Bush pushes Freedom to Manage

President Bush sent to Congress Oct. 15 a widely anticipated legislative package designed to reform how personnel, budget and property are managed in the federal government and to eliminate other barriers to good management.

The two pieces of legislation are the Managerial Flexibility Act and the Freedom to Manage Act. These bills are key parts of the Bush administration's larger Freedom to Manage Initiative, which the president announced in August.

The Managerial Flexibility Act would give federal managers more flexibility in personnel issues. For instance, it would:

* Create a governmentwide targeted buy-out program providing employees a cash incentive of up to $25,000.

* Allow agencies to offer larger recruitment and relocation bonuses.

* Increase the cap on the total annual compensation for senior executives to that of the vice president's rate of basic pay.

* Make it easier for managers to institute "demonstration" projects, such as pay-banding, in their own agencies.

* Give managers the authority to directly hire candidates for certain positions where there is a critical need.

The legislation would group together and make more widely available many flexibilities that are already in existence, said Kay Coles James, director of the Office of Personnel Management. "I think there will be broad-based support" for the legislative package, she said.

The Managerial Flexibility Act also would require agencies to fully account for the cost of all retirement and retiree health care benefits and retirement pay for federal employees instead of figuring the costs separately. It also would modernize how the government manages and disposes its land and facilities.

The Freedom to Manage Act would allow the president at any time to submit a set of legislative proposals intended to eliminate or reduce legal barriers to efficient government, such as a law that prohibits the Agriculture Department from closing or relocating rural state offices. The proposals would be given "fast-track," or nearly immediate, consideration in Congress.

Sean O'Keefe, deputy director of the Office of Management and Budget, said he expects agencies in their fiscal 2003 budget submissions to list any laws that they believe should be repealed. "If senior managers are concerned that a law is a barrier, they [would have] a procedure to ask Congress to lift it," he said.