018 Base 1,693 $353,304 

Program Changes:

Program Decreases (13) ($22,467)

Accounting and Reporting - ($3,066)

Collections - ($2,788)

Payments - ($2,603)

Retail Securities Services - ($1,600)

Support Services - ($8,323)

Streamlining Staff/Other Efficiencies (13) ($4,087)

Subtotal Program Changes (13) (22,467)

Total FY 2018 Request 1,680 330,837 
Fiscal Service - 5

C – Budget Increases and Decreases Description

Maintaining Current Levels (MCLs) ...................................................... +$6,971,000 / +0 FTE 

Pay-Raise +$3,027,000 / +0 FTE 

Funds are requested for the proposed January 2018 pay-raise.

Pay Annualization +$1,109,000 / +0 FTE 

Funds are requested for annualization of the January 2017 pay-raise.

Non-Pay +$2,835,000 / +0 FTE 

Funds are requested for inflationary adjustments to non-labor costs such as travel, contracts, rent, 

supplies, and equipment. 

Non-Recurring Costs and Efficiency Savings ....................................... -$16,825,000 / -30 FTE 

The Digital Accountability and Transparency Act of 2014 (DATA Act) -$10,780,000 / +0 FTE 

With the implementation of the DATA Act anticipated to be well underway, it is expected that 

Fiscal Service will be able to decrease the funding needed to complete the balance of the 

government-wide legislative requirements.

Rent Savings -$4,110,000 / +0 FTE 

With the final closeout of the Emeryville, California lease, Fiscal Service is realizing the last 

portion of the Payment Center Closure savings.

Program Efficiencies -$1,935,000 / -30 FTE 

Anticipated savings from reduced programmatic and FTE requirements to align with operating 

levels.

Program Decreases .................................................................................. -$22,467,000 / -13 FTE

Accounting and Reporting -$3,066,000 / +0 FTE 

Delay the remediation of non-DoD material weaknesses related to the Financial Report of the 

U.S. Government and the implementation of critical updates to systems.

Collections -$2,788,000 / +0 FTE 

Reductions to contractor support and security assessments associated with the expansion of 

electronic collections and settlement activities.

Payments -$2,603,000 / +0 FTE 

System modernization efforts related to improved customer agency support and the ability to 

decommission costly antiquated legacy systems will be delayed. 

Retail Securities Services -$1,600,000 / +0 FTE 

Improvements to retail securities customer services will be postponed. 
Fiscal Service - 6

Support Services -$8,323,000 / +0 FTE 

Fiscal Service will be unable to implement planned space efficiencies designed to maximize the 

bureau’s use of space within its D.C. facility. Additionally, plans to elevate the physical security 

threshold and increase security measures in several facilities will be cancelled. 

Streamlining Staff/Other Efficiencies -$4,087,000 / -13 FTE 

Anticipated savings as a result of streamlining staff and realizing any associated efficiencies. 
Fiscal Service - 7

1.3 – Operating Levels Table

Fiscal Service FY 2016 FY 2017 FY 2018

Object Classification Actual Annualized CR Request

11.1 - Full-time permanent 142,818 146,927 139,894 

11.3 - Other than full-time permanent 411 514 524 

11.5 - Other personnel compensation 3,655 4,754 5,853 

11.8 - Special personal services payments 0 23,434 23,879 

11.9 - Personnel Compensation Total 146,884 175,629 170,150 

12.0 - Personnel benefits 48,800 50,170 48,181 

13.0 - Benefits for former personnel 107 100 100 

Total Personnel and Compensation Benefits $195,791 $225,899 $218,431 

21.0 - Travel and transportation of persons 1,947 1,976 2,021 

22.0 - Transportation of things 133 150 121 

23.1 - Rental payments to GSA 26,254 22,214 21,418 

23.2 - Rental payments to others 583 519 445 

23.3 - Communication, utilities, and misc charges 8,069 8,089 7,555 

24.0 - Printing and reproduction 132 245 237 

25.1 - Advisory and assistance services 23,905 21,515 15,218 

25.2 - Other services from non-Federal sources 23,558 18,848 12,622 

25.3 - Other goods and services from Federal sources 59,946 54,016 45,664 

25.4 - Operation and maintenance of facilities 2,124 1,041 950 

25.7 - Operation and maintenance of equipment 4,043 2,100 1,603 

26.0 - Supplies and materials 3,273 2,763 2,708 

31.0 - Equipment 13,876 2,769 1,234 

32.0 - Land and structures 215 1,014 610 

43.0 - Interest and dividends 1 0 0 

Total Non-Personnel $168,059 $137,259 $112,406 

Total Budgetary Resources $363,850 $363,158 $330,837 

FTE 2,043 2,120 2,107

Note: This table includes total annually appropriated funding (actuals for FY 2016, FY 2017 Annualized CR and FY 2018).
Fiscal Service - 8

D – Appropriations Language and Explanation of Changes

Appropriations Language Explanation of Changes

DEPARTMENT OF THE TREASURY

BUREAU OF THE FISCAL SERVICE

Federal Funds

SALARIES AND EXPENSES

For necessary expenses of operations of the Bureau of the Fiscal 

Service, $330,837,000; of which not to exceed $4,210,000, to 

remain available until September 30, 2020, is for information 

systems modernization initiatives; and of which $5,000 shall be 

available for official reception and representation expenses. In 

addition, $165,000, to be derived from the Oil Spill Liability 

Trust Fund to reimburse administrative and personnel expenses 

for financial management of the Fund, as authorized by section 

1012 of Public Law 101–380.

Note.—A full-year 2017 appropriation for this account was not 

enacted at the time the budget was prepared; therefore, the budget 

assumes this account is operating under the Further Continuing 

Appropriations Act, 2017 (P.L. 114–254). The amounts included 

for 2017 reflect the annualized level provided by the continuing 

resolution.

Federal Reserve Bank Permanent, Indefinite Appropriation

The Federal Reserve Banks (FRBs) act as fiscal agents of the United States when directed by the 

Secretary of the Treasury in accordance with 12 U.S.C. 391. Under this account, the FRBs 

support fiscal operations unrelated to the administration of the public debt and provide banking 

and financial services on behalf of the Treasury of the United States. Specifically, this account 

supports the accounting and reporting, collections, and payments programs. These and other

programs are vital to Fiscal Service’s strategic goals, the National Financial Critical

Infrastructure and the expanding of e-government efforts to reduce costs, improve accuracy and

increase options available to citizens to conduct transactions with the Federal Government. 

Fiscal Service estimates that the cost of FRB services for FY 2018 will be approximately

$585.8 million.

Reimbursements to the Federal Reserve Banks

Public Law 101-509, 104 Stat. 1389, 1394 (1990), established a permanent, indefinite 

appropriation to pay such sums as necessary to reimburse the FRBs for acting as fiscal agents. 

This account was further defined in FY 1992 to solely support those activities related to the 

administration of the public debt. Claims for reimbursements are closely monitored for 

compliance with the Instructions for Filing Reimbursement Claims for Fiscal Agent Services 

Provided to Fiscal Service. Funding for FY 2018 is estimated at $149.5 million. 

Financial Agent Services Permanent, Indefinite Appropriation

Congress has given the Secretary of the Treasury broad discretion to deposit money in financial 

institutions and obtain banking services by designating financial institutions to act/serve as 
Fiscal Service - 9

Financial Agents (FA) of the United States. The services support many Fiscal Service

programs, such as collections, payments, securities and accounting and reporting. These and 

other programs are vital to Fiscal Service’s strategic goals, the National Financial Critical

Infrastructure and the expanding of e-government efforts to reduce costs, improve accuracy and

increase options available to citizens to conduct transactions with the Federal Government. The 

services provided by the FAs are authorized under numerous statutes including, but not limited 

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

Fiscal Service estimates that the cost of FA services for FY 2018 will be approximately 

$801.9 million, which includes $2 million for Government Sponsored Enterprise - Mortgage 

Backed Securities administrative costs.

Government Losses in Shipment

Public Law 103-329 established a permanent, indefinite appropriation to pay such sums as 

necessary to make payments for the replacement of valuables, or the value thereof, lost, 

destroyed, or damaged in the course of United States Government shipments. The Government 

Losses in Shipment Act was enacted July 8, 1937 to dispense with the necessity for insurance by 

the government against loss or damage to valuables in shipment and for other purposes. The

Act was amended in 1943 to cover losses resulting from the redemption of savings bonds (for 

example, stolen bonds, which were fraudulently negotiated even though the paying agent 

followed identification guidelines established by the Treasury). All authority of the Treasury 

under the Act has been delegated to the Commissioner of Fiscal Service. In FY 2018, the 

funding estimated to support payments for the replacement of valuables is $1.2 million.

1.4 – Permanent, Indefinite Appropriations Table

Dollars in Thousands

Permanent, Indefinite Appropriation FY 2016 

Actuals

FY 2017 

Requested

FY 2018 

Requested

Federal Reserve Bank 1 $495,866 $580,200 $585,800 

Reimbursements to the Federal Reserve 

Banks $129,062 $147,550 $149,480 

Financial Agent Services 1, 2 $728,549 $794,698 $801,920 

Government Losses in Shipment $502 $1,123 $1,200 

1 Approximately $75M is reimbursed from other government agencies and deposited into 

the General Fund each year.

2 FY 2016 and FY 2017 include $3M and FY 2018 includes $2M for the Government 

Sponsored Enterprise - Mortgage Backed Securities administrative costs.

E – Legislative Proposals

Fiscal Service has no legislative proposals.
Fiscal Service - 10

Section II – Annual Performance Plan and Report

A – Strategic Alignment

Fiscal Service fulfills its mission and vision through five annually appropriated budget activities 

and one mandatory budget activity, funded through debt revenue.

The FY 2018-2022 strategic plan is currently under development. The annual performance plan will be 

updated in the FY 2019 budget to reflect the new priorities.

Enterprise Priorities

Government-wide Shared Services

• Create efficient and effective government-wide best practices by bringing together the 

federal financial management community to develop a set of standard use cases that describe 

the fundamental financial work processes of all agencies.

• Continue to support and advance the adoption of shared services by coordinating input from 

the financial marketplace, managing financial business processes and expanding lessons 

learned into other lines of business.

• Improve delivery of services, stabilize shared ecosystems and identify additional 

opportunities for agency collaboration by supporting the GSA’s Unified Shared Services 

Management.

Accounting and Reporting 

Fiscal Service accomplished the following during FY 2016:

• Accounted for and reported on all financial activity related to the $19.6 trillion public debt,

managed a daily cash flow of $96.6 billion and issued and serviced nearly $5.6 trillion in 

Treasury securities invested by 79 federal agencies in over 247 Federal Government trust and 

investment accounts, including $3.2 trillion in 22 Treasury managed trust funds.

• Continued to implement corrective actions outlined in the material weakness remediation 

plan for the Financial Report of the U.S. Government including preparation of the General 

Fund reporting entity to undergo an independent external audit.

• Continued the remediation of the non-DoD material weaknesses included in the independent 

auditor’s report to the Financial Report of the U.S. Government in conjunction with the 

Office of Management and Budget (OMB).

• Increased the public accessibility and visibility into the financial health of the Federal 

Government by enhancing the Financial Information Repository (FIR).

• Continued implementation of the DATA Act to include necessary government-wide financial 

system enhancements and providing assistance to agencies. This included developing the 

technical platform/architecture to collect data across disparate systems in the Federal 

Government.

FY 2017

• Implement DATA Act and develop a publication platform that provides consistent, reliable, 

and searchable government-wide spending data to the American public.

• Enable Treasury to monitor and manage its cash position in near real time by modifying 

payment, collection, and accounting systems.
Fiscal Service - 11

FY 2018

• Implement necessary data transparency enhancements to further improve consistency, 

reliability, and searchability of government-wide spending data available to the public. 

• Maintain the accounting and reporting of financial activities related to the public debt, daily 

cash flows, Treasury securities and Treasury managed trust funds.

Collections 

Fiscal Service accomplished the following during FY 2016:

• Collected over $3.96 trillion in federal revenue, settled over $3.89 trillion (98.2 percent of 

total revenue collected) through EFT and processed over 175 million transactions worth over 

$152 billion through Pay.Gov.

• Increase options available to citizens to conduct transactions with the Federal Government by 

advancing Treasury’s E-Commerce initiative to have non-tax collections and remittances 

submitted electronically.

FY 2017

• Continue to increase convenience and accessibility for customers to conduct transactions 

with the Federal Government by implementing a variety of mobile apps and increasing 

agency implementation of digital wallet providers and offering online bill payment.

FY 2018

• Maximize the collection of federal revenue by continuing to expand the adoption of Online 

Bill Payment, Digital Wallets, and Mobile Applications.

• Complete the review and update of 31 CFR Part 206 to include mandate of electronic funds 

transfer for the collection of federal funds from business entities and individuals.

Payments 

Fiscal Service accomplished the following during FY 2016:

• Facilitated the payment of Social Security and Veterans’ benefits, income tax refunds and

other payments by disbursing 1.2 billion Federal payments, totaling $3.3 trillion.

• Continued to support and expand the DirectExpress prepaid card program, which provided 

more than 4.4 million cardholders, most of whom do not have a bank accounts, with a safe, 

secure, convenient, low-cost way to receive payments electronically and allows cardholders 

to, among other things, check their account balance.

• Took steps to ensure payee claims of non-receipt were processed, stale uncashed checks were 

cancelled, misdirected electronic payments were returned, monies erroneously paid to 

deceased individuals were recovered, checks returned in the mail were properly safeguarded 

and funds redirected to the right payee or held safely in the U.S. Treasury.

• Supported the Inspector General, Assistant U.S. Attorneys, and state and local law 

enforcement agencies in the investigation and prosecution of criminals engaged in fraud 

related to the Treasury payment system, which resulted in 107 arrests, 83 convictions, and 

$24 million recovered through fines, restitution, and seizures. 

• Supported the U.S. Military by expanding the Stored Value Card program replacing more 

than $8 billion in cash and checks by issuing over 3.5 million cards to servicemen and 

women in austere environments, on U.S. Navy ships, and on military bases around the world 

in 15 countries.
Fiscal Service - 12

• Provided Government vendors with a self-service portal to view transaction and payment 

statuses across multiple agencies totaling more than 400,000 vendor invoices valued at 

$17 billion through Fiscal Service’s centralized E-invoicing system.

FY 2017 

• Eliminate redundancies in the Federal Government by centralizing all Federal payment 

disbursements by continuing to work with the DoD and other agencies that disburse their 

own payments.

• Improve Do Not Pay analytics capabilities through the use of new algorithms and predictive 

modeling; acquire income, expanded death, and credit data; and implement authorities to 

work with Federal legislative and judicial programs and federally funded state-administered 

programs.

• Continue to increase the percentage of payments disbursed electronically, and decrease the 

number of payments disbursed by checks.

FY 2018 

• Centralize the payment activities of a large portion of the DoD and other non-Treasury 

disbursing agencies at Fiscal Service. 

• Support industry “faster payments” solutions by implementing Same Day Automated 

Clearing House (ACH) capability allowing for settlement of electronic payments on the same 

day.

• Continue to increase the percentage of payments disbursed electronically, and decrease the 

number of payments disbursed by checks.

Retail Securities Services 

Fiscal Service accomplished the following during FY 2016:

• Issued and serviced $28.7 billion in savings and marketable securities held by 

592,000 investors in TreasuryDirect.

• Timely and accurately made 2.6 million retail payments worth $13.5 billion.

• Identified the future customer base and clarified the most effective channels for interacting 

with customers by completing a review of the Retail Securities Services program to refocus 

program direction and solidify the mission and long-term vision.

• Enhanced the capability for customers to purchase, reinvest, redeem, transfer, and hold 

securities electronically, through the development of a new retail securities system and web 

interface.

• Improved the customer experience though process automation and creating a virtual contact 

center in addition to the development of virtual case files allowing financial institutions to 

electronically stamp bond images.

FY 2017

• Continue enhancing the capability for customers to purchase, reinvest, redeem, transfer, and 

hold securities electronically, through the development of a new retail securities system and 

web interface.
Fiscal Service - 13

FY 2018

• Continue to support investors by servicing and issuing savings and marketable securities 

through TreasuryDirect.

Wholesale Securities Services

Fiscal Service accomplished the following during FY 2016:

• Made available $8 trillion to fund critical daily Federal Government operations and activities 

by hosting 269 auctions of marketable Treasury securities. 

• Continue to develop and deploy plans to improve and modernize the TAAPS application 

software and technology components.

FY 2017

• Make funds available for critical daily Federal Government operations and activities by 

hosting auctions of marketable Treasury securities.

• Continue the stabilization, modernization, and migration of TAAPS.

FY 2018

• Make funds available for critical daily Federal Government operations and activities by 

hosting auctions of marketable Treasury securities.

• Complete the stabilization, modernization, and migration of TAAPS to a new technical 

platform and continue to modernize the software components.

• Continue to develop and deploy plans to improve and modernize the TAAPS application 

software and technology components to strengthen operational resiliency.

Debt Collection 

Fiscal Service accomplished the following during FY 2016:

• Collected $7.41 billion through all offset programs and $269.9 million through crossservicing tools. Expanded Treasury Offset Program (TOP) State Income Tax Program to 

service a total of 41 states, the TOP State Reciprocal Program to service a total of 11 states 

and D.C. and expanded TOP Unemployment Insurance (UI) Program to service a total of 43 

states and D.C.

• Serviced a total of 53 agencies, processed 48,192 cases and collected nearly $30 million 

through the Centralized Receivables program.

• Facilitated repayment or resolution of defaulted student loans by continuing a CrossServicing debt collection pilot program with the Department of Education.

FY 2017

• Maximize the collection of delinquent debt by expanding the use of state-of-the-art debt 

collection mechanisms and strategies.

• Achieve greater efficiency with government resources by finalizing the results of the 

Department of Education Student Loan Pilot and making recommendations for future 

servicing of Education debts.

FY 2018

• Increase collection and resolution of delinquent debt through excellent operations and 

addition of new customer agencies and payment streams.
Fiscal Service - 14

B – Budget and Performance by Budget Activity

2.1.1 – Accounting and Reporting Resources and Measures

Dollars in Thousands

 Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Annualized 

CR Request

Appropriated Resources $88,629 $86,628 $102,661 $104,600 $113,413 $124,352 $109,379 

Reimbursable Resources $7,416 $6,517 $6,699 $10,256 $24,155 $25,395 $27,399 

Budget Activity Total $96,045 $93,145 $109,360 $114,856 $137,568 $149,747 $136,778 

FTE 490 464 357 374 425 443 439

Note: FY 2016 Appropriated Resources are Actual

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target FY 2016

Cost Per Government 

Agency Investment 

Services Transaction ($)

 33.48 35.2 35.99 56.38 57.16 56.38 56.38 56.38

Cost Per Summary Debt 

Accounting Transaction ($) 22.47 19.86 16.36 19.26 15.67 19.26 19.26 19.26

Percentage Summary Debt 

Accounting Reports 

Submitted Timely and 

Accurately

 N/A N/A N/A N/A N/A N/A 100.0 100.0 N/A

Percentage of

Government-Wide 

Accounting Reports 

Issued Timely

99.86 100.0 100.0 99.5 100.0 100.0 100.0 100.0

Collect and Disburse 

Interest/Principal Payment 

Amounts for Government 

Agency Investment 

Services 

Investments/Borrowings 

Timely and Accurately

 N/A N/A N/A N/A N/A N/A 98 98 N/A

Percent of Respondents 

Selecting the Highest

Rating of Customer 

Satisfaction with 

Government Agency 

Investment Services (%)

 60 61 57 52 50.4 59 DISC DISC

Key: DISC - Discontinued; B – Baseline

2.1.1 – Accounting and Reporting Budget and Performance 

($109,379,000 from direct appropriations, and $27,399,000 from reimbursable resources):

The Accounting and Reporting activity consists of three programs: Government Agency 

Investment Services, Government-wide Accounting and Reporting, and Summary Debt 

Accounting.

The Government Agency Investment Services (GAIS) program issues, services, and redeems 

Government Account Series (GAS) securities for federal agencies that have legislative authority 

to invest; administers State and Local Government Series (SLGS) securities and offers a flexible 

investment alternative for state and local governments to refinance their outstanding tax-exempt 
Fiscal Service - 15

debt; and represents Treasury’s role in the federal loan program including accounting for and 

reporting on loans made to other federal agencies with legislative authority to borrow. The 

strategic goal of GAIS is to strengthen and streamline controls for government investments 

GAIS is committed to positioning government agency customers to more effectively manage 

their investments.

The Government-wide Accounting (GWA) program produces timely and accurate financial 

information that contributes to the improved quality of financial decisions made by operating and 

overseeing the government’s Central Accounting Reporting System and implementing the data 

transparency requirements included in the DATA Act. Fiscal Service collects, analyzes, and 

publishes government-wide financial information made available to both the public and private 

sectors to provide transparency on the government’s financial status. GWA 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).

Fiscal Service is taking significant steps to address the material weaknesses found in the 

compilation process of the FR that include: 

• Requesting federal entities to provide root cause analysis and corrective action plans for any 

recurring intragovernmental differences;

• Expanding feedback by providing scorecards to additional federal entities to ensure coverage 

over the material intragovernmental differences;

• Collecting data from all identified reporting entities and/or demonstrating their data is 

immaterial;

• Ensuring engagement with federal entities and that adequate support is gathered for all journal 

vouchers;

• Ensuring appropriate information regarding litigation is included in the Financial Report;

• Implementing a process to work in a more collaborative manner with key federal entity 

personnel in the preparation of complex areas in the Financial Report;

• Providing reasonable assurance that new or substantially revised federal accounting standards 

are consistently implemented among federal entities;

• Determining the significance of data contained in the Financial Report that does not have 

audit assurance;

• Performing an analysis of the variances for all financial statement lines and disclosures;

The Summary Debt Accounting (SDA) program reports daily on the balances and composition 

of the public debt, publishes the Monthly Statement of the Public Debt, and issues the annual, 

audited Schedules of Federal Debt (Schedules). The Schedules report on the single largest 

liability in Treasury’s Agency Financial Report and received an unmodified opinion for each of 

the past 19 years.

Description of Performance:

The GAIS program strives to provide high-quality customer service, reliable transaction 

processing, and accurate and timely payment distribution. To aid in measuring performance, the 

organization conducted an annual customer survey with the intent to increase the percentage of 

customers rating GAIS as "Excellent." Fiscal Service streamlined the customer service surveys 
Fiscal Service - 16

by integrating all individual surveys into a single annual survey. A new efficiency measure to 

ensure timely and accurate reporting of investment and borrowing activity is now used to 

measure the success of the GAIS program. The FY 2017 and FY 2018 reporting targets for the 

new measure are 98 percent.

In FY 2016, Fiscal Service established and met a target of 100 percent for the Percentage of 

Government-wide Accounting Reports, which include the Daily Treasury Statement (DTS), 

Monthly Treasury Statement (MTS), and consolidated Financial Report, issued on time measure 

for FY 2016. The timeliness standard of each report is as follows:

• DTS target to be published by 4:00 pm (Eastern Time) each business day.

• MTS target to be published by the eighth business day each month.

• Consolidated Financial Report must be published annually.

Fiscal Service continues to achieve its targets by maintaining the established process of 

validating and reconciling data with reporting sources such as FPAs and various electronic 

deposit and payment applications. The bureau will continue modernization efforts to ensure the 

timeliness of these reports and anticipates it will continue to achieve the 100 percent target for 

FY 2017 and FY 2018.

In FY 2017, SDA eliminated unnecessary and/or duplicative business processes and replaced 

them with a new measure, Percentage of Summary Debt Accounting reports submitted timely, 

with a target of 100 percent.

2.1.2 – Collections Resources and Measures

Dollars in Thousands

 Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Annualized 

CR Request

Appropriated Resources $21,166 $20,851 $30,469 $34,982 $37,394 $38,598 $33,951 

Reimbursable Resources $1,419 $176 0 $3,898 $8,265 $8,690 $10,033 

Budget Activity Total $22,585 $21,027 $30,469 $38,880 $45,659 $47,288 $43,984 

FTE 122 120 139 144 152 159 158

Note: FY 2016 Appropriated Resources are Actual

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target FY 2016

Trend

Percentage of Total 

Federal Government 

Receipts Settled 

Electronically (in dollars)

97.0 97.0 98.0 98.0 98.2 98.0 98.0 98.0

Key: DISC - Discontinued; B – Baseline

2.1.2 – Collections Budget and Performance 

($33,951,000 from direct appropriations, and $10,033,000 from reimbursable resources):

Fiscal Service manages the collection of federal revenues such as individual and corporate 

income tax deposits, customs duties, loan repayments, fines, and proceeds from leases. 
Fiscal Service - 17

In addition, Fiscal Service establishes and implements collection policies, regulations, standards, 

and procedures for the Federal Government. These efforts also support the following Fiscal 

Service strategic goals:

• Serve as a catalyst for effective government through initiative and innovation.

• Deliver exceptional programs and services.

• Promote data transparency and usefulness as a public good.

Fiscal Service continues to promote the use of electronic systems in the collections process and 

to assist agencies in converting collections from paper to electronic media with programs such 

as:

• Electronic Federal Tax Payment System (EFTPS): Fiscal Service communicates the benefits 

of EFTPS – accuracy, security, simplicity, and flexibility – to financial institutions, small 

businesses, and tax practitioners. The goal is to continue to require businesses to pay their 

federal taxes electronically and focus efforts on increasing the number of individuals that pay 

taxes electronically.

• Pay.gov: Pay.gov is a system allowing individuals and businesses to make non-tax payments 

to federal agencies over the internet. Recent developments have focused on a mobilefriendly user interface; incorporation of a new digital wallet providers, Amazon Payments, in 

addition to PayPal and Dwolla; and enhanced functionality in the areas of electronic billing 

and electronic forms.

• Check Conversion and Truncation: Fiscal Service is employing strategies to reduce the 

number of paper checks it receives and to ensure that those it does receive are converted for 

electronic processing. The Over the Counter Channel Application (OTCnet) and Electronic 

Check Processing (ECP) are programs that provide a complete electronic record of all check 

images and related financial data that is accessible by agencies and eliminate the costly and 

time-consuming need to photocopy checks, safeguard checks, or process paper.

Description of Performance: 

The measure, Percentage of Total Federal Government Receipts Settled Electronically, reflects 

the dollar value of collections received (settled) electronically. In FY 2016, Fiscal Service’s 

commitment to agency outreach efforts resulted in 98.2 percent of all Federal Government 

receipts settled electronically, exceeding the 98 percent target. Fiscal Service will continue 

agency outreach and offer new products, such as mobile applications, online bill presentment, 

and expand the use of digital wallets to further demonstrate the cost efficiency realized through 

the use of electronic transactions. Fiscal Service expects to maintain an annual electronic 

collections rate of at least 98 percent through FY 2018.
Fiscal Service - 18

2.1.3 – Payments Resources and Measures

Dollars in Thousands

Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Annualized 

CR Request

Appropriated Resources $142,265 $130,570 $114,650 $120,769 $127,943 $117,362 $108,517 

Reimbursable Resources $131,165 $102,401 $78,625 $81,953 $111,088 $116,792 $119,408 

Budget Activity Total $273,430 $232,971 $193,275 $202,722 $239,031 $234,154 $227,925 

FTE 730 711 577 521 562 569 564

Note: FY 2016 Appropriated Resources are Actual

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target FY 2016

Trend

Percentage of Treasury 

Payments and Associated 

Information Made 

Electronically

88.0 92.5 94.4 94.7 94.9 95.0 95.2 96.0

Key: DISC - Discontinued; B - Baseline

2.1.3 – Payments Budget and Performance

($108,517,000 from direct appropriations, and $119,408,000 from reimbursable resources): 

The Payments budget activity supports the National Financial Critical Infrastructure in addition 

to the strategic objective “to improve the disbursement and collection of federal funds and reduce 

improper payments made by the U.S. Government.” Major payments include Social Security 

Benefits, Supplemental Security Income, Federal Pension Benefits, Veterans’ Compensation and 

Pension, Railroad Retirement Pensions, and tax refunds.

