[House Hearing, 112 Congress] [From the U.S. Government Publishing Office] TRANSPARENCY AND FEDERAL MANAGEMENT IT SYSTEMS ======================================================================= HEARING before the SUBCOMMITTEE ON TECHNOLOGY, INFORMATION POLICY, INTERGOVERNMENTAL RELATIONS AND PROCUREMENT REFORM of the COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM HOUSE OF REPRESENTATIVES ONE HUNDRED TWELFTH CONGRESS FIRST SESSION __________ JULY 14, 2011 __________ Serial No. 112-83 __________ Printed for the use of the Committee on Oversight and Government Reform Available via the World Wide Web: http://www.fdsys.gov http://www.house.gov/reform U.S. GOVERNMENT PRINTING OFFICE 71-984 WASHINGTON : 2012 ----------------------------------------------------------------------- For sale by the Superintendent of Documents, U.S. Government Printing Office Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800; DC area (202) 512-1800 Fax: (202) 512-2104 Mail: Stop IDCC, Washington, DC 20402-0001 COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM DARRELL E. ISSA, California, Chairman DAN BURTON, Indiana ELIJAH E. CUMMINGS, Maryland, JOHN L. MICA, Florida Ranking Minority Member TODD RUSSELL PLATTS, Pennsylvania EDOLPHUS TOWNS, New York MICHAEL R. TURNER, Ohio CAROLYN B. MALONEY, New York PATRICK T. McHENRY, North Carolina ELEANOR HOLMES NORTON, District of JIM JORDAN, Ohio Columbia JASON CHAFFETZ, Utah DENNIS J. KUCINICH, Ohio CONNIE MACK, Florida JOHN F. TIERNEY, Massachusetts TIM WALBERG, Michigan WM. LACY CLAY, Missouri JAMES LANKFORD, Oklahoma STEPHEN F. LYNCH, Massachusetts JUSTIN AMASH, Michigan JIM COOPER, Tennessee ANN MARIE BUERKLE, New York GERALD E. CONNOLLY, Virginia PAUL A. GOSAR, Arizona MIKE QUIGLEY, Illinois RAUL R. LABRADOR, Idaho DANNY K. DAVIS, Illinois PATRICK MEEHAN, Pennsylvania BRUCE L. BRALEY, Iowa SCOTT DesJARLAIS, Tennessee PETER WELCH, Vermont JOE WALSH, Illinois JOHN A. YARMUTH, Kentucky TREY GOWDY, South Carolina CHRISTOPHER S. MURPHY, Connecticut DENNIS A. ROSS, Florida JACKIE SPEIER, California FRANK C. GUINTA, New Hampshire BLAKE FARENTHOLD, Texas MIKE KELLY, Pennsylvania Lawrence J. Brady, Staff Director John D. Cuaderes, Deputy Staff Director Robert Borden, General Counsel Linda A. Good, Chief Clerk David Rapallo, Minority Staff Director Subcommittee on Technology, Information Policy, Intergovernmental Relations and Procurement Reform JAMES LANKFORD, Oklahoma, Chairman MIKE KELLY, Pennsylvania, Vice GERALD E. CONNOLLY, Virginia, Chairman Ranking Minority Member JASON CHAFFETZ, Utah CHRISTOPHER S. MURPHY, Connecticut TIM WALBERG, Michigan STEPHEN F. LYNCH, Massachusetts RAUL R. LABRADOR, Idaho JACKIE SPEIER, California PATRICK MEEHAN, Pennsylvania BLAKE FARENTHOLD, Texas C O N T E N T S ---------- Page Hearing held on July 14, 2011.................................... 1 Statement of: Kundra, Vivek, Federal Chief Information Officer, Office of Management and Budget; Roger Baker, Assistant Secretary for Information and Technology, U.S. Department of Veterans Affairs; Lawrence Gross, Deputy Chief Information Officer, U.S. Department of the Interior; Owen Barwell, Acting Chief Financial Officer, U.S. Department of Energy; and Joel Willemssen, Managing Director of Information Technology Issues, Government Accountability Office................... 7 Baker, Roger............................................. 17 Barwell, Owen............................................ 27 Gross, Lawrence.......................................... 22 Kundra, Vivek............................................ 7 Willemssen, Joel......................................... 36 Letters, statements, etc., submitted for the record by: Baker, Roger, Assistant Secretary for Information and Technology, U.S. Department of Veterans Affairs, prepared statement of............................................... 19 Barwell, Owen, Acting Chief Financial Officer, U.S. Department of Energy, prepared statement of................ 29 Connolly, Hon. Gerald E., a Representative in Congress from the State of Virginia, prepared statement of............... 5 Gross, Lawrence, Deputy Chief Information Officer, U.S. Department of the Interior, prepared statement of.......... 23 Kundra, Vivek, Federal Chief Information Officer, Office of Management and Budget, prepared statement of............... 9 Lankford, Hon. James, a Representative in Congress from the State of Oklahoma, prepared statement of................... 2 Willemssen, Joel, Managing Director of Information Technology Issues, Government Accountability Office, prepared statement of............................................... 38 TRANSPARENCY AND FEDERAL MANAGEMENT IT SYSTEMS ---------- THURSDAY, JULY 14, 2011 House of Representatives, Subcommittee on Technology, Information Policy, Intergovernmental Relations and Procurement Reform, Committee on Oversight and Government Reform, Washington, DC. The subcommittee met, pursuant to notice, at 1:48 p.m. in room 2157, Rayburn House Office Building, Hon. James Lankford (chairman of the subcommittee) presiding. Present: Representatives Lankford, Farenthold and Connolly. Also present: Representative Issa. Staff present: Will L. Boyington, staff assistant; Hudson T. Hollister, counsel; Tegan Millspaw, research analyst; Peter Warren, legislative policy director; Christine Martin, staff assistant; Jaron Bourke, minority director of administration; Amy Miller, minority professional staff member; and Cecelia Thomas, minority counsel/deputy clerk. Mr. Lankford. Committee will come to order. This is a hearing on Transparency and Federal Management of IT Systems of the Oversight and Government Reform Committee. We exist to secure two fundamental principles. First, Americans have a right to know that the money Washington takes from them is well spent. And second, Americans deserve an efficient and effective government that works for them. Our duty on the Oversight and Government Reform Committee is to protect these rights and it is our solemn responsibility to hold government accountable to taxpayers because taxpayers do have a right to know what they get from their government. We have worked and will work tirelessly in partnership with citizen watchdogs to deliver the facts to the American people and bring genuine reform to Federal bureaucracy. This is the mission of the Oversight and Government Reform Committee. I am going to submit my opening statement for the record. [The prepared statement of Hon. James Lankford follows:] [GRAPHIC] [TIFF OMITTED] 71984.001 [GRAPHIC] [TIFF OMITTED] 71984.002 Mr. Lankford. As the ranking member has also chosen to do, is that correct? Mr. Connolly. That is correct, Mr. Chairman. [The prepared statement of Hon. Gerald E. Connolly follows:] [GRAPHIC] [TIFF OMITTED] 71984.003 