Interview transcript:

Terry Gerton A couple of months ago, we covered your first report in this disaster assistance high-risk series where you looked at the federal response workforce. You’re back with report number two, looking at state and local response capabilities. Talk to us about the headlines.

Chris Currie The headline for this report is that the capabilities of state and local governments across the country vary drastically for a disaster or other type of event. You know, what we did is we actually look at data that the states prepare and provide to FEMA as part of their justification for federal preparedness grants. It’s meant to be a very, very honest self-assessment of capabilities. And for that reason, we actually don’t provide states individually, we sort of roll it up and wrap it up anonymously because some of that information, as you imagine, could be sensitive. We looked at states that have been involved in major disasters over the last two to three years, and some of these states are very experienced, large states, and even they vary in terms of their capabilities. There’s actually 32 capabilities that FEMA sets in the National Preparedness System that you want to achieve to be prepared to respond for a disaster or a large event. And states vary. Some of the areas, they were less than 10% prepared — met less than 10% of those capabilities — and others, they were much more. So the reason that’s important right now is to understand that if you were to change the support that FEMA and the federal government provide to states quickly, then they’re going to have capability gaps that are going to have to get filled.

Terry Gerton Let’s talk about some of the support that FEMA does provide. One of the ways that they support the states is through preparedness grants, and those help build local capacity. What did you find as you dug into the preparedness grants?

Chris Currie Those preparedness grants started after 9/11, and since 9/11, there’s been over $60 billion provided to states. It’s the main way that the federal government transfers funds to state and local governments to get them ready to handle something bad that could happen, not just a natural disaster, but it could be a terrorist attack. And those grants have built capabilities tremendously over the years. But those capabilities change over time, and we identify through real-world events and exercises the gaps that still need to be addressed. So I’ll give you a great example. After Hurricane Helene and after other disasters, housing for disaster survivors is always a perennial challenge. Housing is a capability area that is assessed and we want to build up through these preparedness grants. It’s an area that states, even very experienced disaster states, still fall short of in terms of their capabilities. And the federal government kind of comes in after a disaster and provides a lot of that support because states don’t. So if the federal governments not going to provide it, then someone else is going to have to provide it. And that’s going to be someone at the state or local level.

Terry Gerton Talk to me about the flexibility and the allocation framework for these grants. Is it meeting requirements? Does it seem to be focused on the places that have the greatest need?

Chris Currie There’s a couple different ways they’re given out. There’s a portion of the grants that are supposed to go towards certain national priorities, and FEMA sets those targets. So think about things like election security or other national priorities. But then a large part of the grant, they’re discretionary, and the states can use them and they’re supposed to use them in the areas where they assess they have gaps. And that’s the data I was talking about earlier that we provided. For example, certain states may have gaps in their ability to handle a mass casualty situation or may struggle to house disaster survivors because they don’t have a lot of housing stock or rental. So those are things they’re supposed to identify and then target those grants towards those specific areas, which makes sense. You want to close your gaps so you’re ready to go when something happens.

Terry Gerton FEMA also provides a great deal of training and technical assistance. How effective has that been in helping states be ready?

Chris Currie This is, I think, one of the biggest success stories since Hurricane Katrina. If you remember Hurricane Katrina, the issue was the role of various levels of government was not clear, and thus, nobody stepped up and was proactive in responding to that event. And people lost their lives. Since that time, the National Preparedness System and FEMA leading that has been extremely effective through exercises, through training, through just regional relationships in taking care of a lot of those problems. So today we are way more proactive and responsive to disasters than we were 20 years ago in Hurricane Katrina. So that’s a huge success story. Having said that, a disaster is a disaster. There’s always going to be things that happen that you don’t expect. And there’s areas where states still have major gaps and require resources and people to address those. And the federal government comes in fills a lot of those gaps. Here’s a great example. Hurricane Helene happened and devastated a very remote part of our country in places like rural Tennessee and North Carolina and Virginia. States and localities don’t have the search and rescue assets for such a large swath of that kind of terrain. Federal government provided a lot of that. They provided a lot of the air support, the land support, the temporary bridges — Army Corps of Engineers. You know, the federal government really kicks in when something’s too big for a state or locality to handle.

Terry Gerton I’m speaking with Chris Currie. He’s director, Homeland Security and Justice at GAO. So Chris, all of this begs the question. This administration has been very clear that it wants states and localities to pick up more of the disaster response mission and that it wants a much smaller FEMA. Given what you found in your first study about the federal response workforce and the impacts of downsizing there, and now the variability in state and local readiness, what are the implications for national disaster response?

Chris Currie I want to make one thing really clear, because all I know is what we know now and the data that we’ve looked at. And I want it to be clear that nothing has changed in terms of FEMA’s responsibilities today. There’s been a lot of talk about it. There’s the president’s council that studied it. But there has been no change so far. So FEMA is still responsible for what it was responsible for two years ago. They have lost some staff. We looked at that in our first report, as you mentioned. They have lost about 1,000 staff, and maybe a little bit more than that, at this point, but they haven’t been cut drastically or cut in half as has been discussed. So they still have the same responsibilities and they’re still performing the same functions on disasters throughout the country, even though last year we didn’t have a huge land-falling hurricane. So what’s important about that is that everybody’s waiting to hear what the next steps are going to be and what’s going to happen to FEMA. One of the things we wanted to do in this report is we wanted to provide a comprehensive picture of preparedness to show what’s going to be necessary if that FEMA support is pulled back or FEMA is made smaller. And the bottom line is that states and localities are going to have to do more. However, it’s going to be critical that they have the time to prepare for that. For example, a lot of the assistance that’s provided to individual survivors, like cash payments and housing, that comes from the federal government. It does not come from the state or local government. So if FEMA is not going to be providing that, the state of the locality is going to have to fill that need. And that requires a lot of money and a lot preparation and planning that you can’t just turn on in a heartbeat. You don’t want to start figuring out programs to help people after a disaster happens.

Terry Gerton You bring up a good point on that time to prepare. As you did the survey, you talked to lots of state and local response officials. What did they tell you, beyond time to prepare, that they were going to need to be effective?

Chris Currie Very simple: Just tell us what we need to do. Tell us what were going to expect from you, the federal government. Nobody knows right now. The FEMA Council has not finished its work. There has been reform legislation introduced in the House and in the Senate, but nothing has passed yet. So the key message is, tell us what the roles and responsibilities are going to be so we know what to prepare for, so we don’t get caught flat-footed in the case of something really bad happening. One of my fears is that last year, like I said, we didn’t have a large land-falling hurricane. It was the first year in a long time we did not. We did not have a catastrophic disaster, other than Los Angeles fires early in the year. So my fear is that folks are going to look at last year and say, hey, things have gone pretty well. We don’t need to be thinking about it. And that is an absolute mistake. Because we’ve seen in years like 2017, 2018, 2024 — my fear is we’re going to have another situation this year or next with multiple concurrent disasters, and we’re just not going to the resources to deal with them.

Terry Gerton So what will you be watching for in the next few months to see if Congress and the federal government and the states have taken your recommendations on board?

Chris Currie Well, when the FEMA Council report comes out, I would like to see, in whatever the execution is for FEMA reform or the changes in how the system works now, an understanding of how this needs to be rolled out so states and localities can prepare and have as clear roles and responsibilities as possible. We’d also like to see them address many of the problems that we’ve pointed out. And to be clear, we’ve pointed out a number of issues with FEMA, particularly in the frustrating recovery phase. I want to see that they’re making sure that we don’t break what’s not broken and we fix the issues that are broken. And there are a number those things.

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Interview transcript:

Terry Gerton Deltek has a new report out that’s looking ahead for federal contractor intelligence for 2026. But before we look forward, I want to look back a little bit. When you think of everything that happened in the contracting space in 2025, what stands out for you as the biggest trends?

Kevin Plexico Well, chaos reigns supreme this past year, for sure. And what I find just super interesting is that some companies happen to find themselves in really good places and align to the goals of the new administration and did really well. And others that happened to be in sort of the wrong place at the wrong time had profound impact. I think 2025 was a year where companies had to really take stock of the organizations that they’re selling to and their offerings to make sure they’re aligned to the goals of the administration and the mission that the government agencies have been asked to take on by that administration. That’s probably, to me, the biggest change. There’s been so much movement of money, in some cases money coming out of certain agencies. We’ve all heard about Agency for International Development and Department of State and Education. But then you look at organizations like the VA, DHS, and DoD that have continued to do really well. So, a lot of haves and have-nots this year, and I think for companies it’s just trying to figure out, based on this new administration, where should we really be aiming to be able to capitalize on it going forward?

Terry Gerton Every administration comes in with different priorities, but it seems like this one was able to make the pendulum swing really fast, and that may have caught companies off guard. What are some of the hard conversations that had to happen inside those boardrooms?

Kevin Plexico Well, early on, it was all about DOGE and the DOGE organization really putting some unprecedented pressure on some vendors. I mean, some of the letters I saw sent to professional services companies and some of demands that were made of value-added resellers were not anything I’ve seen a federal agency communicate to a vendor that was otherwise performing to the jobs that they were asked to do. And I think it’s, in some respects, a bit surreal that the administration was asking companies to identify wasteful spending. It’s just an awkward situation to be in if you have a customer, and the customer already hired you to do the work, and you’re now being asked to identify where there’s wasteful spending in that and sort of serve up cuts. So I think that was the early part of the year. We did see that start to sunset a bit and fade as we got into the summertime. But then all of a sudden, all eyes were turning to appropriations and funding for 2026. And we all know where that’s landed, which it hasn’t. We’re still waiting for full-year 2026, with just a couple agency exceptions. We bought some time ending the shutdown, which was, as you know, the longest on record. But there’s nothing to say that we might not have another shutdown here at the end of January. I still think where there’s that bit of uncertainty, the one silver lining this past year for the contracting community is the One Big Beautiful Bill, just because it had so much opportunity in it for contractors that really cut across the gamut of aerospace, defense, professional services, training, architecture, engineering, construction. There was literally something in there for everybody, but it does require really an honest assessment by a company to figure out, okay, how do we get after this? Because that might not be in the agencies that they’re used to doing business in.

Terry Gerton Right. And a lot of those funds haven’t been dispersed yet. So they’re still maybe in the RFP or RFQ stage. This unpredictability of funding flows is something you don’t normally see in government contracts. Everything from stop-work orders and termination notices earlier in the year to unpaid bills at the end of the fiscal year and the CR. Has that caused the GovCon community to sort of re-evaluate and re-adjust their planning for predictable cash flows?

Kevin Plexico I think this year, while it was a record-setting shutdown, is not an unusual year in that we don’t have a line of sight on what line appropriations are going to get done. I think industry has become used to that scenario. And while shutdowns are certainly not good for anyone, they’re usually relatively short-lived because of what happens. The pain gets so severe that finally Congress is like, we’re inflicting a lot of pain on rank-and-file Americans, we need to resolve this. I’m hoping that cooler heads will prevail the next time that this comes around. What I think is perhaps different this time versus what we’ve seen, say, the last decade or so is we’ve always had a bipartisan budget agreement or resolution that sort of set the top line that appropriators were negotiating towards. I think we’ve had that literally for about a decade, since back during the Budget Control Act, and we don’t have that for ’26. So there was no goalpost that Congress was working towards on a bipartisan basis that that they agreed on previously. And I think that’s the same for 2027. That’s what’s unique about this, is there’s nothing that says, here’s the goal that we’re working towards, and then how do we allocate it by the different appropriations bills that are negotiated?

Terry Gerton Kevin Plexico is senior vice president of information solutions at Deltek. Kevin, let’s turn our attention to the windshield and not the rear-view mirror now. With all of that disruption in 2025, what is at the top of Deltek’s intelligence report for 2026?