Through the Payments budget activity, Fiscal Service is also responsible for controlling and 

providing financial integrity to the payment process through reconciliation, accounting, and 

claims activities. The claims activities settle claims against the United States resulting from 

Federal Government checks that have been forged, lost, stolen, or destroyed, as well as claims 

and reclamations of EFT payments. Fiscal Service also collects monies from those parties liable 

for fraudulent or otherwise improper negotiation of government checks.

In addition, Fiscal Service actively encourages recipients to convert to electronic payment 

methods through a nationwide public education campaign, called Go Direct®, as well as offering 

the unbanked and those beneficiaries who prefer a prepaid debit card the Direct Express® card, 

which enables benefit payments to be deposited into the recipient’s card account on the payment 

date. As a result, 98.1 percent of benefit payments were disbursed electronically in FY 2016. 

Electronic payments provide timely, accurate, and efficient disbursement of Federal Government 

payments; eliminate the costs associated with postage and the re-issuance of lost or stolen 

checks; and help protect against fraud and identity theft.

Fiscal Service has undertaken considerable efforts to modernize its payment systems, 

incorporating new technologies and the internet. Some programs that continue to be in focus are:

• Stored Value Card (SVC): SVCs streamline financial requirements during initial entry into 

training of military personnel, remove physical cash from government locations overseas as 
Fiscal Service - 19

well as from ships at sea, and provide a safe and secure means for government personnel 

stationed overseas to access and safeguard their personal funds in locations with limited or no 

internet connectivity. SVCs effectively reduce the high costs of securing, transporting, and 

accounting for physical currency. The program also provides a safe and convenient payment 

method for government, military, and support personnel. Currently, SVCs replace cash, 

checks, and coins at over 60 military bases and installations in 15 countries (including the 

U.S.) and on 130 Naval ships. Meeting this global demand necessitates the deployment of 

over 8,700 pieces of equipment including kiosks (cashless ATMs), point-of-sale terminals, 

laptops, and other related hardware.

• Invoice Processing Platform (IPP): IPP is a government-wide, secure, web-based electronic 

invoice exchange network connecting federal agencies and their vendors. IPP promotes the 

efficient use of resources by enabling federal agencies to receive invoices electronically from 

their vendors, transforming existing paper-based invoice processes into a streamlined 

electronic process that integrates with existing agency core financial systems. IPP’s single 

point of entry allows vendors to invoice multiple IPP enrolled agencies via online or batch 

invoice submission. Vendors can view and receive notification of payments (including debt 

offsets) associated with their invoices via IPP. In addition, IPP supports the Financial 

Innovation and Transformation initiative to develop a standard for electronic invoicing 

government-wide.

• Payment Application Modernization (PAM): The PAM investment supports the production 

and delivery of over 1.2 billion federal payments on behalf of more than 200 agencies with a 

single application. PAM replaced 30 legacy Fiscal Service payment applications that 

generated check, ACH, International ACH Transaction (IAT), and wire transfer payments, 

thus modernizing the distribution of domestic payments. PAM also automatically interfaces 

with core Treasury systems such as the Do Not Pay Business Center and the Treasury Offset 

Program (TOP) in order to prevent improper payments and collect delinquent debt owed to 

the Federal Government, respectively, and allows FPAs to comply with the Governmentwide Accounting mandate to submit valid data components on all payments when originated.

• Post Payment System (PPS) Consolidation: Fiscal Service is investing in the consolidation 

of several post payment systems into a single, centralized system that will unify disparate 

business processes, eliminate data redundancy across systems, and provide a customer portal 

to be leveraged by FPAs and financial institutions for post-payment processing and reporting. 

By consolidating all post payment processing into one comprehensive application, Fiscal 

Service will be able to decommission five legacy systems resulting in one authoritative data 

source for all payment and post payment data – the official System of Record. PPS will 

include functionality to support: payment matching and verification, returns and 

cancellations, inquiries, calls and claims, funds receipt/funds management, reclamations, 

reconciliation, fraud detection, integrity analysis, and reporting and integrated customer 

engagement. PPS will provide Fiscal Service and post-payment stakeholders with enhanced 

reconciliation activities, improved information exchange, reduced reliance on paper, and 

more robust fraud detection. In addition, it will use standardized Common Government-wide 

Accounting Classification (CGAC) reporting structure and leverage commercial off-the-shelf 

software solutions, when appropriate, to provide common, best practice functionality and 

proven implementation methodologies.
Fiscal Service - 20

Fiscal Service’s Do Not Pay provides a single, centralized point of access to timely, accurate, 

and actionable data for informed decision making and can help identify, prevent, detect, and 

recover improper payments throughout the payment life cycle while protecting individuals’ 

privacy. In addition, Do Not Pay provides real-time matching at the time of payment, resulting 

in more timely access to potential improper payments that may require further investigation; 

more actionable results and fewer false positive matches.

In FY 2016, Do Not Pay deployed a robust state-of-the-art analytics tool to support advanced 

analytics methodologies to include not only descriptive and diagnostic analytics, but predictive 

and prescriptive analytics as well. Do Not Pay continued offering Business Process Mapping 

services in order to improve customer agencies’ internal controls and to increase efficiency in 

identifying improper payments while focusing engagement efforts on targeted high-risk improper 

payment issues within specific agencies.

Through FY 2018, Do Not Pay will continue pursuing valuable data sources to provide timely, 

accurate, and actionable results by enhancing the Do Not Pay portal through user-defined 

feedback. In addition, Do Not Pay analytics will mature to include the creation and execution of 

predictive models, which will provide customer agencies with much needed additional tools to 

identify potential improper payments before payment in addition to at the time of payment or 

post-payment.

Description of Performance:

The measure Percentage of Treasury Payments and Associated Information Made Electronically

supports efforts to fairly and effectively reform and modernize the federal financial management, 

accounting, and tax systems. Due to the continued success of the Go Direct® and Direct 

Express® programs and implementation of the All Electronic Treasury priority, Fiscal Service 

issued 98.1 percent of its benefit payments and 94.9 percent of its total payments via EFT in 

FY 2016. Fiscal Service expects to achieve its targets in the out years by expanding electronic 

conversion efforts to additional benefit agencies and payment types, such as other vendor 

miscellaneous payments and federal tax refunds.
Fiscal Service - 21

2.1.4 – Retail Securities Services Resources and Measures

Dollars in Thousands

 Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Annualized 

CR Request

Appropriated Resources $116,260 $110,876 $95,249 $76,711 $71,252 $69,038 $65,712 

Reimbursable Resources $17,166 $16,841 $17,400 $6,006 $16,026 $16,849 $17,515 

Budget Activity Total $133,426 $127,717 $112,649 $82,717 $87,278 $85,887 $83,227 

FTE 676 605 491 442 436 454 451

Note: FY 2016 Appropriated Resources are Actual

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target FY 2016

Trend

Cost Per Electronic 

Transaction ($) N/A N/A N/A N/A N/A N/A B 4 N/A

Cost Per Customer 

Service ($) N/A N/A N/A N/A N/A N/A B 115.29 N/A

Cost Per TreasuryDirect 

Assisted Transaction ($) 4.58 7.3 7.18 9.55 15.25 9.55 DISC DISC

Cost Per TreasuryDirect 

Online Transaction ($) 2.28 1.72 1.84 1.49 1.14 1.49 DISC DISC

Increase the Number of 

Customers Who Buy 

Treasury Retail Securities 

Electronically

301,737 269,180 222,790 193,120 189,790 185,000 DISC DISC

Key: DISC - Discontinued; B - Baseline

2.1.4 – Retail Securities Services Budget and Performance

($65,712,000 from direct appropriations, and $17,515,000 from reimbursable resources):

Fiscal Service’s Retail Securities Services (RSS) program offers simple, safe, and affordable 

Treasury investment choices that enable Americans to invest and save for their future. The RSS 

program continues to examine the saving and investing needs of customers by researching new 

Treasury retail securities and services that will promote savings and appeal to the American 

public. 

The RSS program encourages customers to buy securities, access their accounts, and conduct 

transactions electronically. The program plans to implement a new securities investment 

management system that will enhance capabilities for customers to purchase, reinvest, redeem, 

transfer, and hold securities electronically. Investors will be able to learn about retail products 

and services, make informed decisions about buying Treasury securities, and manage their 

Treasury investments more efficiently. 

Focused efforts to enhance the retail customer experience, increase opportunities for self-service 

capabilities and expand customer interactions include the implementation of an automated 

process to notify customers when the status of their case files change. To reduce the burden on 

customer service representatives and to expedite case file processing, the program will also begin 

to develop web applications designed to assist the customer in perfecting their case before 

submitting documentation and evidence. These are just two examples of improvements to 
Fiscal Service - 22

customer interactions that will be implemented while the program simultaneously refines 

requirements for future system changes and explores new technology platforms.

Description of Performance:

The Cost per TreasuryDirect Online Transaction and Cost per TreasuryDirect Assisted 

Transaction measures have been discontinued to allow Fiscal Service to measure performance 

for securities transactions regardless of the system used and for the incorporation of future 

offerings. 

Fiscal Service created new baseline performance measures in FY 2017 to support the bureau’s 

goal to serve as a catalyst for effective government through initiative and innovation. The Cost 

per Electronic Transaction demonstrates the efficiency of investor self-service for all retail 

securities currently offered. Customers are able to conduct several transactions independently of 

customer service representatives, including creating online accounts to purchase and hold 

securities, updating account information, purchasing and redeeming securities, etc. 

The Cost per Customer Service Transaction demonstrates the efficiency of customer service 

operations for all retail securities currently offered. The RSS customer service staff handles 

phone and email inquiries, offline authentications, paper savings bond conversions, changes in 

bank information, and transactions requiring legal evidence. The Cost per Customer Service

Transaction is projected to be $120.53 in FY 2017 and $115.29 in FY 2018.

2.1.5 – Wholesale Securities Services Resources and Measures

Dollars in Thousands

 Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Annualized 

CR Request

Appropriated Resources $23,120 $22,092 $12,840 $10,676 $13,848 $13,808 $13,278 

Reimbursable Resources $3,051 $3,000 $2,346 $927 $3,115 $3,275 $3,404 

Budget Activity Total $26,171 $25,092 $15,186 $11,603 $16,963 $17,083 $16,682

FTE 124 113 121 109 78 78 78

Note: FY 2016 Appropriated Resources are Actuals

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target FY 2016

Trend

Cost Per Debt Financing 

Operation ($)

159,449 141,115 137,888 174,998 211,397 165,716 DISC DISC

Percent of Auction Results 

Releases Accurately (%) 100 99.6 99.3 99.6 100 100 100 100

Key: DISC - Discontinued; B - Baseline

2.1.5 – Wholesale Securities Services Budget and Performance

($13,278,000 from direct appropriations, and $3,404,000 from reimbursable resources):

The Wholesale Securities Services (WSS) program supports the National Financial Critical 

Infrastructure by managing a critical Treasury High Value Asset (HVA) that enables the Federal 

Government to finance daily operations. WSS ensures that communications, systems, processes, 

and contingency plans provide for high-level performance and business continuity for wholesale 
Fiscal Service - 23

auction operations. In addition, WSS is responsible for the announcement, auction, issuance, and 

settlement of marketable Treasury bills, notes, bonds, Treasury Inflation-Protected Securities and 

Floating Rate Notes. The program also oversees the portion of the federal infrastructure that 

provides for the transfer, custody, and redemption of all Treasury marketable securities, 

purchased mostly by commercial market participants.

In an effort to ensure the system used to finance daily operations remains fully functional, Fiscal 

Service began a multi-year effort to stabilize, modernize, and migrate the system to a new 

technical platform in FY 2017. The bureau has also begun another multi-year initiative to 

modernize the system’s application software and technology components by FY 2019.

Description of Performance:

Fiscal Service strives to efficiently deliver its debt financing operations, including auctions and 

buybacks, at the lowest possible cost. The Cost per Debt Financing Operation in FY 2016 was 

$211,397, above the target of $165,716, principally as a result of the migration of TAAPS to a 

new technical infrastructure. Also impacting this measure is the change in Fiscal Service’s cost 

accounting methodology. This measure is discontinued in FY 2017 as Fiscal Service assesses 

how to better measure operational efficiency of debt operations given that the number of auctions 

is outside the control of the bureau. Fiscal Service plans to implement a new outcome measure 

in FY 2019.

The accurate and timely release of auction results, with an emphasis on accuracy, is critical to the 

success of the WSS program. An emphasis on accuracy ensures preservation of public 

confidence in Treasury securities and stability of the financial market. Therefore, in FY 2015, 

Fiscal Service modified its performance measure from Percent of Auction Results Released in 

Two Minutes +/- 30 Seconds to Percent of Auction Results Released Accurately, with a target of 

100 percent. Released accurately is defined as auction results released to the public without any 

subsequent revisions. Fiscal Service met this target in FY 2016 and anticipates continuing to 

meet its target through ongoing business process reviews and regularly scheduled contingency 

planning and mock auction exercises.

2.1.6 – Debt Collection Resources and Measures

Dollars in Thousands

 Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Annualized CR Request

Column32 Column4 Column5 Column6 Column7 Column8 Column9

Reimbursable Resources $133,257 $153,667 $139,377 $174,634 $187,152 $197,000 $200,221 

Budget Activity Total $133,257 $153,667 $139,377 $174,634 $187,152 $197,000 $200,221 

FTE 496 560 363 406 390 417 417

Note: FY 2016 Appropriated Resources are Actual

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target FY 2016

Trend

Amount of Delinquent Debt 

Collected Through All 

Available Tools ($ billions)

$6.17 $7.02 $6.91 $7.28 $7.41 $7.36 $7.54 $7.57

Key: DISC - Discontinued; B - Baseline
Fiscal Service - 24

2.1.6 – Debt Collection Budget and Performance

($200,221,000 from reimbursable resources):

The Debt Collection program supports the goal to improve the disbursement and collection of 

federal funds and reduce improper payments made by the U.S. Government. Fiscal Service 

collects delinquent government, state, and child support debt by providing centralized debt 

collection, oversight, and operational services to FPAs and states pursuant to the Debt Collection 

Improvement Act of 1996 (DCIA) and related legislation. Fiscal Service uses two debt 

collection programs: Treasury Offset Program (TOP) and Cross-Servicing.

Fiscal Service acquired a new Cross-Servicing collection system (Cross-Servicing Next 

Generation [CSNG]), a commercial off the shelf product, which enables optimized, costeffective collection and resolution approaches. CSNG, implemented during the second quarter 

of FY 2017, permits greater automation, improved functionality and reliable data. The Debt 

collection program continues to optimize the call center, as necessary; expand the use of highly 

productive debt collection approaches, such as wage garnishment; and transition to a data-driven, 

analytical approach.

Also, in close partnership with the Department of Education, the Cross-Servicing program 

conducted a 24-month pilot program to service a total of 12,000 student loan debts. This began 

in February 2015 and ended in January 2017. The results of that pilot are being analyzed to 

determine applicable next steps to be taken in the future. Furthermore, Fiscal Service continues 

to help agencies implement Section 5 of the DATA Act, which amended the DCIA to require 

agencies to refer to TOP eligible debt at 120 days delinquent, rather than 180 days, and requires 

Treasury to report non-compliance to Congress. Fiscal Service continues to work with OMB and 

agencies on the new requirements and tools developed for tracking compliance, as required.

Description of Performance:

Fiscal Service’s goals for FY 2017 and FY 2018 are to collect $7.54 billion and $7.57 billion, 

respectively, in delinquent debt by expanding the use of the administrative wage garnishment 

collection tool and enhancing the use of analytics. In FY 2019, Fiscal Service hopes to propose 

legislative changes such as authorizing Treasury to offset federal income tax refunds to collect 

delinquent state tax obligations regardless of where the debtor resides.
Fiscal Service - 25

Section III – Additional Information

A – Summary of Capital Investments

Fiscal Service leads the way for responsible, effective government through commitment to 

cutting-edge technologies, service, efficient operations, sharing of best practices, and openness to 

change in order to meet the operating needs of the Federal Government. Fiscal Service 

systematically analyzes the demand for its services, considers effective methods for delivery, and 

identifies the broad asset implications through sound governance and investment management.

Effective Investment Governance

Fiscal Service Governance and Capital Planning and Investment Control programs ensure the 

selection/re-selection, comparison, and prioritization of the most effective Information 

Technology (IT) investments to support the mission and long range plans for Fiscal Service and 

Treasury. These programs also ensure the IT investment portfolio is well managed, cost 

effective, and achieving intended results through monthly tracking and progress reports. A 

monthly investment health assessment of cost, schedule, and operational performance is in place 

in addition to a formal TechStat process that engages appropriate senior level officials for insight 

and successful remediation of significant issues or risks.

Effective Project Execution

Fiscal Service has a disciplined and consistent approach to project management (PM) as 

facilitated through a bureau-wide project management program that manages PM standards, 

procedures, and training. In addition, a standing monthly project management community of 

practice is in place providing practitioners the opportunity for collaboration and continuous 

learning of creative problem solving/solution design related to practical lessons learned. Each IT 

investment has a dedicated program manager and a fully staffed integrated program team. The 

systems that support each investment are enhanced using iterative development techniques.

Enterprise Architecture Services

Enterprise Architecture (EA) services ensure that Fiscal Service applies a common language and 

framework to describe and analyze investments. Fiscal Service EA program is designed to 

facilitate cross-agency analysis of capabilities, knowledge, processes, and relationships to apply 

evidence-based techniques, to identify duplicative investments, to discover goals and 

opportunities for collaboration with other agencies, and to establish a line-of-sight from the 

highest level strategic goals to the infrastructure that enables the achievement of those goals. 

The value of EA services is to facilitate planning by documenting where Fiscal Service is 

currently and determining what the bureau should look like in the future so that it can make plans 

to transition from current state to future state. The planning is enabled by a holistic suite of 

integrated services that incorporates architecture perspectives from business, data, technical, and 

security.

Risk Management

The nature of Fiscal Service’s work requires effective risk management and high levels of 

performance to ensure the bureau maintains operational excellence while seeking innovative 

solutions to improve efficiencies and transform financial management and the delivery of shared 

services in the Federal Government. As such, Fiscal Service has established an Enterprise Risk 
Fiscal Service - 26

Management (ERM) office to promote a common understanding and approach to risk 

management. Through the development and issuance of an ERM framework, the bureau 

incorporates risk management practices in decision making processes such as strategic and 

tactical planning, workforce planning, capital investment planning, and budget formulation. 

Fiscal Service will continue to communicate the importance of effective risk management to all 

employees.

Cybersecurity

Fiscal Service protects the enterprise architecture and infrastructure to ensure the confidentiality, 

integrity, and availability of information technology resources. This is accomplished by 

monitoring the network for both internal and external information attacks, proactive vulnerability 

assessment, effective patch management, and expedient incident response. In addition, 

Enterprise Cybersecurity ensures Fiscal Service information technology resources are in 

compliance with National Institute of Standards and Technology security standards and fulfills 

annual security audit requirements. Furthermore, as the bureau responsible for a number of 

Treasury’s High Value Assets, Fiscal Service will work with the Treasury Chief Information 

Office to identify appropriate cybersecurity initiatives that most effectively leverage the funds 

requested in the Cybersecurity Enhancement Account.

A summary of capital investment resources, including major information technology and nontechnology investments, can be viewed and downloaded here: 

http://www.treasury.gov/about/budget-performance/Pages/summary-of-capital-investments.aspx

This website also contains a digital copy of this document.

Department of the Treasury

Office of Financial Stability

Congressional Justification 

for Appropriations and 

Annual Performance 

Report and Plan

FY 2018
OFS - 2

Table of Contents

Section 1 – Purpose ....................................................................................................................... 3

1A – Mission Statement.............................................................................................................. 3

1.1 – Program Account Summary.......................................................................................... 3

1.3 – Program Disbursement, Repayments, and Cost/Savings................................................... 4

1B – Vision, Priorities and Context............................................................................................ 4

1C - Credit Reform and Administrative Accounts ..................................................................... 6

Section 2 – Budget Adjustments and Appropriation Language............................................... 7

2.1 – Budget Adjustments Table................................................................................................. 7

2A – Budget Increases and Decreases Description..................................................................... 7

2.2 – Operating Levels Table...................................................................................................... 8

2B – Appropriations Language and Explanation of Changes..................................................... 8

2C – Legislative Proposals.......................................................................................................... 8

Section 3 – Budget and Performance Plan ................................................................................. 9

3A – EESA Program Descriptions.............................................................................................. 9

3B – EESA Administration....................................................................................................... 10

3C – Operational Goals............................................................................................................. 10

Section 4 – Supplemental Information...................................................................................... 13

4A – Summary of Capital Investments..................................................................................... 13
OFS - 3

Section 1 – Purpose

1A – Mission Statement

A central part of the response to the 2008 financial crisis was the implementation of the Troubled 

Asset Relief Program (TARP), which was established in the fall of 2008 under the Emergency 

Economic Stabilization Act of 2008 (EESA) (P.L. 110-343) within the Office of Domestic 

Finance at the U.S. Department of the Treasury (Treasury). TARP was created to restore the 

liquidity and stability of the financial system and is administered by the Office of Financial 

Stability (OFS) established within Treasury.

Since late 2010, OFS has focused on carefully winding down TARP’s investment programs, 

recovering OFS’s outstanding investments, and continuing to implement the various housing 

programs under TARP. OFS has made significant progress in winding down TARP investment 

programs and continues to administer housing programs to help struggling families avoid 

foreclosure. As of April 30, 2017, OFS has recovered more than 97 percent of the $436.9 billion 

in total program funds disbursed under TARP, as well as an additional $17.6 billion from 

Treasury’s equity in AIG. When all of Treasury’s AIG investments are included, the amount 

recovered is greater than the funds disbursed by $5.5 billion.

1.1 – Program Account Summary

Dollars in Thousands

 FY 2016 FY 2017 FY 2018 FY 2017 to FY 2018

 Actual Estimated Estimated $ Change % Change

AMOUNT AMOUNT AMOUNT AMOUNT AMOUNT

Obligations

Equity Program Account 125,031 5,596 0 (5,596) -100.00%

Housing Account 2,000,225 0 0 0 NA

TARP Account 547,588 9,656 0 (9,656) -100.00%

TARP Administrative Account 133,759 106,976 83,080 (23,896) -22.34%

TARP Negative Downward Reestimate Receipt Account (855,038) (90,377) 0 90,377 -100.00%

TARP Negative Subsidy Receipt Account 0 0 0 0 0.00%

Total Obligations $1,951,565 $31,851 $83,080 $51,229 160.84%

Budget Authority 

Equity Program Account 125,031 5,596 0 (5,596) -100.00%

Housing Account 225 0 0 0 NA

TARP Account 547,588 9,656 0 (9,656) -100.00%

TARP Administrative Account 152,572 106,976 83,080 (23,896) -22.34%

TARP Negative Downward Reestimate Receipt Account (855,038) (90,377) 0 90,377 -100.00%

TARP Negative Subsidy Receipt Account 0 0 0 0 0.00%

Total Budget Authority ($29,622) $31,851 $83,080 $51,229 160.84%

Outlays

Equity Program Account 125,031 5,596 0 (5,596) -100.00%

Housing Account 4,288,359 3,735,682 2,646,511 (1,089,171) -29.16%

TARP Account 547,588 9,656 0 (9,656) -100.00%

TARP Administrative Account 139,527 161,580 87,859 (73,721) -45.63%

TARP Negative Downward Reestimate Receipt Account (855,038) (90,377) 0 90,377 -100.00%

TARP Negative Subsidy Receipt Account 0 0 0 0 NA

Total Outlays $4,245,467 $3,822,137 $2,734,370 ($1,087,767) -28.46%
OFS - 4

1.2 – Financing Account Summary

Dollars in Thousands

 FY 2016 FY 2017 FY 2018 Change % Change

 Actual Estimated Estimated FY 2017 to FY 

2018

FY 2017 to FY 

2018

AMOUNT AMOUNT AMOUNT AMOUNT AMOUNT

TARP Direct Loans

Obligations 669,264 2,360 0 (2,360) -100.00%

Collections 552,877 15,036 0 (15,036) -100.00%

Financing Authority (net) 12,750 (12,750) 0 12,750 -100.00%

Financing Disbursements (net) 116,387 (12,676) 0 12,676 -100.00%

Equity Purchases

Obligations 213,191 125,947 17,311 (108,636) -86.26%

Collections 189,289 380,096 56,480 (323,616) -85.14%

Financing Authority (net) 39,003 (274,870) (39,169) 235,701 -85.75%

Financing Disbursements (net) 23,902 (254,149) (39,169) 214,980 -84.59%

Housing

Obligations 2,627 4,685 1,501 (3,184) -67.96%

Collections 367 1,761 32 (1,729) -98.18%

Financing Authority (net) 0 0 0 0 0.00%

Financing Disbursements (net) 2,270 2,924 1,469 (1,455) -49.76%

1.3 – Program Disbursement, Repayments, and Cost/Savings

Dollars in Billions

Cumulative 

Obligated

Cumulative 

Disbursed

(as of 

4/30/17)

Cumulative 

Outstanding

(as of 

4/30/17)

Total 

Cumulative 

Income (as 

of 4/30/17)

Total 

Cash 

Back

(as of 

4/30/17)

Total 

Estimated 

Lifetime Costs 

(as of 

11/30/16)

Bank Support Programs 250 245 0 36 275 -24

Credit Market Programs 19 19 0 5 24 -3

AIG Investment Program (AIG) 68 68 0 1 55 15 *

Automotive Industry Financing 

Program 80 80 0 7 71 12

Treasury Housing Programs 38 25 33 ***

Total** $455 $437 $0 $49 $425 $32

Additional AIG Common Shares 

Held by Treasury 0 0 0 18 18 -18 *

Total for Programs and Shares** $455 $437 $0 $66 $442 $15

*If all Treasury AIG Investments are combined, it would result in a net gain of nearly $2.4 billion on those shares.

**Totals may not foot due to rounding.

***Making Home Affordable (MHA) and Hardest Hit Fund (HHF) Estimated Lifetime Costs are as of 3/31/17.

1B – Vision, Priorities and Context

TARP was created by EESA in October 2008 as part of a broad-based federal response to the 

financial crisis. The purposes of EESA were —

(1) to immediately provide authority and facilities that the Secretary of the Treasury can use to 

restore liquidity and stability to the financial system of the United States; and

(2) to ensure that such authority and such facilities were are in a manner that —

(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.
OFS - 5

EESA vested authority in the Secretary of the Treasury to “purchase, and to make and fund 

commitments to purchase, troubled assets from any financial institution, on such terms and 

conditions as are determined by the Secretary.” 

