| |
Hearing on FY 2003 Appropriations
Statement of
Dr. Christine C. Boesz, Inspector General
National Science Foundation
Before the VA, HUD, and Independent Agencies
Subcommittee of the Committee on Appropriations
U.S. Senate
May 15, 2002
Madam Chair, Senator Bond, and distinguished members
of the Subcommittee, I am Dr. Christine Boesz, Inspector
General at the National Science Foundation (NSF).
I appreciate the opportunity to appear before you
today. As you know, NSF continues to be an innovative
agency dedicated to maintaining American leadership
in the discovery and development of new technologies
across the frontiers of scientific and engineering
research and education. NSF has had an extraordinary
impact on scientific and engineering knowledge, laying
the groundwork for technological advances that have
shaped our society and fostered the progress needed
to secure the Nation's future. Because the scientific
enterprise and its underlying basic research are everchanging,
NSF continuously faces new challenges. Consequently,
my office is working closely with NSF management to
identify and address issues that are important to
the success of the Agency. Today I would like to provide
an update on the status of NSF's progress in three
areas critical to its success: post-award management,
workforce planning, and large facilities management.
POST-AWARD MANAGEMENT
NSF's primary mission is to fund extramural research
and education activities that will advance science
and engineering. Over ninety-five percent of NSF's
FY 2002 budget is in support of these activities,
which are funded primarily through grants and cooperative
agreements. The Agency's scientific directorates and
offices have a shared responsibility with the Office
of Budget, Finance, and Award Management to oversee
the financial and programmatic management of these
awards. Because of its enormous impact on NSF's daily
operations, for the past two years I have identified
award administration as one of NSF's top ten management
challenges.
In addition, during the most recent annual audit of
NSF's financial statements, our external auditors
identified, as a reportable condition, weaknesses
in NSF's internal controls over the financial aspects
of post-award management.
The auditors found that, while NSF has a robust system
of award management over its pre-award and award phases,
it needs to develop a more rigorous, risk-based monitoring
program for the post-award phase. In addition, NSF
needs to significantly improve its current policies
and procedures for the valuation and tracking of its
assets, including facilities and equipment held and
maintained by other entities.
NSF management agrees that award administration is
one of NSF's top management challenges, but disagrees
that it should be classified as a reportable condition
for the purposes of financial statement reporting.
Nevertheless, NSF is working to continuously improve
its business processes by refining its award management
procedures to include a more structured, risk-based
monitoring element. Further, NSF is taking steps to
improve its oversight of assets for which it holds
title.
In support of these efforts, my office is currently
conducting a review of best practices in grant award
administration to assist NSF in addressing this audit
finding and meeting its management challenge. We are
looking at organizations in both the public and private
sectors that dispense and administer financial assistance
awards, and we plan to issue our report by the end
of the year. In addition, we will continue to assess
NSF's overall progress in developing a more effective
post-award management system.
WORKFORCE PLANNING
Despite an increasing workload and a budget that has
grown from $1 billion to $5 billion over the past
20 years, the number of full-time equivalent positions
(FTEs) at NSF has remained relatively static. In addition,
NSF, like much of government, is vulnerable to a wave
of retirements in key areas. Because of these concerns,
I identified workforce planning and training as another
management challenge for NSF.
The strategic management of human capital is a major
component of the President's Management Agenda
and has been identified by the Government Accounting
Office (GAO) as posing a significant risk government-wide.
Last year, this Subcommittee requested that my office
analyze the adequacy of the agency's staffing and
management plans in light of the efforts to expand
NSF's budget over the next five years. In response
to that request, my office has performed a review
of NSF's workforce planning activities.
NSF's workforce planning to date, like that of most
Federal agencies, has largely been confined to stating
broad goals and standards. It falls short of an actionable
plan, which requires specific objectives, clearly
assigned responsibilities, well-defined milestones
for discrete actions, and practical measures of effectiveness
for accountability. However, NSF is in the process
of contracting for a multi-year business analysis
of its operations that will include a human capital
management plan component identifying its future workforce
requirements.