Mr. Connolly. I just want to join you in welcoming our panel and also particularly, Mr. Vivek Kundra who is, unfortunately, going to be leaving Federal service. I have known Vivek for a long time and he has provided very visionary leadership in the Federal Government. I certainly hope his good work will not be discarded but in fact attended to because I think he set us on the right path in terms of U.S. technology policy. Thank you. And with that I'll also submit my full statement for the record. Mr. Issa. Mr. Chairman, could I have just a moment? Mr. Lankford. You most certainly may. I recognize the chairman of the full committee. Mr. Issa. I only came up to make a quorum but if this is the last time we get you on the cheap because somebody is going to scrape you out and pay you what you are worth, then we will miss you. Hopefully, you will still come back in some new role because you have been a great bipartisan friend to the committee. Mr. Kundra. Thank you for your kind words. Mr. Issa. You deserve that and more. I will come back later on but thank you, Mr. Chairman. Mr. Lankford. Thank you. With that, all Members may have 7 days to submit opening statements and extraneous material for the record. I would like to now welcome our panel of witnesses. We have already spoken several times already about Mr. Vivek Kundra. He is the Chief Information Officer at the Office of Management and Budget, and the first time the Federal Government has had that, so you get to be the pacesetter. As I mentioned to you earlier, that is always the person who does the greatest amount of work. Everyone else builds on your work from here on out. Mr. Roger Baker, Chief Information Officer of the Department of Veterans Affairs. Thank you for being here. Mr. Lawrence Gross is Deputy Chief Information Officer of the Department of the Interior. Mr. Owen Barwell, Acting Chief Financial Officer of the Department of Energy. Mr. Joel Willemssen is Managing Director of Information Technology Issues at the Government Accountability Office [GAO]. Pursuant to committee rules, all witnesses will be sworn in before they testify. If you would please rise and raise your right hands. Thank you gentlemen. [Witnesses sworn.] Mr. Lankford. Let the record reflect that all witnesses answered in the affirmative. You may be seated. In order to allow time for discussion, I will ask you to limit your testimony to 5 minutes. There is a countdown clock in front of you with which I am sure all of you are familiar with. It will count down from five to zero. If you go a little bit over, we will be fine with that. As I mentioned to everyone before, we do have votes that will be called sometime in the middle of this afternoon and we are going to honor your time as much as we possibly can and to be able to get straight to questions as quickly as we can and hopefully get a chance to get this hearing finished. With that, I would like to recognize Mr. Kundra for 5 minutes. STATEMENTS OF VIVEK KUNDRA, FEDERAL CHIEF INFORMATION OFFICER, OFFICE OF MANAGEMENT AND BUDGET; ROGER BAKER, ASSISTANT SECRETARY FOR INFORMATION AND TECHNOLOGY, U.S. DEPARTMENT OF VETERANS AFFAIRS; LAWRENCE GROSS, DEPUTY CHIEF INFORMATION OFFICER, U.S. DEPARTMENT OF THE INTERIOR; OWEN BARWELL, ACTING CHIEF FINANCIAL OFFICER, U.S. DEPARTMENT OF ENERGY; AND JOEL WILLEMSSEN, MANAGING DIRECTOR OF INFORMATION TECHNOLOGY ISSUES, GOVERNMENT ACCOUNTABILITY OFFICE STATEMENT OF VIVEK KUNDRA Mr. Kundra. Good afternoon, Chairman Lankford, Ranking Member Connolly and members of the subcommittee. Thank you for the opportunity to testify on the administration's ongoing efforts to move the government to a more open, transparent and participatory entity. Over the last 2\1/2\ years, our efforts to shine light on government operations have taught us 10 key principles that we must apply as we scale transparency across all Federal spending. I would like to talk about these key lessons that we've learned. Number one, that we must build end-to-end digital systems to reduce errors and protect the integrity of the data across the Federal enterprise. Number two, build once, use often. Across the Federal Government, there are over 12,000 major IT systems with thousands and thousands of data bases behind those systems. That leads to the complexity of the enterprise which is the U.S. Government and some of the issues around data quality. Number three, tap into the golden sources of data. What I mean by that is that we shouldn't be relying on derivative data bases, data derived from other data sources and massaged, but we should go directly to the very transactional systems that are used to do business on a day to day basis. Number four, release data in machine readable formats and encourage third party applications. Washington doesn't have a monopoly on the best ideas and we have seen what happens when you democratize data. You have the ability to get innovation in ways that were structurally impossible before. Number five, employ common data standards. Think about what would have happened if railroads across the country had different standards in terms of railroad track gauges. We wouldn't have had the impact we had during the industrial revolution and the transcontinental railroad that created so many jobs and opportunities and created innovation across the board. In the same way, data and having common data standards is vital as we think about transparency. Number six, use simple, upfront data validations. If you go back in time and think of recovery.gov in the early days, there were phantom congressional districts because data wasn't validated upfront. A simple data validation upfront would have prevented phantom congressional districts from being entered to begin with. Number seven, release data as close to real time as possible. If you think about some of the innovations and applications in the ecosystem that have been developed such as mobile apps that allow you to see, on a real-time basis landing of flights across the country, allowing the American people to make decisions based on that data, it is because that data is real time. In the same way, when it comes to transparency, we should be able to get data on a real-time basis as someone is charging or conducting a transaction on a credit card all the way to procurement. Number eight, engineer systems to reduce burden. It is critical to make sure that as we think about transparencies, we look at this $3.7 trillion model in terms of how do we shine light on all of that funding, that we make sure we are not creating more burdens. A simple example, when it comes to student aid applications, is that the IRS and Department of Education decided to share data, therefore we were able to eliminate about 70 questions that students had to fill because that data