As a result of improved financial conditions and careful stewardship of the program, the ultimate 

cost to taxpayers of TARP investments is estimated to be significantly lower than initially 

expected. In Fiscal Year (FY) 2009, the program was projected to cost $341 billion, but it is 

now estimated to cost only $32.4 billion (of which -$0.2 billion relates to investments and $32.6

billion relates to housing programs that do not require repayments by recipients) as of November 

30, 20161

. Lifetime costs are projected at $14.8 billion with the inclusion of receipts from 

Treasury’s sale of additional AIG common stock.

 *Includes $17.6 billion in proceeds from additional Treasury AIG shares

During FY 2017 and FY 2018, OFS priorities will be to continue winding down TARP’s bank 

investment programs subject to market conditions and continue helping struggling homeowners 

find solutions to avoid foreclosure by administering TARP housing programs. OFS will also 

begin to wind-down TARP’s largest housing program, the Making Home Affordable (MHA) 

program, as the application period terminated on December 31, 2016, as required by the 

Consolidated Appropriations Act, 2016 (the Act) (P.L. 114-113).

OFS Administrative Expenses

The authority for OFS’s administrative funding is provided in section 118 of EESA. In 

FY 2017, OFS plans to obligate no more than $107 million and use no more than 52.5 FTEs. 

These levels are less than previously estimated due to the faster than anticipated wind-down of 

TARP’s investment programs and the MHA program application deadline of December 2016, 

established in the Act. In FY 2018, OFS plans to obligate $83 million and use no more than 42.5

FTEs, a decrease of approximately $24 million and 10 FTEs from the current FY 2017 estimates, 

 1 MHA and HHF Estimated Lifetime Costs are as of 3/31/17.

$341.0

$124.1

$77.7 $70.2 $59.7

$22.7* $20.0* $19.7* $14.8*

0

50

100

150

200

250

300

350

400

May-2009 Sep-2009 Sep-2010 Sep-2011 Sep-2012 Sep-2013 Sep-2014 Sep-2015 Nov-2016

Cost (in billions)

Date

OFS TARP Cost Estimates
OFS - 6

to fund the management, maintenance and wind-down of the TARP housing programs and the 

disposition of OFS’s remaining investments. The decrease in FTEs and outside contracts reflects 

the continued wind-down of TARP.

1C - Credit Reform and Administrative Accounts

Section 123 of EESA requires the cost of TARP programs to be calculated using the methods 

required by the Federal Credit Reform Act of 1990 ("credit reform"). In addition to the OFS 

Administrative Account, the organization manages six accounts to comply with the credit reform 

accounting requirements: TARP Equity Purchase Program Account, TARP Equity Purchase 

Financing Account (EPFA), TARP Housing Programs Account, TARP Housing Programs, 

Letter of Credit (LOC) Financing Account, TARP Program Account, and TARP Direct Loan 

Financing Account (DLFA). 

Account Descriptions

TARP Equity Purchase Program Account: The TARP Equity Purchase Program Account 

records the subsidy costs (cost to the Government) associated with federal equity injections into 

qualifying financial institutions. Subsidy costs are calculated on a net present value basis. 

TARP EPFA: The TARP EPFA is a non-budgetary account that records all financial 

transactions to and from the Government resulting from equity purchases. The EPFA primarily 

tracks each cohort year’s purchase activity (dividend payments, the exercise of warrants, 

Treasury borrowings, interest paid to or received from Treasury, etc.) and is not included in the 

Budget totals when calculating total Government spending.

TARP Housing Programs Account: The TARP Housing Programs Account records the subsidy 

costs and cash outlays associated with Treasury’s housing programs under TARP. The Making 

Home Affordable (MHA) and Hardest Hit Fund housing programs are recorded on a cash basis, 

and the Federal Housing Administration (FHA)-Refinance Program is subject to the Federal 

Credit Reform Act of 1990 whereby its subsidy cost is calculated on a net present value basis. 

TARP Housing Programs, LOC Financing Account: The TARP Housing Programs, LOC

Financing Account is a non-budgetary account that records all financial transactions to and from 

the Government resulting from OFS’s FHA-Refinance Program. Like other financing accounts, 

its primary purpose is the financial tracking of each cohort year’s loan activity and is not 

included in the Budget totals.

TARP Program Account: The TARP Program Account records the subsidy costs associated with 

direct loans obligated to qualifying institutions. Subsidy costs are calculated on a net present 

value basis. 

TARP DLFA: The TARP DLFA is a non-budgetary account that records all financial 

transactions to and from the Government resulting from direct loans. Like EPFA, its primary 

purpose is the financial tracking of each cohort year’s loan activity and is not included in the 

Budget totals.

OFS Administrative Account: This account provides for the administrative costs of OFS.
OFS - 7

Section 2 – Budget Adjustments and Appropriation Language

2.1 – Budget Adjustments Table

Dollars in Thousands

Office of Financial Stability FTE Amount

FY 2017 Estimated 52.5 $106,976

Maintaining Current Levels (MCLs): - 2,136

Pay-Raise - 126

Pay Annualization - 46

Non-Pay - 1,964

Total FY 2018 Base 52.5 109,112

Program Changes:

Program Decreases: (10) (26,032)

Housing Program Support - (19,005)

Maintenance and Disposition of Assets - (440)

OFS Salaries and Benefits (10) (1,681)

Organizational Support - (4,906)

Total FY 2018 Estimated 42.5 83,080

2A – Budget Increases and Decreases Description

Maintaining Current Levels (MCLs) ......................................................+$2,136,000 / +0 FTE

Pay-Raise +$126,000 / +0 FTE 

Funds are required for the proposed January 2018 pay raise.

Pay Annualization +$46,000 / +0 FTE

Funds are required for annualization of the January 2017 pay raise.

Non-Pay +$1,964,000 / +0 FTE 

Funds are required for non-labor costs such as travel, contracts, rent, supplies, and equipment.

Program Decreases .................................................................................-$26,032,000 / -10 FTE

Housing Program Support -$19,005,000 / +0 FTE 

MHA administrative functions and compliance will decline sharply from FY 2017 to FY 2018 as 

the program’s application deadline expired as of December 30, 2016. Administrative and 

compliance functions will continue to wind-down over time as the application pipeline decreases 

and commitments are paid.

Maintenance and Disposition of Assets -$440,000 / +0 FTE 

During FY 2017, OFS will continue the disposition of its position in the remaining Capital 

Purchase Program (CPP) banks and complete the execution of the Community Development 

Capital Initiative (CDCI) Early Repurchase Option, announced by Treasury on August 1, 2016. 

In FY 2018, OFS expects its portfolio to be composed mostly of CDCI institutions with a 

handful of CPP institutions.
OFS - 8

OFS Salaries and Benefits -$1,681,000 / -10 FTE 

Savings resulted from natural attrition and expiration of term appointments due to the winddown of various TARP programs. 

Organizational Support -$4,906,000/ +0 FTE 

Administrative costs associated with managing OFS’s portfolio will decline over time as TARP 

winds down. However, many duties and responsibilities will remain and are not directly 

correlated to the volume of assets held by OFS. Many of these organizational support functions 

will be run in-house and relate to legislative and oversight-mandated reporting functions, as well 

as the management and maintenance of TARP’s housing programs.

2.2 – Operating Levels Table

Dollars in Thousands

Office of Financial Stability FY 2016 FY 2017 FY 2018

Object Classification Actual Estimated Estimated

11.1 - Full-time permanent 8,281 6,675 5,506

11.5 - Other Personnel Compensation 89 67 55

11.9 - Personnel Compensation (Total) $8,370 $6,742 $5,561

12.0 - Personnel benefits 2,505 2,053 1,725

Total Personnel Compensation and Benefits $10,875 $8,795 $7,286

21.0 - Travel and transportation of persons 147 188 141

23.0 - Rent, communications and utilities 6 5 4

25.1 - Advisory and assistance services 10,335 11,777 9,386

25.2 - Other services from non-Federal sources 98,448 73,453 55,425

25.3 - Other goods and services from Federal sources 13,500 12,348 10,500

26.0 - Supplies and materials 374 402 330

31.0 - Equipment 74 8 8

Total Non-Personnel $122,884 $98,181 $75,794

Total Budgetary Resources $133,759 $106,976 $83,080

Budget Activities:

TARP Administrative Account 133,759 106,976 83,080

Total Budgetary Resources $133,759 $106,976 $83,080

FTE 66.5 52.5 42.5

Table includes direct FTEs.

Totals may not foot due to rounding.

2B – Appropriations Language and Explanation of Changes

OFS does not receive discretionary appropriations from Congress. Therefore, no appropriations 

language is proposed.

2C – Legislative Proposals

OFS has no legislative proposals.
OFS - 9

Section 3 – Budget and Performance Plan

3A – EESA Program Descriptions

The FY 2018-2022 Strategic Plan is currently under development. The Annual Performance Plan 

will be updated in the FY 2019 Budget to reflect the new priorities.

Bank Support Programs

Capital Purchase Program (CPP): OFS created CPP, its largest program, in October 2008. OFS

provided a total of $204.9 billion in capital to 707 institutions in 48 states. During FY 2016, OFS

continued to wind-down remaining CPP investments through repayments by those institutions 

that were able to do so and restructuring investments in limited cases. As of April 30, 2017, CPP 

has generated $226.7 billion in recoveries for taxpayers with nine institutions remaining in the 

program for a total of $191 million in investments outstanding.

Community Development Capital Initiative (CDCI): OFS created CDCI on February 3, 2010, to 

provide investments of capital to certified Community Development Financial Institutions banks, 

thrifts, and credit unions. The initial dividend or interest rate was two percent. To encourage 

repayment, the dividend rate increases to nine percent after eight years. On August 1, 2016, 

Treasury, as part of its ongoing effort to wind-down TARP, offered participating CDCI 

institutions an opportunity to repurchase their outstanding securities owned by Treasury at fair 

value ahead of the dividend rate step-ups set to take place in 2018. OFS invested $570 million in 

84 CDFIs, of which 28 institutions converted $363 million (including warrants) from CPP to 

CDCI. As of April 30, 2017, CDCI has generated $508 million in recoveries for taxpayers with 

27 institutions remaining in the program for a total of $98 million in investments outstanding. 

Housing Programs

OFS established several TARP housing programs, assisting millions of homeowners and 

introducing reforms for the mortgage servicing industry to facilitate mortgage modifications.

Making Home Affordable® Program (MHA): In 2009, OFS launched MHA to help homeowners 

prevent avoidable foreclosures and strengthen the housing market. The cornerstone of MHA is 

the Home Affordable Modification Program (HAMP), which provides eligible homeowners the 

opportunity to reduce their monthly mortgage payments. In accordance with provisions of the 

Act, MHA terminated on December 31, 2016, except with respect to certain applications made 

before such date. As of April 30, 2017, OFS had disbursed $17.0 billion out of a possible $27.8

billion under MHA.

Housing Finance Agency (HFA) Hardest Hit Fund (HHF): HHF was established in 2010 to 

provide targeted aid to homeowners in states hit hardest by the economic and housing market 

downturn by providing funding to to state HFAs. The $7.6 billion initiative encompassed 18 

states and the District of Columbia (D.C.). In December 2015, the Act granted Treasury 

authority to make an additional $2.0 billion in commitments through the HHF. As of April 30, 

2017, OFS had disbursed $8.1 billion out of a possible $9.6 billion under the HFA Hardest Hit 

Fund.
OFS - 10

FHA Short Refinance Program: OFS continues to support the FHA Short Refinance Program, 

designed to assist borrowers with negative equity. The program has seen limited participation. 

As such, OFS has reduced the LOC facility supporting this program from $8.0 billion to $100 

million. On December 31, 2016, the FHA Short Refinance Program ended; therefore, OFS plans 

to lower the LOC in FY 2017 to the total amount of OFS coverage for the loans in the program.

As of November 30, 2016, the revised lifetime cost estimate for the program was $18 million for 

outstanding refinanced loans.

Other Programs

Automotive Industry Financing Program (AIFP): OFS fully wound down AIFP during FY 2015, 

selling its remaining stake in Ally Financial. OFS disbursed $79.7 billion in loans and equity 

investments to the auto industry through the AIFP. As of April 30, 2017 OFS has collected 

$70.5 billion through sales, repayments, dividends, interest, recoveries, and other income.

Recoveries from the bankruptcy liquidation of Old Chrysler and Old GM remain possible. 

All other TARP programs closed prior to FY 2016, including the Targeted Investment Program, 

Asset Guarantee Program, Public-Private Investment Program, Term Asset-Backed Securities 

Loan Facility, Small Business Administration 7(a) Securities Purchase Program, and American 

International Group, Inc. Investment Program.

For more details, please see the Budgetary Effects of the Troubled Asset Relief Program chapter 

in the Analytical Perspectives volume of the 2018 Budget.

3B – EESA Administration

The authority for the OFS’s administrative funding is provided in section 118 of EESA. The 

administrative budget consists primarily of contracting and financial agent support costs 

associated with OFS’s ongoing implementation and management of the TARP housing programs 

and the management and disposition of OFS’s remaining investments. In addition, continuing 

organizational support, including information technology, facilities, legal, compliance, 

accounting, and human resources, will be needed to manage these ongoing OFS initiatives. 

OFS’s senior management is responsible for performance against its operational goals.

3C – Operational Goals

Complete the wind-down of TARP investment programs

The first operational goal for OFS is to complete the wind-down of TARP investment programs. 

Only two investment programs remain: CPP and CDCI. OFS is focused on recovering TARP 

funds in a manner that continues to promote the Nation’s financial stability while maximizing 

returns on behalf of the taxpayers. For CPP institutions, participating financial institutions may 

repay the funds they received at any time, with the approval of their regulators. However, since 

the majority of the institutions currently in the CPP portfolio remain a going concern, OFS 

continues to work with CPP institutions to restructure certain investments that will allow them to 

exit TARP. As of April 30, 2017, OFS had $191 million in outstanding CPP investments and $98

million in outstanding CDCI investments. 
OFS - 11

Continue to help struggling homeowners avoid foreclosure

OFS’s second operational goal is to continue helping struggling homeowners avoid foreclosure. 

MHA statutorily sunset in December 2016. Under this program more than 1.7 million 

homeowners have had their mortgages modified permanently through March 2017. HAMP has 

also set new standards and changed practices throughout the mortgage servicing industry. In 

addition, HHF provides funding to 18 states and D.C. to assist struggling homeowners. In 

FY 2016, state HFAs continued to adapt their programs to best meet borrower needs in evolving 

economic and housing markets. The Act included a provision that allowed OFS to commit an 

additional $2.0 billion in TARP funds to current HHF program participants.

FY 2012 FY 2013 FY 2014 FY 2015 FY 2016

Performance Metrics and Indicators1

(includes GSE and non-GSE)

Actual Actual Actual Actual Actual

Reduction in median payment for homeowners in 

permanent modifications (assist homeowners) 

program-to-date.

$541 $547 $540 $481 $472

Number of modifications entered into 

(assist homeowners)

Trial

Permanent

213,613

233,622

181,505

178,039

137,550

148,070

122,496

125,338

108,721

112,279

12-month re-default rate for Permanent 

Modifications (90+ days delinquency rate for loans 

seasoned 12 months)

14.5 % 13.6% 13.4% 13.1% 13.1%

1

Items in italics are indicators. 

Minimize cost to taxpayers

The third operational goal of OFS is to minimize the cost of TARP to taxpayers by carefully 

managing the timely exit of these investments to reduce taxpayers’ exposure, returning TARP 

funds to reduce the federal debt, and continuing to replace government assistance with private 

capital in the financial system. OFS has taken a number of steps to dispose of outstanding 

investments in a manner that balances the need to exit these investments as quickly as practicable 

while maximizing taxpayer returns. OFS also takes steps to ensure that TARP recipients comply 

with any TARP-related statutory or contractual obligations such as executive compensation 

requirements and restrictions on dividend payments.

FY 2012 FY 2013 FY 2014 FY 2015 FY 2016

Performance Metrics and Indicators1 Actual Actual Actual Actual Actual

Proceeds from warrant repurchases as percent of 

aggregate CPP preferred investment amount

(plus median for the selected banks)

1.9% 3.3% 4.2% 9.0% NA

1

Items in italics are indicators.
OFS - 12

Continue to operate with highest standards of transparency, accountability, and integrity

OFS’s final goal is to continue to operate with the highest standards of transparency, 

accountability, and integrity. OFS posts a variety of reports online that provide taxpayers with 

regular and comprehensive information about how TARP funds are spent, who received them 

and on what terms, and how much has been recovered to date. OFS also publishes the annual 

audited Agency Financial Report and continues to maintain productive working relationships 

with three oversight bodies charged with auditing and reviewing TARP activities. 

Performance Metrics and FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Indicators1 Actual Actual Actual Actual Actual Target Target Target FY 2016

Trend

Percentage of StatutorilyMandated Reports Submitted 

On-Time (ensure 

transparency of operations to 

the public)

100.0 80.0 80.0 99.0 94.7 100.0 100.0 100.0

Percentage of Customers 

Satisfied with 

FinancialStability.gov (Self 

Selected Respondents) 

(ensure transparency of 

operations to the public)

67.0 67.0 70.0 66.5 73.0 75.0 75.0 75.0

Average days to close a 

FOIA case2 98 90 21 NA NA NA NA NA

Percentage of FOIA 

Assignments On-Time or 

Less Than 30-Days Overdue

(ensure transparency within 

the government)

N/A N/A 15.0 13.03 56.56 33.0 33.0 33.0

Percentage of Congressional 

Constituent Correspondence 

Responses Completed within 

10 Business Days of Receipt

99.0 100.0 92.0 50.0 66.75 100.0 100.0 100.0

Clean Audit Opinion on 

TARP Financial Statements 

(ensure transparency of 

operations to the public) (1.0 

= Yes)

1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0

Percentage of SIGTARP and 

GAO Oversight 

Recommendations 

Responded to On-Time 

(ensure transparency of 

operations to the public)

82.0 80.0 100.0 100.0 100.0 100.0 100.0 100.0

1

Items underlined are measures. Targets are provided only for measures. 2

The ‘Average days to close a FOIA case’ measure was discontinued in third quarter FY 2014 to best reflect available reporting 

data. OFS now reports ‘Percentage of FOIA requests on-time or less than 30-days overdue’.
OFS - 13

Section 4 – Supplemental Information

4A – Summary of Capital Investments

OFS uses Departmental Offices’ (DO) system and is part of DO’s capital investment strategy.

A summary of capital investment resources, including major information technology and nontechnology investments, can be viewed and downloaded at 

http://www.treasury.gov/about/budget-performance/Pages/summary-of-capital-investments.aspx

This website also contains a digital copy of this document.

Office of Financial Research

Congressional Justification for 

Appropriations and 

Annual Performance 

Report and Plan

FY 2018
OFR - 2

Table of Contents

Section I – Budget Request........................................................................................................... 3

A – Mission Statement................................................................................................................ 3

B – Summary of the Request ...................................................................................................... 3

C – Vision, Priorities, and Context............................................................................................. 4

1.2 – Budget Adjustments Table................................................................................................. 6

D – Budget Increases and Decreases Description....................................................................... 6

1.3 – Operating Levels Table...................................................................................................... 7

E – Appropriations Language and Explanation of Changes....................................................... 7

F – Legislative Proposals............................................................................................................ 7

Section II – Annual Performance Plan and Report................................................................... 8

A – Data Center .......................................................................................................................... 8

2.1.1 – Data Center Budget and Performance Plan .................................................................... 8

B – Technology Center............................................................................................................... 9

2.1.2 – Technology Center Budget and Performance Plan......................................................... 9

C – Research and Analysis Center.............................................................................................. 9

2.1.3 – Research and Analysis Center Budget and Performance Plan...................................... 10

D – Operations and Support Services....................................................................................... 10

2.1.4 – Operations and Support Services Budget and Performance Plan ................................. 10
OFR - 3

Section I – Budget Request 

A – Mission Statement

Promote financial stability by delivering high-quality financial data, standards, and analysis for 

the Financial Stability Oversight Council (FSOC or Council) and public.

B – Summary of the Request 

The Office of Financial Research (OFR) is estimating an FY 2018 funding level of $76.056 

million, which is 25 percent below its Fiscal Year (FY) 2017 operating level. To align with the 

Administration’s initiative to improve government efficiency and effectiveness, OFR is 

implementing a staffing streamlining effort to ensure appropriate levels for maximum efficiency.

1.1 – Resource Detail Table Dollars in Thousands

Office of Financial Research

Budgetary Resources

 FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

Revenue/Offsetting Collections 16FTE 16Amt 17FTE 17Amt 18FTE 18Amt ChgFTE ChgAmt pctFTE pctAmt

Assessments1 $91,926 $75,935 $54,560 ($21,375) NA -28.15%

Interest $169 $189 $176 ($13) NA -6.88%

Recovery of Prior Year Paid Obligations $231 $220 $132 ($88) NA -40.00%

Recovery of Prior Year Unpaid Obligations $4,638 $6,380 $3,740 ($2,640) NA -41.38%

Restoration of Sequestration Rescission $5,945 $6,262 $5,253 ($1,009) NA -16.11%

Unobligated Balances from Prior Years2 $70,175 $71,947 $54,274 ($17,673) NA -24.56%

Total Revenue/Offsetting Collections $173,084 $160,933 $118,135 ($42,798) NA -26.59%

Expenses/Obligations 16FTE 16Amt 17FTE 17Amt 18FTE 18Amt ChgFTE ChgAmt pctFTE pctAmt

Data Center 37 $16,477 45 $19,157 43 $16,865 (2) ($2,292) -4.44% -11.96%

Technology Center 61 $32,132 65 $35,562 36 $27,281 (29) ($8,281) -44.62% -23.29%

Research and Analysis Center 54 $14,239 55 $17,719 38 $11,573 (17) ($6,146) -30.91% -34.69%

Operations and Support Services 56 $32,026 58 $28,969 22 $20,337 (36) ($8,632) -62.07% -29.80%

Total Expenses/Obligations 208 $94,874 223 $101,407 139 $76,056 (84) ($25,351) -37.67% -25.00%

Sequestration Rescission ($6,262) ($5,253) $0 $5,253

Net Results $71,948 $54,273 $42,079 ($12,194) -22.47%

FY 2016 FY 2017 FY 2017 to FY 2018

Actual Estimated Estimated Change % Change

FY 2018

1) The OFR is financed through assessments on certain bank holding companies and nonbank financial companies. See Treasury’s final rule and interim final rule governing the Assessments 

process: https://financialresearch.gov/strategy-budget/files/final_rule_interim_final_rule.pdf 

2) The funding for the first six months of operating expenses and 12 months of capital expenses are reflected in the unobligated balance line. This is because the first assessment covering the 

fiscal year beginning October 1 is actually collected on September 15 of the prior fiscal year. This makes it appear as though large amounts of unobligated balances went unused, when in 

fact very little, if any, of those balances were from under execution. For instance: the entire $71,947M carried forward from FY 2016 was to cover the estimated need of $73,718M for the 

first assessment period of FY 2017. The remaining need was covered by the return of the FY 2016 sequestration reduction.
OFR - 4

C – Vision, Priorities, and Context 

The Office of Financial Research (OFR or Office) resides within the Department of the Treasury.

In carrying out its mission, the OFR seeks to achieve its vision of a transparent, efficient, and 

stable financial system. The OFR’s work contributes to making informed and comprehensive 

policies and taking actions that will strengthen the financial system. The Office monitors the 

financial environment for the emergence of new vulnerabilities and migration of financial 

activity that could threaten financial stability. Although the OFR was created within Treasury, 

the work of the OFR is independent from the Council and the Treasury. This independence 

provides the Office with an objective position to evaluate macroprudential policies, advocate for 

needed data initiatives, help the regulatory community enhance its peripheral vision, and produce 

work that may have previously been beyond the reach of individual regulatory agencies.

In the OFR Strategic Plan for Fiscal Years 2015–2019, the OFR established three strategic goals 

that reflect its primary functions in data and analysis, data standardization, and research.

1 The 

plan will continue to guide the Office’s work through FY 2019 and will support the decisions 

made about resources needed to implement those strategies. The three goals are:

1. The OFR is an essential source of data and analysis for monitoring threats to financial 

stability.

Key objectives of this goal include:

• The OFR’s monitoring tools and analyses are widely used and critical to assessing 

financial stability.

• Data used to monitor financial stability are comprehensive, reliable, and accessible to 

policy makers and the public through the OFR.

• Data providers and the public trust, acknowledge, and recognize that OFR data are 

protected and secure.

2. Standards that improve the quality and utility of financial data are identified and 

adopted.

Key objectives of this goal include:

• Recognition of the need for standards by policy makers and industry.

• The OFR is the source of expert knowledge needed to develop and implement types and 

formats of data reported and collected.

• Financial data standards that create efficiencies and facilitate analysis are widely used.

3. Leading edge research improves financial stability monitoring and the scope and 

quality of financial data, and informs policy and risk management.

Key objectives of this goal include:

• The OFR is the recognized center for objective, innovative research on financial 

stability.

 1 See the OFR Strategic Plan for Fiscal Years 2015–2019: 

http://financialresearch.gov/strategy-budget/files/Office-of-Financial-Research-Strategic-Plan-2015-2019.pdf.
OFR - 5

• OFR research is widely cited and used to improve policy making, risk management, 

financial stability, and the scope and quality of financial data.

OFR research priorities include:

• Broadening the market monitoring framework, including continued publication of a Financial 

Markets Monitor; 

• Developing a suite of additional monitors and dashboards to assess and monitor risks in 

money market funds, hedge funds, and credit default swap markets; 

• Publishing descriptions of the methodology behind the Financial Stability Monitor and 

Financial Stress Index, as well as other publications on significant threats to financial 

stability;

• Understanding and analyzing the conflicts and complementarities among macroprudential 

policy tools;

• Developing and executing a research program to examine factors behind market liquidity;

• Developing and executing a research and data program to examine risks in central 

counterparty clearinghouses;

• Expanding the evaluation of stress tests and other macroprudential policy tools; and

• Publishing research on financial stability, risk management, and related topics.

OFR data priorities include:

• Advocating for continued global implementation of the Legal Entity Identifier (LEI) in 

regulation and market practice; 

• Promoting the use of data standards in derivatives markets, in collaboration with the 

Commodity Futures Trading Commission;

• Leading or contributing to the development and implementation of new standards for 

financial data;

• Filling data gaps, particularly in secured funding markets and asset management;

• Collecting data on the repo market, in collaboration with the Federal Reserve; 

• Promoting and developing protocols for secure data sharing among regulatory agencies; and

• Creating a prototype financial instrument reference database to promote market transparency.
OFR - 6

1.2 – Budget Adjustments Table

Dollars in Thousands

Office of Financial Research FTE Amount

FY 2017 Estimated 223 $101,407 

Changes to Base:

Total FY 2018 Base 223 $101,407 

Program Changes:

Program Decreases (84) ($25,351)

Personnel (84) ($17,824)

Non-Personnel 0 ($7,527)

Total FY 2018 Estimated 139 $76,056 

D – Budget Increases and Decreases Description

Program Decreases........................................................................-$25,351,000

Personnel -$17,824,000 / -84 FTE

To align with the Administration’s initiative to improve Government efficiency and 

effectiveness, the Office of Financial Research is implementing a staffing streamlining effort to 

ensure appropriate levels for maximum efficiency.