Kevin Plexico Well, I think 2026 is going to be a better year than 2025, thanks primarily to the One Big Beautiful Bill. As you pointed out, it’s not a single-year appropriation. The funding in that legislation lasts through, I think it has to be committed in contracts essentially by the end of 2029; then expenditures can take longer. So that gives us a bit of time and it certainly doesn’t mean that it has get rushed out the door like we’ve seen — some emergency supplemental appropriations have had that shape. And so that provides some longer-term opportunity and ability for companies to reposition, to get after some of that money. The biggest challenge on the base-level appropriations, we’ve got this ambitious goal of growing defense spending, paid for by significant cuts in civilian spending, and we saw that under the prior Trump administration. But they were never able to get appropriators to buy off on that. And I think that’s the dynamic that we have in the Senate, where it has to get 60 votes to get past the filibuster. It does really need a bipartisan-level agreement to get appropriations done. That’s particularly challenging in these contentious times, but I do think it helps prevent those draconian cuts that could be put in place for some civilian agencies that we’ve seen this and the prior Trump administration ask for that usually have not been enacted.

Terry Gerton One of the sectors that’s really struggled this past year is small businesses. What do you see in the future for them?

Kevin Plexico This is an interesting one, because on the one hand, the government has done a really good job of spending money with small business. But if you look at the level of participation in terms of prime contracts, it’s going down. The number of small businesses I think has declined by close to 30% over the last several years in terms of prime contracting. And I think that’s a problem that the administration really has to take a look at. Unfortunately, some of the things that we’re seeing them do around relying on best-in-class contracts, don’t create a new contract if there’s already an existing contract that you can place a task or delivery order under — those really favor the companies that already have those prime contracts. I think it makes it challenging for small businesses to enter the market. On the research and development side, we’re still waiting for Congress to extend the SBIR and STTR programs, which are Small Business Innovative Research-related work. So it’s a challenging market for all companies, but in particular for small businesses. They’re dependent on cash flow; shutdowns particularly impact small businesses. The rule changes that are being made in the FAR overhaul are pretty profound in terms of their impact on small business. I think it’s unpredictable to understand how much is it going to affect a service-disabled veteran-owned business versus an 8(a) company versus a women-owned business. It seems like they’re gravitating more towards a preference of just small business set-asides and trying to get away from sole-source awards. And that’s a big change for the small business community for sure. So I think getting smart about the new rules and how they’re going to be applied agency by agency is going to be super important for small businesses.

Terry Gerton Well, speaking about the FAR overhaul, let’s talk about GSA for a minute. They’ve really worked over this last year to centralize a lot of buying strategies, centralize lot of contracts. They’ve updated the OASIS contract. What are you seeing and what should contractors be expecting to hear from GSA?

Kevin Plexico Well, I think the thing that’s created a lot of confusion is the way they’re rolling it out. Usually when FAR changes are rolled out, they go through a rulemaking process, they issue drafts, take comments and then go to a final rule or interim rule. What they’ve done in this particular situation is instead of approaching it in that traditional way, they’ve rolled out the revised FAR and basically said that agencies can adopt it if they get a class deviation. So, you have to literally go to the FAR overhaul website and see which agencies have adopted these FAR clauses. And right now you basically have different agencies using different versions of the FAR. The DoD is still using the traditional FAR and DFAR. They don’t have any class deviations that I’m aware of, but many civilian agencies do. So it just puts a lot of onus on the contracting community to really be mindful of what regulations are being followed by the agency you’re selling to, because it’s not the same as everybody’s following the FAR anymore. Which version of the FAR? Is it this class deviation or is it the traditional FAR? And that’s just an example of the chaos that we talked about.

Terry Gerton If you could give contractors one piece of advice as they’re trying to put their 2026 business strategies together, what would it be?

Kevin Plexico I go to what we call the four Cs. Customers: Who are the right customers that you’re going to be focused on selling to? Contracts: What vehicles are they going to be using to get access to those providers? Compliance: What do you need to be able to comply with, and I know the CMMC is a big one, but even with all the FAR overhaul changes, I haven’t seen what I would call a deregulation of compliance requirements. There’s pressure on agencies to use more fixed-price; that would potentially take away some of the accounting requirements that come along with a cost-plus contract. I think I might have missed a C in that, but you get the gist of it, right? It’s really just being more strategic and being more thoughtful about how you’re going to go to market. You can’t just afford to live off the agencies you’ve been doing business with, because they might be starving for money going forward. So you really have to take an honest assessment of where you are today, where you want to play, and how are you going to position yourself to get there? Because it’s not a quick pivot by any stretch.

The post New year, new opportunities? Here’s where contractors should focus in 2026 first appeared on Federal News Network.

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The federal government is preparing to undertake one of the most ambitious IT transformations in decades: Modernizing and unifying human resources information technology across agencies. The technology itself is not the greatest challenge. Instead, success will hinge on the government’s ability to establish an effective, authoritative and disciplined governance structure capable of making informed, timely and sometimes difficult decisions.

The central tension is clear: Agencies legitimately need flexibility to execute mission-specific processes, yet the government must reduce fragmentation, redundancy and cost by standardizing and adopting commercial best practices. Historically, each agency has evolved idiosyncratic HR processes — even for identical functions — resulting in one of the most complex HR ecosystems in the world.

We need a governance framework that can break this cycle. It has to be a structured requirements-evaluation process, a systematic approach to modernizing outdated statutory constraints, and a rigorous mechanism to prevent “corner cases” from derailing modernization. The framework is based on a three-tiered governance structure to enable accountability, enforce standards, manage risk and accelerate decision making.

The governance imperative in HR IT modernization

Modernizing HR IT across the federal government requires rethinking more than just systems — it requires rethinking decision making. Technology will only succeed if governance promotes standardization, manages statutory and regulatory constraints intelligently, and prevents scope creep driven by individual agency preferences.

Absent strong governance, modernization will devolve into a high-cost, multi-point, agency-to-vendor negotiation where each agency advocates for its “unique” variations. Commercial vendors, who find arguing with or disappointing their customers to be fruitless and counterproductive, will ultimately optimize toward additional scope, higher complexity and extended timelines — that is, unless the government owns the decision framework.

Why governance is the central challenge

The root causes of this central challenge are structural. Agencies with different missions evolved different HR processes — even for identical tasks such as onboarding, payroll events or personnel actions. Many “requirements” cited today are actually legacy practices, outdated rules or agency preferences. And statutes and regulations are often more flexible than assumed, but in order to avoid any risk of perceived noncompliance or litigation.

Without centralized authority, modernization will replicate fragmentation in a new system rather than reduce it. Governance must therefore act as the strategic filter that determines what is truly required, what can be standardized and what needs legislative or policy reform.

A two-dimensional requirements evaluation framework

Regardless of the rigor associated with the requirements outlined at the outset of the program, implementers will encounter seemingly unique or unaccounted for “requirements” that appear to be critical to agencies as they begin seriously planning for implementation. Any federal HR modernization effort must implement a consistent, transparent and rigorous method for evaluating these new or additional requirements. The framework should classify every proposed “need” across two dimensions:

• Applicability (breadth): Is this need specific to a single agency, a cluster of agencies, or the whole of government?
• Codification (rigidity): Is the need explicitly required by law/regulation, or is it merely a policy preference or tradition?

This line of thinking leads to a decision matrix of sorts. For instance, identified needs that are found to be universal and well-codified are likely legitimate requirements and solid candidates for productization on the part of the HR IT vendor. For requirements that apply to a group of agencies or a single agency, or that are really based on practice or tradition, there may be a range of outcomes worth considering.

Prior to an engineering discussion, the applicable governance body must ask of any new requirement: Can this objective be achieved by conforming to a recognized commercial best practice? If the answer is yes, the governance process should strongly favor moving in that direction.

This disciplined approach is crucial to keeping modernization aligned with cost savings, simplification and future scalability.

Breaking the statutory chains: A modern exception and reform model

A common pitfall in federal IT is the tendency to view outdated laws and regulations as immutable engineering constraints. There are in fact many government “requirements” — often at a very granular and prescriptive level — embedded in written laws and regulations, that are either out-of-date or that simply do not make sense when viewed in a larger context of how HR gets done. The tendency is to look at these cases and say, “This is in the rule books, so we must build the software this way.”

But this is the wrong answer, for several reasons. And reform typically lags years behind technology. Changing laws or regulations is an arduous and lengthy process, but the government cannot afford to encode obsolete statutes into modern software. Treating every rule as a software requirement guarantees technical debt before launch.

The proposed mechanism: The business case exception

The Office of Management and Budget and the Office of Personnel Management have demonstrated the ability to manage simple, business-case-driven exception processes. This capability should be operationalized as a core component of HR IT modernization governance:

• Immediate flexibility: OMB and OPM should grant agencies waivers to bypass outdated procedural requirements if adopting the standard best practice reduces administrative burden and cost.
• Batch legislative updates: Rather than waiting for laws to change before modernizing, OPM and OMB can “batch up” these approved exceptions. On a periodic basis, these proven efficiencies through standard processes to modify laws and regulations to match the new, modernized reality.

This approach flips the traditional model. Instead of software lagging behind policy, the modernization effort drives policy evolution.

Avoiding the “corner case” trap: ROI-driven decision-making

In large-scale HR modernization, “corner cases” can become the silent destroyer of budgets and timelines. Every agency can cite dozens of rare events — special pay authorities, unusual personnel actions or unique workforce segments — that occur only infrequently.

The risk is that building system logic for rare events is extraordinarily expensive. These edge cases disproportionately consume design and engineering time. And any customization or productization can increase testing complexity and long-term maintenance cost.

Governance should enforce a strict return-on-investment rule: If a unique scenario occurs infrequently and costs more to automate than to handle manually, it should not be engineered into the system.

For instance, if a unique process occurs only 50 times a year across a 2-million-person workforce, it is cheaper to handle it manually outside the system than to spend millions customizing the software. If the government does not manage this evaluation itself, it will devolve into a “ping-pong” negotiation with vendors, leading to scope creep and vulnerability. The government must hold the reins, deciding what gets built based on value, not just request.

Recommended governance structure

To operationalize the ideas above, the government should implement a three-tiered governance structure designed to separate strategy from technical execution.

1. The executive steering committee (ESC)

• Composition: Senior leadership from OMB, OPM and select agency chief human capital officers and chief information officers (CHCOs/CIOs).
• Role: Defines the “North Star.” They hold the authority to approve the “batch exceptions” for policy and regulation. They handle the highest-level escalations where an agency claims a mission-critical need to deviate from the standard.

The ESC establishes the foundation for policy, ensures accountability, and provides air cover for standardization decisions that may challenge entrenched agency preferences.

2. The functional control board (FCB)

• Composition: Functional experts (HR practitioners) and business analysts.
• Role: The “gatekeepers.” They utilize the two-dimensional framework to triage requirements. Their primary mandate is to protect the standard commercial best practice. They determine if a request is a true “need” or just a preference.

The FCB prevents the “paving cow paths” phenomenon by rigorously protecting the standard process baseline.

3. The architecture review board (ARB)

• Composition: Technical architects and security experts.
• Role: Ensures that even approved variations do not break the data model or introduce technical debt. They enforce the return on investment (ROI) rule on corner cases — if the technical cost of a request exceeds its business value, they reject it.

The ARB enforces discipline on engineering choices and protects the system from fragmentation.

Federal HR IT modernization presents a rare opportunity to reshape not just systems, but the business of human capital management across government. The technology exists. The challenge — and the opportunity — lies in governance.

The path to modernization will not be defined by the software implemented, but by the discipline, authority, and insight of the governance structure that guides it.

Steve Krauss is a principal with SLK Executive Advisory. He spent the last decade working for GSA and OPM, including as the Senior Executive Service (SES) director of the HR Quality Service Management Office (QSMO).

The post Governing the future: A strategic framework for federal HR IT modernization first appeared on Federal News Network.

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Interview transcript:

Terry Gerton There’s a lot to talk about, but it strikes me as strange that here we are two weeks before all of the continuing resolutions expire. The Senate is out this week. The House is planning to be out next week. Are they going to finish in time?

Loren Duggan There’s a path for them to do so and unlike other deadlines, when they’re approaching, everyone’s hair on fire — we haven’t felt that dynamic on this one. The House and Senate appropriators, they’re reaching deals, releasing packages, processing them through the House in the Senate, and there’s a way to get this all done by Jan. 30, or if they need a week or something, appropriators are already saying we could do another short-term. But there’s not a panic about this deadline that’s only two weeks away or so.

Terry Gerton Well, let’s recap, which bills are through and who would you say are the big winners in those bills?