was already prepopulated. Number nine, protect privacy and security. This is critical especially in the age of Facebook and Twitter which is that you can create a mosaic effect without really thinking about it. It is one thing to release data, for example, when it comes to health care at a State level; it is another thing to release it at a zip code level. In rural parts of the country, there may be one person who has that condition and you could tie that to a Facebook account. So we have to be vigilant when it comes to protecting the privacy of the American people and also national security. Number 10, provide equal access to data and incorporate user feedback on an ongoing basis. These 10 principles are grounded in the work we have done and the hard lessons we have learned. I would like to share three examples of what is possible by making government more open, transparent and participatory. Number one, when we looked at the $80 billion we spent on information technology, we launched an IT Dashboard and parked online the picture of every CIR right next to the IT project they were responsible for. The results were we were able to reduce the budget of poorly performing IT projects by $3 billion. Number two, by launching Recovery.gov, what we've seen is an unprecedented low level of fraud, waste and abuse below 0.6 percent. Number three, by launching Data.gov, we started with 47 datasets in May 2009. Today, we have over 390,000 datasets on every aspect of government operations and 29 States have followed this model, 11 cities, and 21 countries. But what we have seen is applications being developed that somebody in Washington couldn't have even imagined. This committee has long recognized the importance of an open, transparent government and I appreciate its ongoing support for these efforts. Going forward, it will take all of us, Congress, the executive branch agencies, and recipients of Federal funds working together, to deliver on an open government that works for all Americans. Thank you very much for the opportunity to testify. I look forward to any questions you may have. [The prepared statement of Mr. Kundra follows:] [GRAPHIC] [TIFF OMITTED] 71984.004 [GRAPHIC] [TIFF OMITTED] 71984.005 [GRAPHIC] [TIFF OMITTED] 71984.006 [GRAPHIC] [TIFF OMITTED] 71984.007 [GRAPHIC] [TIFF OMITTED] 71984.008 [GRAPHIC] [TIFF OMITTED] 71984.009 [GRAPHIC] [TIFF OMITTED] 71984.010 [GRAPHIC] [TIFF OMITTED] 71984.011 Mr. Lankford. Thank you. Mr. Baker, you are recognized for 5 minutes. STATEMENT OF ROGER BAKER Mr. Baker. Thank you, Chairman Lankford, Ranking Member Connolly and members of the subcommittee, thank you for inviting me to testify alongside my colleagues today. As the Assistant Secretary for Information and Technology, the VACIO is uniquely positioned for a Federal CIO, controlling all IT resources and staff at the Federal Government's second largest department. In effect, the VACIO runs a $3 billion IT services company, with its primary customers being the Health and Benefits Administrations at the VA. In this role and as the former CEO of a private sector company, I bring an operational perspective to today's hearing. Since my confirmation in 2009, I have been a strong supporter of this administration's efforts to eliminate wasteful spending and implement real transparency in the way we do business. Over the last 2 years, we have focused on running the VA IT organization like a company, driving the fiscal and IT process disciplines necessary to dramatically improve cost efficiency, reliability and customer satisfaction. In that effort, one of the key challenges has been the difference in financial management approaches between the private and the public sectors. As a private sector CEO, I became accustomed to a constant flow of data regarding revenue, costs and cash-flow that provided an effective means for monitoring, measuring and forecasting the performance of projects, programs and business units within my organization. Effective cost accounting and strong financial management systems are the lifeblood of companies that must compete on a daily basis just to stay in business. While the private sector is concerned with revenue, expenditures and cash-flow, the public sector focuses on appropriations and obligations. This results in core financial systems that, while performing exactly as intended, simply are not designed to provide the type of detailed, real time cost data necessary to effectively manage a business. To draw an analogy, managing IT projects using Federal financial systems is the equivalent of crossing Pennsylvania Avenue using a photograph taken 30 days ago. Transparency, and particularly the IT Dashboard, has provided broad visibility to this problem. As the GAO aptly points out, the information VA systems originally provided to the IT Dashboard was frequently old or inaccurate. Of greater concern to me was that that information was precisely what was being used by IT managers and department leadership to manage our IT projects. With strong encouragement from OMB and from VA's Deputy Secretary, we have implemented both short term and longer term projects to address these issues, including implementing several new systems that will better track actual costs, including labor hours at the project level. The President's call for more transparency in government and this committee's work are important to making our government run better. Especially in these economic times, it is critical that our financial management systems provide clear and accurate data that is as transparent as possible. VA will continue to strive to excel at both management efficiency and transparency and build on the successes of our existing strong management and transparency efforts. Again, thank you, Mr. Chairman, Mr. Ranking Member and committee members, once again, for the opportunity to be here today. [The prepared statement of Mr. Baker follows:] [GRAPHIC] [TIFF OMITTED] 71984.012 [GRAPHIC] [TIFF OMITTED] 71984.013 [GRAPHIC] [TIFF OMITTED] 71984.014 Mr. Lankford. Thank you, Mr. Baker. Mr. Gross, you are recognized for 5 minutes. STATEMENT OF LAWRENCE GROSS Mr. Gross. Thank you, Chairman Lankford and members of the subcommittee. I appreciate the opportunity to appear before you today to present the Department of Interior's efforts to improve transparency through technology improvements and financial data standardization. I am Lawrence Gross, and I am Deputy Chief Information Officer at the Department of the Interior. If I may, I would like to submit our full statement for the record and summarize our testimony. Mr. Chairman, members of the committee, the Department of Interior has a unique public facing mission, that of protecting America's great outdoors and empowering our future. The Department