DATA Act 2.0: Fewer Bells, but Brighter Future

Today the House Oversight and Government Reform Committee is considering a bill to vastly improve the tracking of how taxpayer dollars are spent. In a show of strong agreement, Representatives Darrell Issa (R-Calif.) and Elijah Cummings (D-Md.) and Senators Mark Warner (D-Va.) and Rob Portman (R-Ohio) reintroduced the Digital Accountability and Transparency Act (DATA Act) in the House (H.R. 2061) and Senate on Tuesday. The revamped DATA Act is now poised to win broad, bipartisan support for meaningful reforms to federal spending transparency.

Last week, the Project On Government Oversight put together a list of 10 questions USASpending.gov—a website designed to display federal spending information—should be able to answer but can’t. This list alone makes a strong case for the DATA Act, but the issues with the status quo also have been widely covered by the Sunlight Foundation, the Data Transparency Coalition, the Center for Effective Government, and the Government Accountability Office. The DATA Act would fix many of the holes in currently reported spending with standardized, more complete data and robust oversight to ensure more reliability. POGO strongly supports making these reforms law.

The new versions of the DATA Act, remodeled from last year’s Senate bill (S. 3600), are essentially identical and represent lots of work between the cosponsors to find agreement. A previous version of the bill passed the House with unanimous support last year (Digital Accountability and Transparency Act of 2012 – H.R. 2146) but the Senate bill failed to advance. Though not as ambitious as last year’s House bill, this legislation is expected to garner enough bipartisan support to pass both chambers this year. “This legislation is an example of how Washington is supposed to work—across the aisle and on both sides of the Capitol,” Senator Warner said in a press release Tuesday.

The new legislation takes the most workable reforms from both of its predecessors. Data standardization, unique identifiers for contractors and grantees, and the combination of data coming in from separate reporting streams are provisions that will turn USASpending.gov from an incomprehensible heap into a reliable system. Another crucial reform will link transaction-level obligations (such as the signing of contracts and grants) with the checks that are actually cut. USASpending.gov will also include information on the nature of budget obligations (such as personnel compensation or contracts). The Department of the Treasury will be responsible for improving USASpending.gov and collaborating with the Office of Management and Budget, the General Services Administration, and the heads of other agencies to develop data standards.

Instead of requiring recipient reporting across the board, the new DATA Act will launch a three-year pilot program to study the effects of such reporting on a smaller scale. If consolidated reporting proves its ability to increase financial transparency and reduce the compliance burden on federal awardees (and we think it will), a stronger case will be made for universal recipient reporting in the coming years. Treasury will be the new home for federal spending, which also aligns with the Administration’s fiscal year 2014 budget. But, instead of oversight coming from Treasury alone, the legislation will expand the Recovery Accountability and Transparency Board’s mandate to oversee all federal spending. The legislation also expands the Recovery Operations Center (ROC), which will be responsible for proactively reviewing and analyzing data for possible fraudulent activity. This proved very effective in minimizing fraud in the Recovery Act spending.

The new drafts do differ slightly. The Senate version gives Treasury access to a new-hires database and includes a section on preventing improper payments.

As our friends at Center for Effective Government point out, there are still reforms we’d like in the future. For right now, the DATA Act is poised to enact the next critical steps on the road to having accurate and useful government spending data. But someday we hope to be able to track spending from its origin in appropriations to the last entity to receive it.

As next steps, the government-wide standardization of spending data will make the information far more reliable and will empower watchdogs and ordinary citizens to identify and prevent waste, fraud, and abuse related to federal spending. As Chairman Issa said on Tuesday, “The American people deserve accurate, timely, and complete checkbook level spending information.”

POGO applauds the bipartisan sponsors of the DATA Act and urges Congress to pass this important legislation without delay.