Non-Personnel -$7,527,000 / 0 FTE

The office proposes to decrease administrative costs, reduce supplies and equipment purchases, 

and re-organize management functions.
OFR - 7

1.3 – Operating Levels Table

Dollars in Thousands

Office of Financial Research FY 2016 FY 2017 FY 2018

Object Classification Actual Estimated Estimated

11.1 - Full-time permanent 31,622 34,371 21,760 

11.3 - Other than full-time permanent 497 535 495 

11.5 - Other personnel compensation 366 775 450 

11.9 - Total personnel compensation 32,485 35,681 22,705 

12.0 - Personnel benefits 11,322 11,849 7,001 

Total Personnel and Compensation Benefits $43,807 $47,530 $29,706 

21.0 - Travel and transportation of persons 556 623 246 

23.1 - Rental payments to GSA 59 0 0 

23.3 - Communication, utilities, and misc charges 3 3 5 

24.0 - Printing and reproduction 26 24 25 

25.1 - Advisory and assistance services 10,338 17,541 12,887 

25.2 - Other services from non-Federal sources 967 1,235 1,212 

25.3 - Other goods and services from Federal sources 24,489 18,185 18,265 

26.0 - Supplies and materials 8,312 7,513 7,135 

31.0 - Equipment 5,997 8,753 6,575 

41.0 - Grants, subsidies, and contributions 320 0 0 

Total Non-Personnel $51,067 $53,877 $46,350 

New Budgetary Resources $94,874 $101,407 $76,056 

FTE 208 223 139

1) Personnel compensation and benefits include direct OFR staff members only. Object Classification 25, “Other contractual 

services,” and expenditures of “Operations and Support Services” include reimbursable support received from Treasury’s 

Departmental Offices; personnel benefits services from the Office of the Comptroller of the Currency; and services from Treasury’s 

Bureau of the Fiscal Service Administrative Resource Center, including human resource services, procurement services, travel, and 

financial management services.

E – Appropriations Language and Explanation of Changes

The OFR receives no appropriations from Congress. 

F – Legislative Proposals

The OFR has no legislative proposals.
OFR - 8

Section II – Annual Performance Plan and Report

The Department of the Treasury’s FY 2018 - 2022 Strategic Plan, in which the OFR is included,

is currently under development. The Annual Performance Plan will be updated in the FY 2019 

budget to reflect the new priorities.

A – Data Center

($16,865,000 from Assessments):

As required by statute, the Data Center, on behalf of the Council, collects, validates, and 

maintains all data necessary to carry out the Center’s duties. Under this mandate, the Data 

Center works to increase efficiency in data acquisition and management; reduce redundant 

reporting requirements across the regulatory system (including through more effective datasharing arrangements); and to ensure the security of sensitive data. 

Data Standards

One of the OFR’s strategic goals is to identify and adopt standards that improve the quality and 

utility of financial data. Standards for financial data will benefit regulators and financial market 

participants by making data aggregation easier, improving analysis, and reducing data collection

costs. The OFR monitors progress through the following key performance indicators: 

• Number of LEIs issued cumulatively in the United States and internationally – This indicator 

tracks the progress over time in the industry use of the LEI. 

• Number of times that financial data standards are incorporated in rules and regulations – This 

data point serves as an indicator of regulators’ awareness of the importance of data standards 

and the extent to which data standards are being adopted in rules and regulations.

2.1.1 – Data Center Budget and Performance Plan

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target

FY 2018

Trend

Number of LEIs Issued 

Cumulatively in the United 

States and Internationally

N/A N/A N/A 395,861 464,412 I I I

Number of Times That 

Financial Data Standards 

Related are Incorporated 

in Rules and Regulations

N/A N/A N/A 2 9 I I I

Key: DISC - Discontinued; B - Baseline, I - Indicator

Indicator: a metric that has no established target and is used for contextual purposes only; a direction for improvement 

may be associated with an indicator, but not a specific target.

Dollars in Thousands

 Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Estimated Estimated

Column1 Column32 Column4 Column5 Column6 Column7 Column3 Column22 Column10

Expense/Obligations $19,303 $37,619 $46,940 $17,240 $16,477 $19,157 $16,865

Budget Activity Total $19,303 $37,619 $46,940 $17,240 $16,477 $19,157 $16,865

FTE 24 66 90 51 37 45 43
OFR - 9

B – Technology Center

($27,281,000 from Assessments):

The Technology Center provides mission-critical analytic services to support the OFR’s work 

with complex, sensitive financial data and the Office’s research and analysis activities. In 

addition, the Technology Center is responsible for safeguarding data and systems, and 

managing all IT capabilities within the OFR. These responsibilities include computing and 

analytic platforms, software, telecommunications, client applications, and office automation 

solutions. 

2.1.2 – Technology Center Budget and Performance Plan

C – Research and Analysis Center

($11,573,000 from Assessments):

Through its Working Paper Series, Brief Series, Staff Discussion Papers Series, and OFR annual 

reports, the OFR publishes results of its analysis to be transparent in its operations and promote 

public understanding of threats to financial stability. In addition, the OFR’s Research Seminar 

Series allows the OFR’s research staff opportunities to collaborate with external experts and seek 

feedback from them. The OFR is establishing forums and networks to bring together experts 

from within and outside the regulatory system. 

Leading Edge Research and Monitoring Threats to Financial Stability

The Research and Analysis Center contributes to the achievement of two of the OFR’s three 

strategic goals: (1) Leading edge research improves financial stability monitoring and the scope 

and quality of financial data, and informs policy and risk management; and (2) The OFR is an 

essential source of data and analysis for monitoring threats to financial stability. The OFR has 

one measure linked to the achievement of each of these two goals:

• Number of research and analysis publications (working papers, briefs, staff discussion 

papers, and reports) made public – This measure tracks the OFR’s progress in increasing the 

size of its research portfolio available to policy makers, regulators, industry, academics, and 

the public. The measure includes a wide range of published research products, from the 

OFR’s comprehensive annual reports to the more frequently issued working papers. This 

measure was formerly called, “Number of research and analysis products made public.”

• Number of monitor editions, policy analyses, and dashboards produced for monitoring 

threats to financial stability – This measure tracks the OFR’s output of monitoring tools and 

other analyses of threats to financial stability. It includes tools and information made 

available to the general public, as well as those produced for the Council or Council member 

agencies.

Dollars in Thousands

 Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Estimated Estimated

Column1 Column32 Column4 Column5 Column6 Column7 Column8 Column2 Column10

Expense/Obligations $0 $0 $0 $30,970 $32,132 $35,562 $27,281

Budget Activity Total $0 $0 $0 $30,970 $32,132 $35,562 $27,281

FTE 0 0 0 51 61 65 36
OFR - 10

2.1.3 – Research and Analysis Center Budget and Performance Plan

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target

FY 2016

Trend

Number of Research and 

Analysis Publications 

Made Public Year-to-Date

N/A 10 15 34 24 25 28 35

Number of monitors 

editions, policy analysis, 

and dashboards produced 

for monitoring threats to 

financial stability

N/A N/A N/A 21 34 12 34 TBD

Key: DISC - Discontinued; B – Baseline, I - Indicator

1) Research and Analysis Center includes only staffing, outside work arrangements, and contracting related to annual report 

production. Costs associated with data, information systems, and analytical tools are under the Data and Technology Centers.

D – Operations and Support Services

($20,337,000 from Assessments):

The category “Operations and Support Services” contains the activities of the Director’s Office, 

Operations, External Affairs, and Chief Counsel. The category includes support provided 

through a shared services model and reimbursable arrangements with Treasury’s Departmental 

Offices; personnel benefits services from the Office of the Comptroller of the Currency; and 

services from Treasury’s Bureau of the Fiscal Service Administrative Resource Center, including 

services related to human resources, procurement, travel, and financial management. 

2.1.4 – Operations and Support Services Budget and Performance Plan

The OFR assesses its performance measures annually and revises them, if appropriate, to ensure 

their continued usefulness for management decision-making and improved results.

http://www.treasury.gov/about/budget-performance/Pages/summary-of-capital-investments.aspx

This website contains a digital copy of this document.

Dollars in Thousands

 Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Estimated Estimated

Column1 Column32 Column4 Column5 Column6 Column7 Column3 Column82 Column2

Expense/Obligations $3,398 $4,733 $7,700 $10,396 $14,239 $17,719 $11,573

Budget Activity Total $3,398 $4,733 $7,700 $10,396 $14,239 $17,719 $11,573

FTE 11 26 33 43 54 55 38

Dollars in Thousands

 Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Estimated Estimated

Column1 Column32 Column4 Column5 Column6 Column7 Column8 Column2 Column3

Expense/Obligations $16,873 $22,953 $28,626 $26,110 $32,026 $28,969 $20,337

Budget Activity Total $16,873 $22,953 $28,626 $26,110 $32,026 $28,969 $20,337

FTE 9 35 43 49 56 58 22

Financial Stability Oversight 

Council

Congressional Justification 

for Appropriations and 

Annual Performance 

Report and Plan

FY 2018
FSOC - 2

Table of Contents

Section I – Budget Request................................................................................................................3

A – Mission Statement .....................................................................................................................3

B – Summary of the Request............................................................................................................3

1.1 – Resource Detail Table .............................................................................................................3

C – Vision, Priorities, and Context ..................................................................................................3

1.2 – Budget Adjustments Table ......................................................................................................5

D – Budget Increases and Decreases Description............................................................................5

1.3 – Operating Levels Table ...........................................................................................................6

E – Appropriations Language and Explanation of Changes ............................................................6

F – Legislative Proposals .................................................................................................................6

Section II – Annual Performance Plan and Report ........................................................................7

A – Financial Stability Oversight Council .......................................................................................7

2.1.1 – Financial Stability Oversight Council Annual Performance and Report .............................7

B – FDIC Reimbursement................................................................................................................7

2.1.2 – FDIC Reimbursement Annual Performance Plan and Report .............................................7
FSOC - 3

Section I – Budget Request

A – Mission Statement

To identify risks to the financial stability of the United States, to promote market discipline, and to 

respond to emerging threats to the stability of the U.S. financial system.

B – Summary of the Request

The Financial Stability Oversight Council (FSOC or Council) is estimating an FY 2018 operating

level of $12.247 million, which is 7.79 percent below its FY 2017 operating level. This request 

includes $7.748 million for the FSOC Secretariat and the Office of the Independent Member with 

Insurance Expertise, and $4.499 million to reimburse the Federal Deposit Insurance Corporation 

(FDIC) for certain expenses as required by law.

1.1 – Resource Detail Table

2) The funding for the first six months of operating expenses and 12 months of capital expenses are reflected in the unobligated balance line. This is 

because the first assessment covering the fiscal year beginning October 1 is actually collected on September 15 of the prior fiscal year. This makes it 

appear as though large amounts of unobligated balances went unused, when in fact very little, if any, of those balances were from under execution. 

C – Vision, Priorities, and Context

The Council is chaired by the Secretary of the Treasury and consists of 10 voting members and five

nonvoting members who serve in an advisory capacity. The Council brings together the expertise 

of the federal financial regulators, an insurance expert appointed by the President, and state 

regulators. 

The Council’s three statutory purposes are:

1) to identify risks to the financial stability of the United States that could arise from the material 

financial distress or failure, or ongoing activities, of large, interconnected bank holding 

companies or nonbank financial companies, or that could arise outside the financial services 

marketplace;

2) to promote market discipline, by eliminating expectations on the part of shareholders, creditors, 

and counterparties of such companies that the Government will shield them from losses in the 

event of failure; and

Dollars in Thousands

Financial Stability Oversight Council

Budgetary Resources

 FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

Revenue/Offsetting Collections 16FTE 16Amt 17FTE 17Amt 18FTE 18Amt ChgFTE ChgAmt pctFTE pctAmt

Assessments $12,535 $10,355 $7,440 ($2,915) NA -28.15%

Interest $23 $26 $24 ($2) NA -7.69%

Recovery of Prior Year Paid Obligations $31 $30 $18 ($12) NA -40.00%

Recovery of Prior Year Unpaid Obligations $632 $870 $510 ($360) NA -41.38%

Restoration of Sequestration Rescission $811 $854 $716 ($138) NA -16.16%

Unobligated Balances from Prior Years $9,569 $9,020 $7,157 ($1,863) NA -20.65%

Total Revenue/Offsetting Collections $23,601 $21,155 $15,865 ($5,290) NA -25.01%

Expenses/Obligations 16FTE 16Amt 17FTE 17Amt 18FTE 18Amt ChgFTE ChgAmt pctFTE pctAmt

FSOC 22 $7,157 23 $8,156 21 $7,748 (2) ($408) -8.70% -5.00%

FDIC 0 $6,571 0 $5,126 0 $4,499 0 ($627) NA -12.23%

Total Expenses/Obligations 22 $13,728 23 $13,282 21 $12,247 (2) ($1,035) -8.70% -7.79%

Sequestration Rescission ($854) ($716) $0 $716

Net Results $9,019 $7,157 $3,618 ($3,539) -49.45%

FY 2016 FY 2017 FY 2017 to FY 2018

Actual Estimated Estimated Change % Change

FY 2018

1) The FSOC and FDIC reimbursements are financed through assessments on certain bank holding companies and nonbank financial companies. See Treasury’s final rule and interim final 

rule governing the Assessments process: https://www.financialresearch.gov/strategy-budget/files/final_rule_interim_final_rule.pdf
FSOC - 4

3) to respond to emerging threats to the stability of the U.S. financial system.

The Council has a statutory duty to facilitate information sharing and coordination among the 

member agencies regarding domestic financial services policy development, rulemaking, 

examinations, reporting requirements, and enforcement actions. Over the next year, the Council 

will continue to monitor the financial system for emerging risks and facilitate interagency 

cooperation to identify and analyze emerging threats. The Council will also continue to facilitate 

information sharing and interagency coordination with respect to various regulatory initiatives.

Over the last year, the Council continued to identify and monitor potential risks to U.S. financial 

stability; fulfilled its statutory requirements, including transmission of its sixth annual report to 

Congress; and served as a forum for coordination among member agencies. The Council continues

to evaluate its nonbank financial company determinations and financial market utility designations. 

In FY 2016, the Council rescinded one nonbank financial company determination.

By law, the Council is required to convene no less than quarterly, but the Council has convened on 

a more frequent basis to share information on key financial developments, coordinate regulatory 

implementation, and monitor progress on recommendations from the Council’s annual reports. In 

FY 2016, the Council convened 10 times. The Council will continue to remain focused on 

identifying near-term threats and addressing structural vulnerabilities in the financial system. 

Transparency into Council work has routinely been provided through an annual report to Congress, 

periodic Congressional testimony on Council activities and emerging threats to financial stability, 

and regular communications with the public about Council activities and decisions.

The Council is an executive agency and is not an office or bureau of the Department of the 

Treasury. However, by law, the Council’s expenses (and, indirectly, FDIC reimbursements) are 

considered expenses of the Office of Financial Research (OFR), an office within the Department of 

the Treasury.

FDIC Reimbursement

By law, the Council’s expenses also include reimbursement of certain reasonable implementation 

expenses incurred by the FDIC in implementing Orderly Liquidation Authority. The FDIC must 

periodically submit requests for reimbursement to the Chairperson of the Council, who shall arrange 

for prompt reimbursement to the FDIC. FDIC expenses are for rule writing and resolution planning.
FSOC - 5

1.2 – Budget Adjustments Table

D – Budget Increases and Decreases Description

Program Decreases.....................................................................-$1,035,000 / -2 FTE

Personnel -$222,000 / -2 FTE

To align with the Administration’s initiative to improve Government efficiency and effectiveness, 

the FSOC is implementing a staffing streamlining effort to ensure appropriate levels for maximum 

efficiency.

Non-Personnel -$186,000 / 0 FTE

The Council proposes to reduce administrative costs and eliminate previously-planned construction 

and renovation costs.

FDIC Reimbursement -$627,000 / 0 FTE

The FDIC estimates its reimbursable expenses for FY 2018 at $4,499,000.

Financial Stability Oversight Council FTE Amount

FY 2017 Estimated 23 $13,282

Changes to Base:

Total FY 2018 Base 23 $13,282

Program Changes:

Program Decreases (2) ($1,035)

Personeel (2) ($222)

Non-Personeel ($186)

FDIC Reimbursement ($627)

Total FY 2018 Estimated 21 12,247

Dollars in Thousands
FSOC - 6

1.3 – Operating Levels Table

Dollars in Thousands

Financial Stability Oversight Council FY 2016 FY 2017 FY 2018

Object Classification Actual Estimated Estimated

11.1 - Full-time permanent 2,862 3,027 2,975 

11.3 - Other than full-time permanent 233 235 230 

11.5 - Other personnel compensation 34 35 34 

11.9 - Total personnel compensation 3,129 3,297 3,239 

12.0 - Personnel benefits 824 1,099 935 

Total Personnel and Compensation Benefits $3,953 $4,396 $4,174 

21.0 - Travel and transportation of persons 40 50 65 

23.1 - Rental payments to GSA (10) 0 0 

25.1 - Advisory and assistance services 250 350 395 

25.2 - Other services from non-Federal sources 85 75 80 

25.3 - Other goods and services from Federal sources 1 8,857 7,851 6,951 

26.0 - Supplies and materials 521 515 499 

31.0 - Equipment 32 45 83 

Total Non-Personnel $9,775 $8,886 $8,073 

Subtotal New Budgetary Resources $13,728 $13,282 $12,247 

FTE 22 23 21

1 Includes FDIC reimbursement.

2 Regarding object class 23.1, beginning in FY 2016, rental payments were no longer a direct charge to the Financial Research Fund. 

In FY 2016, there was a refund of prior-year activity, causing there to be an overall negative for the year.

E – Appropriations Language and Explanation of Changes

The FSOC receives no appropriations from Congress.

F – Legislative Proposals

The FSOC has no legislative proposals.
FSOC - 7

Section II – Annual Performance Plan and Report

A – Financial Stability Oversight Council

($7,748,000 from Assessments): 

There are no measures specified for managing Council performance at this time. Information on the 

Council is provided on www.treasury.gov, www.fsoc.gov, and member agency websites to provide 

transparency and accountability.

The FY 2018 - 2022 Strategic Plan is currently under development. The Annual Performance Plan 

will be updated in the FY 2019 Budget to reflect the new priorities.

2.1.1 – Financial Stability Oversight Council Annual Performance and Report

B – FDIC Reimbursement

($4,499,000 from Assessments): 

Certain FDIC expenses are treated as expenses of the Council. For additional detail, see above.

2.1.2 – FDIC Reimbursement Annual Performance Plan and Report

Dollars in Thousands

 Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Estimated Estimated

Column1 Column32 Column4 Column5 Column6 Column7 Column8 Column2 Column10

Expense/Obligations $5,428 $5,679 $7,660 $6,236 $7,157 $8,156 $7,748

Budget Activity Total $5,428 $5,679 $7,660 $6,236 $7,157 $8,156 $7,748

FTE 16 23 23 22 22 23 21

Dollars in Thousands

 Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Estimated Estimated

Column1 Column32 Column4 Column5 Column6 Column7 Column8 Column2 Column3

Expense/Obligations $4,716 $6,327 $11,592 $7,628 $6,571 $5,126 $4,499

Budget Activity Total $4,716 $6,327 $11,592 $7,628 $6,571 $5,126 $4,499

Department of the Treasury

Treasury Franchise Fund

Congressional Justification 

for Appropriations and 

Annual Performance 

Report and Plan

FY 2018 
TFF - 2

Table of Contents

Section I – Budget Request........................................................................................................... 3

A – Mission Statement................................................................................................................ 3

B – Summary of the Request ...................................................................................................... 3

1.1– Appropriations Detail Table ............................................................................................ 4

1.2 – Budget Adjustments Table................................................................................................. 4

C – Budget Increases and Decreases Description....................................................................... 4

1.3 – Operating Levels Table .................................................................................................. 6

D – Appropriations Language and Explanation of Changes ...................................................... 6

E – Legislative Proposals............................................................................................................ 6

Section II – Annual Performance Plan and Report................................................................... 7

A – Strategic Alignment ............................................................................................................. 7

B – Budget and Performance by Budget Activity ...................................................................... 8

2.1 Shared Services Programs Resources and Measures............................................................ 8

Shared Services Programs Budget and Performance.................................................................. 8

2.2 Administrative Services Resources and Measures ............................................................. 10

2.3 Information Technology Resources and Measures ......................................................... 11

Section III – Additional Information ........................................................................................ 13

A – Summary of Capital Investments....................................................................................... 13

B – Treasury Franchise Fund Program Costs........................................................................... 13
TFF - 3

Section I – Budget Request

A – Mission Statement

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

cost-effective administrative and information technology support services.

B – Summary of the Request 

The Treasury Franchise Fund (TFF) is a leader in providing effective administrative and 

information technology services through commitment to service, efficient operations, openness 

to change, and values-based behavior. The TFF achieves cost savings, promotes economies of 

scale, and increases productivity and efficiency in the use of resources by providing centralized 

services.

The TFF includes Departmental Offices’ Shared Services Programs (SSP) and the Fiscal 

Service’s Administrative Resource Center (ARC). SSP and ARC provide financial management, 

HR, IT, and other administrative services to federal customers on a fully cost recoverable, feefor-service basis. 

In FY 2018, the TFF will continue to be an integral federal partner to customer agencies. We 

will provide responsive, high quality and cost effective shared services to federal agencies 

through our commitment to streamlined processes to ensure compliance and eliminate 

redundancy, and focus on maximizing cost sharing opportunities that take advantage of 

economies of scale. 

FY 2018 Treasury Franchise Fund Priorities 

• Maintain service levels and achieve cost efficiencies wherever possible.

• Expand shared services opportunities throughout Treasury and to federal agencies, thus 

maximizing cost sharing opportunities.

• Meet internal and external customers’ changing demands.

• Establish service rates and ensure price transparency for all business lines, including details 

of service components, cost drivers and how they result in cost sharing across the customer 

base.

• Protect our systems and data through strengthening cybersecurity and enhance operations to 

promote resiliency and operational effectiveness in critical Information Technology 

infrastructure and systems.
TFF - 4

1.1 – Appropriations Detail Table

Dollars in Thousands

Note: FY 2016 Other Resources are Actual

1.2 – Budget Adjustments Table

Dollars in Thousands

Treasury Franchise Fund FTE Amount

FY 2017 Estimated 1,794 $606,404 

Changes to Base:

Maintaining Current Levels (MCLs): 0 $11,371 

Pay-Raise 0 $2,922 

Pay Annualization 0 $1,071 

Non-Pay 0 $7,378 

Subtotal Changes to Base 0 11,371 

Total FY 2018 Base 1,794 $617,775 

Program Changes:

Program Increases: 64 $7,938 

Customer Growth (ARC) 64 $7,938 

Program Decreases: (10) ($36,617)

 Operational Support (ARC) 0 ($21,465)

Systems Reductions (SSP) (10) ($15,152)

Subtotal Program Changes 54 (28,679)

Total FY 2018 Estimated 1,848 589,096 

C – Budget Increases and Decreases Description

Maintaining Current Levels (MCLs) ....................................................+$11,371,000 / +0 FTE

Pay Raise +$2,922,000 / +0 FTE 

Funds are required for the proposed January 2018 pay-raise.

Treasury Franchise Fund

Budgetary Resources

 FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

Revenue/Offsetting Collections 16FTE 16Amt 17FTE 17Amt 18FTE 18Amt ChgFTEChgAmt pctFTE pctAmt

Reimbursable

Shared Services Program (SSP) $229,871 $232,731 $225,198 ($7,533) -3.24%

Administrative Support Services $167,374 $156,070 $173,713 $17,643 11.30%

Information Technology Services $189,625 $174,531 $174,376 ($155) -0.09%

Recovery from Prior Years $7,140 $15,882 $24,114 $8,232 51.83%

Unobligated Balances from Prior Years $112,395 $127,589 $100,399 ($27,190) -21.31%

Total Revenue/Offsetting Collections $706,405 $706,803 $697,800 ($9,003) -1.27%

Expenses/Obligations 16FTE 16Amt 17FTE 17Amt 18FTE 18Amt ChgFTEChgAmt pctFTE pctAmt

Shared Services Program (SSP) 228 $229,070 265 $236,290 255 $225,198 (10) ($11,092) -3.77% -4.69%

Administrative Support Services 988 $156,869 1,025 $163,151 1,087 $173,713 62 $10,562 6.05% 6.47%

Information Technology Services 499 $192,877 504 $206,963 506 $190,185 2 ($16,778) 0.40% -8.11%

Total Expenses/Obligations 1,715 $578,816 1,794 $606,404 1,848 $589,096 54 ($17,308) 3.01% -2.85%

Net Results $127,589 $100,399 $108,704 $8,305 8.27%

FY 2016 FY 2017 FY 2017 to FY 2018

Actual Estimated Estimated Change % Change

FY 2018
TFF - 5

Pay Annualization +$1,071,000 / +0 FTE 

Funds are required for annualization of the January 2017 pay-raise.

Non-Pay +$7,378,000 / +0 FTE 

Funds are requested for non-labor expenses such as travel, contracts, rent, supplies, and 

equipment.

Program Increases ...................................................................................+$7,938,000 / +64 FTE

Customer Growth (ARC) +$7,938,000 / +64 FTE

Increased demand and customer growth of 6 percent is anticipated within the Administrative 

Service budget activity due to our high performance and cost effectiveness, continuing federal 

initiatives to expand the use of shared services by the Office of Management and Budget (OMB) 

and the Unified Shared Services Management (USSM) Office. Additional costs as a result of 

this growth will be covered by an increase in offsetting collections.

The Administration’s priorities may provide more growth opportunities for administrative shared 

services and the additional FTE will help to support the increased customer demand for human 

resources, financial management, procurement and travel services. 

Two FTE for the IT business line are in direct support of two of the Department’s priorities: 

protection of data and assets through emerging cybersecurity requirements and the protection of 

high value assets (HVAs) for resiliency, failover capability, and network encryption. 

Program Decreases ..................................................................................-$21,465,000 / + 0 FTE

Operational Support (ARC) -$21,465,000 / +0 FTE

The operational support decrease is attributable to one-time infrastructure purchases and IT 

support of Fiscal Service’s physical location move, as well as, anticipated decreases in 

operational support contracts.

Program Decreases ................................................................................-$-15,152,000 / - 10 FTE

Systems Reductions (SSP) -$15,152,000 / -10 FTE

Shared Services plans to reduce or delay systems enhancements and upgrades. FTE and 

contractor support will be reduced to coincide with program decreases.
TFF - 6

1.3 – Operating Levels Table

Dollars in Thousands

Treasury Franchise Fund FY 2016 FY 2017 FY 2018

Object Classification Actual Estimated Estimated

11.1 - Full-time permanent 132,484 145,493 150,447 

11.3 - Other than full-time permanent 705 739 796 

11.5 - Other personnel compensation 4,087 4,389 4,683 

11.9 - Total personnel compensation 137,276 150,621 155,926 

12.0 - Personnel benefits 45,811 52,375 54,287 

Total Personnel and Compensation Benefits $183,087 $202,996 $210,213 

21.0 - Travel and transportation of persons 1,398 1,822 2,056 

22.0 - Transportation of things 23 11 10 

23.1 - Rental payments to GSA 0 4,641 4,752 

23.2 - Rental payments to others 56 270 270 

23.3 - Communication, utilities, and misc charges 65,545 69,407 67,011 

24.0 - Printing and reproduction 6 2 0 

25.1 - Advisory and assistance services 66,762 38,954 29,193 

25.2 - Other services from non-Federal sources 40,128 19,900 26,381 

25.3 - Other goods and services from Federal sources 89,713 117,836 120,186 

25.4 - Operation and maintenance of facilities 4,302 30 20 

25.7 - Operation and maintenance of equipment 73,578 106,396 97,118 

26.0 - Supplies and materials 1,245 4,037 946 

31.0 - Equipment 52,973 40,102 30,940 

Total Non-Personnel $395,729 $403,408 $378,883 

Total Budgetary Resources $578,816 $606,404 $589,096 

FTE 1,715 1,794 1,848

D – Appropriations Language and Explanation of Changes

The Treasury Franchise Fund receives no annually appropriated resources from Congress.