protects America's natural resources and heritage, honors our cultures and tribal communities and supplies the energy to power our future. In order to meet this unique mission requirement and engender the public trust now and into the future, cost effective, fully integrated, 21st Century technology must play a central role. The Department recognizes the critical role that technology and information quality plays in meeting our mission and as a result, have taken aggressive steps to provide 21st Century technologies to the Department employees and to improve the access and quality of data to the public. Specifically, the Department has three major initiatives that will, over the next few years, retire duplicative financial management and reporting systems by moving forward to continue to retire and integrate enterprise-wide financial management systems. Specifically, we will be deploying the financial management business system; second, we will be modernizing our information technology infrastructure through our recently launched, self-funded IT modernization initiative, which we anticipate will result in savings to the public of $500 million over a 4-year period; and third, an alignment with the Office of Management and Budget TechStat process, we have implemented a vigorous governance process that we call within DOI, IStat. This process will improve the management and oversight of the Department's IT investment portfolio. Mr. Chairman, the Department fully understands the budget environment and we are confident that these initiatives will contain costs and significantly improve the Department's ability to meet its mission and to fulfill the demands of the public for transparent access into the operations of the Department. I welcome any questions you or members of the committee may have. Thank you. [The prepared statement of Mr. Gross follows:] [GRAPHIC] [TIFF OMITTED] 71984.015 [GRAPHIC] [TIFF OMITTED] 71984.016 [GRAPHIC] [TIFF OMITTED] 71984.017 [GRAPHIC] [TIFF OMITTED] 71984.018 Chairman Lankford. Thank you, Mr. Gross. Mr. Barwell, you are recognized for 5 minutes. STATEMENT OF OWEN BARWELL Mr. Barwell. Good afternoon, Mr. Chairman, Ranking Member Connolly, and members of the subcommittee. Thank you for the opportunity to speak about the Department of Energy's business systems. I would like to start by providing a brief overview of them. In January 2003, the Department launched the Integrated Management Navigation System, now known as iManage, to consolidate, standardize and streamline the Department's business and finance systems and processes. The functions and scope of this effort include finance and cost accounting, travel, payroll, budget formulation and execution, procurement and contracts management, facilities management, human capital and information management. Today, the strategic objectives for iManage are connecting our people, simplifying our work and liberating our data, and we continue to work to improve financial and business systems and to use these systems to provide greater transparency in support of Presidential priorities. The full suite of systems was substantially deployed in 2008. Since then, the iManage program has continued to invest in software upgrades and operational performance improvements pursuant to an integrated enterprise architecture. The core of our business systems is the iManage Data Warehouse, IDW, the central data warehouse that links common data elements from each of the Department's corporate business systems. IDW serves as a knowledge bank of information about programs and projects including budget execution, accumulated costs, performance achieved and critical milestones met. As a key component of the iManage program, the Department relies heavily on IDW for executive management and operational reporting, as well as for external requests for data. While our work is not done, I think it is important to recognize our accomplishments in deploying and integrating these systems and tools. For example, one of the key outcomes of implementing the STARS Accounting System has been that the Department has received a clean audit opinion since fiscal year 2007 based on the consolidated financial statements generated by STARS. Also, since 2008 when STRIPES, our procurement system, first came online, the Department had made 29,000 separate grant awards totaling $40 billion, including significant funding under the American Recovery and Reinvestment Act. During that same time, the Department has also made 67,000 contract actions worth a total of $47 billion. The real test of these systems came in implementing the Recovery Act, providing transparency of our performance through recovery.gov. We helped over 4,500 Recovery Act recipients submit quality and accurate information into FederalReporting.gov for public viewing. The information was also cross-checked internally using our business intelligence tools to identify and address any data quality issues. The advantage of having STRIPES fully deployed has been the increased speed and accuracy of procurement as well as increased vendor participation. By enhancing the integration and interoperability of our acquisition and financial systems, workload performed by the financial personnel was reduced and in some cases, eliminated. In addition to these accomplishments, I would like to highlight our integration with governmentwide corporate systems. While an ongoing effort, it is important to note that the Department's deployment of iManage has taken the need for governmentwide systems' interoperability into account. STARS, our accounting system, is fully integrated with governmentwide financial reporting systems, FACTS I and FACTS II operated by the Department of the Treasury. Our Funds Distribution System uploads information directly to the Office of Management and Budget's MAX system to expedite apportionments. STRIPES interfaces with governmentwide procurement systems, including Grants.gov, FedConnect, Federal Business Opportunities and USASpending.gov. As I have mentioned, the Department's efforts to improve its financial systems is unfinished business and challenges associated with implementing systems, business processes and organizational changes remain. With each successive system upgrade or integration effort, we learn from our experience and apply the lessons we have learned in a rigorous and systematic way to increase the likely success of what we do. To address these challenges, the Department is working to continue to improve the capability, integration and transparency of our systems within the constraints of the Department's resources. iManage 2.0, the second generation of the program now being deployed, is shifting much of its focus from collecting and storing data to analytical and other value- added