The e-government main event: Congress vs. OMB

A power struggle between Congress and the Office of Management and Budget ended when the fiscal year concluded Friday without the Commerce Department contributing money to any of the 24 e-government projects.

Congress constrained Commerce in its spending bill for fiscal 2005 from transferring funds to e-government projects without giving both congressional appropriations committees 15 days' notice. That 15-day period has long since passed for Commerce's request.

Although the law only requires Commerce to notify Congress, many federal officials interpret the requirement to mean Commerce must wait for lawmakers' approval. "By law, they can do whatever they want," a Senate staffer said, speaking on condition of anonymity. "But by convention, they really shouldn't." A Commerce spokesman had no comment and said the department's chief information officer, Tom Pyke, was unavailable.

An OMB spokesman said the missing funds affect the government's ability "as a whole to provide comprehensive and effective delivery of services."

The House Appropriations Committee has responded to Commerce's request to transfer funds, but the Senate committee has not. The fate of the unobligated funds is now in dispute, but the Senate staffer said the money would not lapse to the Treasury Department.

Requiring federal agencies to obtain congressional committee approval before acting has been illegal since 1983 when the Supreme Court ruled in INS v. Chadha that such a legislative veto is unconstitutional. But insisting that committees follow the letter of the law does agencies little good, said Alan Balutis, a former Commerce CIO and now president and chief executive officer of government strategies at Input.

"If you proceed without their action, you do risk some retribution down the road for your narrow legal interpretation," Balutis said.

The actual dollar amount at stake is relatively little for the federal government — less than $5 million — but Commerce's unwillingness to proceed without appropriators' blessing could have huge ramifications for all e-government initiatives.

"It's the principle," the Senate staffer said. E-government is mostly funded through individual agency contributions rather than directly through a single line-item appropriation. It's not that Congress doubts the value of e-government, the staffer said. It's the pass-the-hat funding that rankles.

"Why are you taxing agencies when you, the mighty OMB, can request these funds upfront?" the staffer asked.

Government analysts have long noted OMB's reticence to ask for more money for itself, especially when it starts enforcing mandatory spending cuts on other agencies. But the goals of e-government require agencies to add their dollars to those cross-agency initiatives, said Mark Forman, former OMB administrator for e-government and information technology.

When agencies add their money, they make the projects accountable to them, Forman said, adding that agencies will never stop using their existing systems without that line of accountability. "The reason you have it in each agency's budget is it enables you to establish that trust relationship," he said.

But trust is often lacking when it comes to e-government.

Having individual departments fund each project gives agency officials wide leeway for undermining the process by asking appropriators to strip out money for e-government. The incentive to do so increases as OMB begins cutting funding for legacy systems in favor of e-government, a former Bush administration official said. Karen Evans, OMB administrator for e-government and IT, has recently pushed for more cost savings in IT systems.

OMB may find the road going forward even harder. The Senate wants to prohibit the National Oceanic and Atmospheric Administration from contributing any money for e-government in fiscal 2006. The Senate has included the same notification language in its fiscal 2006 spending bill for Commerce.

On the House side, lawmakers included notification clauses for e-government projects in the Justice, State and Commerce departments; NASA; the National Science Foundation; and the Federal Communications Commission. Congress has already prevented the Interior Department from spending any money on two e-government projects, Disaster Management and SafeCom, in fiscal 2006.

E-government observers often speak about the need to better educate Congress about the benefits of e-government initiatives, but briefings on their value won't address appropriators' core concerns, the Senate staffer said.

"If we start approving this little peel-off for e-gov, next year it's going to be God knows what," the staffer said. OMB has tried the pass-the-hat funding approach before, "and we've always said no."