E – Legislative Proposals

The Treasury Franchise Fund does not have legislative proposals.
TFF - 7

Section II – Annual Performance Plan and Report

A – Strategic Alignment

Treasury Franchise Fund Strategic Goals

• Establish a level of transparency and a governance process that sets the standard for 

government service providers.

• Maintain status as a Financial Management Federal Shared Service Provider (FSSP).

• Commitment to continual improvement of operational service levels and process 

improvement efforts that reduce service costs.

• Prioritize resiliency, security (including cybersecurity), and data integrity of all IT systems 

and services.

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

initiatives.

• Continue to assess and report TFF’s performance and provide timely feedback to customers.

In FY 2018, TFF will maintain its commitment to excellence and continue to meet all strategic 

goals, financial goals and benchmarks. TFF continues to strive for growth opportunities to 

expand existing service lines and provide other valuable in-demand administrative and 

information technology services in an era of fiscal constraint and increasing performance 

expectations. In order to meet the goal of reducing costs to customers, TFF will maximize 

shared service value and continue to look for opportunities to improve the efficiencies in 

business processes and technologies used in service delivery. TFF strives to incorporate the 

customer perspective into the decision-making process. Customer involvement and input 

provide an opportunity to obtain constructive and directed feedback which allows customer 

concerns to be addressed and services to meet customer demand. 
TFF - 8

B – Budget and Performance by Budget Activity

2.1 Shared Services Programs Resources and Measures

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target FY 2016

Trend

Customer Satisfaction with 

Financial Planning Staff %

N/A 57.2 59.09 63.0 69.0 70.0 62.0 62.0

ECM/Web Solutions 

Response Time to 

Resolve ECM and Web 

Solutions Non-Critical 

Issues/Help Desk Tickets 

within 10-15 Business 

Days

92.8 96.8 95.0 82.0 82.0 90.0 90.0 85.0

HR Connect Customer 

Satisfaction %

90.0 90.0 90.1 83.0 82.0 85.0 91.0 83.0

HR Connect Employee 

Update Files-Transmission 

of Employee Update Files 

Made to the Specified 

External Benefit Provider 

Within Established 

Timeframes

98.3 96.8 100.0 97.33 100.0 90.0 90.0 90.0

HR Connect Number of 

Tickets Escalated to Tier 3

303 212 242 128 N/A 200 200 200

Key: DISC - Discontinued; B - Baseline

Shared Services Programs Budget and Performance

($53,560,000 from direct appropriations, $3,594,000 from reimbursable resources):

The service providers under the SSP are organizational components of the Assistant Secretary 

for Management within the Departmental Offices (DO). SSP supports the goals of shared 

services by offering administrative and information technology services on a competitive basis, 

as well as delivering outstanding customer service. 

Description of Performance:

• Customer Satisfaction with Financial Planning Staff Survey Results – The Office of Shared 

Services established a customer satisfaction measure starting in FY 2014. Results reflect the 

percentage of customers that rate their communication experience with the SSD Financial 

Planning staff as either “Good” or “Excellent” on a 5-point scale. The SSD will continue to 

push for a high score on this measure through customer outreach on billing, pricing, financial 

management and the performance of each of the SSPs. SSD is also implementing a plan in 

FY 2018 that includes an improved governance structure and updated charter.

Dollars in Thousands

 Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Estimated Estimated

Column1 Column32 Column4 Column5 Column6 Column7 Column8 Column10

Expense/Obligations $175,258 $187,498 $165,419 $225,024 $229,070 $236,290 $225,198

Budget Activity Total $175,258 $187,498 $165,419 $225,024 $229,070 $236,290 $225,198

FTE 187 202 211 205 228 265 255
TFF - 9

• Enterprise Content Management (ECM)/Web Solutions – Response time to resolve ECM and 

Web Solutions non-critical issues/helpdesk tickets is targeted to be within 10 - 15 business 

days.

• HR Connect: Customer Satisfaction Annual Survey Results – Enterprise Business Solutions

continues to improve and strives to maintain the level of customer satisfaction for HR 

Connect as customer expectations are rising. 

• HR Connect: Employee Update Files – Transmission of employee update files were made to 

the specified external benefit provider within established timeframes. EBS continues to 

improve and stay in its acceptable range, which is relatively wide due to the limited number 

of transmitted files. EBS’s targets are consistent with the targets used use for quarterly 

Capital Planning and Investment Control process and OPM reporting for HR Connect.

• HR Connect: Number of Tickets Escalated to Tier 3 – EBS continues to maintain its current 

target levels. This target is based on implementing process improvements in the Design 

Documents and Quality Assurance environments. 
TFF - 10

2.2 Administrative Services Resources and Measures

Dollars in Thousands

 Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Estimated Estimated

Expense/Obligations $116,571 $127,747 $128,904 $146,282 $156,869 $163,151 $173,713 

Budget Activity Total $116,571 $127,747 $128,904 $146,282 $156,869 $163,151 $173,713 

FTE 723 766 816 936 988 1,025 1,087

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target FY 2016

Trend

Direct Cost as a 

Percentage of Award 

Dollars

N/A N/A .41 .1 .2 .5 .5 .5

Direct Cost per AP 

Transaction

N/A N/A 65.4 47.22 59.07 73.0 65.0 64.0

Direct Cost per FTE in 

Core HR Services

N/A N/A 976.25 963.0 1,070.29 1,075.0 1,050.0 1040.0

Direct Cost per 

System User - Oracle

N/A N/A 18,261.0 21,724.0 16,241.0 18,300.0 22,160.0 22,380.0

Direct Cost per Travel 

Voucher

N/A N/A 24.75 21.1 19.81 27.0 26.0 26.0

First Call Resolution -

Oracle %

N/A N/A 61.0 57.0 50.34 50.0 50.0 50.0

Hiring Timeliness % N/A N/A 89.0 87.0 84.76 85.0 85.0 85.0

Indirect Cost Admin 

Services %

24.0 23.48 27.1 27.5 21.96 25.0 25.0 25.0

Timely Contract 

Issuance

N/A N/A N/A N/A 89.26 90.0 90.0 90.0

Travel Voucher 

Payments Timeliness 

%

N/A N/A 99.0 99.0 99.87 98.0 98.0 98.0

Unqualified Audit 

Opinions %

N/A N/A 96.0 100.0 100.0 100.0 100.0 100.0

Key: DISC - Discontinued; B - Baseline

Administrative Services Budget and Performance 

($173,713,000 from assessments revenue/offsetting collections):

TFF’s administrative services activity supports OMB’s and the Department of the Treasury’s 

shared services initiatives, furthering “good government” through standardized administrative 

financial systems and processes required of federal agencies. Value is provided through cost 

sharing opportunities in systems capital investments, as well as, reduced operating costs through 

standardized, compliant and streamlined, high quality, value added services.
TFF - 11

Within the Department of the Treasury, the Administrative Services Activity fills three important 

roles:

• OMB designated Federal Shared Service Provider (FSSP) for the Financial Management 

Line of Business. 

• Support organization for Treasury's Human Resources Line of Business. 

• Designated provider for the Budget Formulation and Execution Line of Business. 

We support these designations through administrative services in the areas of financial 

management, procurement, travel and relocation, and human resources. The Administrative 

Services Activity’s success is demonstrated by our growing customer base, increasing demand 

for services, meeting or exceeding our performance measures, high customer satisfaction results 

and commitment to cost effective and stable customer prices.

Description of Performance:

For FY 2016, the Administrative Services Activity met or exceeded all performance measures 

except the new Timely Contract Issuance Metric. Through meeting greater than 90 percent of 

our quality and cost effectiveness performance standards, we’ve demonstrated an overall 

achievement of customer value. Although we did not achieve the 90 percent quality metric for 

Timely Contract Issuance (89.3 percent) in year one of the metric, we are confident we can 

achieve our goal in future years.

2.3 Information Technology Resources and Measures

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target FY 2016

Trend

Fiscal IT Hosting -

Percentage of Time 

Service is Operational (Up 

Time Excluding Planned 

Maint.)

N/A N/A N/A N/A 99.8 99.0 99.0 99.0

Number of Engagements 

in Strategic Sourcing or 

"Service Provider" or 

Other Shared Services 

Opportunity

N/A N/A N/A N/A 1 2 2 2

Percentage of POA&Ms 

Scheduled for Closure in 

Last 30 Days - Closed 

Early or On Time

N/A N/A N/A N/A 69.6 90.0 90.0 90.0

Key: DISC - Discontinued; B - Baseline

Dollars in Thousands

 Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Estimated Estimated

Expense/Obligations $149,581 $152,050 $149,992 $162,895 $192,877 $206,963 $190,185

Budget Activity Total $149,581 $152,050 $149,992 $162,895 $192,877 $206,963 $190,185

FTE 442 457 459 459 499 504 506
TFF - 12

Information Technology Services Budget and Performance 

($190,185,000 from assessments revenue/offsetting collections):

TFF’s Information Technology Services Activity provides shared services to a variety of federal 

customers. Value is provided through IT infrastructure consolidation and standardized IT 

service delivery in a modern, technically innovative, and secure environment. Customers avoid 

costly, long-term development projects when they take advantage of TFF’s shared services and 

environments. TFF’s Information Technology Services Activity, designated by the OMB as a 

Shared Service Center for Information Systems Security Line of Business, provides agencies 

with proven Security Assessment and Authorization (SA&A) and Continuous Monitoring 

services. The TFF also is one of two Treasury trusted internet connection providers and hosts 

Treasury’s public domain name system. TFF provides key services such as SA&A, Continuous 

Monitoring, Hosting services and Software Development.

Description of Performance:

For FY 2016, Information Technology Services exceeded its performance measure for system 

uptime, thus ensuring that mission critical and other administrative systems were available to 

enable customer agencies to meet their missions. We were unable to achieve the targets for 

closure of Plan of Action and Milestones (POA&M) (90 percent) and the number of 

engagements for strategic sourcing (2).

The POA&M metric was impacted by a security review that resulted in an extraordinary number 

of invalid exceptions resulting from the application of new testing techniques. A significant level 

of effort was applied to prioritize with competing priorities and to research and document each 

exception, causing adverse affects on the POA&M metric. The strategic sourcing metric was not 

achieved due to resource constraints related to supporting other critical Bureau activities, such as 

cybersecurity enhancements and enhancing failover capabilities of High Value Assets. For 

FY 2017 and FY 2018 we continue to challenge ourselves with high performance targets for all 

three of our performance measures and are using targeted efforts with regular reviews to monitor 

our progress.
TFF - 13

Section III – Additional Information

A – Summary of Capital Investments

TFF’s planned investments enhance the capabilities and capacity of our financial management 

shared services. Investing in Service Oriented Architecture will allow customers to streamline 

application connections resulting in benefits that include reducing development time, using 

industry development best practices for coding efforts, allowing real time processing of 

transactional data between systems, and independent communication between systems. This 

effort will also reduce redundancy, providing more flexibility and more efficient interfaces with 

customers' third-party applications. 

TFF also plans to expand the use of an enterprise-wide financial statement reporting tool and 

update operational (transactional) reporting and analytical tools in order to provide a more 

efficient interpretation of large volumes of data, long-term stability, and improved presentation 

and distribution capabilities.

The Administrative Resource Center capital investments are contained within the Fiscal Service 

capital investment summary. The Shared Service Programs capital investments are contained 

within the Departmental Offices capital investment summary.

A summary of capital investment resources, including major information technology and nontechnology investments can be found at:

http://www.treasury.gov/about/budget-performance/Pages/summary-of-capital-investments.aspx

This website also contains a digital copy of this document.
B – Treasury Franchise Fund Program Costs

This information is provided to fulfill requirements of Section 125, Public Law 114-113, Consolidated Appropriations Act, 2016.

Treasury Franchise Fund – Shared Services Programs, FY 2016 Total Charges by Customer

FY 2016 SSP Customers

Enterprise 

Business 

Solutions

Infrastructure 

Operations Cyber Security

IT Strategy And 

Technology 

Management

Non-Information 

Technology 

Services

Total

Architect of the Capitol 208,514 - - - 10,404

Alcohol, Tobacco, Firearms and Explosives 1,622,017 30,997 - 110,966 1,763,980

Alcohol and Tobacco Tax and Trade Bureau 264,730 597,052 79,896 19,613 267,523 1,228,814

Bureau of Engraving and Printing 2,217,765 3,489,600 172,736 78,979 928,696 6,887,775

Bureau of the Fiscal Service 6,113,422 753,817 208,807 95,472 1,368,385 8,539,903

Consumer Financial Protection Bureau 1,215,194 6,091 1,312 - 414,437 1,637,035

Commodities Futures Trading Commission - - - - 55,199 55,199

DHS Customs - and Immigration Service - - - - 58,511 58,511

DHS - Headquarters - - - - 169,930 169,930

DHS - U.S. Secret Service 1,527,408 25,455 - - 64,325 1,617,187

Community Development Financial Institutions Fund 191,455 34,058 6,647 3,039 107,056 342,256

DC Pensions 18,761 92,271 1,684 770 59,065 172,551

Federal Financing Bank 33,362 155,322 2,836 1,297 63,179 255,997

Financial Stability Oversight Council 524,554 137,830 2,393 1,094 42,694 708,566

Treasury Office of Financial Research 212,669 5,695,983 201,291 10,455 405,020 6,525,418

Treasury Office of Financial Stability 864,497 595,463 9,483 161,312 308,865 1,939,619

Treasury Office of Technical Assistance 46,260 125,094 1,595 729 35,939 209,618

Small Business Lending Fund Administration 19,789 92,275 1,684 770 47,865 162,383

Treasury Departmental Offices 3,068,501 6,840,452 804,321 53,612 2,881,358 13,648,243

State Small Business Credit Initiative Administration 22,388 53,484 975 446 40,506 117,798

Treasury Executive Office for Asset Forfeiture 961,733 194,245 2,659 1,216 102,736 1,262,589

Treasury Terrorism Risk Insurance Program 4,301 48,530 886 405 26,440 80,563

Department of Commerce 14,587,684 135,540 - - 294,000 15,017,224

Department of Education - - - - 7,280 7,280

Department of the Interior 92,700 - - - 8,733 101,433

Department of Justice - Antitrust - - - - 33,119 33,119

Department of Justice - Headquarters - - - - 72,391 72,391

Department of Labor 4,940,145 63,881 - - 202,814 5,206,841

Department of Transportation Federal Transit Agency - - - - 21,728 21,728

Department of Education - - - - 104,225 104,225

Export Import Bank Office of the Inspector General - - - - 4,416 4,416
TFF - 15

Treasury Franchise Fund – Shared Services Programs, FY 2016 Total Charges by Customer (Continued)

FY 2016 SSP Customers

Enterprise 

Business 

Solutions

Infrastructure 

Operations Cyber Security

IT Strategy And 

Technology 

Management

Non-Information 

Technology 

Services

Total

Environmental Protection Agency - - - - 354,091 354,091

Federal Communications Commission 44,797 - - - 2,175 46,972

Federal Deposit Insurance Corporation 90,294 - - - 17,112 107,406

FDIC Office of the Inspector General - - - - 4,346 4,346

Federal Emergency Management Agency 388,335 - - - 94,075 482,410

Federal Housing Finance Agency - - - - 54,320 54,320

Financial Crimes Enforcement Network 239,836 624,899 30,754 14,061 223,807 1,133,358

Federal Reserve Board - - - - 4,416 4,416

General Accountability Office 652,485 12,387 - - 26,838 691,710

General Services Administration - - - - 102,492 102,492

Department of Housing and Urban Development 3,468,535 30,869 - - 279,188 3,778,592

Internal Revenue Service 42,014,846 65,217,524 7,305,321 3,285,170 14,692,325 132,515,185

U.S. Mint 1,471,142 1,463,278 166,532 76,142 1,024,983 4,202,077

National Archives and Records Administration - - - - 21,185 21,185

Office of the Comptroller of the Currency 2,617,592 1,339,684 351,852 160,875 918,747 5,388,752

Office of Government Ethics - - - - 5,461 5,461

Treasury Office of Inspector General 122,237 584,631 18,966 8,672 103,178 837,685

Overseas Private Investment Corporation - - - - 9,936 9,936

Peace Corps 110,668 - - - 26,943 137,611

Small Business Administration 548,528 - - - 21,000 569,528

Special Inspector General for TARP 226,240 861,497 17,105 7,821 144,984 1,257,648

Smithsonian Institute - - - - 127,653 127,653

Smithsonian National Gallery of Art - - - - 14,666 14,666

TFF Administrative Resource Center/1 1,493,165 2,044,053 121,952 55,759 391,896 4,106,825

Treasury Inspector General for Tax Administration 486,001 2,196,880 74,359 33,999 285,324 3,076,562

United States Agency for International Development 2,530,342 18,899 - - 84,373 2,633,614

Department of Veterans Affairs - - - - 68,269 68,269

Grand Total 95,262,892 93,562,042 9,586,045 4,071,708 27,421,591 229,904,278

1/SSP bills all customers for services, including ARC. SSP costs collected from ARC are initially billed and collected from the ARC customers.
TFF - 16

Treasury Franchise Fund – Administrative Resource Center, FY 2016 Total Charges by Customer

Treasury Franchise Fund – Administrative Resource Center, FY 2016 Total Charges by Customer

FY 2016 ARC Customers

Financial 

Management 

Services

FMLoB FEES

Human 

Resource 

Services

Procurement 

Services Travel Services

Information 

Technology 

Services

Grand Total

ACCESS BOARD 227,259 79,789 56,861 40,263 404,172

ADMIN OFFICES OF THE US COURTS 144,127 144,127

ADMINISTRATION FOR CHILDREN AND FAMILIES 98,546 2,330 100,876

ADMINISTRATIVE RESOURCE CENTER - ADMIN/1 12,685,346 12,685,346

AFRICAN DEVELOPMENT FOUNDATION 1,098,383 438,331 39,412 1,576,126

AGENCY FOR INTERNATIONAL DEVELOPMENT 87,212 95,819 183,031

AGENCY FOR INTERNATIONAL DEVELOPMENT - OIG 108,056 108,056

ALCOHOL AND TOBACCO TAX AND TRADE BUREAU 812,801 957,191 709,016 225,285 2,704,293

ALCOHOL TOBACCO FIREARMS AND EXPLOSIVES 1,186,465 1,186,465

ARMED FORCES RETIREMENT HOME 857,713 1,179,882 822,685 23,943 2,884,224

BUREAU OF ENGRAVING AND PRINTING 710,374 104,793 815,167

BUREAU OF THE FISCAL SERVICE 17,628,015 4,451,026 5,305,251 441,229 161,638,076 189,463,597

CDFI PROGRAM FUND 887,780 143,716 277,867 17,919 1,327,282

CENTER FOR DISEASE CONTROL 2,252,328 2,252,328

CHEMICAL SAFETY AND HAZARD BOARD 255,021 21,222 26,831 303,074

COMPTROLLER OF THE CURRENCY 124,732 124,732

CONSUMER FINANCIAL PROTECTION BUREAU 1,577,200 4,142,378 1,634,469 1,414,834 4,225 8,773,105

CONSUMER PRODUCT SAFETY COMMISSION 2,228 2,228

CORPORATION FOR NATIONAL AND COMMUNITY SERVICE 93,423 93,423

DC PENSIONS PROJECT OFFICE 1,747,626 57,137 26,580 1,478 1,879,164 3,711,985

DEFENSE HEALTH AGENCY 67,950 67,950

DEFENSE NUCLEAR FACILITIES SAFETY BOARD 81,969 81,969

DENALI COMMISSION 359,909 62,126 99,018 21,990 543,043

DEPARTMENT OF AGRICULTURE 167,510 167,510

DEPARTMENT OF AGRICULTURE - OIG 8,596 8,596

DEPARTMENT OF COMMERCE 262,700 262,700

DEPARTMENT OF DEFENSE 187,342 187,342

DEPARTMENT OF EDUCATION 316,979 230,616 547,595

DEPARTMENT OF ENERGY 142,921 124,236 267,157

DEPARTMENT OF HEALTH & HUMAN SERVICES 230,616 90,245 320,861

DEPARTMENT OF HEALTH & HUMAN SERVICES - OIG 8,086 8,086

DEPARTMENT OF HOMELAND SECURITY 246,442 187,342 521,798 955,582

DEPARTMENT OF HOMELAND SECURITY - CIS 468,067 468,067

DEPARTMENT OF HOMELAND SECURITY - OIG 735,404 246,435 981,839

1/ARC-IT bills all customers for services, including ARC-Admin. ARC-IT costs collected from ARC-Admin are initially billed and collected from the ARC-Admin customers.
TFF - 17

FY 2016 ARC Customers

Financial 

Management 

Services

FMLoB FEES

Human 

Resource 

Services

Procurement 

Services Travel Services

Information 

Technology 

Services

Grand Total

DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT 30,093,802 230,616 11,873,842 851,837 3,287,996 46,338,094

DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT - OIG 1,655,719 381,907 14,815 2,052,441

DEPARTMENT OF JUSTICE 150,116 124,236 274,352

DEPARTMENT OF LABOR 267,285 141,399 408,684

DEPARTMENT OF STATE 572,886 95,892 668,778

DEPARTMENT OF THE INTERIOR 1,670,750 124,236 1,794,986

DEPARTMENT OF TRANSPORTATION 230,616 230,616

DEPARTMENT OF VETERANS AFFAIRS 446,333 158,998 605,331

DEPARTMENT OF VETERANS AFFAIRS - OIG 1,969,043 1,969,043

DEPARTMENT OF VETERANS AFFAIRS - TAC 597,916 597,916

ELECTION ASSISTANCE COMMISSION 359,730 136,172 21,837 517,739

ENVIRONMENTAL PROTECTION AGENCY 95,819 93,000 188,819

FARM CREDIT ADMINISTRATION 335,620 53,747 225,780 615,147

FARM CREDIT SYSTEM INSURANCE CORPORATION 173,950 1,432 4,521 179,903

FEDERAL EMERGENCY MANAGEMENT AGENCY 28,573 28,573

FEDERAL HOUSING FINANCE AGENCY 1,047,929 119,160 452,651 377,922 1,997,662

FEDERAL HOUSING FINANCE AGENCY - OIG 147,440 238,320 328,326 36,948 751,034

FEDERAL LABOR RELATIONS AUTHORITY 435,023 48,352 32,129 515,504

FEDERAL MARITIME COMMISSION 279,244 76,879 23,164 379,287

FEDERAL MINE SAFETY AND HEALTH REVIEW COMMISSION 322,600 154,085 24,789 46,289 547,763

FINANCIAL CRIMES ENFORCEMENT NETWORK 610,502 146,066 654,024 65,914 2,556,977 4,033,483

FOOD AND DRUG ADMINISTRATION 609,196 609,196

GENERAL SERVICE ADMINISTRATION 41,332 41,332

GULF COAST ECOSYSTEM RESTORATION COUNCIL 250,944 10,533 5,792 267,269

INTER AMERICAN FOUNDATION 802,453 612,426 30,647 1,445,526

INTERIOR BUSINESS CENTER 42,210 42,210

IRS CRIMINAL INVESTIGATION DIVISION 957,698 957,698

MERIT SYSTEMS PROTECTION BOARD 397,301 26,862 65,005 489,168

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION 145,263 124,236 473,164 742,663

NATIONAL ARCHIVES & RECORDS ADMINISTRATION 3,816,946 519,551 269,761 4,606,258

NATIONAL MEDIATION BOARD 328,835 231,674 72,485 108,300 741,294

NATIONAL SCIENCE FOUNDATION 139,094 91,850 230,944

NUCLEAR REGULATORY COMMISSION 41,332 41,332

OCCUPATIONAL SAFETY AND HEALTH REVIEW COMMISSION 231,492 18,682 23,445 273,619
TFF - 18

Treasury Franchise Fund – Administrative Resource Center, FY 2016 Total Charges by Customer (Continued)

FY 2016 ARC Customers

Financial 

Management 

Services

FMLoB FEES

Human 

Resource 

Services

Procurement 

Services Travel Services

Information 

Technology 

Services

Grand Total

OFFICE OF ADMINISTRATION, EXEC OFF OF THE PRES 1,254,784 291,354 335,053 1,881,191

OFFICE OF FINANCIAL STABILITY 270,743 207,813 49,778 18,780 547,114

OFFICE OF GOVERNMENT ETHICS 304,350 213,300 212,482 14,661 744,793

OFFICE OF PERSONNEL MANAGEMENT 41,332 41,332

OFFICE OF PERSONNEL MANAGEMENT - OIG 149,325 149,325

OFFICE OF TECHNICAL ASSISTANCE (OTA) 892,126 35,406 54,234 161,222 1,142,988

OFFICE OF THE INSPECTOR GENERAL 313,420 606,071 159,546 64,950 1,143,987

PENSION BENEFIT GUARANTY CORPORATION 125,126 125,126

RAILROAD RETIREMENT BOARD 4,715 4,715

SECURITIES AND EXCHANGE COMMISSION 328,044 328,044

SMALL BUSINESS ADMINISTRATION 67,475 67,475

SOCIAL SECURITY ADMINISTRATION 67,475 762,484 829,959

SPECIAL INSPECTOR GENERAL - TARP 301,488 391,117 211,557 111,553 1,015,715

TREASURY DEPARTMENTAL OFFICES 3,423,502 4,321,021 1,310,005 705,146 157,778 9,917,452

TREASURY FRANCHISE FUND/INFORMATION TECHNOLOGY/1 781,654 932,761 1,374,592 102,674 3,191,681

TREASURY FRANCHISE FUND/SHARED SERVICES PROGRAM/2 581,190 95,892 1,424,460 366,603 20,204 4,078,769 6,567,118

TREASURY INSPECTOR GENERAL FOR TAX ADMINISTRATION 654,825 1,311,741 620,636 297,197 2,884,399

TRUST FUND - BLACK LUNG DISABILITY 186,602 186,602

TRUST FUND - FEDERAL DISABILITY 483,469 483,469

TRUST FUND - FEDERAL HOSPITAL INSURANCE 541,374 541,374

TRUST FUND - FEDERAL OLD AGE & SURVIVORS 483,469 483,469

TRUST FUND - FEDERAL SUPPLEMENT INSURANCE 548,262 548,262

TRUST FUND - OIL SPILL LIABILITY 127,749 127,749

TRUST FUND - UNEMPLOYMENT 789,782 789,782

UNITED STATES AIR FORCE -134,488 -134,488

UNITED STATES MARSHALS SERVICE 2,409 2,409

UNITED STATES MINT 7,824,940 2,681,459 2,258,175 194,781 12,959,355

US COURT OF APPEALS FOR VETERANS 231,982 8,345 11,828 252,155

USDA FOOD AND NUTRITION 831,744 831,744

USDA FOREST SERVICE 116,445 116,445

USDA OCIO INTERNATIONAL TECHNOLOGY SERVICES 1,247,684 1,247,684

USDA OFFICE OF INSPECTOR GENERAL 42,979 42,979

Grand Total 90,659,182 3,043,461 41,446,229 20,863,184 14,061,353 187,883,590 357,956,999

1/ARC-Admin bills all customers for services, including ARC-IT. ARC-Admin costs collected from ARC-IT are initially billed and collected from the ARC-Admin customers.