functionality to support the Department's mission. Mr. Chairman, Ranking Member Connolly and members of the subcommittee, I am pleased to be here today representing the Department of Energy and I am pleased to answer any questions that you may have. [The prepared statement of Mr. Barwell follows:] [GRAPHIC] [TIFF OMITTED] 71984.019 [GRAPHIC] [TIFF OMITTED] 71984.020 [GRAPHIC] [TIFF OMITTED] 71984.021 [GRAPHIC] [TIFF OMITTED] 71984.022 [GRAPHIC] [TIFF OMITTED] 71984.023 [GRAPHIC] [TIFF OMITTED] 71984.024 [GRAPHIC] [TIFF OMITTED] 71984.025 Mr. Lankford. Thank you, Mr. Barwell. Mr. Willemssen, you are now recognized for 5 minutes. STATEMENT OF JOEL WILLEMSSEN Mr. Willemssen. Thank you, Mr. Chairman, Ranking Member Connolly and Congressmen. Thank you for inviting us to testify today. As requested, I will briefly summarize our statement on two OMB Web sites, the IT Dashboard and USASpending. OMB's IT Dashboard displays detailed information on about 800 major Federal IT investments, including assessments of actual performance against cost and schedule targets. For example, as of March 2011, the Dashboard had slightly over 300 major investments in need of attention. Specifically, 272 investments representing $17.7 billion in fiscal year 2011 spending were rated as yellow and needing attention, and 39 at about 2 billion were rated as red with significant concerns. Looking at the site yesterday, we note that since March, the dollar figures for yellow ratings decreased by about $4 billion, but the red ratings, meaning significant concerns, nearly doubled from 2 billion to 3.8 billion. As noted by the Federal CIO, the Dashboard has greatly improved transparency of IT investment performance. However, our reviews have also found that the data on the Dashboard are not always accurate. Specifically, in reviews of selected investments from 10 agencies, the Dashboard ratings were not always consistent with agency performance data. To address these issues, we made recommendations to the agencies to comply with OMB's guidance to standardize activity reporting, to provide complete and accurate data to the Dashboard on a monthly basis, and to ensure that CIO ratings disclose issues that could undermine the accuracy of investment data. We also made several recommendations for improvements to OMB. Drawing on the information provided by the Dashboard, OMB has initiated efforts to improve the management of IT investments needing attention. According to OMB, these efforts have enabled the government to improve or terminate IT projects experiencing problems and along with other OMB reviews, have resulted in a $3 billion reduction in life cycle costs. Our recent and ongoing work has identified other opportunities for using the Dashboard to increase efficiencies and savings. For example, the Dashboard showed that as of yesterday, Federal agencies were investing in hundreds of systems with similar functions such as over 600 human resource management systems costing an estimated $2.45 billion for fiscal year 2011 and almost 100 public affairs systems at about $226 million for FY-11. While the Dashboard focuses on IT investments, OMB has another reporting mechanism, USASpending.gov, that provides detailed information on Federal awards such as contracts, loans and grants. Last year, we reported on this Web site. Among our findings was that in a random sample of 100 awards, numerous inconsistencies existed between USASpending and the records provided by the awarding agencies. Each of the 100 awards had at least one required data field that was blank or inconsistent with agency records. These errors could be attributed in part to a lack of specific OMB guidance on how agencies should fill in certain fields and how they should validate their data submissions. Accordingly, we recommended that OMB include all required data on the site and share complete reporting and clarify verification guidance. OMB subsequently issued guidance to improve the quality of the data, although we have not subsequently gone in and tested a sample of that data against underlying agency records. That concludes the summary of my statement and I look forward to your questions. Thank you. [The prepared statement of Mr. Willemssen follows:] [GRAPHIC] [TIFF OMITTED] 71984.026 [GRAPHIC] [TIFF OMITTED] 71984.027 [GRAPHIC] [TIFF OMITTED] 71984.028 [GRAPHIC] [TIFF OMITTED] 71984.029 [GRAPHIC] [TIFF OMITTED] 71984.030 [GRAPHIC] [TIFF OMITTED] 71984.031 [GRAPHIC] [TIFF OMITTED] 71984.032 [GRAPHIC] [TIFF OMITTED] 71984.033 [GRAPHIC] [TIFF OMITTED] 71984.034 [GRAPHIC] [TIFF OMITTED] 71984.035 [GRAPHIC] [TIFF OMITTED] 71984.036 [GRAPHIC] [TIFF OMITTED] 71984.037 [GRAPHIC] [TIFF OMITTED] 71984.038 [GRAPHIC] [TIFF OMITTED] 71984.039 [GRAPHIC] [TIFF OMITTED] 71984.040 [GRAPHIC] [TIFF OMITTED] 71984.041 [GRAPHIC] [TIFF OMITTED] 71984.042 Mr. Lankford. Thank you. And with that, I recognize myself for 5 minutes to begin. Let me talk through several issues here. Mr. Kundra, let me start off and I am going to run through your list of 10 is a great list and it is a good thing to be able to pass on to the person that's after you. Let me just mention a couple of things on it. Six and seven on that validating data upfront and releasing data in real time seem to be conflicting at times. When you have to validate data, obviously that slows the process down and you've got to get it out in real time, and so that seems a challenge. You and I spoke before about my priorities on data from the Federal Government and that is that the American people get a chance to see it as fast as possible and as accurate as possible. That puts six and seven right there together on your list. Whether that be USASpending, whether that be Grants.gov, whatever it may be, Data.gov, they get a chance to see the information, see it as complete as they can, can research it, cross it, everything else they need to be able to do. The second aspect of our data, to me, that is very important is for the decisionmakers, whether they be in the agency or legislators, whoever it may be, that's going to make a decision, it has to be accurate and complete. How do we accomplish six and seven? Do you have ideas you can pass on and say where does the priority land between validating data upfront and releasing data in real time? Mr. Kundra. Absolutely, when I talk about validating data upfront, what I mean by that is the example I used as far as congressional districts were concerned, which is that there is no need for people to go in and enter that information if they can just do a drop down. It is how you would actually architect and engineer systems. But, the preferred path would be that people don't actually have to enter data if that data is available in another source. This is a challenge that I faced when