Loren Duggan So we had the three bills go through last year. We’ve had another three-bill package get through both chambers this year. The House sent another two-bill package over to the Senate, who can deal with that when they come back. And then there’s this four-bill package, the remaining outstanding ones that they still need to tackle and get through both chambers. So there’s a lot of progress there. The last one’s big — Defense, Labor, HHS — and thorny in the case of the Homeland Security Department, given everything that’s going on there with ICE in Minnesota and concerns about lawmaker oversight there.

Terry Gerton Well, Homeland and Defense both got big chunks of money in the summer that they’re continuing to operate. So does it feel like maybe there’s a little less urgency around those bills?

Loren Duggan A little less urgency on the Defense side, where I think if you put that together with the reconciliation bill, it’s like $1 trillion. Of course, the president wants to take that to $1.5 trillion next year. We can deal with that another time. And Homeland, that extra pool of money has helped. They’ve used that to hire staff, to open centers. But there was a little controversy because DHS said if an ICE facility is funded with the reconciliation dollars, some of the oversight is different there than if it was regular appropriations. So we’ve seen a distinction made there. But definitely having that money earlier, locking that in for the administration, was really key to their plans for the year.

Terry Gerton What are the big controversies that are still on the table that are going to have to be hashed out before that last bill package gets through?

Loren Duggan DHS has been the sticking point. That was initially supposed to be in the last package; it ended up only being two bills instead of three as they worked through some of these discussions. And you could see a deal being made there and getting that through, maybe both chambers. But there could be a fight on that one in either chamber, depending on what you need. What we have seen are very bipartisan packages where the votes have been widespread, some opposition obviously, but they’ve gotten through very comfortably after all the fights that we went through ahead of this point in time.

Terry Gerton It does also seem, at least on the bills that have gotten through so far, that Congress has largely rejected the cuts that the administration proposed for 50% reductions are higher. Most of the reductions are very minor. So since agencies have already been downsized in many cases, what does this mean? How will relative increases, I guess, compared to where they’re operating today — how will that come into effect?

Loren Duggan In some cases, it’s less than they had last year, but still more than the administration wanted and more than House Republicans wanted in their initial versions. So we’re seeing a classic compromise being hashed out here between the House and the Senate, enough money for Democrats to support these bills, not the drastic cuts. And they’ve hastened to say “no poison pills” when they’ve released these different packages. But we’ll see how the agencies respond to more money. That’s been a fight over the course of the administration, where they’ve wanted to impound funds, rescind them, but if you put them back out there the agencies can use them. And even something like foreign aid is going to the State Department now, rather than USAID, after USAID was disestablished by the administration.

Terry Gerton I’m speaking with Loren Duggan. He’s deputy news director for Bloomberg Government. Loren, outside of the appropriations, what other sorts of legislative discussions are taking place on the Hill these days? ACA subsidies still on top?

Loren Duggan ACA subsidies has been a big driver of discussion. We are now at the end of open enrollment without an answer to what to do with these credits, if they’ll be extended. I assume the senators are still talking this week and when they come back. Donald Trump’s proposal last week didn’t necessarily change the dynamic too much. But one thing that might: We’re going to see insurance company executives brought to the Hill before two different House committees this week. They’ll have to answer some tough questions. Probably get a little beaten up by both sides in this case, because both parties have some concerns with them. So we’ll see how that plays out. The ACA, that’s now a deadline that’s passed; they’re still trying to figure out how to resolve that debate.

Terry Gerton There was also a lot of news last week about the crypto bill in the Senate. Tell us what’s going on there.

Loren Duggan There were markups that had been scheduled in two committees, and then they got pulled back as they continue to work through the issues and deal with the industry feedback. I think it was the Coinbase CEO who was up there weighing in pretty directly with lawmakers. So they pulled back, didn’t move forward, and they’re going to recalibrate the bill. This is the market structure bill, not to be confused with the stablecoin legislation, which is part of the crypto universe. This is a broader market structure bill, who has regulatory authority. I assume they’ll rejoin that debate when they return next week, if they’re not working up while they’re gone. But there’s big interest, big money, big stakes in this legislation.

Terry Gerton All of the things we’ve talked about so far are sort of normal order: appropriations bills, although late, getting through other sorts of legislative activities. Let’s talk about Greenland for a minute, because it seems like it has the potential to really upend all kinds of conversations and agreements that are going on. President Trump made tariff threats over the weekend. We have a congressional delegation on the ground in Denmark. What does this all mean when it comes back to domestic politics?

Loren Duggan We’ll have to see, there hasn’t been a ground swell against this. There are some members of Congress who concede it might be a good idea if Greenland was part of the United States, given its geostrategic importance. But then there’s other members of Congress who have said, maybe we’ll have to impeach Trump if he goes too far on this, so there’s not a consensus. There’s definitely a lot of range of opinions on this one. And it’s something that Donald Trump’s going to hear directly from other world leaders when he goes to Davos, Switzerland, this week and he’ll be side-by-side with some of the people who he’s threatened to tariff or have strong opinions on this, given their proximity to Denmark.

Terry Gerton We usually focus here on domestic politics, but this seems like it will flow over into lots of conversations. What are you expecting to hear out of Davos as that conversation gets started?

Loren Duggan Well, we had expected a domestic announcement with the president talking about his home ownership plan, maybe taking money from 401(k)s to make a down payment, part of his broader affordability discussion, home ownership discussion. So that’s a domestic thing, but we’re definitely going to hear the global things. Not just Greenland, but his “Board of Peace” that he’s talked about, where he wants world leaders to chip in money and be part of this arrangement. I’m sure those discussions will continue and there’ll be lots of feedback, given the compact nature of Davos and everyone who will be there. There’s a little bit of domestic, but it’s more of a foreign play given who’s there. It is the World Economic Forum after all, and the world will be there and talking to Donald Trump directly.

Terry Gerton When everybody gets back, what will you be watching for on the Hill?

Loren Duggan We’ll see if they can wrap up the spending debate and then they’ll be turning to February and eventually the fiscal ’27 process is right there. We’ll just get done with this one and really have to turn the page pretty quickly.

The post Crypto overhaul, Greenland, ACA subsidies, spending bills: Lawmakers’ January juggling acts first appeared on Federal News Network.

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Lawmakers are moving to extend key cybersecurity information authorities and grant programs, while also providing funds for the Cybersecurity and Infrastructure Security Agency to fill “critical” positions.

The “minibus” appropriations agreement released by House and Senate negotiators on Tuesday includes fiscal 2026 funding for the Department of Homeland Security. DHS funding could be a sticking point in moving the bill forward, as some Democrats want more restrictions around the Trump administration’s immigration enforcement operations.

The bill also extends the Cybersecurity Information Sharing Act of 2015 (CISA 2015) and the State and Local Cybersecurity Grant Program through the end of fiscal 2026. Both laws are set to expire at the end of this month.

The extension would give lawmakers more time to work out differences between competing versions of CISA 2015 reauthorizations in the House and Senate.

Ross Nodurft, executive director of the Alliance for Digital Innovation, also applauded the extension of the Technology Modernization Fund included in the minibus.

“Reauthorizing the Technology Modernization Fund and the State and Local Cyber Grant Program for the rest of the fiscal year allows the government to invest money in new technology modernization and cyber security projects at the federal and state level while we work on more permanent, longer term reauthorizations and funding,” Nodurft said. “I am encouraged to see Congress put forward these stop gap measures and will continue to work with members to reauthorize these critical programs beyond 2026.”

CISA funding

The bill would include a cut for the agency CISA, with fiscal 2026 funding level set at $2.6 billion, about $300 million less than its current annual budget.

But CISA has already seen steep workforce cuts and program reductions under the Trump administration. The Trump administration proposed cutting CISA’s budget by roughly $500 million.

The appropriations agreement would specifically provide $20 million for CISA to hire additional staff to “critical positions,” according to the joint explanatory statement on the DHS appropriations measure.

That funding would be evenly split across five CISA programs: Threat Hunting; Vulnerability Management; Continuous Diagnostics and Mitigation; Security Programs; and Security Advisors.

The bill would also require CISA to “not reduce staffing in such a way that it lacks sufficient staff to effectively carry out its statutory missions.” Both Democrats and Republicans have expressed concerns about CISA losing roughly one-third of its staff over the past year.

Secret Service burnout

Appropriators are also taking aim at burnout within the Secret Service’s ranks. The funding measure provides $3.3 billion for the Secret Service as it embarks on a major recruiting initiative over the next two years.

That total would allow the Secret Service to “maintain ‘zero-fail’ mission by funding aggressive recruitment and retention to eliminate officer burnout, while modernizing high-tech training facilities and armored fleets to stay ahead of evolving threats
to our nation’s leaders,” according to a DHS spending bill summary provided by Senate appropriators.

The bill includes an increase of $46 million for Secret Service hiring in fiscal 2026. It also provides the agency with advance funding to prepare for the 2028 Olympic and Paralympic Games in Los Angeles.

But appropriators also want updates on the Secret Service’s recruitment and retention efforts. The explanatory statement directs the agency to provide briefings on its employee resiliency program and hiring projections, respectively.

“The briefing shall also include ongoing efforts to decrease the time to hire and increase yield rates from applicants to hires, as well as the impact that these hiring efforts will have on overtime costs,” lawmakers wrote.

FEMA staffing

The spending agreement also includes a “rejection” of staffing cuts made at the Federal Emergency Management Agency in fiscal 2025, according to the joint explanatory statement. The bill would provide $32 billion for FEMA, including $26.4 billion for the Disaster Relief Fund.

FEMA lost more than 2,000 employees to workforce reduction programs last year. And the agency has undertaken further staff reductions by not renewing Cadre of On-Call Response/Recovery Employees (CORE) in recent weeks. FEMA headquarters officials have also contemplated cuts totaling up to 50% of its workforce as part of a planning exercise shared with agency leaders in December.

Now, appropriators want FEMA to provide monthly briefings on the agency’s staffing levels and workload requirements.

“Such briefings shall also include projected staffing levels for the remainder of the fiscal year in light of the agreement’s rejection of the position reductions implemented in fiscal year 2025,” the joint explanatory statement reads.

The bill also requires FEMA to maintain staff “necessary to fulfill the missions” required of the agency by six separate laws and various other authorities. That staffing requirement, lawmakers emphasize, also applies to FEMA reservists and CORE staff.

The Trump administration has moved to shift more emergency management responsibilities to state and local governments. FEMA staffing reductions and policy changes over the last year have sparked concerns that the administration is implementing that plan despite there being no changes in the agency’s lawful responsibilities.

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Congressional appropriators are one step closer to reaching a comprehensive spending deal for the rest of the fiscal year before a stopgap spending bill expires at the end of the month.

Members of the House and Senate appropriations committees released a four-bill “minibus” of fiscal 2026 spending bills on Tuesday.

Congress is roughly halfway to passing a spending plan for the rest of FY 2026. The current continuing resolution expires on Jan. 30.

The latest “minibus” covers annual appropriations for the departments of Defense, Homeland Security, Labor, Health and Human Services, Education, Transportation and Housing and Urban Development, as well as some smaller related agencies.

House Appropriations Committee Chairman Tom Cole (R-Okla.) said in a statement that the spending package delivers “results without waste.”

“At a time when many believed completing the FY26 process was out of reach, we’ve shown that challenges are opportunities. It’s time to get it across the finish line,” Cole said.

Here are a few highlights from the spending package:

3.8% pay raise for air traffic controllers

The spending deal would give the Federal Aviation Administration a $1.58 billion budget for fiscal 2026, as well as funding to hire 2,500 new air traffic controllers

The FAA is about 3,500 air traffic controllers short of its staffing goals. Many current air traffic controllers are working six days a week, including mandatory overtime.

As part of this budget plan, the FAA would receive $140 million to implement a 3.8% pay raise for air traffic controllers, as well as supervisors and managers who oversee air traffic.

The Trump administration approved a 3.8% pay raise for federal law enforcement personnel, which went into effect at the start of January. Air traffic controllers were not on the Office of Personnel Management’s list of positions receiving a higher pay raise.

The spending bill states that the 3.8% pay raise “shall be implemented for all such employees only to the extent that the administrator determines, in his sole discretion, that improvements in workforce scheduling, staffing utilization, or other operational efficiencies are achieved that contribute to addressing workforce shortfalls and enhancing aviation safety.”