2/ARC-IT and ARC-Admin bill all customers for services, including SSP. ARC-IT and ARC-Admin costs collected from SSP are initially billed and collected from the SSP customers.

Department of the Treasury

Treasury Forfeiture Fund

Congressional Justification 

for Appropriations and 

Annual Performance 

Report and Plan

FY 2018 
TEOAF - 2

Table of Contents

Section I – Purpose........................................................................................................................ 3

A – Mission Statement................................................................................................................ 3

B – Summary of the Request ...................................................................................................... 3

1.1 – Appropriations Detail Table .............................................................................................. 4

1.2 – Operating Levels Table...................................................................................................... 5

D – Appropriations Language and Explanation of Changes ...................................................... 6

E – Legislative Proposals............................................................................................................ 6

Section II – Annual Performance Plan and Report................................................................... 7

A – Strategic Alignment ............................................................................................................. 7

B – Budget and Performance by Budget Activity ...................................................................... 8

2.1.1 - Treasury Forfeiture Fund Resources and Measures....................................................... 8

Treasury Forfeiture Fund Budget and Performance ................................................................... 8

Section III – Additional Information .......................................................................................... 9

A – Summary of Capital Investments......................................................................................... 9
TEOAF - 3

Section I – Purpose

A – Mission Statement

To affirmatively influence the consistent and strategic use of asset forfeiture by law enforcement 

bureaus that participate in the Treasury Forfeiture Fund (the Fund) to disrupt and dismantle 

criminal enterprises.

B – Summary of the Request 

The Treasury Executive Office for Asset Forfeiture (TEOAF) administers the Treasury 

Forfeiture Fund. The Fund is the receipt account for proceeds from non-tax forfeitures made 

pursuant to laws enforced or administered by participating Treasury and Department of 

Homeland Security agencies. The Fund was established in 1992 as the successor to the Customs 

Forfeiture Fund.

The Treasury Forfeiture Fund is a special fund. Special funds are federal fund accounts for 

receipts earmarked by law for specific purposes and the expenditure of these receipts. In 

addition to the agencies listed below, the funds can be allocated to other law enforcement entities 

that do not have forfeiture authority, such as the Financial Crimes Enforcement Network, Federal 

Law Enforcement Training Center, and Alcohol and Tobacco Tax and Trade Bureau.

The principal revenue-producing member bureaus include Internal Revenue Service Criminal 

Investigation, Customs and Border Protection (CBP), Immigration and Customs Enforcement 

(ICE), and the U.S. Secret Service. The latter three bureaus are part of the Department of 

Homeland Security, transferred from other agencies as part of the Homeland Security Act of 

2002. These member bureaus are joined by the U.S. Coast Guard, Department of Homeland 

Security, as the result of a longstanding close law enforcement relationship with CBP and ICE. 

As the administrator for the Fund, TEOAF performs the following functions:

• Promotes the use of proceeds from asset forfeitures to fund programs and activities aimed at 

disrupting criminal enterprises and enhancing forfeiture capabilities;

• Manages the Fund’s revenues to cover the cost of the asset forfeiture program;

• Promotes financial stability and vitality of the Fund; and

• Identifies and addresses program risks.

TEOAF intends to maintain a dynamic and evolving asset seizure and forfeiture program that is 

responsive to the needs of member law enforcement bureaus. The Fund estimates $416 million 

in revenue from forfeiture deposits, reverse asset sharing, and interest in FY 2018.
TEOAF - 4

1.1 – Appropriations Detail Table

Dollars in Thousands

Treasury Forfeiture Fund

Budgetary Resources

FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

Revenue/Offsetting Collections

Interest 0 $7,644 0 $8,000 0 $3,000 0 ($5,000) 0 -62.50%

Restored Temporary Rescission 0 $944,000 0 $876,000 0 $876,000 0 $0 0 0.00%

Restored Sequestration 0 $399,291 0 $124,328 0 $93,783 0 ($30,545) 0 -24.57%

Forfeiture Revenue 0 $876,702 0 $475,177 0 $413,000 0 ($62,177) 0 -13.09%

Recovery from Prior Years 0 $4,057,885 0 $30,000 0 $30,000 0 $0 0 0.00%

Unobligated Balances from Prior Years 0 $97,184 0 $1,034,832 0 $835,000 0 ($199,832) 0 -19.31%

Total Revenue/Offsetting Collections $6,382,706 $2,548,337 $2,250,783 ($297,554) -11.68%

Expenses/Obligations

Asset Forfeiture

Mandatory Obligations 1 25 $451,581 25 $621,232 25 $450,000 0 ($171,232) 0 -27.56%

Secretary's Enforcement Fund 0 $57,165 0 $7,075 0 $30,000 0 $22,925 0 324.03%

Super Surplus Obligations 2 0 $0 0 $114,634 0 $100,000 0 ($14,634) 0 -12.77%

Total Expenses/Obligations 25 $508,746 25 $742,941 25 $580,000 0 ($162,941) 0 -21.93%

Rescissions/Cancellations

Sequestration Reduction 3 0 ($124,328) 0 ($93,783) 0 0 $93,783 0 -100.00%

Temporary Rescission 0 ($876,000) 0 ($876,000) 0 0 $876,000 0 -100.00%

Permanent Cancellation 0 ($3,800,000) 0 $0 0 ($876,000) 0 ($876,000) 0 NA

Appropriation Precluded from Obligation 4 0 ($38,800) 0 $0 0 0 $0 0 NA

Total Rescissions/Cancellations ($4,839,128) ($969,783) ($876,000) $93,783 -9.67%

Net Results $1,034,832 $835,613 $794,783 ($40,830) -4.89%

Contingent Liabilities $485,421 $352,054 $300,000 ($52,054) 0 -14.79%

FY 2016 FY 2017 FY 2018 FY 2017 to FY 2018

Actual Estimated5 Estimated $ Change % Change

1 The Treasury Forfeiture Fund is staffed by Departmental Offices employees and positions are funded via reimbursable agreement. The FTE are 

shown here for clarity, but are also reflected in the Departmental Offices chapter in the reimbursable FTE total. 2 Treasury will revise the FY 2017 Super Surplus plan based on the Consolidated Appropriations Act, 2017, and resubmit the FY 2017 Super Surplus 

plan to Congress. For FY 2018, Treasury will submit a spending plan to Congress for the FY 2018 Super Surplus amount. 3 Treasury reestimated the forfeiture revenue after OMB’s A-11 MAX deadline; therefore, the FY 2017 sequestration reduction is slightly higher than the 

amount in the Budget. Treasury will compute the FY 2018 sequestration reduction once the OMB Report to Congress on the Joint Committee 

Sequestration for Fiscal Year 2018 is released. 4 P.L. 114-113 permanently rescinded $3,800,000,000 of the $3,838,800,000 forfeited in United States v. BNPP, No.14 Cr. 460 (S.D.N.Y.). Treasury is 

unable to obligate the remaining $38,800,000 due to a provision in section 405, Title IV limiting the use of these funds. 5 A full-year 2017 appropriation for this account was not enacted at the time the budget was prepared; therefore, the budget assumes this account is 

operating under the Further Continuing Appropriations Act, 2017 (P.L. 114–254). The amounts included for 2017 reflect the annualized level provided 

by the continuing resolution.
TEOAF - 5

1.2 – Operating Levels Table

Dollars in Thousands

Treasury Forfeiture Fund FY 2016 FY 2017 FY 2018

Object Classification Actual Estimated Estimated

25.2 - Other services from non-Federal sources $62,647 $78,022 $40,600 

25.3 - Other goods and services from Federal sources $165,897 $222,905 $115,985 

26.0 - Supplies and materials $14 $15 $15 

41.0 - Grants, subsidies, and contributions $188,677 $372,349 $373,390 

43.0 - Interests and dividends $5 $5 $5 

44.0 - Refunds $34,348 $69,640 $50,000 

94.0 - Financial transfers $57,157 $5 $5 

Total Non-Personnel $508,746 $742,941 $580,000 

Total Budgetary Resources $508,746 $742,941 $580,000 

Budget Activities:

Asset Forfeiture Fund $508,746 $742,941 $580,000 

Total Budgetary Resources $508,746 $742,941 $580,000 

FTE 25 25 25
TEOAF - 6

D – Appropriations Language and Explanation of Changes

Appropriations Language Explanation of Changes

DEPARTMENT OF THE TREASURY

TREASURY FORFEITURE FUND

(CANCELLATION)

 Of the unobligated balances available under this heading, 

$876,000,000 are hereby permanently cancelled not later than 

September 30, 2018.

(INCLUDING RETURN OF FUNDS)

 In addition, of amounts in the Treasury Forfeiture Fund, 

$38,800,000 from funds paid to the United States Government by 

BNP Paribas S.A. as part of, or related to, a plea agreement 

dated June 27, 2014, entered into between the Department of

Justice and BNP Paribas S.A., and subject to a consent order 

entered by the United States District Court for the Southern 

District of New York on May 1, 2015, in United States v. BNPP, 

No. 14 Cr. 460 (S.D.N.Y.), are hereby returned to the General 

Fund of the Treasury.

 Note.—A full-year 2017 appropriation for this account was not 

enacted at the time the budget was prepared; therefore, the budget 

assumes this account is operating under the Further Continuing 

Appropriations Act, 2017 (P.L. 114–254). The amounts included 

for 2017 reflect the annualized level provided by the continuing 

resolution.

The addition of “not later 

than September 30, 

2018” to the cancellation 

language will allow 

Treasury to manage the 

timing of the reduction 

and help prevent 

disruptions to cash flow. 

Treasury is also 

proposing to permanently

cancel these balances. 

P.L. 114-113 rescinded

$3,800,000,000 of the 

$3,838,800,000 forfeited 

by BNP Paribas in 2015 

and prohibited Treasury 

from obligating the 

remaining balance. 

However, the remaining 

balance will remain in 

the Fund unless returned 

to the General Fund.

Return of these funds to 

Treasury is being done 

solely to remove them 

from the Fund’s account, 

but will not count as 

savings because the 

funds are already 

precluded from 

obligation.

E – Legislative Proposals

The Fund has no legislative proposals for FY 2018.
TEOAF - 7

Section II – Annual Performance Plan and Report

A – Strategic Alignment

The function of the Fund is to ensure resources are managed to cover the costs of an effective 

asset seizure and forfeiture program, including the costs of seizure or the proceedings of 

forfeiture and sale, including the expenses of detention, inventory, security, maintenance, 

advertisement, or disposal of the property. Additionally, the Fund is used to support law 

enforcement priorities, financial investigative capabilities and the seizure of physical and 

financial resources to disrupt and dismantle criminal enterprises. The FY 2018-2022 Strategic 

Plan is currently under development. The Annual Performance Plan will be updated in the FY 

2019 Budget to reflect the new priorities.

Summary of the Fund’s Authorities: The enabling legislation for the Fund (31 U.S.C. § 9705) 

defines the purposes for which the Fund’s revenue may be used. Revenues deposited to the Fund 

can be allocated and used as the result of a permanent indefinite appropriation provided by 

Congress. 

A forfeiture process begins once currency or property is seized. Seized currency is deposited 

into a suspense account (holding account) until forfeited. At that time, the forfeited amount is 

transferred (deposited) to the Fund as revenue. Forfeited properties are usually sold and the 

proceeds are also deposited into the Fund as revenue. This revenue represents budget authority 

for meeting obligations and expenses of the program.

Expenses of the Fund are set in a relative priority so that operating costs are met first and may 

not exceed revenues.

Uses of the Fund:

 

Mandatory items represent the operating costs of the Fund, including expenses of storing and 

maintaining seized and forfeited assets, valid liens and mortgages, investigative expenses 

incurred in pursuing a seizure, information and inventory systems, remissions, victim restoration, 

and certain costs of local police agencies incurred in joint law enforcement operations. 

Following seizure, equitable shares may be paid to state and local law enforcement agencies that 

contributed to the seizure activity at a level proportionate to their involvement.

Secretary’s Enforcement Fund (SEF) represents revenue from equitable shares received from

Department of Justice (DOJ) or U.S. Postal Service (USPS) forfeitures. These shares are 

proportionate to Treasury’s participation in the overall investigative effort that led to a DOJ or 

USPS forfeiture. SEF revenue is available for federal law enforcement related purposes of any 

law enforcement organization participating in the Fund.

Super Surplus authority, established by Congress in 31 U.S.C. § 9705(g)(4)(B), allows TEOAF 

to fund priority law enforcement initiatives with remaining unobligated balances at the close of 

the fiscal year after an amount is reserved for the next fiscal year’s operations. This balance can 

be used for any federal law enforcement purpose.
TEOAF - 8

B – Budget and Performance by Budget Activity

2.1.1 - Treasury Forfeiture Fund Resources and Measures

Dollars in Thousands

Resource Level FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Actual Estimated Estimated

Revenue/Offsetting 

Collections $590,415 $527,417 $908,113 $787,849 $4,360,617 $508,746 $742,941 $580,000 

Budget Activity Total $590,415 $527,417 $908,113 $787,849 $4,360,617 $508,746 $742,941 $580,000 

Treasury Forfeiture Fund Budget Activity

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target FY 2016

Trend

Percent of Forfeited Cash 

Proceeds Resulting from 

High-Impact Cases

76.38 95.09 86.73 98.25 89.09 80.0 80.0 80.0

Treasury Forfeiture Fund Budget and Performance 

($580,000,000 in obligations from revenue/offsetting collections):

Description of Performance

The Fund continues to measure the performance of the participating law enforcement bureaus 

through the use of the performance measure: percent of forfeited cash proceeds resulting from 

high-impact cases. This measures the percentage of forfeited cash proceeds resulting from highimpact cases, which are cases resulting in a cash forfeiture deposit equal to or greater than 

$100,000. 

Focusing on strategic cases and investigations that result in high-impact forfeitures will do the 

greatest damage to criminal organizations while accomplishing the ultimate objective, which is 

to disrupt and dismantle criminal activity. Member law enforcement bureaus participating in the 

Fund have met or exceeded the performance target since FY 2013. The Fund maintains a target 

of 80 percent because some cases may be important to pursue, even if they are not high-impact 

cases and result in deposits of less than $100,000. 

The member bureaus exceeded the target 80 percent by 9.09 percent for FY 2016. For FY 2017 

and FY 2018, the target will remain at 80 percent.
TEOAF - 9

Section III – Additional Information

A – Summary of Capital Investments

A summary of capital investment resources, including major information technology and nontechnology investments can be found at:

http://www.treasury.gov/about/budget-performance/Pages/summary-of-capital-investments.aspx

This website also contains a digital copy of this document.

Department of the Treasury

Bureau of Engraving and 

Printing

Congressional Justification 

for Appropriations and 

Annual Performance 

Report and Plan

FY 2018 
BEP - 2

Table of Contents

Section I – Purpose........................................................................................................................ 3

A – Mission Statement................................................................................................................ 3

B – Summary of the Request ...................................................................................................... 3

1.1 – Appropriations Detail Table .............................................................................................. 5

1.2 – Budget Adjustments Table................................................................................................. 6

C – Budget Increases and Decreases Description....................................................................... 6

1.3 – Operating Levels Table .................................................................................................. 8

D – Appropriations Language and Explanation of Changes ...................................................... 8

E – Legislative Proposals............................................................................................................ 8

Section II – Annual Performance Plan and Report................................................................... 9

A – Strategic Alignment ............................................................................................................. 9

B – Budget and Performance by Budget Activity ...................................................................... 9

2.1 Manufacturing Resources and Measures.............................................................................. 9

Manufacturing Budget and Performance .................................................................................. 10

Section III – Additional Information ........................................................................................ 11

A – Summary of Capital Investments....................................................................................... 11
BEP - 3

Section I – Purpose

A – Mission Statement

To develop and produce United States currency notes trusted worldwide.

B – Summary of the Request 

The Bureau of Engraving and Printing (BEP) produces and delivers U.S. currency notes for the 

Federal Reserve System ordered by the Board of Governors of the Federal Reserve (FRB) and 

other security products for the federal government. The Bureau began printing currency in 1862 

and operates on the basis of authority conferred upon the Secretary of the Treasury by 31 U.S.C. 

321(a) (4) to engrave and print currency and other security documents. Operations are financed 

through a revolving fund established in 1950 in accordance with Public Law 81-656. The fund is 

reimbursed for direct and indirect costs of operations, including administrative expenses, through 

product sales. In 1977, Public Law 95-81 authorized the Bureau to include an amount sufficient 

to fund capital investment and to meet working capital requirements in the prices charged for 

products, eliminating the need for appropriations from Congress.

The Bureau provides technical assistance, advice, and some production services to other Federal 

agencies in the development of security documents that require counterfeit deterrent features due 

to their innate value or other characteristics. Other activities at the BEP include engraving plates 

and dies; manufacturing inks used to print security products; purchasing materials, supplies and 

equipment; and storing and delivering products in accordance with customer requirements. 

The BEP’s FY 2018 request funds the following projects: 

1. Banknote Design and Development: In 2018, BEP will continue working with the Federal 

Government’s Advanced Counterfeit Deterrent (ACD) Steering Committee to research and 

develop future currency designs for the next family of redesigned notes that will enhance and 

ensure the security and integrity of U.S. currency. The ACD Committee is an inter-agency 

group established to monitor and explore existing and emerging technologies to deter the 

counterfeiting of U.S. currency; it includes representatives from BEP, the Department of the 

Treasury, the U.S. Secret Service, and the FRB. While many factors are taken into 

consideration, the primary purpose for redesigning currency is to address current and 

potential counterfeiting threats.

2. Meaningful Access: Work continues in FY 2018 on redesigning currency to better assist 

domestic and international users, including the blind and visually impaired, with 

denominating U.S. currency notes. The three approved methods BEP is pursuing include the 

continued use of large, high-contrast numerals and different colors on currency notes; 

implementation of a U.S. Currency Reader Program that distributes iBill® currency readers 

(electronic assistive devices that identify a note’s value and communicates it to the user) at 

no cost to those individuals; and the pursuit of a Raised Tactile Feature for future currency 

notes. In 2013, the ACD recommended that the $10 note be the first denomination 

redesigned based on current and potential counterfeiting threats, amongst other factors. 

Throughout 2018, the testing and refinement of features will continue to determine and shape 

which processes and potential features work best at the high production volumes needed for 

U.S. currency.
BEP - 4

3. Retooling: BEP is in the process of a multi-year effort to retool BEP’s manufacturing 

processes with state-of–the-art intaglio printing presses, electronic inspection systems, and 

finishing equipment. In order to ensure that the BEP will meet the yearly currency order, the 

FRB and BEP developed and established short, medium, and long-term strategic equipment 

replacement plan for the U.S. Currency Program. The successful implementation of this 

advanced technology will improve productivity, reduce environmental impact, and enhance 

counterfeit deterrence of U.S. currency.

4. BEP Workforce: In 2015, the BEP developed a FY 2016 – 2020 Human Capital Strategic 

Plan outlined priority goals and initiatives to assess and drive meaningful workforce 

improvements in leadership and career development, knowledge management, training, and 

STEM (Science, Technology, Engineering and Mathematics) hiring and development over 

the next five years. Throughout 2018, BEP will continue to develop, execute, and 

communicate the results of Employee Engagement Plans and the FEVS annual survey 

results. In addition to implementing BEP Human Capital Plan initiatives, efforts will 

continue to fill gaps in needed STEM skill sets to support our Currency Quality Assurance 

(CQA) efforts in addition to adding resources in technology development and feature testing 

areas.

5. Currency Quality Assurance Program: BEP has partnered with the FRB to reinvent its 

quality management program based on the best practices of leading manufacturers. The 

BEP, in collaboration with its stakeholders, developed a robust CQA program that began in 

2014 and will continue to mature in 2018. BEP now builds quality into production 

processes. Every BEP work activity is aligned and will be resourced to support this program 

that focuses on every step of the supply chain from raw material, through the manufacturing 

process, to final packaging and delivery. CQA reaches into nearly every “corner” of the 

organization and its effectiveness depends on a strong cadre of process and production 

engineers, quality assurance specialists and other specialists in related science and 

engineering disciplines.

6. New International Organization for Standardization (ISO) requirements: ISO has 

published updated standards that the BEP must follow to maintain certification. The updated 

ISO 14001:2015 requirements will allow BEP to manage an integrated and proactive 

Environment Management System (EMS) that will better manage the activities on the 

environment and demonstrate sound environmental management. In order to pass 

recertification, BEP must align its Quality Management System (QMS) to the ISO 9001:2015 

standard and its EMS to the ISO 14001:2015 standard no later than September 2018. The 

updated ISO 9001:2015 requirements include a significant expansion of the BEP QMS, with 

the inclusion of business processes that support currency manufacturing. This includes 

processes that affect people, infrastructure, as well as the operational environment of 

currency manufacturing. The updated ISO 14001:2015 requirements will allow BEP to 

manage an integrated and proactive EMS that will better manage the effects of BEP activities 

on the environment and demonstrate sound environmental management.
BEP - 5

7. Replacement Production Facility: BEP’s current Washington, DC facility has an aging and

outdated infrastructure with multiple floors and wings, which drives up costs and adversely 

impacts quality. BEP needs to move forward to upgrade its facility in FY 2018, in order to 

be prepared to issue redesigned banknotes. BEP could renovate the existing facility, which 

would be very costly and inefficient ($15M more in FY 2018 alone), or could purchase land 

and construct a new facility, which would a more efficient with less costs. However, under 

current law, BEP does not have the authority to purchase land or a new facility. For 2018, 

BEP is requesting legislative authority to purchase land and construct a new more efficient 

currency production facility in the National Capital Region with a goal of reducing the 

Federal footprint. The FRB supports the construction of a new facility. Renovation will cost 

approximately $1.8 billion, $700 million more than the cost of purchasing and constructing a 

new facility and would not achieve any of the projected efficiencies (28 percent less space 

and a $38 million reduction in annual operating costs). With the new authority, construction 

of the new production facility would be completed by 2022 and the new facility fully 

operational by the end of 2026.

1.1 – Appropriations Detail Table

Dollars in Thousands

Bureau of Engraving and Printing

Offsetting Colections

 FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

Revenue/ Offsetting Collections:

Federal Reserve Notes $644,035 $801,335 $834,484 $33,149 4.14%

Other Security Products 4,000 5,000 5,000 - 0.00%

Total Revenue/Offsetting Collections $648,035 $806,335 $839,484 $33,149 4.11%

Expenses/Obligations:

Direct Manufacturing 754 $446,840 724 $486,840 724 $462,266 0 ($24,574) 0.00% -5.05%

Indirect Manufacturing 1,064 201,195 1,118 319,495 1,118 377,218 0 57,723 0.00% 18.07%

Total Expenses/Obligations 1,818 $648,035 1,842 $806,335 1,842 $839,484 0 $33,149 0.00% 4.11%

Net Results 0 0 0 0 NA

FY 2016 FY 2017 FY 2018 FY 2017 to FY 2018

Actual Estimated Estimted $ Change % Change
BEP - 6

1.2 – Budget Adjustments Table

C – Budget Increases and Decreases Description

Maintaining Current Levels (MCLs) ....................................................+$10,823,000 / +0 FTE

Pay-Raise +$3,528,000 / +0 FTE 

Funds are required for the proposed January 2018 pay-raise. 

Pay Annualization +$1,293,000 / +0 FTE 

Funds are required for annualization of the January 2017 pay-raise.

Non-Pay +$6,002,000 / +0 FTE 

Funds are required for non-labor costs such as travel, contracts, rent, supplies and equipment.

Program Decreases ...................................................................................-$41,674,000 / -0 FTE

Production Efficiency -$10,823,000 / -0 FTE 

BEP will strategically prioritize and perform critical mission requirements to lower production 

costs to offset increases in MCLs.

Currency Reader -$20,000,000 / -0 FTE 

As the U.S. Currency Reader Program matures and downloadable applications and image 

recognition technology becomes more commonplace, the BEP expects the demand for currency 

readers to be reduced in FY 2018.

Dollar in Thousands

Bereau of Engraving and Printing FTE Materials Operating & 

Capital Total

FY 2017 Estimated 1,842 $300,000 $506,335 $806,335 

Changes to Base:

Maintaining Current Levels (MCLs):

Pay Raise $3,528 $3,528 

Pay Annualization 1,293 1,293

Non-Pay 6,002 6,002

Subtotal Changes to Base 10,823 10,823

Total FY 2018 Base 1,842 $300,000 $517,158 $817,158 

Program Changes:

Program Decrease ($10,851) ($30,823) ($41,674)

Production Efficiency (10,823) (10,823)

Currency Readers (20,000) (20,000)

Materials (10,851) (10,851)

Program Increase $0 $64,000 $64,000 

DCF Production Facility Replacement 64,000 64,000 

Total FY 2018 Estimated 1,842 $289,149 $550,335 $839,484 
BEP - 7

Materials -$10,851,000 / -0 FTE 

Reduction in materials due to program reduction, increased 50 subject printing coupled with 

anticipated reduction in spoilage. 

Program Increases ...................................................................................+$64,000,000 / +0 FTE

Production Facility Replacement +$64,000,000 / +0 FTE

In 2018 BEP requests statutory authority to purchase land and construct a new and more efficient 

currency production facility in the National Capital Region. Absent legislative authority to 

purchase land and construct a new, smaller, more efficient currency production facility, an

additional $15 million would be required in FY 2018 to award needed renovation contracts in 

order to ensure BEP’s ability to meet its mission. 
BEP - 8

1.3 – Operating Levels Table

Dollars in Thousands

Bureau of Engraving and Printing FY 2016 FY 2017 FY 2018

Object Classification Actual Estimated Estimated

11.1 - Full-time permanent $176,236 $177,560 $181,256

11.3 – Other than Full-time Permanent Positions 0 150 150

11.5 - Other personnel compensation 19,117 2,050 2,093

11.6 - Overtime 0 15,000 15,000

11.9 - Personnel Compensation (Total) $195,353 $194,760 $198,499

12.0 - Personnel benefits 51,396 52,000 53,082

Total Personnel and Compensation Benefits $246,749 $246,760 $251,581

21.0 - Travel and transportation of persons $1,311 $1,350 $1,800

22.0 - Transportation of things 189 250 250

23.1 - Rental payments to GSA 1,398 2,000 2,000

23.2 Rent Payments to Others 0 1,000 1,000

23.3 - Communication, utilities, and misc charges 10,313 14,000 14,000

24.0 - Printing and reproduction 350 250 250

25.1 - Advisory and assistance services 2,272 3,500 4,150

25.2 - Other services 47,827 90,865 133,078

25.3 - Other purchaes of goods and services from Government Accounts 241 0 0

25.4 - Operation & Maintenance of Facilities 0 8,100 8,950

25.5 - Research & Development Contracts 0 7,000 15,000

25.7 - Operation & Mantenance of Equipment 0 11,900 12,000

26.0 - Supplies and materials 295,259 300,000 249,815

31.0 – Equipment 41,951 119,200 145,450

41.0 – Insurance claims and indemnities 0 160 160

42.0 – Insurance claims and indemnities 175 0 0

Total Non-Personnel $401,286 $559,575 $587,903

Total Budgetary Resources $648,035 $806,335 $839,484

FTE 1,818 1,842 1,842

D – Appropriations Language and Explanation of Changes

The BEP receives no appropriated funds from Congress.