I used to work in the Commonwealth of Virginia for the Governor and we were building a small Women and Minority Dashboard. Part of it was that everybody was asking agencies for the data, and I asked a very simple question, can't we just go to the credit card companies and actually get the data directly from them. We know that data is being generated and credit card data is actually stored there, why do we have to actually ask people to self report. That not only reduced the burden but it actually also allowed us to get real data. It wasn't people saying this is what I did, but it's data that we were getting directly from the very data bases that stored it. So, with six where we are talking about the validation upfront, what that allows you to do is make sure that people don't even have an option. In life, a lot of it is about defaults, so if the defaults are very complicated, you are actually going to end up with a degree of error that's going to be very high. Second, in terms of real time, we should actually try to get machine-to-machine interactions where possible. So, in a credit card case, imagine if we had to ask everybody for every credit card transaction to go and to enter it on some centralized system. It would be burdensome, you would spend more money actually entering that data than you would generating value out of that data. Mr. Lankford. We had the same issue and the agencies were terrific to be able to respond to our requests for additional information on processes and systems and what's in place and I do want to thank all the agencies because I'm sure that was very time consuming. One of the things that came out was that there was a lot of manual input still of data. How do we get through that because that's where we get a lot of inaccuracies, that's where it takes a month to be able to get information. In this current time, especially with the budget issues, we're dealing with accurate, immediate data is very important that we can get and then generally reducing the number of mistakes. How do we start working through that process so there is fewer manual input and more automatic like what you're mentioning? Mr. Kundra. So, I think part of what the President has done with the Executive order that sets up the Government Accountability and Transparency Board is actually going to be to do a total reset in terms of how the government is operating when it comes to transparency. What I mean by that is there is a simple question before us which is that if the Treasury Department is actually writing most of the checks and literally before a check is issued, the Treasury Department can have an Internet payment portal that allows you to get that data right from where the checks are being issued. On the manual side, that is a more complicated issue and what I mean by that is if you look at contracts, for example, there are certain agencies when you look at the pre-award phase, where they are writing the RFP and then they put the RFP on the street, then they make an award and then thy've got to manage that contract. Agencies at a different or a very different evolutionary cycle when it comes to some of their processes are end-to-end paper, or some of them actually go from paper they go to digital and others are all end-to-end electronic. So, the way we have to attack this problem is two pronged. One is go to the golden source which would be creating some type of Internet payment portal so the default is just digital. We know somebody is writing the check, why aren't we just going to them? Why are we asking the recipient to fill in all this paperwork when the government is the one that's issuing the check? Second would be to modernize on the back end some of these outdated systems that are paper-based. Mr. Lankford. Thank you. And with that, I am going to pass on 5 minutes to Mr. Connolly. Mr. Connolly. Thank you, Mr. Chairman. And of course votes have now been called. Mr. Lankford. I'm going to make a quick comment and not take up your time. We will go through the votes being called. It should take about 20 minutes for this first series of votes. I want to make sure we get through all three of us that are here to be able to do that and then we'll probably buzz back off and we'll try to evaluate from there. Mr. Connolly. It was my understanding Mr. Chairman that there will only be one series of votes. Mr. Lankford. Right, but the first one is a 15 minute vote, so we will make sure all three of us get our questions in. Mr. Connolly. Well, I won't be back, so perhaps you will indulge me. Mr. Lankford. Is that a promise? Mr. Connolly. I am going to leave you guessing, at any rate, but thank you. And, I am going to urge you to please to make concise answers because there is an issue of time. One of the things Mr. Willemssen, you focused on and so have you about transparency and accountability and how the IT Dashboard has really helped. And I assume, from your point of view, all of your point of view, it's unprecedented in terms of transparency and accountability in the Federal Government, would you agree? [Chorus of agreement.] Mr. Connolly. I make that point because we sometimes on this committee, not the subcommittee, but on the committee, the full committee, we hear statements about how the lack of transparency by the Obama administration but as a matter of fact, frankly, this tool is unprecedented and there is lots of transparency and accountability. Now, I headed up a very large government for 5 years and one of the concerns I always had about IT investments was absolutely transparency and accountability are very important from a public policy point of view and how we serve the public, but we have to have metrics to go beyond that. What about productivity improvement? And so my question to especially Mr. Kundra and Mr. Willemssen is how have we used these tools to improve the efficiency of delivery of services? Are we in fact achieving productivity gains in the public sector with these massive investments in IT and shouldn't we, if we don't? Mr. Willemssen. I would say from an efficiency perspective, one of the great benefits of the Dashboard is the fact that it can identify governmentwide investments in similar functions so that you can potentially look for duplication that could potentially be eliminated and save money. Mr. Connolly. But are we doing it? Mr. Willemssen. The administration is in the process of doing that. It is a bit of a carryover from the prior administration's line of business effort to try to look at investments across agencies and instead of agencies rebuilding and reinventing the wheel, trying to reuse consistent with one of Vivek's 10 points, trying to reuse what's already out there rather than rebuild and reinvest and a lot more money being spent to do