If the FAA administrator determines these conditions, the pay raise would retroactively go into effect for the first pay period in January 2026.

Spending cuts for a smaller federal workforce

Republican appropriators applauded overall spending cuts in the spending bill that funds the Transportation Department, HUD and related agencies.

GOP lawmakers on the House Appropriations Committee wrote that the spending deal “codified DOGE recommendations to reduce the federal bureaucracy” of Transportation, HUD and related agencies by 29%.

More specifically, GOP lawmakers said the spending package reflects a 24% reduction in HUD staffing achieved partially through layoffs last year.

Lawmakers said a smaller HUD workforce will save $348 million in salaries and related expenses.

Republican appropriators said the spending deal reflects the Transportation Department “right-sizing” its workforce through a 5% staffing reduction, “all without compromising transportation safety.”

President Donald Trump told reporters at a White House press briefing on Monday that his administration “slashed tremendous numbers of people off the federal payroll” during his first year in office.

OPM data shows over 300,000 federal employees left government last year. That’s about a net loss of 220,000 employees, when accounting for new hires.

Trump said downsizing the federal workforce was necessary, because “they had 10 people for every job,” and that terminated federal employees have moved on to higher-paying jobs in the private sector.

“I don’t feel badly, because they’re getting private sector jobs, and they’re getting sometimes twice as much money, three times as much money,” Trump said. “They’re getting factory jobs, they’re getting much better jobs and much higher pay.”

Higher HHS spending, proposed cuts rejected

The spending bill gives the Department of Health and Human Services $116.8 billion in discretionary spending — a $210 million increase in discretionary spending. By contrast, the Trump administration proposed a nearly 20% cut to HHS discretionary spending this year.

The congressional spending deal rejects the administration’s calls for deep cuts within HHS. The administration sought a 50% spending cut for the Centers for Disease Control and Prevention. Instead, the compromise reached by lawmakers essentially keeps CDC funded at current levels, and includes funding increases for some of its pandemic preparedness programs.

The spending package would give $7.4 billion to the Substance Abuse and Mental Health Services Administration (SAMHSA) a $65 million increase over current funding levels.

The bigger budget reflects increased spending to address a rise in opioid overdoses, especially from fentanyl, as well as boosts to substance abuse disorder prevention and mental health services.

Lawmakers rejected a 15% cut to SAMHSA funding proposed by the Trump administration. The spending deal also rejects the administration’s plan to reorganize SAMHSA into the Administration for a Healthy America (AHA), a new office envisioned by HHS Secretary Robert F. Kennedy, Jr.

Democrats on the appropriations committees said the spending deal ensures SAMHSA remains its “own, independent agency to help ensure substance use and mental health remain a priority at HHS” and “includes new guardrails to ensure SAMHSA funds are allocated as intended.”

NPR reported last week that HHS briefly terminated $2 billion in addiction and mental health grants, but quickly walked back those cuts.

Education Department budget remains intact

Lawmakers are largely rejecting the administration’s proposal to dismantle the Education Department, and move many of its functions to other federal agencies.

The spending bill gives the department $79 billion in discretionary spending — a roughly flat budget compared to current spending levels.

The Trump administration proposed cutting the Education Department by $12 billion, or about 15% of its current discretionary budget.

The Education Department has already signed six interagency agreements to transfer some of its programs and employees to HHS and the departments of Labor, Interior and State.

Education Secretary Linda McMahon told employees last November that the department is soft-launching plans to reassign its work to other parts of the federal government, before calling on Congress to permanently shutter the agency.

Senate Appropriations Committee Vice President Patty Murray (D-Wash.) said in a statement that “Congress will not abolish the Department of Education, and the people’s representatives will have the final say on how taxpayer dollars get spent.”

Budget boost for Social Security

The Social Security Administration would see a higher budget under this spending plan.

Lawmakers propose giving SSA $15 billion for its administrative budget in fiscal 2026 — a $554 million increase compared to current spending levels.

Lawmakers from both parties agreed that the funding will help the agency improve customer service for the public. Democratic appropriators urged SSA to use these increased funds to resume hiring.

SSA currently has about 50,000 employees in total, according to the latest data from the Office of Personnel Management. The agency lost more than 7,000 employees through voluntary incentives last year. It also relocated many of its employees from its headquarters and regional offices to field offices.

SSA Commissioner Frank Bisignano told staff at an all-hands meeting last week that the agency is continuing to hire, according to several employees in attendance. Those employees, however, said the agency still faces a hiring freeze.

Labor Dept. federal contractor watchdog spared from elimination

The spending bill provides $13.7 billion in discretionary spending to the Labor Department — a slight increase compared to its current $13.5 billion discretionary budget.

The department’s Office of Federal Contract Compliance Programs would receive a $101 million budget, about a 9% cut to current spending levels. OFCCP ensures federal contractors aren’t discriminating against their employees.

OFCCP, however, would remain largely intact, after the Trump administration proposed major staffing cuts. An earlier funding proposal from House Republicans also proposed fully eliminating OFCCP.

The agency sent layoff notices to 90% of its staff, but rescinded those layoffs last August. Instead of being reinstated to their jobs at OFCCP, the agency said impacted employees would be “reassigned to a new position” at the Labor Department.

Small agencies marked for closure stay open

The spending bill also includes funding for small, independent agencies marked for elimination by an executive order last year.

Lawmakers propose giving the Institute of Museum and Library Services a $292 million budget — a $3 million cut compared to current spending levels.  The spending bill also proposes $3 million in funding for the Interagency Council on Homelessness.

President Trump signed an executive order last March, eliminating these agencies and five others “to the maximum extent consistent with applicable law.”

A federal judge in Rhode Island ordered a permanent injunction last November, putting the Trump administration’s plans to shutter these small agencies on hold.

House Appropriations Committee Ranking Member Rosa DeLauro (D-Conn.) said in a statement that the funding package “continues Congress’s forceful rejection of extreme cuts to federal programs proposed by the Trump administration.”

“Where the White House attempted to eliminate entire programs, we chose to increase their funding. Where the administration proposed slashing resources, we chose to sustain funding at current levels,” DeLauro said.

The post 3.8% pay raise for air traffic controllers, Education Dept cuts rejected: Highlights from final FY 2026 spending bills first appeared on Federal News Network.

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Interview transcript:

Terry Gerton I want to start with Secretary Hegseth’s Arsenal of Freedom tour. He’s taking his pitch on the road and recently spoke at the Lockheed Martin Air Force plant in Fort Worth, Texas. I know you’ve been following this, the developments in defense procurement for quite a while. What are you hearing at this point?

Stephanie Kostro So Terry, this “Arsenal of Freedom” is a month-long tour, and it really is Secretary Hegseth going around to various places. He started out in Newport News, here in Virginia, talking with shipbuilders about what it means to be part of the team, right? Being part of the arsenal of freedom and in making things faster, more efficiently, etc. He then went out to California and spoke with folks, and then most recently, just last week in Texas, visiting Lockheed Martin as you mentioned, but also SpaceX. And so talking to folks about, what does it mean to be part of the arsenal of freedom? This is building on his November 7th Arsenal of Freedom speech that he gave here at Fort McNair in the D.C. area. And it is really about reviving this team mentality of, “we are in this together.” Against that backdrop, of course, we have recent activity in acquisition transformation, but also an executive order that came out earlier this month about limiting executive compensation for defense contractors, limiting dividends and also share repurchases or stock buybacks. And so this is a very interesting time to be in the defense industry.

Terry Gerton Stephanie, with all of the changes in the FAR and the DFAR and now the Defense Appropriation Act that’s in law, do you think that DoD has the policy tools it needs and wants to accomplish its transformation?

Stephanie Kostro There are two elements of the answer here. One is, with the fiscal year 2026 National Defense Authorization Act, which was just signed into law last month, they received a lot of new authorities, a lot of a sense from Congress about the ways in which this should be tackled. There is language there about technical data rights and intellectual property. There were things in there about how to define a nontraditional defense company, etc. But I don’t think that was sufficient; we still have work to do. And so does the department have all of the authorities and resources it needs to move forward? I think we’re going to see a lot of legislative proposals come out of the department for this next round of the NDAA, the fiscal year ’27 NDAA. And I think we’ll see things about acquisition workforce. We’re going to see things about working outside of the Federal Acquisition Regulation way of doing contracts. That is code for things like Other Transaction Authority or commercial solutions openings, etc. I don’t think they have everything they need. Part of the Arsenal of Freedom tour and the rollout of this acquisition transformation is to look at how the department can buy things more effectively and more efficiently. That’s time, not having cost overruns, etc. And so all of this is sort of coming together, in a way, to ultimately really transform the way the department buys. And I’m very excited to be part of this.

Terry Gerton Having the rules and authorities is only one piece. What’s your sense of whether the acquisition culture and workforce are aligned to actually accomplish the goals?

Stephanie Kostro Culture is the hardest element of any kind of transformation, right? I do think they’re trying to empower contracting officers and other key members of the acquisition workforce, program managers, contracting officer representatives, etc. This is a longer-term issue, and I think they are trying to tackle it through training programs, etc., letting folks know tools are at their disposal and giving them the authority to go ahead and use those tools. Now, folks don’t get into acquisition within the civil service because they’re risk-loving. A lot of times they get into it because they want to do things very smartly, very efficiently and oftentimes they look back on precedent to see how things were done before. Layer over that, Terry, the fact that we lost a lot of contracting personnel through deferred resignation programs, voluntary early retirement programs and reductions in force. So we are trying to rebuild the workforce in numbers as well as in training. I don’t think they’re there yet; I do think there’s a path to get them there. I’m eager for industry to work with the Department of War and others about how to train effectively and to let industry folks sit in the same training as the government folks, so everyone’s hearing the same thing.

Terry Gerton Stephanie, before we leave this topic, you touched on the executive order about defense contractors and compensation and buybacks. There’s a lot of unknowns still in how that will play out, but what are you hearing from your members?

Stephanie Kostro Our members were very eager to hear how the Professional Services Council would summarize that EO. So we did put out — based on the fact sheet from the White House, based from some interactions we’ve had with administration officials — our interpretation of it. That said, we’ve also asked our member companies, and we have 400 member companies and the majority of them do business with the Department of War and the intelligence community, “hey, what questions for clarification would you like us to ask?” And that list is growing. It is very long. It’s things like, is this really just for publicly traded companies? What about privately owned, or S corps and LLCs? The reason I mentioned that, Terry, is S corps and LLCs will often pay out a dividend to an executive at the company so that executive can pay taxes. They pay out of dividend, so it’s not only a dividend payment, it’s executive compensation, but it’s really just to go ahead and pay federal taxes. What do people do in that regard? How do they explain this? If they have a parent company that is overseas in Europe or elsewhere, how do they explain this executive order to those folks? And that executive compensation, there’s a limit if the company is underperforming, and all of this is predicated on the company’s underperforming — either cost overruns or schedule overruns. How do they explain this to folks? And is it really just about government contracts, or what if you’re a commercial and a government company and your executive compensation is based usually on both elements, commercial and government? So how do you go ahead and limit compensation there? This is a fascinating area to be engaged with the government on. We are all learning this together.

Terry Gerton As Secretary Hegseth tries to walk this tightrope between encouraging defense contractors to be on the team and work with us, and at the same time kind of tightening the screws on enforcement and compensation, the president has said he wants to spend $1.5 trillion on defense next year. That’s a lot of money. How is that going to get spent, do you think?