E – Legislative Proposals

In 2018 BEP requests statutory authority to purchase land and construct a new and more efficient 

currency production facility in the National Capital Region. 

The FRB supports this project. Alternatively, BEP must begin the renovation of the existing DC 

Main and Annex Buildings in FY 2018. Renovation will cost approximately $1.8 billion, $700 

million more than the cost of purchasing and constructing a new facility, and would have none of 

the projected efficiencies (28 percent less space and a $38 million reduction in annual operating 

costs). 
BEP - 9

Section II – Annual Performance Plan and Report

A – Strategic Alignment

To develop and produce United States currency notes, trusted worldwide. BEP's vision is to be 

the world standard securities printer providing its customers and the public with superior 

products through excellence in manufacturing and innovation. The FY 2018-2022 Strategic Plan 

is currently under development and BEP will updated its Annual Performance Plan in the 

FY 2019 Budget.

U.S. currency is used globally and as its designer and manufacturer, BEP needs to achieve and 

maintain best-in-class practices for U.S. currency to be accepted worldwide. Working closely 

with our partners in the U.S. Currency Program, BEP looks forward to developing the next series 

of secure notes. BEP continues to make every effort to meet its mission to manufacture 

sophisticated and technologically advanced notes that are dependable in commerce. This 

achievement requires the focus and determination of the entire agency since BEP faces 

challenges and has committed to stay ahead of increasingly sophisticated counterfeiters. 

B – Budget and Performance by Budget Activity

2.1 Manufacturing Resources and Measures

Manufacturing Activity

Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Estimated Estimated

Expense/Obligations $630,000 $624,243 $733,208 $778,592 $648,035 $806,355 $839,484

Budget Activity 

Total

$630,000 $624,243 $733,208 $778,592 $648,035 $806,355 $839,484

FTE 1,872 1,890 1,845 1,780 1,818 1,842 1,842

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2011 -

Actual Actual Actual Actual Actual Target Target Target FY 2016

Trend

Best Places to Work in 

Federal Government 

Ranking

178 47 51 74 97 99 99 99

Lost Time Accident Rate 

per 100 Employees

1.9 1.63 1.73 1.65 1.77 1.80 1.80 1.80

Manufacturing Costs For 

Currency (Dollar Costs Per 

Thousand Notes 

Produced)

43.34 50.45 44.22 42.35 44.25 50.0 50.0 50.0

Percent of Currency Notes 

Delivered Returned Due to 

Defects

.0001 .466 .00001 .0000003 .0000003 .00001 .00001 .00001

Key: DISC - Discontinued, B - Baseline
BEP - 10

Manufacturing Budget and Performance

($839,484,000 from reimbursable resources):

Manufacturing Costs for Currency (dollar cost per 1,000 notes produced) is an indicator of 

manufacturing efficiency and effectiveness of program management. The measure is based on 

contracted price factors, productivity improvements, as well as the mix of denominations 

ordered. Actual performance against standard costs depends on BEP’s ability to meet spoilage, 

efficiency, and capacity utilization goals. In 2016 the cost of manufacturing was lower than 

anticipated; the actual result was $44.25 per 1,000 notes produced against a target of $50.00. 

BEP’s target for this performance metric, in both 2017 and 2018, is set at $50.00 per 1,000 notes 

produced.

The percent of currency notes returned due to defects is an indicator of the BEP’s ability to 

provide a quality product. BEP’s FY 2016 target for this performance metric was .0001 percent, 

and the actual result realized for this measure was .0000003 percent. BEP’s target for this 

performance metric will be held constant at .0001 percent for both FY 2017 and 2018.

BEP’s ranking in the government-wide Best Place to Work in the Federal Government is based 

on the results of the Partnership for Public Service data on three questions in the Federal 

Employee Viewpoint Survey (FEVS). BEP’s 2016 rank was 97 out of 305. BEP will continue 

to target improving its ranking and strives to be in the upper quartile of Federal agencies

The Lost Time Accident Rate per 100 employees measures the BEP’s ability to reduce injuries 

and illnesses in the workplace. BEP’s 2016 Lost Time Accident rate was at 1.77 cases per 100 

employees, surpassing the target of 1.80 cases per 100 employees. The BEP remains committed 

to improving the safety of its employees and has undertaken analysis to determine the root 

causes of injury and to identify best practices in safety. BEP’s target will be held constant at 

1.80 cases per 100 employees for FY 2017 and FY 2018.
BEP - 11

Section III – Additional Information

A – Summary of Capital Investments

The BEP capital investment strategy is comprised of several broad investment categories, with 

more specific smaller projects in each category. 

The BEP’s mission to develop and produce U.S. currency notes, trusted worldwide, demands 

that BEP continually update and improve its manufacturing processes by investing in new 

technologies and innovations. BEP’s retooling project replaces older, fully depreciated 

production equipment. Replacing out of date equipment allows BEP to be more quality driven 

and cost effective and efficient in meeting customer requirements for the production of currency 

notes. In addition, the BEP is focused on building the capability to produce new currency 

designs with tactile features to provide meaningful access to currency for the blind and visually 

impaired.

BEP participates as a partner in significant Treasury-wide, enterprise-level investments such as 

Homeland Security’s Presidential Directive-12, HRConnect (a Human Resources Line of

Business service provider), and the Treasury Learning Management System.

BEP’s IT portfolio includes a “cloud first” approach to implementing business systems. The 

Oracle eBusiness Suite is an integrated manufacturing suite which runs at the Oracle 

Corporation’s “Federal on Demand” Shared Service Center in Austin, Texas. 

A summary of capital investment resources, including major information technology and nontechnology investments, can be viewed/downloaded here: 

http://www.treasury.gov/about/budget-performance/Pages/summary-of-capital-investments.aspx

This website also contains a digital copy of this document

Department of the Treasury

United States Mint

Congressional Justification 

and 

Annual Performance 

Report and Plan

FY 2018 
MINT - 2

Table of Contents

Section I – Purpose........................................................................................................................ 3

A – Mission Statement................................................................................................................ 3

B – Summary of the Request ...................................................................................................... 3

 1.1 – Resource Detail Table.................................................................................................. 5

 1.2 – Budget Adjustments Table.......................................................................................... 5

C – Budget Increases and Decreases Description....................................................................... 6

 1.3 – Operating Levels Table ............................................................................................... 8

D – Appropriations Language and Explanation of Changes ...................................................... 9

E – Legislative Proposals............................................................................................................ 9

Section II – Annual Performance Plan and Report................................................................. 10

A – Strategic Alignment ........................................................................................................... 10

B – Budget and Performance by Budget Activity .................................................................... 11

 2.1 Manufacturing Resources and Measures...................................................................... 11

Section III – Additional Information ........................................................................................ 14

A – Summary of Capital Investments....................................................................................... 14
MINT - 3

Section I – Purpose

A – Mission Statement

Enable America’s economic growth and stability by protecting assets entrusted to us and 

manufacturing coins and medals to facilitate national commerce.

B – Summary of the Request 

In FY 2018, the United States Mint’s (Mint) total estimated budgetary requirements for 

operating, metal, and capital investments are $2.7 billion. This budget will support the 

production of 16 billion circulating coins, as well as the production of bullion and other 

numismatic products sufficient to meet customer demand.

The Mint has one budget activity: Manufacturing, which encompasses the bureau’s two major 

programs, circulating coinage and numismatic products (including bullion coins, collector coins,

and national medals). 

The Mint’s vision is to be the finest mint in the world, through excellence in its people, products 

customer service and workplace. The Mint has three strategic objectives to help fulfill its vision 

and mission: 1) foster a safe, flexible, diverse, and engaged workforce; 2) improve enterprise 

management and governance; and 3) integrate technology into operations and support lines. 

Mint operations are funded through the Mint Public Enterprise Fund (PEF), 31 U.S.C. § 5136. 

The Mint generates revenue through the sale of circulating coins to the Federal Reserve Banks 

(FRB), numismatic products to the public, and bullion coins to authorized purchasers. All 

circulating and numismatic operating expenses along with capital investments incurred for the 

Mint’s operations and programs are paid out of the PEF. By law, all funds in the PEF are 

available without fiscal year limitation. Revenues determined to be in excess of the amount 

required by the PEF are transferred to the United States Treasury General Fund.

Circulating

Circulating coin production projections are based on current economic data and forecasts of FRB 

coin orders. Circulating coin production for FY 2017 and FY 2018 is forecasted at 16.0 billion 

coins. This level reflects a 1.9 percent decrease in all coin denomination shipments as compared 

to 16.3 billion in FY 2016.

Circulating financial performance continues to be affected by the costs of the inputs for 

producing the coinage. Since FY 2006, commodity prices for copper, nickel, and zinc have been 

at levels at which costs of the one-cent coins (pennies) and 5-cent coins (nickels) have exceeded 

their face value. The Mint expects the costs of these commodities to remain at levels that result 

in continued losses from issuing pennies and nickels to the FRB at face value. Positive 

seigniorage from minting and issuing dime and quarter-dollar coins has fully offset the losses the 

Mint incurs from minting and issuing pennies and nickels.
MINT - 4

Numismatic Program

The numismatic program, which includes bullion coins, is designed to prepare and distribute 

premium products to collectors and those who desire quality versions of coinage. Numismatic 

products are priced to cover metal and production costs.

Bullion Coins 

The bullion coin program provides the public a means to acquire precious metal coins as part of 

an investment portfolio from authorized purchasers. Investors purchase bullion coins not only 

for their intrinsic metal value, but also because the United States guarantees each coin’s metal 

weight, content, and purity. The main objective of the bullion coin program is to meet demand 

and ensure that the program recovers its costs.

In FY 2016, bullion demand declined to 45.2 million ounces from the 49.7 million ounces sold in 

FY 2015. Demand for bullion is forecasted to decline in FY 2017 to 43.8 million ounces and to 

41.7 million ounces in FY 2018. As a result, bullion revenue is forecasted to be $1.9 and $1.8

billion in FY 2017 and FY 2018, respectively.

Numismatic (Collector Coins and Medals)

The numismatic (collector coins and medals) program provides high-quality versions of 

circulating coinage, precious metal coins, commemorative coins, and medals for sale to the 

public. Most of the Mint’s recurring products, such as the uncirculated coin sets and proof sets, 

are required by Federal statute. Others, such as commemorative coins and Congressional Gold 

Medals, are required by individual public laws.

Numismatic revenue decreased by nine percent from $453 million in FY 2015 to $413 million in 

FY 2016. The decrease was driven primarily by lower customer demand for numismatic

products. Total units decreased by 22 percent from 5.4 million in FY 2015 down to 4.2 million 

in FY 2016. FY 2017 and FY 2018 numismatic revenues are projected to be $391 million and 

$273 million, respectively, as demand for numismatic products is projected to continue to 

decrease.
MINT - 5

1.1 – Resource Detail Table

Dollars in Thousands

1.2 – Budget Adjustments Table

Dollars in Thousands

United States Mint

Budgetary Resources

FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

Revenue/Offsetting Collections

Other Income

Circulating 0 1,104,156 0 1,046,400 0 1,046,400 0 0 N/A 0.0%

Bullion/Numismatic 0 2,498,317 0 2,242,034 0 2,051,826 0 -190,208 N/A -8.5%

Total Revenue/Offsetting Collections 0 3,602,473 0 3,288,434 0 3,098,226 0 -190,208 N/A -5.8%

Expenses/Obligations

Manufacturing

Circulating 964 525,535 1,042 729,548 1,042 700,644 0 -28,904 0.0 -4.0%

Bullion/Numismatic 728 2,746,571 759 2,076,404 759 1,994,140 0 -82,264 0.0 -4.0%

Total Expenses/Obligations 1,692 3,272,106 1,801 2,805,952 1,801 2,694,784 0 -111,168 0.0 -4.0%

Net Results 330,367 482,482 403,442 -79,040 -16.4%

Coin Shipments (Units In Millions/Coins) FY 2016 FY 2017 FY 2018

Circulating:

One Cent 9,114 9,440 9,440

5-Cent 1,578 1,280 1,280

Dime 3,134 2,880 2,880

Quarter 2,482 2,400 2,400

Half-Dollar - - -

Dollar - - -

Total Circulating 16,308 16,000 16,000

FY 2016 FY 2017 FY 2018

Budget Category Actual Estimated Estimated

Administrative Operating Costs 376,089 $405,452 $414,284

Capital Investments $29,415 $40,500 $40,500

Metals and Materials Costs $2,866,602 $2,360,000 $2,240,000

Total Resources $3,272,106 $2,805,952 $2,694,784

0.0%

0.0%

0.0%

% Change

0.0%

0.0%

0.0%

0.0%

FY 2016 FY 2017 FY 2018 FY 2017 to FY 2018

Actual Estimated Estimated $ Change % Change

% Change

2.18%

0.0%

-5.1%

-4.0%

FTE Materials 

 Operating & 

Capital Total 

FY 2017 Original Estimate 1,874 $2,510,000 $446,207 $2,956,207 

 10 $8,577 $8,577 

($100,000) ($100,000)

($50,000) ($50,000)

 (83) ($8,832) ($8,832)

Revised - FY 2017 Estimated Resources 1,801 2,360,000 445,952 2,805,952

Changes to Base:

Maintain Current Levels (MCLs) $8,832 $8,832 

 Pay-Raise 3,100 3,100 

 Pay Annualization 1,136 1,136 

 Non-Pay 4,597 4,597 

Subtotal, Changes to the Base $8,832 $8,832 

Total FY 2018 Base 1,801 2,360,000 454,784 2,814,784

Program Changes

 Program Decreases:

 Metals due to forecasted decrease in bullion production ($140,000) ($140,000)

 Program Increases:

 Metals due to forecasted increase in circulating coin metals prices $20,000 $20,000 

Subtotal FY 2018 Program Changes ($120,000) ($120,000)

Total FY 2018 Estimate 1,801 2,240,000 454,784 2,694,784

United States Mint

Adjustment to Estimate - Cyber Security Initiative

Adjustment to Estimate - Metal due to forecasted decrease in circulating coin production

Adjustment to Estimate - Metal due to forecasted decrease in numismatic/bullion production

Adjustment to Estimate - Staffing Streamline
MINT - 6

C – Budget Increases and Decreases Description

FY 2017 Revised Estimated Resources ................................................-$150,255,000 / -73 FTE

Cyber Security Enhancements, +$8,577,000 / +10 FTE

In support of the Government-wide cyber security initiative, the Mint’s FY 2017 budget includes 

10 additional FTEs, as well as funding to enhance the bureau’s cyber security infrastructure to 

meet new standards. The additional funds are for a new cyber security contract that will support 

security engineering and compliance activities ($5M), capital equipment ($2.1M), and personnel 

($1.5M). 

Metal due to forecasted decrease in circulating coin metal prices, -$100,000,000 / -0 FTE

Current metal price forecasts show a significant decrease in FY 2017. Copper, zinc, and nickel 

prices have all declined when compared to the original forecast. This lower cost for metal, 

coupled with a forecasted decrease in demand, results in a $100 million decrease in base metal 

purchases.

Metal due to forecasted decrease in numismatic/bullion coin production, -$50,000,000 / -0 FTE

FY 2017 numismatic/bullion costs have decreased due to a forecasted decline in numismatic and 

bullion demand, coupled with an anticipated reduction in metal prices. Demand for bullion is 

forecasted to decline primarily because interest rates are expected to continue to increase. 

Staffing Streamline, -$8,832,000 / -83 FTE

To align with the Administration’s initiative to improve government efficiency and effectiveness, 

the Mint is implementing a staffing streamlining effort to ensure it has the appropriate staffing 

levels for maximum efficiency. 

FY 2018 Budget Increases and Decreases Description.......................... -$111,168,000/ -0 FTE

Maintaining Current Levels (MCLs) .......................................................+$8,832,000 / +0 FTE

Pay-Raise +$3,100,000 / +0 FTE 

Funds are required for the proposed January 2018 pay-raise.

Pay Annualization +$1,136,000 / +0 FTE

Funds are required for the annualization of the January 2017 pay-raise.

Non-Pay +$4,597,000 / +0 FTE 

Funds are required for non-labor expenses such as travel, contracts, rent, supplies, and 

equipment.

Program Decreases ..................................................................................-$140,000,000 / -0 FTE

Metal due to forecasted decrease in numismatic/bullion coin production, -$140,000,000 / -0 FTE 

Forecasted demand for the numismatic program continues to decrease in FY 2018. The 

Presidential $1 Coin Program ended in 2016, and the first full-year impact will be in FY 2018. 
MINT - 7

Program Increases ...................................................................................+$20,000,000 / +0 FTE

Metal due to forecasted increase in circulating coin metal prices, $20,000,000 / +0 FTE

FRB demand for circulating coins will remain flat in FY 2018 at 16.0 billion coins; however, 

metal prices are forecasted to rise modestly, causing an increase in overall production costs for 

the circulating program. Increases in metals prices result in a $20 million increase for metal 

purchases. 
MINT - 8

1.3 – Operating Levels Table

Dollars in Thousands

Dollars in Thousands

US Mint FY 2016 FY 2017 FY 2018 

Object Classification Actual Estimated Estimated 

11.1 - Full-time permanent 131,831 143,068 147,165 

11.3 - Other than full-time permanent 930 161 161 

11.5 - Other personnel compensation 13,397 12,729 12,729 

11.9 - Personnel Compensation (Total) 146,159 155,958 160,055 

12.1 - Personnel benefits 49,952 50,564 51,729 

13.0 - Benefits for former personnel 53 1,019 1,019 

Total Personnel and Compensation Benefits $196,164 $207,541 212,803 

21.0 - Travel and transportation of persons 1,653 2,649 2,703 

22.0 - Transportation of things 32,101 28,702 28,702 

23.2 - Rental payments to others 14,508 14,445 14,445 

23.3 - Communication, utilities, and misc charges 13,825 17,358 17,358 

24.0 - Printing and reproduction 962 1,050 1,550 

25.1 - Advisory and assistance services 40,392 42,340 52,810 

25.2 - Other services 21,740 37,574 28,797 

25.3 - Other purchases of goods & serv frm Govt accounts 18,004 20,372 21,372 

25.4 - Operation and maintenance of facilities 5,438 3,185 3,185 

25.5 - Research and development contracts 1,201 1,913 1,913 

25.6 - Medical care 758 460 460 

25.7 - Operation and maintenance of equip 6,807 7,887 7,887 

26.0 - Supplies and materials 2,886,027 2,377,928 2,257,928 

31.0 - Equipment 25,088 30,734 31,057 

32.0 - Land and structures 7,438 11,815 11,814 

Total Non-Personnel 3,075,942 2,598,411 2,481,981 

Total Budgetary Resources $3,272,106 $2,805,952 2,694,784 

FTE 1,692 1,801 1,801 
MINT - 9

D – Appropriations Language and Explanation of Changes

Appropriations Language Explanation of Changes

DEPARTMENT OF THE TREASURY

UNITED STATES MINT PUBLIC ENTERPRISE FUND

Federal Funds

Pursuant to section 5136 of title 31, United States Code, the 

United States Mint is provided funding through the United States 

Mint Public Enterprise Fund for costs associated with the

production of circulating coins, numismatic coins, and protective

services, including both operating expenses and capital 

investments: Provided, That the aggregate amount of new 

liabilities and obligations incurred during fiscal year 2018 under 

such section 5136 for circulating coinage and protective service 

capital investments of the United States Mint shall not exceed 

$30,000,000.

Note.—A full-year 2017 appropriation for this account was not 

enacted at the time the budget was prepared; therefore, the budget 

assumes this account is operating under the Further Continuing

Appropriations Act, 2017 (P.L. 114–254). The amounts included 

for 2017 reflect the annualized level provided by the continuing 

resolution.

The increased capital 

limit will allow the Mint 

to execute a 

comprehensive capital 

strategy that focuses on 

safety, equipment 

replacements, protection,

and facility 

improvements.

E – Legislative Proposals

The Mint’s investments in capital are a critical part of regular manufacturing operations. As coin 

demand from the FRB increases, the Mint’s need for capital investments becomes more 

critical. The current limitation of $20 million for circulating and protection capital is below the 

amount needed to meet capital investment requirements. 

The legislative limit is linked to the annual depreciation level, which has been the unofficial 

baseline since 2002. Because the capital limit is linked to depreciation, the limit has decreased 

over time as the depreciation level declines. Fewer capital purchases were made in prior years 

due to cost savings efforts during times of low coin demand (2007 – 2010). This in turn caused 

lower depreciation levels for capital spending authority. As a result, capital needs during a 

period of high FRB demand are not able to be fully met.

The bureau has identified an urgent need to increase its legislative limit by $10 million. This 

will raise the current limit from $20 million to $30 million beginning in FY 2018. The increased 

capital limit will allow the Mint to execute a comprehensive capital investment strategy that 

focuses on safety, equipment replacements, protection, and facility improvements.
MINT - 10

Section II – Annual Performance Plan and Report

A – Strategic Alignment

The Department of the Treasury FY 2018-2022 strategic plan is under development and the 

Annual Performance Report will be updated in the FY 2019 Budget to reflect the new priorities. 

This budget activity encompasses the bureau’s two major programs: circulating coinage and 

numismatic products, including bullion coins, collector coins, and national medals. 

Circulating Coinage Program

Circulating coinage includes the minting and issuing of pennies, nickels, dimes, and quarterdollars. The Mint delivers circulating coinage to the FRBs in quantities to support their service 

to commercial banks and other financial institutions. These financial institutions then meet the 

coinage needs of retailers and the public. The Mint recognizes revenues from the sale of 

circulating coins at face value when they are shipped to the FRBs.

The Mint will continue to mint and issue circulating quarter-dollar coins honoring America’s 

national parks and other national sites, in accordance with the America’s Beautiful National 

Parks Quarter Dollar Coin Act of 2008 (Public Law 110-456). In 2017, the Mint will release 

quarters honoring Effigy Mounds National Monument (Iowa), Frederick Douglass National 

Historic Site (District of Columbia), Ozark National Scenic Riverways (Missouri), Ellis Island 

(Statue of Liberty National Monument) (New Jersey), and George Rogers Clark National 

Historical Park (Indiana). In FY 2018, the Mint will release quarters honoring Pictured Rocks 

National Lakeshore (Michigan), Apostle Islands National Lakeshore (Wisconsin), Voyageurs 

National Park (Minnesota), Cumberland Island National Seashore (Georgia), and Block Island 

National Wildlife Refuge (Rhode Island).

Numismatic Program

Bullion Coins 

The Mint produces and issues gold, silver, and platinum bullion coins to authorized purchasers 

through the American Eagle, American Buffalo, and America the Beautiful Silver Bullion Coin 

Programs to fulfill investor demand. The authorized purchasers agree to maintain an open, twoway market for these coins, ensuring their availability for consumers who desire them for 

investment portfolios. Demand for bullion coins is greatly influenced by the performance of 

other investment options, such as equities or currency markets, and therefore is highly 

unpredictable. The content and purity of the precious metal in the bullion coins are backed by 

the United States Government.

Other Numismatic Products 

The Mint’s numismatic program provides high-quality versions of circulating coinage, precious 

metal coins, commemorative coins, and medals for sale directly to the public. For some 

numismatic products, authorizing legislation specifies program requirements, such as design 

theme, mintage level, and duration of product availability. Other programs are structured by law 

to grant the Secretary of the Treasury discretion in determining product specifications. 
MINT - 11

The Mint will continue to mint and issue $1 coins commemorating the important contributions 

made by Indian tribes and individual Native Americans to the development and history of the 

United States in accordance with the Native American $1 Coin Act (Public Law 110-82). The 

Presidential $1 Coin Program ended in 2016.

Commemorative coins are authorized by law to recognize and honor people, places, events, 

institutions, and other subjects of historic or national significance. Each coin is minted and 

issued by the Mint in a limited quantity and is available only for a limited time. Included in the

price is a surcharge that is authorized to be paid to the designated recipient organizations, 

assuming all legal requirements have been met. Recipient organizations must use the proceeds 

for the purposes specified in the enabling legislation. In FY 2017, the Mint is scheduled to mint 

commemorative coins for two programs: the Lions Club International Commemorative Coin 

(Public Law 112-181) and the Boys Town Centennial Commemorative Coins (Public Law 114-

30). In FY 2018, the Mint has authorization to mint commemorative coins for two programs: 

the World War I American Veterans Centennial Commemorative Coin (Public Law 113-212) 

and the Breast Cancer Awareness Commemorative Coin (Public Law 114-148).

B – Budget and Performance by Budget Activity

2.1 Manufacturing Resources and Measures

Dollars in Thousands

FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Measure Actual Actual Actual Actual Actual Target Target Target

FY 2016

Trend

Customer Satisfaction 

Index (%)

90.0 92.6 89.8 89.5 91.0 90.0 90.0 90.0

Numismatic Sales Units 

(Million Units)

5.6 5.51 5.7 5.4 4.2 4.6 4.4 3.5

Safety Incident 

Recordable Rate

3.5 2.9 3.31 3.42 2.53 2.96 2.83 2.75

Seigniorage per Dollar 

Issued ($)

.21 .24 .37 .49 .52 .47 .48 .49

Key: DISC - Discontinued; B - Baseline

Manufacturing Budget and Performance

($3,098,226,000 from offsetting collections) The Mint will mint and issue circulating coins and 

produce numismatic, including bullion, products to meet demand.

Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Estimated Estimated

 Expenses/Obligations $3,806,838 $3,525,178 $2,861,632 $2,937,553 3,272,106 $2,805,952 $2,694,784 

Budget Activity Total $3,806,838 $3,525,178 $2,861,632 $2,937,553 $3,272,106 $2,805,952 $2,694,784 

 FTE 1,788 1,705 1,661 1,657 1,692 1,801 1,801 
MINT - 12

Description of Performance:

Several key performance measures are used to gauge the bureau’s progress in achieving its 

strategic goals and to assess its Manufacturing Budget Activity performance.

Customer Satisfaction Index (CSI)

The Mint conducts a quarterly survey of a random sample of active numismatic customers. The 

survey is intended to capture customer satisfaction with the Mint’s service performance as a coin 

products supplier and with the quality of specific products. The CSI is a single quantitative score 

of the survey results. The Mint’s strategic plan goal for this performance measure is “Improve 

enterprise management and governance.” 

By the end of FY 2016, the CSI reached 91.0 percent, exceeding its 90.0 percent target. The Mint 

anticipates the FY 2017 and 2018 CSI ratings will remain steady. The performance target for 

CSI is 90.0 percent for both FY 2017 and FY 2018.

Numismatic Sales Units

The numismatic sales unit metric measures public demand for coin products sold from 

numismatic operations. The Mint’s strategic plan goal for this performance measure is “Improve 

enterprise management and governance.” 

In FY 2016, the Mint sold 4.2 million units, nine percent below the fiscal year target of 4.6 

million units. The primary drivers were lower customer demand for silver coin products and a 

decline in unit sales of the American Eagle Silver (AE) dollar coin due to legislative restrictions 

on the design of coins sold during 2016 (Public Law 114-94). This Act included the stipulation 

that proof and uncirculated versions of the AE coins issued in 2016 “shall have a smooth-edge 

incused with a designation that notes the 30th anniversary of the first issue of the coins.” Due to 

this provision, during calendar year 2016, the Mint could not issue or sell any proof or

uncirculated AE coins that had their usual reeded edge. 

Lower unit sales were also seen in the Presidential and First Spouse Coin product category. 

Demand for commemorative coin products and annual recurring sets also dropped during 

FY 2016. 