something that is already working well. I will let Vivek speak for himself. I think they are in the process of doing that. We would like to see a litte bit more. Mr. Connolly. Vivek. I mean Mr. Kundra. Mr. Kundra. We see major results. For example, through these tools, we have been able to identify the fact that we went from 432 data centers to 2,000-plus data centers in a decade, and we're cracking down on those data centers, shutting down 800. We have already shut down 67 data centers and are on track to shut down 137. But in terms of productivity, we have also seen as a result of this, we were able to see where we had inefficient technology such as collaboration. So GSA, for example, migrated 17,000 employees to a system and so did USDA, saving not only $42 million but using modern technologies to accelerate business processes. And the VA has some really good examples when it comes to veterans benefits and cutting down the time it takes, actually numbers of days, and I'll let Roger speak to that, through these investments as far as when we are issuing those benefits. Mr. Connolly. Before Roger does, you mentioned the data centers and how they exploded sort of without rhyme or reason, and you have called for a 40 percent reduction by 2015. I have introduced a bill, the Federal Cost Reduction Act, to make that statutory, just in case other people go away, and would double that goal over the next 5 year period. Is that a piece of legislation you think would be helpful in this regard? Mr. Kundra. The data center provisions, absolutely, especially if we look at the ultimate vision, from my perspective, is that we would end up as a nation basically building three digital Ft. Knox's, three major data centers as we think about it. There is no reason to have over 2,000 data centers across the Federal Government. Mr. Connolly. Mr. Chairman, I am going to ask if you would be willing to indulge me by giving me one extra minute because I am not coming back. Mr. Lankford. Without objection. Mr. Connolly. I thank my colleagues. Thank you and Mr. Chairman, I hope you will join us in that legislative effort because I think it is a good bipartisan piece of legislation that could actually save us some money and codify what Mr. Kundra has so ably begun. Mr. Baker, I didn't want to cut you off, you wanted to talk about the Veterans Administration experience? Mr. Baker. I would just point out one thing with the system we built for the new GI bill, if you recall that's putting now hundreds of thousands of veterans into college, billions of dollars. The new system that we introduced and that changed the processing time for the main claim when veterans go into college from 42 minutes to 7 minutes. That reduction was hundreds of head count in processing those claims, and clearly you can equate the reduction in the head count needed to the number of people, I'm sorry the dollars needed to process those claims. Mr. Connolly. Thank you. I think I have with your indulgence, Mr. Chairman, Mr. Kundra, you talked about a new app economy. What did you refer, what did you mean by that reference? Mr. Kundra. What I mean by the new app economy is that the 390,000 plus datasets that are out there in the public domain now will allow us to tap into the ingenuity of the American people in ways that we haven't before. We actually worked with Congress on the America Competes Act which allows every agency now to issue challenges up to $50 million. So the old path of acquiring technology was only going through a grants process or through a long, drawn out procurement process. Now an agency can go out there and say for 5 million or 10 million, here is a problem that we are trying to solve and we're looking for applications rather than RFPs. Already we have seen, for example, is that developers have taken data that comes out of the Consumer Financial Protection Agency and created apps that allow you to track what is going on within your specific location. And we have also seen in terms of apps apps that have been built that allow you to see based on your iPhone, you can scan a product and see whether it has been recalled or not to apps that allow you see on a real time basis what the closest train station is sent to you and when trains are coming in both directions to stimulus funding and where it is being spent. So huge, huge improvements in terms of innovative apps that are being created. Hundreds of these have already been built. Mr. Connolly. Thank you and thank you, Mr. Chairman, for your courtesy, and you, Mr. Farenthold, I appreciate it. Mr. Lankford. Thank you. Mr. Farenthold, you are recognized for 5 minutes. Mr. Farenthold. Thank you very much. I;m going to be quick. We actually have nine votes it looks like here, so it may be a while before we are able to get back. Mr. Kundra, my question to you is, as we are starting to gather all of this data and strive toward real time, what sort of effort is being taken into data analysis to detect waste, fraud and abuse and to find for instance on a list of payees, the outliers? Mr. Kundra. So, one of the lessons learned through the Recovery Act implementation was to actually use these forensic technologies and business intelligence platforms. So there was an entity called Pelletier that mined a lot of data and allowed us to see how we could slice and dice and cube through terabytes and petabytes of data. We are looking at the same technologies and applying them now to health care and other domains across the Federal Government, and the Recovery Operations Center is actually the model that is being scaled. Mr. Farenthold. Thank you very much and Mr. Baker, we do a lot of case work with the Veterans Administration in the district office and a constant complaint is the length of time some of this stuff takes to process. I notice you had one example of how you are getting some processes down to the minutes. That isn't true throughout the agency. I'm hearing reports of years from someone coming out of DOD before they actually get into your data base where you all aren't getting the data or they are not being able to get their exams quick enough. What is being done to address those problems? Mr. Baker. Thank you Congressman, we have, and are working a major investment in the IT side to turn that entire paper- bound process for benefits administration at the VA into a paperless process that will then begin to allow us to really work on the business processes there. We want to do the same thing with compensation and pension benefits which is exactly what you are talking to, that we did with education benefits which is fully automate them, and take those processes and get a sixfold improvement on the processing time for those. Mr. Farenthold. Do you have a timeframe on getting something