Stephanie Kostro Oh, it is an eye-catching number, right? $1.5 trillion when we are roughly $1 trillion now are just under, and it is a huge increase. Now, we’ve had large increases in the defense budget in other times in U.S. history. In the early 1950s with the Korean War, the Reagan buildup that some of us remember from the ’80s. Some of us who are listening may not remember it. They may not have been born yet, and that’s okay too. You know, there is some precedent for huge increases in the defense spend. The question here becomes, if the department and the military services are going for commercial-first mentality to prioritize speed of award and innovation, etc., they certainly can spend that money throughout the defense ecosystem. The question that we have is really, what is the organizing construct for this? What would we be spending the money on? Would it be shipbuilding, combat aircraft, the logistics piece, which always tends to be an issue? We also know operations and maintenance accounts are sometimes used and reprogrammed away if they’re not spent by a certain time, because it’s one-year money at the department, it gets reprogramed away. It’s going to be an interesting mathematical problem to tackle. In addition, I would mention, we had the reconciliation bill, the One Big, Beautiful Bill Act that passed and was signed into law last July. That infused a bunch of cash into both the Department of Defense and the Department of Homeland Security. I understand some of that money hasn’t been apportioned and provided to the departments yet, but we are now at this point in January of 2026 talking about, what would a reconciliation bill look like for 2026? Congress can pass one per fiscal year. The one that was passed last July was the one for fiscal ’25. What happens this year? There are a lot of different mechanisms to get that money through Congress and over to the government to apportion to the department.

Terry Gerton Well, speaking of 2026 appropriations, it looks like Homeland Security and Defense will be two of the last bills out, hopefully before the end of this month. What are you hearing from folks on the Hill?

Stephanie Kostro I’m hearing that they’re trying really, really hard to avert a shutdown. And I think we’re going to get there. I’m not a betting person, Terry, you know, I’ve talked about that in the past. And I’m not in this case, either. The chance for a shutdown is never zero. That said, the experience that we all had back in October and November last year would indicate that there really is no appetite for a shutdown this year. The National Defense Appropriations Act and the DHS [bill] I think are probably the last because they want to get everything done before they tackle those. Those are the two departments that received the lion’s share of the money from the reconciliation bill, One Big Beautiful Bill Act last year, and they are looking to get more money in a reconciliation bill this year. So I’m not surprised to hear that those are last, but I actually don’t think that indicates that they’re very far apart on the numbers.

Terry Gerton And on those two departments, PSC is sponsoring a trip in January to the border to do some on-site research. Tell us about that plan.

Stephanie Kostro I am so excited about this. PSC has not typically done this. I do know other entities have done this, I used to be at a think tank where we would do things like this. We are bringing almost 30 different companies out to California next week, Jan. 28 and 29, to do a behind-the-scenes access with the Customs and Border Protection folks who are out there. And the ports of LA and Long Beach, the ports at entry, the land ones over at San Ysidro and Otay Mesa, really talking with folks on the ground there about what their requirements are. This is really focused on technology. How do we use technology and the art of the possible to protect our borders? Now, I would hasten to add, Terry, border security is not a partisan issue in many, many ways. The Biden administration, the Obama administration, the previous Trump administration all focused on border issues in different ways. Our companies really want to mention to folks on the ground, here is technology that you may not have experience with that is up-and-coming. How can we leverage it to better secure our borders? Talking about cargo screening, etc. I think this is a really good opportunity for companies to sit down with folks who are in the field and hear about what they need.

The post Can key visits to cities anchoring U.S. national security spur a new American “arsenal”? first appeared on Federal News Network.

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After a tumultuous 2025 that saw it lose around 4,000 employees, NASA finally has an operating budget for 2026, and one that largely preserves its scientific capabilities. On Thursday, the Senate passed an appropriations bill funding NASA, alongside the National Science Foundation and a handful of other federal agencies. 

Going into the appropriations process, the president called for a 24 percent year over year reduction to NASA's total operating budget. As part of that plan, the White House wanted to reduce the Science Mission Directorate's funding by nearly half, a move that would have forced NASA to cancel 55 ongoing and planned missions, including efforts like OSIRIS-APEX. The bill effectively rejects President Trump's plan, reducing NASA's total operating budget by just 1.6 percent year over year to $24.4 billion. 

Per the new appropriations, NASA's science budget will stand at $7.25 billion, 1.1 percent less relative to fiscal 2024, while shuffling the remaining funds to focus on different priorities. For instance, the House and Senate allocated $874 million (+8.7 percent) for the agency's heliophysics work; planetary sciences, which oversees missions like New Horizons, was cut to $2.5 billion (-6.5 percent) compared to 2024. At the same time, NASA's STEM engagement office, which the president proposed eliminating, escaped unscathed with its funding maintained at parity.

"It's almost everything we had been asking for, and it's very encouraging to see a House and Senate run by the president's own party agreeing that we need to keep investing in things like NASA science," says Casey Dreier, chief of policy at the Planetary Society, a nonprofit founded by Carl Sagan that advocates for the exploration and study of space. "It contains very clear and direct language that not only is this funding made available to these projects, but that it will be spent on the initiatives that Congress states."

Lawmakers also rejected Trump's effort to scuttle the Space Launch System after its third flight. NASA's heavy-lift rocket is billions of dollars over budget, but remains — as of now — the only spacecraft ready to ferry astronauts to the Moon. Compared to the rest of NASA, the fate of the SLS was never really in doubt. Senator Ted Cruz (R-TX) secured funding for the rocket as part of Trump's Big Beautiful Bill. "I've been saying for a long time you should never underestimate the political coalition behind the SLS, and I think that was very much validated this year," says Dreier. 

More importantly, it appears the Goddard Space Flight Center will be safe from further damage. Over the summer, the future of the facility, known for its work on projects like the James Webb Space Telescope, was put in jeopardy. By some estimates, the campus has lost a third of its staff due to workforce cuts, and dozens of buildings, including some 100 laboratories, have been shut down by management. One of the casualties was NASA's largest library, which houses irreplaceable documents chronicling the history of the space race. As part of a "consolidation" effort, many of those documents will be thrown out.

Under the appropriations bill, the Senate has directed NASA to “preserve all the technical and scientific world-class capabilities at Goddard.” It has also instructed the agency to ensure employees of the Goddard Institute for Space Studies are able to continue their work with "minimal disruption." The New York-based office, one of America's leading climate labs, was sent into limbo last spring after the Trump administration moved to shut it down. 

The bill also provides a lifeline for NASA's to bring back samples of Martian dirt collected by the Perseverance rover. Congress has effectively cancelled the official program tied to that ambition, the Mars Sample Return (MSR), but has set aside $110 million for the agency to continue developing technologies for future science missions to the Red Planet. MSR advocates have argued the mission could lead to significant scientific discoveries, but Dreier notes the program was "ripe for cancellation" after it became mired in mismanagement. 

"I worry MSR now has this stink of bloat, excess cost and threat of overruns that are really going to make it challenging to restart this without having a dramatically different approach," says Dreier, adding that deciding what to do with mission will likely be top of mind for the agency's new administrator, Jared Isaacman. 

The 2026 budget leaves NASA with fewer resources. Even in areas where Congress allocated the same amount of funds as it did in 2024, the agency will need to do more with less due to inflation. Compared to the absolute blood bath that would have been Trump's proposed budget, a marginal funding cut is the best case scenario given the circumstances, but the circumstances remain less than ideal. 

"There will be another presidential budget request coming out in the next couple of months," Dreier said. "They could do this all over again if they wanted to."

In the immediate future, NASA and its employees are at least protected from the potential fallout of another impending government shutdown. Congress has until January 30 to fully fund the federal government, and as of earlier this week, it has yet to find a way forward on appropriations for agencies like the Department of Labor.  

Correction 9:05PM ET: A previous version of this article incorrectly stated Casey Dreier’s surename as Drier. We regret the error.

This article originally appeared on Engadget at https://www.engadget.com/science/space/senate-passes-minibus-bill-funding-nasa-rejecting-trumps-proposed-cuts-231605536.html?src=rss

©

Interview transcript:

Terry Gerton I suspect that most people don’t know that Medicare funds graduate medical education. This is a topic you’ve looked into quite a bit at GAO. Give us an overview of this situation first.

Leslie Gordon Medicare is the biggest funder of graduate medical education. There are a number of federal programs that fund graduate medical education, but Medicare is the primary funder, funding about $22 billion in 2023. We’ve been looking at it over a course of years, because that’s a chunk of change to look at and understand if it’s being effective. Over the course of our work in 2017, 2018, we’ve noticed that there’s a misalignment; there’s an unevenness in how medical residency is distributed across the country and where those graduate medical education dollars go.

Terry Gerton How’s it supposed to work?

Leslie Gordon Well, the impetus behind funding for graduate medical education is to ensure we have a well-trained workforce. And indeed, it should be distributed across the country so that people have access to services. And Medicare cares about having trained providers to care for all the Medicare beneficiaries across the country.

Terry Gerton So the Consolidated Appropriations Act of 2021, if we can take our minds back that far, put in some provisions maybe to try to address this misallocation of graduate medical education, and you’ve just published a report on that. Tell us about what you found in terms of the first three years of this program.

Leslie Gordon Our report is an interim report. The Consolidated Appropriations Act of ’21 funded 1,000 new residency positions. That’s in a framework of over 163,000 medical residents. So it’s not a lot of positions, but it’s designed to alleviate situations where hospitals would like to expand, or smaller hospitals would like to open new medical residency programs, and to direct some attention to underserved communities.

Terry Gerton And as you looked at the distribution of those thousand positions, what did you find?

Leslie Gordon We found that awarded hospitals were very similar to those that applied who were not awarded. So we did a comparison to look at, were there any biases in how these positions were being distributed when CMS was distributing them? Or, did they follow the rules and the categories set out in the CAA? And generally, the awardees and those that were not awarded were similar in nature. There was an effort and an impetus to focus on underserved areas, particularly rural areas, as we noted earlier. And while there wasn’t a redistribution of a majority of positions going to rural areas, there was an emphasis and a success in funding the rural hospitals that applied. Ten rural hospitals applied, nine were awarded. That’s different from about 50% of urban hospitals that applied that were awarded.

Terry Gerton Sounds like this really didn’t get to the crux of putting more residents in urban hospitals.

Leslie Gordon It didn’t put more residents necessarily in urban hospitals. It put more residents everywhere, let me say that. It emphasized and allowed for more residency positions and programs in rural and underserved areas. But with a small portion of residencies that were being awarded, it’s a big pile to redistribute and only have a thousand pieces with which to do that.

Terry Gerton I’m speaking with Leslie Gordon. She’s director for Medicare at GAO. Are there particular issues that the smaller or rural hospitals faced in terms of applying for this program or really making the best use of the resources that could potentially be available?

Leslie Gordon In the course of our work, we talked to representatives from hospitals in all kinds of areas, including rural hospitals. We talked to some hospitals and we talked to hospital associations. We heard that CMS’s use of the health professional shortage area as the primary criterion for distributing and allocating prioritization of who would be awarded got in the way for some smaller communities and those that might be training in rural areas or serving rural residents that traveled out of their local area to seek care. The way in which it didn’t quite land for rural areas is that the HPSA score is based on a population-to-provider ratio. And if you add one new doctor to population of a thousand people, that can really change the score a lot, as opposed to adding one new doctor to a population of 200,000 people. In that way, it wasn’t quite aligned with the goal of focusing on rural areas.

Terry Gerton And so, are there changes that CMS could make to this distribution model in the last couple of years of this program to help address those shortcomings?

Leslie Gordon We provided this feedback and other feedback to CMS as a part of the course of our work. They have two more rounds to distribute. And one of the things we also learned about is that hospitals needed other funding to make good use of these additional spots, these additional residency spots. I think being more aware of upfront costs, the need to maintain accreditation, and some of the challenges that we highlight in our report will help CMS, perhaps, and those who apply.

Terry Gerton If CMS does adjust the criteria or support, are there metrics that they should track to make sure that the changes are working?

Leslie Gordon CMS is tracking the metrics that were set out in the Consolidated Appropriations Act, and we will be looking at and reporting again in 2027.

Terry Gerton So when you think about this over the next couple of years, are there things that Congress, or educators, or other folks should watch to gauge whether or not these new slots are meeting workforce goals? Are they helping advance the accreditation or the certification of young medical students?

Leslie Gordon I think the experience of awarding these positions helps highlight that it’s not just funding that will solve the problem in terms of distribution of medical residency. There’s a support infrastructure that needs to be there in terms staffing, in terms equipment, in terms considering the types of experiences that medical residents need to have to be fully trained. So we cover all these things in our report and I think that this experience with the allocation of the thousand positions helps highlight all the infrastructure that’s needed to support medical residency training.

Terry Gerton Are there companion programs designed to address those infrastructure shortcomings?