While it may be premature to attempt a meaningful assessment
of future workforce planning at NSF, due to the imminent
launch of the Agency's ambitious business analysis
initiative, I can offer some preliminary conclusions.
I believe that the Agency's proposed business analysis,
if diligently conducted by the contractor and properly
overseen by NSF, represents a comprehensive and rigorous
approach to reviewing NSF's primary operations and
the human resources needed to staff them. It has the
potential to generate an actionable plan that will
help NSF identify and meet its current and future
workforce needs, as well as plan ways to head off
future problems. The ultimate value of the initiative,
of course, will be determined by the validity of the
findings of the business analysis and the actions
that NSF takes pursuant to them. Given NSF's investment
in time and resources, I look forward to substantial,
concrete results that will improve the agency's business
processes, including workforce planning and management.
LARGE FACILITIES MANAGEMENT PLAN
NSF's management of large facility projects is another
issue that I have identified as one of the Agency's
top ten management challenges. In response to the
President's Budget Blueprint, increased scrutiny
from the Office of Management and Budget (OMB) and
the Congress, and recommendations from my office,
NSF developed a Facilities Management and Oversight
Plan (Plan) last fall.
As part of its implementation, the Plan calls for significantly
upgrading the current procedures and guidelines for
oversight and management of large facility projects.
The implementation has been slower than originally
anticipated, and recruitment of a new Deputy Director
for Large Facility Projects is now expected to be
completed this summer. However, despite the delay,
I am encouraged by recent progress. Last month, members
of the team charged with drafting the new guidelines
and procedures briefed my office on their progress,
and I am pleased to see NSF is on track for full implementation
later this year.
To assist NSF in carrying out this plan, we have identified
additional ways that NSF can enhance its policies
and procedures to provide a more robust facilities
management system.
During our audit of the Major Research Equipment (MRE)
appropriation account, which was requested by this
Subcommittee, we found several areas that NSF needs
to address to continue improving its management and
oversight for large projects and facilities. My office
issued a report responding to your request earlier
this month. We found that questionable practices discovered
during our audit of the Gemini project have occurred
in other MRE-funded projects as well. NSF's existing
policies and procedures have led the Agency to apply
funding sources inconsistently among these projects
and fail to account for each project's total cost.
As a result of these findings, we have recommended
that NSF revise its financial management policies
and procedures to ensure that it identifies the full
cost of major research equipment and facilities and
improves its administration of MRE accounts. NSF should
be able to incorporate these improvements into its
current efforts to implement the large facilities
Plan.
Finally, the MRE account provides funding for two distinctly
different types of projects: those that invest in
state-of-the-art, scientific tools for research and
the development of new knowledge and ideas; and those
that support the investment in mission critical property,
plant, and equipment (PP&E;) owned by NSF. The latter
provide the facilities and logistical means for a
broad range of science endeavors, primarily in NSF's
Polar Programs. Both types of projects require effective
management, i.e., planning, budgeting, construction
oversight, and risk management, to ensure that these
multimillion-dollar projects proceed on schedule,
stay within budget, and perform as expected. Both
also require full-cost accounting in accordance with
Federal accounting standards.
But funding these types of projects from a single appropriation
account creates a situation where the replacement,
renovation, and upkeep of assets critical to the safety
and health of researchers and their support personnel
could potentially compete with new scientific tools
for limited funding. In updating its large facilities
policies and procedures, therefore, NSF should (1)
plan and prioritize the mission critical PP&E; projects
separately from the development and construction of
research tools and (2) distinguish their different
funding sources, to avoid possible negative impact
on the broad range of programs these assets support.
More specific accounting will reduce confusion about
how funds are being allocated, improve the accuracy
of budget planning, and allow more effective monitoring
of the use of funds.
I am pleased to see NSF addressing large facility management
through the development of this Plan. As the guidelines
and procedures are fully developed and implemented,
my office will continue to assess this critical area
and recommend further enhancements where necessary.
We share the same goal - efficient and effective management
of these large and complex projects - and I look forward
to assisting NSF in realizing this goal.
Madam Chair, this concludes my statement. I would be
happy to answer any questions you or other members
of the subcommittee may have, or to elaborate on any
of the issues that I have addressed today.
|
|