like that implemented? Mr. Baker. Yes, we will implement in 2012. We have been on the path of that implementation for about 18 months at this point. Full implementation of it will occur during 2012. Mr. Farenthold. Alright that's basically all I've got. I will yield back the remainder of my time. Mr. Lankford. Thank you. Mr. Barwell, let me ask you a quick question. Not to mention the great names for your system, the STARS and the STRIPES system, but integrating that with Treasury and with OMB, is that a reproducible system that can be done in other agencies? How long did it take to process that and how is that working? Mr. Barwell. The FACTS I and FACTS II systems have been in operation for some time now, I am not sure of the exact date when this came in, but the procedures for uploading financial information into FACTS I and FACTS II are well established and the process is pretty mature. I think it is applied consistently across the government too. Mr. Lankford. Mr. Kundra, are all other agencies experiencing that same type of system where it's immediately put into their system and then it's populated out as well and it's that integrated and seamless or are there other agencies that are not experiencing that same kind of success? Mr. Kundra. Now I wish that was the case across the entire Federal Government but given that different agencies have either successfully implemented whether it's financial systems or contracting systems versus others who frankly, we've have had to terminate those systems because after years and years of attempting, we continue to throw in millions of dollars and nothing was really happening. Part of what we are looking at is making sure that across the entire Federal Government, that we demand that within a 6- month period, there be meaningful functionality if an IT project is started. The Department of Defense, for example, spent 12 years and $1 billion on an integrated human resource system that had to be terminated because it didn't operate and we kept throwing good money after bad money. Some of these departments don't have the capacity frankly to execute or deliver, so the leapfrog for us is actually going to be literally moving to Cloud solutions. So the challenge before the private sector is to actually help us stand up Cloud-based systems so that on day one, we can start using them rather than having to wait 12 years before we can use them. Mr. Lankford. Obviously that is unacceptable in a technology environment to wait 12 years to be able to integrate that. That is a lot of different versions and languages and everything else you are going to work through in that process. Data.gov and USASpending.gov are some great ideas. They have good information that's being loaded onto them. Obviously, we need much faster information, we need to make sure that information is accurate. Let me just ask a quick question about Data.gov. What is your goal for the actual data that's on there? Because the variety of data in the different agencies is plentiful. Some of them have quality data, some of them have very old data, some of them have data that no one's going to look for but there is other data they would love to see. The basics for me is I think everyone should be able to go to not only an agency Web site but also a central location and see how many different departments, how many people work in that department, what is the budget of that department, what are they accomplishing, what are the documents that can come out of that to be able to show just the basics. If they see a name that's a bureau, they should be able to search for that, find it, get the data, find out more about it, rather than it is hidden out there somewhere and you can't even discover what it is. Your goal for Data.gov? Mr. Kundra. Sure, so let me lift up in terms of a single entry for all Americans is actually USA.gov. That platform should become the single platform across the entire U.S. Government. Today, what we realized is a lot of thugs who come onto USA.gov they are actually looking for driver's licenses or passports. And so these are State services or they are Federal services, and the idea is that for an average American person they shouldn't have to navigate the Federal bureaucracy to figure out what service they want. They should be able to just go on USA.gov, search, which is what they can do today and find that information. The goal for Data.gov, the dream there is that we want to create this platform which we have, with 390,000 data sets, but it should be millions of data sets. Mr. Lankford. Right, because much of that data is very old that is on there. Mr. Kundra. Some of it is real like the FAA data. In other cases, it is old data from Medicare/Medicaid, but we believe there is a billion dollar opportunity for entrepreneurs to create applications and build a data curation layer. I will give you one example. There is a site called Hospitalcompare.gov. Most people don't even know what that site is and never really visited it. As soon as we took that data and democratized it, Bing decided to take that data and said, it is interesting, this is a very rich data set. It actually has the name of hospitals, how patients rate it, the outcome based on the surgeries or operations. So now what happens if you go to Bing.com and do a search for Georgetown Hospital or George Washington Hospital, right on that search box it will show you what do patients think of Georgetown Hospital, what do they think in terms of outcomes and ratings. That is the vision, which is to democratize that data, allow the private sector to build innovative applications and generate new jobs. Mr. Lankford. Which, by the way, we would completely concur with that. That is the twofold that I was talking about before, the American people being able to see it, research it, pull it down and democratize the data and then decisionmakers be able to get very accurate, fast information and know it is reliable. I do appreciate your time. I'm going to do this considering the votes are going to take a little over an hour so it looks like I'm going to go ahead and dismiss this hearing and let you all be able to get back to your lives. Your written testimony will go in the permanent record. Obviouisly, there were multiple Members that couldn't make it based on a hearing that just came and just finished up but I don't want to be able to keep you all waiting that long period of time. If we have additional questions, do you mind if we write you a quick question and be able to follow up on that? Let the record show everyone answered in the affirmative. I do appreciate that and we will try to follow up quickly if we have additional questions. With that, this meeting is adjourned. [Whereupon, at 2:33 p.m., the subcommittee was adjourned.]