Leslie Gordon The federal government actually has 72 programs. Yes, there’s a lot of programs and there are 72 health care workforce programs. And we have open recommendations from our prior work that HHS needs to examine the gaps in the workforce and take action to address those gaps and needs to communicate around them. We have other open recommendations that they don’t have the information necessary to identify and evaluate the cost effectiveness of those 72 programs. So we do have open work, not directly related to this report, but we have open recommendations that focus in on the need to have better information and truly evaluate the effectiveness of all of the Work First programs in a comprehensive way.

Terry Gerton And do you have a sense that CMS and HHS are taking on that task to sort of harmonize all of these programs so that they make sense and they are optimized for best outcomes?

Leslie Gordon They are making progress on our recommendations and we will continue to follow up to see how they progress.

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Interview transcript:

Joel Gurin The work that we’re doing now is part of an effort being led by the Robert Wood Johnson Foundation, which has become really concerned about the potential for some real disruptions to what you can think of as the public health data infrastructure. This is the data on all kinds of things, on disease rates, on social determinants of health, on demographic variables that’s really critical to understanding health in this country and working to improve it for all Americans. And we’ve seen a lot of changes over the last year that are very troubling. There are attempts to make some of this data unavailable to the public. Some major research studies have been discontinued. There’ve been deep cuts to the federal staff that are responsible for collecting some of this data. And just cuts to research funding, for example from the NIH overall. So it really adds up to a cross-cutting risk to the infrastructure of public health data that we’ve relied on for decades.

Terry Gerton Talk to us about why this data is so important, why it’s the government’s responsibility, maybe to keep it up to speed, and whether it’s a policy shift that’s driving this, or is it just individual actions?

Joel Gurin From what we can tell, it’s, I would say, a number of policy decisions that are all related to how the Trump administration sees the president’s priorities and how they want to implement those. So it’s not like we’ve seen a wholesale destruction of data, but we’ve see a lot of kinds of targeted changes. Anything related to DEI, to diversity issues, to looking at health inequity. That’s at risk. Any kinds of data related to environmental justice or climate justice — that’s at risk. Data related to the health of LGBTQ people, particularly trans individuals, that’s at risk. So we’re seeing these kinds of policy priorities of the administration playing out in how they relate to the collection of public health data. And this data is critical because government data, number one, some of these data collections are expensive to do and only the government can afford it. And also federal data has a kind of credibility, as a kind centralized source for information, that other studies don’t have. For example, the administration recently discontinued the USDA’s study of food insecurity, which is critical to tracking hunger in America. And it’s going to be especially important as SNAP benefits are cut back. There are other organizations and institutions that study hunger in America. The University of Michigan has a study, NORC has a study. But the federal study is the benchmark. And losing those benchmarks is what’s troubling.

Terry Gerton One of the recommendations, just to skip ahead, is that more states and localities and nonprofits collect this data if the federal government is not going to. But what does that mean for trust in the data? You mentioned that federal data is usually the gold standard. If we have to rely on a disperse group of interested organizations to collect it, what happens both to the reliability of the data and the trust in data?

Joel Gurin It’s a great question, and it’s one that we and a lot of other organizations are looking at now. One of the things that’s important to remember is that a lot of what we see as federal data actually begins with the states. It’s data that’s collected by the states and then fed up to federal agencies that then aggregate it, interpret it and so on. So one of questions people have now is, could we take some of that state data that already exists and collect it and aggregate it and study it in different ways, if the federal government is going to abdicate that role? There was some very interesting work during COVID, for example, when the Johns Hopkins Center, Bloomberg Center for Government Excellence, pulled together data from all over the country around COVID rates, at a time when the CDC was not really doing that effectively, and their website really became the go-to source. So we have seen places where it’s possible to pull state data together in ways that have a lot of credibility and a lot impact. Some of the issues are what do the states really need to make that data collection effective? So regardless of what the federal government does with their data, they need mandates from the federal government to collect it, or it won’t be collected. They need funding. About 80% of the CDC’s budget actually goes to state and local, and a lot of that is for data collection, so they need that funding stream to do the work. And they also need networks, which are starting to develop now, where they can sort of share expertise and share insights to make data work on a regional level.

Terry Gerton I’m speaking with Joel Gurin. He’s the president and founder of the Center for Open Data Enterprise. Well, Joel, then let’s back up a little bit and talk about the round table and the research that led into this paper. How did you do it and what were the key insights?

Joel Gurin So one of the things that our organization, Center for Open Data Enterprise, or CODE, does is we hold roundtables with experts who have different kinds of perspectives on data. And that’s what we did here with Robert Wood Johnson Foundation support. We pulled together a group of almost 80 experts in Washington last summer, and we led them through a very highly facilitated, orchestrated set of breakout discussions. We also did a survey in advance. We did some individual interviews with people. We do a lot of our own desk research. The result is a paper that we’ve just recently published on ensuring the future of essential health data for all Americans. You can find it on our website, odenterprise.org. That’s odenterpreise.org. If you go to our publications page and do the health section in the drop-down from publications, you’ll find it right there, along with a lot of other op-eds and things we publish related to it. Putting out this paper was really the result of pulling together a lot information from literally hundreds of pages of notes from those breakout discussions as well as our own research and as well is tracking everything that we could see in the news. But one of the things that I want to really emphasize, in addition to the analysis that we’ve done of what’s happening and what some of the solutions could be which is that’s a fairly lengthy paper and hopefully useful, we’ve also put together an online resource hub of what we think are the 70 or so most important public health data sets. And I want to really stress this because we think it’s actually a model for how to look at some of the issues affecting federal data in a lot of areas. We found that by working with these 80 or so experts and doing additional research and surveying them and talking to them, there’s a lot commonality and common agreement on what are the kinds of data that are really, really critical to public health and what are those sources. Once you know that, it becomes possible for advocates to argue for why we need to keep this data and how it needs to be applied. And it’s also possible to ask questions like, for this particular kind of data, could somebody other than the federal government collect it? And could we develop supplemental or even alternative sources? So we really feel that that kind of analysis, we hope, is a step forward in really figuring out how to address these issues in a practical way.

Terry Gerton That’s really helpful and also a great prototype for, as you say, data in other areas across the federal government that may or may not be getting the visibility that they used to get. What were the key recommendations that come out of the paper?

Joel Gurin Well, we had recommendations on a couple of different levels. We had recommendations to, as we talked about before, to really look at state and local governments as important sources of data. They are already, but could more be done with those? This includes, for example, not just government data collections the way it’s done now, but using community-based organizations to help collect data from the community in a way that ultimately serves communities. We’re also very interested in the potential for what are being called non-traditional data sources, like the analysis of social media data and other kinds of things that can give insights into health. But I think probably the single most important recommendations at the federal level are to continue funding for these critical data sources and to recognize how important they are and to really recognize the principle that there’s an obligation to understand health and improve health for all Americans, which means looking at data that you can disaggregate by demographic variables and so on. I want to say we have had some really positive signs, I think, from Congress, particularly on the overall issue of supporting health research. And when we talk about NIH research, remember some of that is really lab medical research, but a lot of it is research on public health, research on social factors, research on behavioral factors, all of this kind of critical work. And the president’s budget actually recommended a 40%  cut in NIH funding, which is draconian. The Senate Appropriations Committee over the summer said, we actually do not want to do that, and in fact, we want to increase the NIH budget by a small amount. So I think what we’re seeing is there’s a lot of support, bipartisan support in Congress, for protecting research funding that ultimately is the source of a lot of the data we need. Some of this is just because it’s a shared value, and some of it is because those research dollars go to research institutions in congressional districts that representatives and senators want to see continue to be funded. So I think that basic fear that a lot of us had a few months ago, that research was simply going to be defunded, I think, that may not happen. And I would hope that Congress continues both the funding and also support for not only some of this research funding, but agencies like the National Center for Health Statistics, or the Agency for Health Research and Quality, which have been under threat, to really recognize their importance and sustain them.

Terry Gerton One of the challenges we might face, even if Congress does appropriate back at the prior levels, is that much of the infrastructure has been reduced or eliminated, and that’s people and that’s ongoing projects. How long do you think it will take to kind of rebuild back up to the data collection level that we had before, if we do see appropriation levels back to what they were?

Joel Gurin I think that’s a really critical question. You know, early in the administration, 10,000 jobs at HHS were cut, about a quarter of those from the CDC. But there has been some pushback. There was an attempt during the shutdown to do massive layoffs in HHS and CDC. The courts ruled against that. So I’m hoping that we can prevent more of that kind of brain drain. It will take a while to restaff and really get everything up to speed, but we think it’s doable and we hope we can get on that path.

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Congress is seeking more in-depth information on staffing numbers, federal contracts, remote work agreements and other federal workforce details, according to several provisions of the two spending bills Senate and House appropriators released over the weekend.

The latest two-bill “minibus,” which has bipartisan, bicameral support, includes appropriations for Financial Services and General Government, as well as National Security and the State Department. The package tees up fiscal 2026 spending levels for the State Department, Treasury Department, Office of Personnel Management, General Services Administration and Small Business Administration, along with many other agencies.

For OPM, lawmakers are now eyeing $167.5 million in appropriations for 2026. That’s about $51.5 million short of OPM’s enacted $219 million appropriation for fiscal 2025. But along with the topline numbers, appropriators also appear to be looking for more details on federal workforce numbers and programs, according to a joint explanatory statement released Sunday alongside the legislation.

For one, the spending minibus includes a provision seeking further data on changes to the federal workforce size over the last year. No later than 60 days after the bill is enacted, OPM would have to publish specific data points on the number of civilian federal employees. That includes the numbers prior to the start of President Donald Trump’s term, as well as the numbers as of Sept. 30, 2025 — the final date of the deferred resignation program (DRP) — and finally, the current federal workforce levels.

The legislation additionally calls for a report from OPM of how many employees opted into the DRP, as well as the agencies, occupations, locations and pay rates for those now-former federal employees.

OPM already recently released some further information on federal workforce numbers. The updated “Federal Workforce Data” website details employee data by geographic location, agency, age, education level, bargaining unit status — and much more. The new platform also reaffirms the significant reshaping the federal workforce experienced over the last year, showing that the current federal workforce size is the lowest it’s been in at least a decade.

In addition to details on federal workforce size, congressional appropriators are also seeking more information about agencies’ use of remote work agreements for federal employees. Within 90 days of enactment, OPM would have to detail how and when employees are deemed eligible for remote work, how often those agreements are reviewed, and how remote work agreements influence locality pay adjustments, according to the legislation.

The policy provision comes shortly after OPM released updated telework and remote work guidance, which now aligns with the Trump administration’s significant curtailing of telework and remote work across the federal workforce. While emphasizing as much on-site presence as possible, OPM’s revised guidance also defined limited exceptions to return-to-office requirements for certain federal employees.

A separate provision of the spending bill would require OPM to report to Congress at least two days before signing any potential sole-source contracts, as well as any contracts worth $2 million or more.

The new provision comes as OPM is working out the details of a federal contract and action plan to modernize and centralize the more than 100 current federal HR systems used across government. During May 2025, OPM initially announced a sole-source contract award to that end, but then quickly canceled the award. OPM later issued a request for proposals (RFP), and agency officials have said they expect to soon award a contract that will eventually result in one cohesive, governmentwide HR system.

Separately, congressional appropriators are also planning to direct OPM to provide quarterly updates on the Postal Service Health Benefits program, “including any gaps in OPM’s capacity to successfully implement the program.”

The provision comes a few years after OPM first established the PSHB program for Postal Service employees. In July 2025, OPM’s inspector general office then reported that the agency’s enrollment platform for PSHB was at risk of an “operational failure” due to staffing reductions within OPM.

Bipartisan, bicameral appropriators agreed to the latest appropriations minibus on Sunday, looking to generally lower spending levels in comparison with enacted appropriations for fiscal 2025. Subcommittee leaders said the agencies that fall under those two bills would see a cumulative total of $9 billion less in spending than last fiscal year.

The proposed budget cuts are more modest than many of the steeper spending reductions the Trump administration requested for fiscal 2026, which now appear to be off the table. The new legislation marks further progress toward Congress reaching a government spending agreement, just weeks away from the Jan. 30 funding deadline.