Accordingly, numismatic unit sales performance targets have been established at 4.4 million 

units for FY 2017 and 3.5 million units for FY 2018. The Mint will continue its efforts in the 

areas of products, promotion, distribution, and systems to achieve responsible growth in 

numismatic product sales while ensuring the program remains profitable.

Safety Incident Recordable Rate

The safety incident recordable rate is the number of injuries and illnesses meeting the 

Occupational Safety and Health Administration (OSHA) recording criteria per 100 full-time 

workers. It measures the occurrence of work-related incidents involving death, lost time and 

restricted work, loss of consciousness, and medical treatment. This measure supports the Mint’s 

strategic goal, “Foster a safe, flexible, diverse, and engaged workforce.”
MINT - 13

By the end of FY 2016, the total recordable case rate reached 2.53, which is below the 2.91 FY 

2016 target and significantly below the industry average rate of 5.9 for metal forging and

stamping manufacturers. During FY 2016, the Mint continued implementing and updating risk 

management guidelines to prioritize resources, mitigating risks in advance of injuries or 

catastrophic events at each plant. Mint plant leadership and employees continue to interact on a 

daily basis on the importance of safety.

The performance targets for the safety incident recordable rate are 2.83 for FY 2017 and 2.75 for 

FY 2018.

Seigniorage per Dollar Issued

Seigniorage per dollar issued is the financial return on circulating operations, calculated as 

seigniorage divided by the total face value of circulating coins shipped to the FRBs. It measures 

the cost effectiveness of minting and issuing the United States’ circulating coinage.

At the end of FY 2016, seigniorage per dollar issued was $0.52, above the FY 2016 performance 

target of $0.47. FY 2016 results exceeded the target as a result of a one percent increase in 

circulating shipment volumes combined with a 10 percent decrease in cost of goods sold.

FY 2017 and FY 2018 seigniorage per dollar issued performance targets are set at $0.48 and 

$0.49, respectively.
MINT - 14

Section III – Additional Information

A – Summary of Capital Investments

The Mint’s capital investment requirements are predominantly for manufacturing-type 

equipment. Capital investments, along with its operating expenses, are paid out of the Mint’s

PEF. Legislative language caps the aggregate amount of new liabilities and obligations incurred 

during a fiscal year for capital investments in circulating coinage operations and protective 

service.

The Mint's manufacturing capital investment projects focus on safety, equipment replacement, 

protection, and facility improvements.

In addition, the Mint’s capital investments encompass a robust information technology (IT) 

portfolio. This IT portfolio focuses on the optimization of formal governance structures to 

manage IT investments and programs in an effort to emphasize reductions in system redundancy 

and to modernize the IT system infrastructure. Enterprise architecture reviews ensure alignment 

of IT investments to the bureau’s strategic plan and the strategic enterprise direction of the 

Department of the Treasury. IT investments are closely monitored for cost, schedule, and 

performance to ensure expected results and benefits are achieved.

In accordance with the Statement of Federal Financial Accounting Standard (SFFAS) No. 6, the 

Condition Index and the Deferred Maintenance assessments for purposes of Federal Real 

Property Profile, the Mint has no deferred maintenance for its equipment. Maintenance is 

scheduled and performed regularly to keep the manufacturing equipment operating at optimal 

levels.

A summary of capital investment resources, including major information technology and nontechnology investments, can be viewed and downloaded at https://www.treasury.gov/about/budgetperformance/Pages/summary-of-capital-investments.aspx

This website also contains a digital copy of this document.

Office of the Comptroller of the 

Currency

Congressional Budget 

Justification 

and 

Annual Performance 

Report and Plan

FY 2018 
OCC - 2

Table of Contents

Section 1 – Purpose ....................................................................................................................... 3

A – Mission Statement................................................................................................................ 3

B – Summary of the Request ...................................................................................................... 3

1.1 – Resource Detail Table........................................................................................................ 4

1.3 – Operating Levels Table...................................................................................................... 5

D – Appropriations Language and Explanation of Changes ...................................................... 5

E – Legislative Proposals............................................................................................................ 5

Section II – Annual Performance Plan and Report................................................................... 6

A Strategic Alignment ................................................................................................................ 6

B – Budget and Performance by Budget Activity ...................................................................... 7

2.1.1 Supervise Resources and Measures Table ......................................................................... 7

Supervise Budget and Performance ............................................................................................ 7

2.1.2 – Regulate Resources and Measure Table ....................................................................... 10

Regulate Budget and Performance............................................................................................ 10

2.1.3 – Charter Budget and Performance Plan.......................................................................... 11

Charter....................................................................................................................................... 11

Section III – Additional Information ........................................................................................ 12

A – Summary of Capital Investments....................................................................................... 12
OCC - 3

Section 1 – Purpose

A – Mission Statement

To ensure that national banks and federal savings associations operate in a safe and sound 

manner, provide fair access to financial services, treat customers fairly, and comply with 

applicable laws and regulations.

B – Summary of the Request

The Office of the Comptroller of the Currency (OCC) was created by Congress in 1863 to 

charter national banks; oversee a nationwide system of banking institutions; and ensure national 

banks are safe and sound, competitive and profitable, and capable of serving in the best possible 

manner the banking needs of their customers. 

As of March 31, 2017, the OCC supervised 973 national bank charters and 48 federal branches 

of foreign banks in the United States with total assets of approximately $11.0 trillion, and 373

federal savings associations with total assets of approximately $738 billion. In total, the OCC 

supervises approximately $11.7 trillion in financial institution assets.

Goals

The OCC has established three goals outlined in its strategic plan that help support a strong 

economy for the American public: 1) A vibrant and diverse system of national banks and federal 

savings associations that supports a robust U.S. economy; 2) “One OCC” focused on 

collaboration, innovation, coordination, and process efficiency; 3) An OCC that is firmly 

positioned to continue to operate independently and effectively into the future. To achieve its 

goals and objectives, the OCC organizes its programs under three activities: 1) Supervise, 2) 

Regulate, and 3) Charter. 

Effective supervision and a comprehensive regulatory framework are the key tools that the OCC 

uses to ensure that national banks and federal savings associations operate in a safe and sound 

manner and that they provide fair access to financial services and fair treatment of their 

customers. A robust chartering program allows new entrants into the financial services sector 

while ensuring that they have the necessary capital, managerial, and risk management processes 

to conduct activities in a safe and sound manner.

The OCC’s priorities focus on strengthening the resiliency of the institutions subject to its 

jurisdiction through its supervisory and regulatory programs and activities. 

Operations are funded primarily (approximately 97 percent) from semiannual assessments levied 

on national banks and federal savings associations. Revenue from investments in Treasury 

securities and other income comprise the remaining three percent of the OCC’s funding. The 

OCC does not receive congressional appropriations to fund any portion of its operations. 
OCC - 4

FY 2017 and 2018 Priorities

A major focus of the OCC’s supervisory, regulatory, and administrative programs for FY 2017

will involve reviews of existing regulations to consider changes consistent with safety and 

soundness and fair treatment of bank customers with the goal of enhanced regulatory 

coordination, reducing unnecessary regulatory burden, and increasing examination efficiency.

The OCC is observing signs that credit risk is building, including erosion in the underwriting 

standards for commercial real estate, and auto lending. Therefore, the OCC will continue to 

closely evaluate current underwriting standards by conducting targeted underwriting 

examinations and using the credit underwriting assessment tool. The OCC will be working to 

complete the implementation of recommended actions arising out of the Large and Midsize 

Supervision Peer Review project and will also continue efforts to implement its strategic 

initiatives to make the OCC a stronger and more effective organization. 

The OCC will conduct examinations based on the risk profile of individual national banks and 

federal savings associations to ensure they are safe and sound, sufficiently capitalized, and 

comply with consumer protection laws and regulations. Priorities and activities will include 

supervisory reviews related to corporate governance and oversight, credit underwriting, 

compliance, cyber threats, operational risk, BSA/AML, and fair access. Examiners will work to 

resolve problem national banks’ and federal savings associations’ situations effectively by 

identifying problems at the earliest possible stage, clearly communicating concerns and 

expectations to bank management through appropriate enforcement actions, and ensuring timely 

follow-up on needed corrective actions.

1.1 – Resource Detail Table

Dollars in Thousands

Office of the Comptroller of the 

Currency FY 2016 FY 2017 FY 2018 FY 2017 to FY 2018

Budgetary Resources Actual Estimated Estimated $ Change % Change

FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

Revenue/Offsetting Collections

Assessments 1,135,000 1,087,000 1,182,000 95,000 8.74%

Interest 18,000 23,000 23,000 0 0.00%

Other Income 17,000 23,000 23,000 0 0.00%

Unobligated Balances from 

Prior Years 1,302,000 1,400,000 1,351,000 (49,000) -3.50%

Total Revenue/Offsetting 

Collections 0 2,472,000 2,533,000 2,579,000 46,000 -1.82%

Expenses/Obligations

Supervise 3,441 975,477 3,525 1,057,980 3,617 1,099,477 92 41,497 2.61% 3.92%

Regulate 319 90,463 326 98,114 335 101,963 9 3,849 2.76% 3.92%

Charter 85 23,978 87 26,006 89 27,026 2 1,020 2.30% 3.92%

Total Expenses/Obligations 3,845 1,089,918 3,938 1,182,100 4,041 1,228,466 103 46,366 2.62% 3.92%

Net Results 

0

 1,382,082 01,350,900 0 1,350,534 0 (366) .00 -0.03%
OCC - 5

1.3 – Operating Levels Table

Dollars in Thousands

Office of the Comptroller of the Currency FY 2016 FY 2017 FY 2018

Object Classification Actual Estimated Estimated

11.1 - Full-time permanent 524,417 561,585 601,926

11.3 - Other than full-time permanent 7,772 7,615 8,624

11.5 - Other personnel compensation 2,628 3,365 3,585

11.9 - Personnel Compensation (Total) 534,817 572,565 614,135

12.0 - Personnel benefits 250,661 276,567 297,994

Total Personnel and Compensation Benefits $785,478 $849,132 $912,130

21.0 - Travel and transportation of persons 56,382 61,792 63,473

22.0 - Transportation of things 2,726 2,809 2,715

23.2 - Rental payments to others 63,735 66,072 64,663

23.3 - Communication, utilities, and misc charges 15,188 17,837 18,067

24.0 - Printing and reproduction 619 734 734

25.1 - Advisory and assistance services 29,009 26,250 23,086

25.2 - Other services 21,220 22,388 21,264

25.3 - Other purchases of goods & serv frm Govt accounts 13,777 14,236 13,959

25.4 - Operation and maintenance of facilities 6,926 5,730 5,814

25.7 - Operation and maintenance of equip 56,682 68,833 65,887

26.0 - Supplies and materials 6,436 8,070 8,474

31.0 - Equipment 24,682 27,688 26,869

32.0 - Land and structures 1,171 10,076 875

42.0 - Insurance claims and indemnities 5,887 395 398

Total Non-Personnel 304,440 332,968 316,336

Total Budgetary Resources $1,089,918 $1,182,100 $1,228,466

FTE 3,845 3,938 4,041

D – Appropriations Language and Explanation of Changes

The OCC receives no appropriations from Congress.

E – Legislative Proposals

The OCC has no legislative proposals.
OCC - 6

Section II – Annual Performance Plan and Report

A Strategic Alignment

The OCC’s nationwide staff of bank examiners conducts on-site reviews of banks and provides 

sustained supervision of these institutions’ operations. Examiners analyze asset quality, capital 

adequacy, earnings, liquidity, and sensitivity to market risk for all banks, and assess compliance 

with federal consumer protection laws and regulations. Examiners also evaluate management’s 

ability to identify and control risk, and assess banks’ performance in meeting the credit needs of 

the communities in which they operate, pursuant to the Community Reinvestment Act (CRA).

In addition, under the bank supervision program, the OCC will also:

• Approve or deny applications for new charters, branches, capital, or other changes in 

corporate or banking structure;

• Take supervisory and enforcement actions against banks that do not comply with laws and 

regulations or that otherwise engage in unsafe or unsound practices;

• Remove and prohibit officers and directors, negotiate agreements—both formal (i.e., public) 

and informal (i.e., non-public)—to change banking practices, and issue cease-and-desist 

orders as well as Civil Money Penalties (CMP); and

• Issue rules and regulations, legal interpretations, supervisory guidance, and corporate 

decisions governing investments, lending, and other practices.

Given that Treasury is developing the FY 2018-2022 strategic plan, the OCC’s annual 

performance plan will be updated in the FY 2019 budget to reflect any new and relevant 

priorities.
OCC - 7

B – Budget and Performance by Budget Activity

2.1.1 Supervise Resources and Measures Table

Dollars in Thousands

Supervise Budget Activity

Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Estimated Estimated

 Expenses/Obligations $924,417 $873,942 $889,111 $873,414 $975,477 $1,057,980 $1,099,477

Budget Activity Total $924,417 $873,942 $889,111 $873,414 $975,477 $1,057,980 $1,099,477

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target FY 2016

Trend

Percentage of National 

Banks and Federal 

Savings Associations That 

Are Categorized As Well 

Capitalized 

92.0 94.0 93.0 95.0 96.0 95.0 95.0 95.0

Percentage of National 

Banks and Federal 

Savings Associations With 

Consumer Compliance 

Rating of 1 or 2

93.0 94.0 95.0 96.0 98.0 94.0 90.0 90.0

Percentage of National 

Banks and Federal

Savings Associations with 

Composite CAMELS 

Rating 1 or 2

76.0 80.0 87.0 91.0 93.0 90.0 90.0 90.0

Rehabilitated National 

Banks And Federal 

Savings Associations As A 

Percentage Of Problem 

National Banks One Year 

Ago (CAMEL 3,4, or 5)

27.0 34.0 39.0 39.0 43.0 40.0 40.0 40.0

Total OCC Costs Relative 

To Every $100,000 in 

Bank And Federal Savings 

Associations Assets 

Regulated ($)

10.51 9.99 9.75 9.37 9.65 10.2 10.2 10.2

Key: DISC - Discontinued; B – Baseline

Supervise Budget and Performance 

($1,057,980,000 from reimbursable resources):

An effective supervision program is the cornerstone of the OCC’s activities that support its 

strategic goals. Specifically, the Supervise Program consists of ongoing supervision and 

enforcement activities that directly support the OCC’s core activities to 1) ensure that each 

national bank and federal savings association is operating in a safe and sound manner and is 

complying with applicable laws, rules, and regulations relative to the financial institution and the 
OCC - 8

customers and communities it serves, and 2) provide fair access to financial services and fair 

treatment of customers. The OCC has terminated several mortgage servicing-related consent 

orders, involving Civil Money Penalties, and took enforcement actions to address unfair billing 

practices, unsafe and unsound sales practices, violations of the Service Members Civil Relief 

Act, and violations of the Bank Secrecy Act.

Description of Performance:

Percentage of National Banks and Federal Savings Associations with Composite CAMELS 

Rating of 1 or 2:

The composite Capital Adequacy, Asset Quality, Management, Earnings, Liquidity, and 

Sensitivity (CAMELS) rating reflects the overall condition of a national bank or federal savings 

association. Bank regulatory agencies use the Uniform Financial Institutions Rating System, 

CAMELS, to provide a general framework for evaluating all significant financial, operational, 

and compliance factors inherent in a national bank or federal savings association. The rating 

scale is 1 through 5 of which 1 is the highest rating granted. These CAMELS ratings are 

assigned at the completion of every supervisory cycle or when there is a significant event leading 

to a change in CAMELS. 

The OCC has established a target outcome measure that 90 percent of the institutions under its 

supervision have a composite CAMELS rating of 1 or 2. Such a rating is consistent with the 

strategic goal of a safe and sound banking system, that banks maintain adequate capital and 

liquidity and have strong risk management practices. As of September 30, 2016, 93 percent of 

national banks and federal savings associations earned the top two composite CAMELS ratings. 

Degradation in CAMELS can reflect weaknesses in risk management systems that need 

corrective action. The OCC, consistent with Treasury’s goal of repairing and reforming the 

financial system and supporting the recovery of the housing market, has instructed bank 

examiners to identify and seek corrective action at an earlier stage to address potential problems 

or weaknesses. The OCC’s primary focus is to ensure that CAMELS ratings are an accurate 

reflection of each institution's current financial position, and thus the OCC would not take action 

to prematurely restore a favorable CAMELS rating.

Percentage of National Banks and Federal Savings Associations that are Considered WellCapitalized:

The Federal Deposit Insurance Act established a system that classifies insured depository 

institutions into five categories (well capitalized, adequately capitalized, undercapitalized, 

significantly undercapitalized, and critically undercapitalized) based on their capital levels 

relative to their risks. The OCC has established a target outcome measure that 95 percent of 

national banks and federal savings associations will meet or exceed the well-capitalized 

threshold. 

The OCC works closely with problem national banks and federal savings associations to develop 

rehabilitation plans. Such plans typically include directives to improve or restore capital levels. 

These efforts, combined with a more stable operating environment, have resulted in 

improvement in this performance goal since FY 2009. As of September 30, 2016, 96 percent of 

national banks and federal savings associations were classified as well capitalized. 
OCC - 9

Percentage of National Banks and Federal Savings Associations with Consumer Compliance 

Rating of 1 or 2:

To ensure fair access to financial services and fair treatment of national bank and federal savings 

association customers, the OCC evaluates an institution’s compliance with consumer laws and 

regulations. Bank regulatory agencies use the Uniform Financial Institutions Rating System and 

the Interagency Consumer Compliance Rating, to provide a general framework for evaluating 

significant consumer compliance factors inherent in an institution. Each institution is assigned a 

consumer compliance rating based on an evaluation of its present compliance with consumer 

protection and civil rights statutes and regulations, and the adequacy of its operating systems 

designed to ensure continuing compliance. Ratings are on a scale of 1 through 5 of which 1 is 

the highest rating granted. The target for FY 2016 and FY 2017 will currently remain unchanged 

at 94 percent. As of September 30, 2016, national banks and federal savings associations 

continue to show strong compliance with consumer protection regulations with 98 percent 

earning a consumer compliance rating of either 1 or 2. Under the Dodd-Frank Act, the OCC has 

enforcement and supervisory authority for those institutions with total assets of no more than $10 

billion. 

Rehabilitated National Banks and Federal Savings Associations as a Percentage of Problem 

National Banks and Federal Savings Associations One Year Ago:

The OCC’s early identification and intervention with problem financial institutions can lead to a 

successful rehabilitation. As of September 30, 2016, 43 percent of national banks and federal 

savings associations with composite CAMELS ratings of 3, 4, or 5 one year ago have improved 

their ratings to either 1 or 2 this year. This is aligns with the target of 40 percent for FY 2016. 

The OCC continues to focus on the early identification and rehabilitation of problem institutions. 

As previously noted, the OCC continuously takes steps through its Supervise and Regulate 

programs to make national banks and federal savings associations more resilient to financial 

stresses and to identify and obtain corrective action at an earlier stage, when problems can be 

addressed most successfully. These efforts include heightened capital and liquidity standards 

and increased emphasis on the need for stress testing, designed to provide financial institutions 

with stronger capital buffers to withstand unforeseen events. These are multi-year efforts that 

will continue in FY 2016 and beyond. 

Total OCC Costs Relative to Every $100,000 in National Bank and Federal Savings Association 

Assets Regulated:

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 federal banking system. 

The OCC costs are those reported as total program costs on the annual audited Statement of Net 

Cost. National bank and federal savings association assets are those reported quarterly by 

national banks and federal savings associations on the Reports of Condition and Income. Total 

national bank and federal savings association assets represent the growth and complexity of the 

financial institutions under the jurisdiction of the OCC. This measure supports the OCC’s 

strategic goal of efficient use of agency resources. The OCC’s ability to control its costs while 

ensuring the safety and soundness of national banks and federal savings associations benefits all 

national bank and federal savings association customers. As of September 30, 2016, total OCC 

cost relative to every $100,000 in assets regulated was $9.65 compared to the FY 2016 target of 
OCC - 10

$10.26. The OCC continues to meet its efforts to ensure that resources are used prudently and 

that programs are carried out in a cost effective manner.

2.1.2 – Regulate Resources and Measure Table

Dollars in Thousands

Regulate Budget Activity

Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Estimated Estimated

 Expenses/Obligations $125,416 $111,783 $105,436 $103,574 $90,463 $98,114 $101,963

Budget Activity Total $125,416 $111,783 $105,436 $103,574 $90,463 $98,114 $101,963

Regulate Budget and Performance

($98,114,000 from reimbursable resources):

The Regulate Program supports the OCC’s strategic goal of a vibrant and diverse system of 

national banks and federal savings associations that supports a robust U.S. economy. 

Specifically, the Regulate Program consists of ongoing activities that result in the establishment 

of regulations, policies, operating guidance, and interpretations of general applicability to 

national banks and federal savings associations. These regulations, policies, and interpretations 

may establish system-wide standards, define acceptable national banking and federal savings 

association practices, provide guidance on risks and responsibilities facing national banks and 

federal savings associations, or prohibit (or restrict) national banking or federal savings 

association practices deemed to be imprudent or unsafe. They also establish standards for 

ensuring fair access to financial services and fair treatment of national bank and federal savings 

association customers. This program includes establishing examination policies and handbooks; 

interpreting administrative, judicial, and congressional proceedings; and establishing the 

applicable legal and supervisory framework for new financial services and products.

Description of Performance: 

OCC undertook a number of activities in FY 2016 to reduce regulatory burden on and support 

responsible innovation by regulated institutions. The agency issued a Framework for Responsible 

Innovation and sponsored a forum on the topic. OCC completed its schedule of Economic 

Growth and Regulatory Paperwork Reduction Act outreach meetings, and proposed a number of 

rule changes to reduce regulatory burden. The 18-month examination cycle was expanded to 

cover a larger population of regulated institutions. The agency completed a Framework for 

Receivership of Uninsured Federally Chartered National Banks, and completed a number of 

rules and guidance issuances, covering such topics as swaps margin, bank reserve ratios, bank 

stress test scenarios, large bank recovery plans, and an accounting standard on financial 

instrument credit losses. The OCC continued to support operations of the Financial Stability 

Oversight Council, and participate in the Federal Financial Institutions Examination Council and 

other national and international financial service regulation and policy bodies. 
OCC - 11

2.1.3 – Charter Budget and Performance Plan

Dollars in Thousands

Charter Budget Activity

Resource Level FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018

Actual Actual Actual Actual Actual Estimated Estimated

 Expenses/Obligations $27,338 $30,486 $19,262 $18,922 $23,978 $26,006 $27,026

Budget Activity Total $27,338 $30,486 $19,262 $18,922 $23,978 $26,006 $27,026

Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2016 FY 2017 FY 2018 FY 2012 -

Actual Actual Actual Actual Actual Target Target Target FY 2016

Trend

Percentage of Licensing 

Applications and Notices 

Completed within 

Established Timeframes

98.0 97.0 98.0 97.0 98.0 95.0 95.0 95.0

Key: DISC - Discontinued; B - Baseline

Charter

($26,006,000 from reimbursable resources): 

The Charter Program consists of ongoing activities that result in the chartering of national banks 

and federal savings associations and the evaluation of the permissibility of structures and 

activities of national banks and federal savings associations and their subsidiaries. This includes 

the review and approval of national bank and federal savings association charters, federal 

branches and agencies, mergers, acquisitions, conversions, business combinations, corporate 

reorganizations, changes in control, operating subsidiaries, branches, relocations, and 

subordinated debt issuances. By supporting the entry of new products and institutions into the 

financial system in a manner consistent with safety and soundness, the Charter Program supports 

the OCC’s strategic goals of assuring safety and soundness while allowing national banks and 

federal savings associations to offer a full competitive array of financial services.

Description of Performance:

Percentage of Licensing Applications and Notices Completed within Established Time Frames:

The OCC’s timely and effective approval of corporate applications contributes to the nation’s 

economy by enabling national banks and federal savings associations to complete various 

corporate transactions and introduce new financial products and services. Delays in providing 

prompt decisions on applications and notices can deprive a national bank or federal savings 

association of a competitive or business opportunity, create business uncertainties, or diminish 

financial results. Time frames have been established for completing each type of application and 

notice. As of September 30, 2016, the OCC completed 98 percent of national bank and federal 

savings association applications and notices within the required time frame, above the target of 

95 percent. The OCC will continue to meet its Charter Program goals by providing staff 

training, coordination between charter and supervisory staff on safety and soundness and 

compliance matters, issuance of updated procedures, and maintaining an emphasis on 

accessibility and early consultation with national bank and federal savings association organizers 

and others proposing national bank and federal savings association structure changes.
OCC - 12

Section III – Additional Information

A – Summary of Capital Investments

The OCC’s IT strategic plan aligns information technology initiatives and investments to the 

OCC’s core mission, including the development of new or enhanced applications and services 

and the disposition of redundant or “end-of-lifecycle” applications, capabilities, and services. 

The IT strategic plan is implemented through the budget formulation and the Capital Planning 

and Investment Control processes. These processes ensure that all IT investments are aligned 

with the OCC’s mission, goals, objectives, and target enterprise architecture before a project is 

funded. The OCC IT strategy ensures adequate funding and staff resources to address IT 

investment priorities, and considers risk mitigation strategies for IT investments that are not 

meeting stated cost, time, and performance goals. Performance metrics are linked to the 

delivery, alignment, and achievement of the OCC’s strategic program objectives. Cost 

effectiveness for each investment is evaluated through regular benchmarking studies, featuring 

peer group organizations. Key metrics used to evaluate infrastructure include availability, 

reliability, utilization, defects, and customer satisfaction.

FY 2017 and 2018 Plans 

The OCC has 4 major IT initiatives in FY 2017 and 2018:

Servers Support Services (SSS) - The SSS supports the OCC’s server Operations and 

Maintenance. The infrastructure staff continues to build out additional capacity at the colocation facility to support the server technology refresh, business resiliency, and increases in 

enterprise storage capacity. In addition, a managed Enterprise Disaster Recovery (eDR) contract 

has been awarded to implement a proven, highly reliable, secure, expandable, and cost-effective 

eDR solution for OCC’s critical business systems.

Telecommunications Services and Support (TSS) - TSS includes telecommunications Wide Area 

Network (WAN) and Local Area Network (LAN) infrastructure. Remote access to the OCC 

systems is facilitated via a virtual private network, dial-in, and cellular wireless access using 

two-factor authentication. This also includes messaging services supporting highly mobile bank 

examiners and the OCC staff. In FY 2017, the OCC will continue an on-going effort to upgrade 

the headquarters and field office phone systems and telecom infrastructure including LAN/WAN

hardware, Video Tele-Conferencing and Voice over Internet Protocol.

End User Services and Support (EUSS) - EUSS includes help desk/customer service support, 

personal computer hardware and software operations and maintenance, asset management, and 

desktop engineering and image management. New computers and peripherals will be deployed 

to the workforce in FY 2017. 

Cyber Security (CS) – CS includes technologies, processes and practices aligned to protect 

networks, computers, programs and data from attack, damage or unauthorized access. The OCC 

has awarded a Cyber Security Defense Center (CDC) contract that provides 24 x 7 computerincident response support, along with monitoring of security appliances and applications. 

A summary of capital investment resources, including major information technology and nontechnology investments, can be viewed and downloaded at: 

http://www.treasury.gov/about/budget-performance/Pages/summary-of-capital-investments.aspx

This website also contains a digital copy of this document.
International Programs

The Department of the Treasury’s FY 2018 budget request for International Programs is included 

in the State, Foreign Operations, and Other Related Programs Appropriation.