The latest minibus comes after congressional appropriators teed up a three-bill minibus early last week. The House later passed those three bills, which are now under consideration in the Senate. In total, three of the 12 appropriations bills for 2026 have completely cleared Congress.

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You just left a high-level meeting with agency leadership. You and your colleagues have been informed that Congress passed new legislation, and your agency is expected to implement the new law with your existing budget and staff. The lead program office replied, “We can make this work.” The agency head is pleased to hear this, but has reservations. How?

Another situation: The president just announced a new priority and has assigned it to your agency. Again, there is no new funding for the effort. Your agency head assigns the priority to your program with the expectation for success. How do you proceed?

Today, given the recent reductions in force (RIFs), people voluntarily leaving government, and structural reorganizations that have taken place and will likely continue, answering the question “How to proceed?” is even more difficult. There is a real need to “know” with a level of certainty whether there are sufficient resources to effectively deliver and sustain new programs or in some cases even the larger agency mission.

Members of the Management Advisory Group — a voluntary group of former appointees under Presidents George W. Bush and Donald Trump — and I believe the answer to these and other questions around an organization’s capabilities and capacity to perform can be found by employing the Operational Readiness and Resiliency Index (ORRI). ORRI is a domestic equivalent of the military readiness model. It is structured into four categories:

• Workforce
• Performance
• Culture
• Health

Composed of approximately 50 data elements and populated by existing systems of record, including payroll, learning management systems, finance, budget and programmatic/functional work systems, ORRI links capabilities/capacity with performance, informed by culture and health to provide agency heads and executives with an objective assessment of their organization’s current and future performance.

In the past, dynamic budgeting and incrementalism meant that risk was low and performance at some levels predictable. We have all managed some increases or cuts to budgets. Those days are gone. Government is changing now at a speed and degree of transformation that has not been witnessed before. Relying on traditional budgeting methods and employee surveys cannot provide insights needed to assess whether current resources provide the capabilities or capacity for future performance of an agency — at any level.

So how does it work?

As is evident with the illustration above, ORRI pulls mainly from existing systems of record. Many of these systems are outside of traditional human resources (HR) departments to include budget, finance and work-systems. Traditionally, HR departments relied on personnel data alone. These systems told you what staff were paid to do, not what they could do. It is focused on classification and pay, not skills, capacity or performance.

Over the years, we have made many efforts to better measure performance. The Government Performance and Results Act (GPRA) as amended, the Performance Assessment Rating Tool (PART), category management and other efforts have attempted to better account for performance. These tools — along with improvements in budgeting to include zero-based budgeting, planning, programming and budgeting systems, and enterprise risk management — have continued to advance our thinking along systems lines. These past efforts, however, failed to produce an integrated model that runs in near real-time or sets objective performance targets using best-in-class benchmarks. Linking capabilities/capacity to performance provides the ability to ask new questions and conduct comparative performance assessments. ORRI can answer such questions as:

• Are our staffing plans ready for the next mission priority? Can we adapt? Are we resilient?
• Do we have the right numbers with the right skills assigned to our top priorities?
• Are we over-staffed in uncritical areas?
• Given related functions, where are the performance outliers — good and bad?
• Given our skill shortages, where do I have those skills that are at the right level available now? Should we recruit, train or reassign to make sure we have the right skills? What is in the best interest of the agency/taxpayer?
• Is our performance comparable — in named activity, to the best — regardless of sector?
• What does our data/evidence tell us about our culture? Do we represent excellence in whatever we do? Compared to whom?
• Where are we excelling and why?
• Where can we invest to demonstrate impact faster?

Focusing on workforce and performance are critical. However, if you believe that culture eats strategy every time, workforce and performance needs to be informed by culture. Hence ORRI includes culture as a category. Culture in this model concentrates on having a team of executives that drive and sustain the culture, evidenced by cycles of learning, change management success and employee engagement. Health is also a key driver for sustained higher performance. In this regard, ORRI tracks both positive and negative indicators of health, as is evident in the illustration. Again, targets are set and measured to drive performance and increase organizational health. Targets are set by industry best in class standards and strategic performance targets necessary for mission achievement.

Governmentwide, ORRI can provide the Office of Management and Budget with real-time comparative performance around key legislative and presidential priorities and cross-agency thematic initiatives. For the Office of Personnel Management, it can provide strategic intelligence on talent, such as enterprise risk management based on an objective assessment: data driven, on critical skills, numbers, competitive environment and performance.

ORRI represents the first phase of an expanded notion of talent assessment. It concentrates on human talent: federal employees.

Phase two of this model will expand the notion of operating capabilities to include AI agents and robotics. As the AI revolution gains speed and acceptance, we can see that agencies will move toward increased use of these tools to increase productivity and reduce transactional cost of government services. Government customer service and adjudication processes will be assigned to AI agents. Like Amazon, more and more warehouse functions will be assigned to physical robots. Talent will need to include machine capabilities, and the total capabilities/capacity reflect the new performance curve — optimizing talent from various sources. This new reality will require a reset in the way government plans, budgets, deploys talent, and assesses overall performance. Phase three will encompass the government’s formalized external supply chains which represent the non-governmental delivery systems — essentially government by other means. For example, the rise of public/private partnerships is fundamentally changing the nature of federated government; think of NASA and its dependence on Space X, Boeing, Lockheed Martin and others. ORRI will need to expand to accurately capture these alternative delivery systems to overall government performance. As the role of the federal government continues to evolve, so too do our models for planning, managing talent and assessing performance. ORRI provides that framework.

John Mullins served on the Trump 45 Transition Team and later as the senior advisor to the director at OPM. Most recently Mullins served as strategy and business development executive for IBM supporting NASA, the General Services Administration and OPM.

Mark Forman was the first administrator for E-Government and Information Technology (Federal CIO). He most recently served as chief strategy officer at Amida Technology Solutions.

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Interview transcript

Terry Gerton You are the Acting Inspector General for the Special Inspector General for Afghan Reconstruction. That’s about to stand down, but tell us the origin story of the organization.

Gene Aloise Well, SIGAR was created around 2008, got started around 2009. We were created especially to look at Afghanistan. We’re the only IG created to look specifically at Afghanistan. Our legislation created us as an independent agency. We worked directly for the Congress and the administration. We’re not housed in any other federal agency, which made us very independent, which helped us do the work we did.

Terry Gerton Was there a specific gap or incident back in 2008 that prompted Congress to stand this up?

Gene Aloise Yes, Congress was getting concerned that there was so much money going into Afghanistan and they really didn’t have a special IG to look at it. They had other IGs going on, but they wanted a specific focus on Afghanistan.

Terry Gerton Over your nearly two decades, you’ve issued hundreds of audits and lessons learned reports. Are there any that stand out as significant and consequential, maybe the most consequential for U.S. Policy or operations?

Gene Aloise I think our final report summarizes all our work in the past 17 years. It lays out where the money was spent, how it was spent, what our audit work covered, what our investigations covered, and what our lessons learned report covers. It’s a very first-time-only comprehensive collaboration of all our work.

Terry Gerton As I read through it, one of the themes I took away was there were a lot of missing internal controls. Processes could have been organized and designed better from the beginning that would have prevented some waste. Could you give us some examples there?

Gene Aloise There are a lot of examples of missing controls. The problem with Afghanistan is we spent, and this is often said, too much money, too fast in a country that couldn’t absorb it. So there was, you know, a lack of agency control over the money going in there. We had too many people rotate too frequently to keep track of all the money. And so it was really easy — I use that term — for SIGAR to go in and find negative findings because of all the money that was going over and the lack of accountability for it.

Terry Gerton One of the things that really struck me was a description of sort of a misapprehension of the problem from the beginning, and it’s reflected in your name, Afghanistan Reconstruction, but we weren’t really reconstructing, we were constructing. What difference did that make in how the process played out?

Gene Aloise When you think about what we were trying to do, build a vibrant economy and democracy in a severely undeveloped country with high illiteracy rates, high poverty rates, it was really a Herculean task. And it wasn’t really reconstruction, as you mentioned, it was construction. We actually constructed the Ministry of Defense building, all the ministerial buildings over there we constructed. There was nothing there.

Terry Gerton We constructed institutions as well. How did that play out?

Gene Aloise Not well. I mean the government we created in Afghanistan, we being the United States and the donor countries, was basically a white collar criminal enterprise because of the corruption that was there. It was a good faith effort, but for many years we ignored, the United State and others, ignored the corruption. And by the time we created a government over there, it was endemic. Corruption was endemic.

Terry Gerton Did you notice in your final report that any of the previous reports and findings led to measurable change?

Gene Aloise Our reports led to about 30 legislative achievements, either specific legislation or amendments to legislation, to correct problems. We made over 1,500 recommendations to agencies. About 73% of them were implemented. We did change programs for the better. We did save money. About $4.6 billion we were able to save. So yeah, our reports had impact.

Terry Gerton Did you see that in real time or only in looking backwards?

Gene Aloise No, sometimes in real time. We stopped the purchase of UH-60 Blackhawk helicopters at a tune I think of $40 million, or there was infrastructure that was being built that we thought was not warranted. We stopped that. The report goes in just lists of a series of things we were able to stop.

Terry Gerton I’m speaking with Gene Alois. He’s the acting inspector general for the Special Inspector General for Afghanistan Reconstruction. Despite all of those accomplishments, the report also notes some systemic issues that were never fully resolved. What were the toughest problems to fix, and why did they persist?

Gene Aloise A lot of it dealt with agencies’ pushback to what we were trying to do. We were a very aggressive IG, probably the most aggressive IG in Washington, D.C., but a lot of people didn’t like that, that we were so aggressive. So sometimes we had a battle to get things done. We had a lot support on the Hill. We had, I think, 24 hearings over our time span, and we were able to get things done, but it wasn’t easy. For example, under the Biden administration, they delayed our work for over a year because they said in 2021 the troops left, your jurisdiction is over. But our jurisdiction was always follow the money. It was never tied to the troops. So that delayed our word for about a year.

Terry Gerton And how did you pick that back up then?

Gene Aloise Through a bipartisan congressional effort that got the administration to start cooperating with us.

Terry Gerton Well, speaking of following the money, your charter, I guess, sunsets in 2026, but there’s still money out there. Who will pick up the responsibility for tracking what’s left?

Gene Aloise For Afghanistan? We’re talking about the DOD IG and the State Department IG. We’ve transferred a lot of our material over to them. And they will pick up what’s left over there. But money has stopped. The Trump administration has stopped funding to Afghanistan.

Terry Gerton In this transition, how will you be able to protect the lessons learned? You’ve done a lot of reports about lessons learned. Where will those go?

Gene Aloise Hopefully, policymakers will look at our lessons learned reports and our other reports and use that to learn from, because if we go into Gaza and we go in Ukraine, they’re going to be facing the same challenges. I can guarantee you, as we sit here today, there are corrupt individuals, corrupt corporations, corrupt tribal leaders, ready to get whatever reconstruction money is going to go into those places. Look at SIGAR’s work. Look at our recommendations. Look at what we’ve discussed for 17 years. And it will give you what you need to do to prevent that.

Terry Gerton Do you think that there are specific legislative actions that would help prevent that in the future if we do create new contingency responses?

Gene Aloise Yeah, I think the best thing they could do is create another SIGAR-like organization because only an independent organization that is not feeling the pressure from an agency head or whatever to not report the facts is going to do what we were able to do in Afghanistan.

Terry Gerton What about on the front hand in terms of designing those contingency response missions? Are there particular lessons you wanted to put a pin in right now for people who are thinking about those?

Gene Aloise Here’s one, think about what you’re gonna do and if it really has any chance of success because what we saw in Afghanistan is really, did we ever have a chance for success in Afghanistan? I mean, the mission was so difficult to do. So be realistic about what you’re going to try to do in these countries that you’re going to pour lots of money in.

Terry Gerton Is that realistic assessment something that the government can do itself? Does it need outside red teamers to help it with? How do you really get a comprehensive realistic assessment?

Gene Aloise Plenty of smart people in the State Department, Defense Department, and other agencies that could sit down and lay out a strategy for wherever country they’re going into that yeah they can figure this out. You know, it’s not rocket science, it is a lot of common sense.

Terry Gerton Would you have a handover book for the next acting IG, for the next contingency IG?

Gene Aloise Yeah, once again, I’ll use our final report. Take a look at that. And it references all the other work we’ve done in the past. You couldn’t have a better plan than what we’ve laid out for the past 17 years or so.

Terry Gerton Well, now you’ve documented the lessons. Here’s hoping we learn them.

Gene Aloise Yes, I agree.

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United States President Donald Trump announced that he has directed the federal government to raise the 2027 military budget target from $1 trillion to $1.5 trillion, framing the increase as necessary “for the Good of our Country” during what he described as a period of “very troubled and dangerous times.” Trump made the statement in […]

Interview transcript:

 

Mike Meese When you think about it, [2025] had as many changes for the federal workforce and for military service members as we have had almost in the last 60 years that was not during wartime. You know, if you think about it we had massive changes after 9/11, an external crisis. We had massive changes after the 2008-2009 Great Recession; another economic crisis and obviously massive changes after COVID. But here we had the election of President Trump, and in a lot of ways that he came in was adjusting for the expansions of government that took place during the last three crises, where he peeled back a lot of that. People may agree with it, people may disagree with it, but it certainly had a huge impact on people in the military, people that were veterans that were serving in the civilian workforce and many other aspects of government.

Terry Gerton Give us a couple of examples of things you saw there at Armed Forces Mutual.

Mike Meese A lot of our members, a lot of our folks were former military, they end up now working for the federal government and were given the option of the early retirement. Consequently, many of them had to go through very rapidly and assess, what is my financial situation? How much longer can I work? If I take this fork in the road, so to speak, is my family going to be secure? Again, without knowing the unknown of what happens if you leave federal service, are there going to be jobs that are going to be out there within the economy? At the same time, you had other pretty radical changes. It wasn’t an economy that you knew that you were jumping out into. There was the liberation day, so to speak, on the first of April when the tariffs were put in place, and there was substantial economic uncertainty. So it was, there’s one government train that you were on that you might want to step off of, and if you recall back earlier in this year, many economists felt that we were going to go into a recession. Fortunately, we managed to avoid that. The market continues to do well. The economy actually seems to continue to be doing well in spite of some of the mastications of a lot of economists.

Terry Gerton Were there any changes you saw in the past year that you’d want to make sure continue?

Mike Meese Well, I think being able to be respectful of government workers and giving them the options wherever you did. The people in the Department of Veterans Affairs talked very rapidly about that they were going to try to take down 80,000 workers. Most of those have tended to be by voluntary separations or not hiring new people, and it’s had an impact on the workforce. But as much as possible, respecting the wishes of government workers and being able to do that has been a positive thing. Also, it will be very interesting because, as sort of a studier of this from a public policy perspective, the president has really stretched the bounds of executive power, and now courts and increasingly the Congress are peeling that back. One example was when the president adjusted the collective bargaining rights of many federal workers, Congress has recently started to peel that back. And so the question is, are many of these changes that were done unilaterally by the executive going to stand the test of time as a powerful president doing things? Whether you agree or disagree with them, unless they become institutionalized, we will tend to revert back to where we were before.

Terry Gerton That’s helpful insight. Certainly one of the things that marked the calendar year 2025, the beginning of fiscal year 2026, was the government shutdown, the longest lapse in appropriations ever. I think so many folks don’t understand the tenuousness of many service members and veterans’ financial status. And whether they missed a SNAP payment or they missed up a paycheck, many were really significantly impacted. Talk us through that and what you saw at Armed Forces Mutual.

Mike Meese Yeah, it’s unfortunate, but somewhere in between a quarter and a third of service members are just one or two paychecks away that if they had a $400 extraordinary expense, that would really set them back. And so consequently, although fortunately, the shutdown was resolved and no military paychecks did not take place, there was a heck of a lot of uncertainty in that. For Armed Forces Mutual, for example, we have a lot of people that pay us their insurance payments by allotment. Normally we get those allotments four days before payday, or we get the information from the Defense Finance and Accounting Service four days before payday. We actually did not get them until about 12 hours before payday. So it literally was the federal government putting things together right before the 31st of October to be able to get things done. And that anxiety for us, and I’m sure every other military-supporting organization, all the banks and everybody else, were working right at the last minute. Service members were postponing vacations. The biggest issues that we saw was people that were literally in the middle of a permanent change of station and the funds either would not come through for that, or maybe they were supposed to go into government quarters, but it was not an essential person that was going to inspect those government quarters. So they’re living on the economy having to pay for a hotel bill while they were moving into those quarters. And so although it did not affect everybody across the board, there were selected pockets where people ended up with some very extraordinary expenses that they might not have been prepared for.

Terry Gerton Mike, there was some proposed legislation that would perhaps mitigate this in the future. What’s your sense of its possibility?

Mike Meese The good news was, and I think we talked about this when we talked in October, everything in the law says that people that were going to be furloughed were in fact going to get back pay. And when this passed, part of the law was for individuals to get back pay. That ought to be permanently part of that law so that you remove the uncertainty and the potential threats that people are not going to get paid on that. In fact, what we really ought to do is find a way for Congress and the executive to work together to get all 13 bills passed by the end of the fiscal year. And that way, you don’t run into this challenge. In fact, this shutdown is probably a good example because I don’t think, whether you’re on one side or the other, anybody hugely politically benefited from this one way or the other. People will write op-eds about it, but nobody outside of Washington cares about that. They just know that government didn’t function for almost a month and a half.

Terry Gerton I’m speaking with Mike Meese. He’s the president of Armed Forces Mutual. Mike, what lessons do you want to make sure that service members, families and veterans take from 2025?

Mike Meese Well, the first is, just following up on the shutdown, some people, especially federal civilian workers, they got lump sum pays in November, at the end of November, where they deferred going out to dinner, deferred vacation or deferred other spending in October. When you get that lump sum pay, that’s actually a good opportunity because you can’t go back out to dinner like you were going to in October. Save that money, set it aside in an emergency fund. Prepare for future potential shutdowns and put the money toward your long-term goals. So that, I think, would be a very important thing. The second thing is, be prepared yourself, always. And that’s keeping your skills up, keeping your resume handy, keeping that LinkedIn profile there. I don’t know what will happen in the future in terms of other federal government shutdowns or opportunities for a deferred retirement system, but it’s always something that people should bear in mind that, especially since we have seen that government jobs that they thought were going to be permanent may not be permanent, you’ve got to be able to have other options.

Terry Gerton Well, speaking of that smart financial planning, any advice for folks who are navigating financial stress through the holidays or perhaps just after?

Mike Meese Well, that is always a challenge. What I tell people, we sometimes have gotten a little bit of a habit; back during COVID when you couldn’t travel, you tended to get more extravagant gifts for the family that you were not visiting. Now that you’re visiting and traveling to them, recognize that just being there is part of that gift, so you don’t need to be quite as lavish on the expenditures. The other thing that I talk with military families, there was one Christmas where I had five members of our family, it turned out that visiting two sets of relatives, we actually flew on Christmas day. And if you fly on Christmas, it’s actually a very cheap fare. It’s kind of strange being in the airport on Christmas but all the flight attendants and pilots are wearing hats and singing Christmas carols. They have to work that day and it turned out to save us a lot of money for a family of five. So there are ways that you can get deals even during the holidays.

Terry Gerton And as you turn your attention to 2026, what legislation or policy changes will you be watching for as the new year begins?

Mike Meese Well, it’ll be very interesting what happens with federal government workers as well as the military. Currently in the National Defense Authorization Act, the military pay increase is going to be 3.8%. And so that is actually ahead of inflation. For me as a military retiree, my pay increase as military retiree and Social Security age is only 2.8%, so the military is doing a little bit better. Federal workers, on the other hand, are going to get a 1% increase, except if they are in federal law enforcement positions, like the FBI, Customs and Border Protection, Secret Service and any other federal border law enforcement. The proposal is for them to get a 3.8% increase, the same as the military. So when you do get that pay increase, whether it’s 1% as a civilian worker, well you’ll be a little bit behind inflation, or 3. 8% in the military or law enforcement, be sure to use that judiciously and maybe put some of that away into savings because you don’t know what will end up happening in 2026.

The post From paychecks to policy shifts, 2025 tested military families. How will they fare in 2026? first appeared on Federal News Network.

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Interview transcript:

 

Terry Gerton You have done some recent research that connects in very detailed ways the accuracy of census data to federal funding programs. Walk us through the high points and what’s at stake now as we look to 2030.

Sean Moulton Everyone knows that every 10 years we do a full census of the entire population here in the United States. And we’ve done it really since the founding of the country. But it’s not just an academic exercise just to figure out how many people are in each state or anything like that. We use that data in a very robust way. One of those ways is helping to guide our federal funding. What we’ve been looking into is, how much funding are we talking about that gets guided by the census? And what we found is 371 federal assistance programs that we can connect to census data in terms of guidance. And it gets guided in a number of ways. There’s some very simple ways where the census data can be, say, an on-off switch. The easiest example of this is funds maybe going to a rural area, or funds for an urban area. Urban-rural designation is entirely based on the number of people you have. You don’t have many people, population density is low, then you’re rural. That’s all there is to it. And so that census data getting that accurate can turn on or off money going to those types of areas. And there’s formulas where different pieces of census data go into an exact formula that figures out how much your area, your state, your county, your city or something like that might get. If you get the census data wrong, it could impact how much money’s coming to your area. A third area is a little bit more nebulous, but it’s definitely something we can track. Some programs accept applications and they can score and evaluate those applications on a variety of criteria, but they’re always transparent about it. And sometimes census data can come into play. Maybe the program is really geared and they want to help lower income areas or areas with historically disadvantaged communities. And so census data can be used to determine that, and your application might get extra points. And then the last way is for some of our loan programs, census data can even influence the interest rate that you might have to pay back. So it can affect how much money gets out and then how much you have to paid back. And these 371 programs, they accounted for $2.2 trillion in a single fiscal year, just one year.

Terry Gerton Was there anything about the 2020 Census or recent funding formulas that raised flags for you, that you want to make sure get addressed before we get to 2030?

Sean Moulton Every census, problems happen. It’s a huge endeavor, trying to count everyone in the country, at the same time, exactly where they are. We always have errors. But 2020 was one of the first years we did a lot more digital records. We were using what’s called administrative records to try and fill in some gaps from non-responses. And so we really need to address those. There are also a number of states that had statistically significant undercounts or overcounts, and those are particularly troubling. We need states and locations, especially in the areas that had previous undercounts, to make more of an effort in the run up to 2030 to make sure they get the count right.

Terry Gerton I’m speaking with Sean Moulton. He’s a senior policy analyst at the Project on Government Oversight. Let’s dig into those undercounts a little bit. Are there communities that are most vulnerable to being undercounted? And when they are undercounted, what is the impact?

Sean Moulton There are, and Census Bureau knows this and has made efforts over the years to do better outreach to what they call hard-to-count communities, or historically hard-to-count, communities. And these are lower income communities, because of the digital divide; these are rural communities; these are renters. Children are hard to count for some reason; even though the parents are filling out the forms, they might not include their children for some reason. Maybe they don’t understand it applies to everybody. Non-English speakers, not primary English speakers, sometimes they don’t understand the forms or understand the necessity to respond. So there’s a lot of different groups that are harder than the average citizen, we’ll say, to get those responses back from. This is where states and cities and counties can do a better job of reaching out and making sure their community members know the importance of the census, not just as a legal activity, but as something that helps the community and then responds.

Terry Gerton The census is supposed to count every single person, right? Citizens and non-citizens. We had the addition of a citizenship question in 2020. Certainly we’ve had a lot of focus under the Trump administration on citizenship. What impact do you think that’s going to have leading into the 2030 count?

Sean Moulton So in 2020, we had an attempt to add a citizenship question, and it went all the way to the Supreme Court and they tossed it out on a procedural issue. They said, it’s a question you can ask. It’s been in the census before, but they did it in the wrong way, their process was wrong, flawed. So we may be seeing another fight over that. The real problem with the citizenship question is there’s not much evidence that it’s going to give us anything of importance. More importantly, a lot of what we use the census for, it doesn’t matter if you’re a citizen. The funding for hospitals or healthcare or roads — the roads don’t care if you are a citizen and driving on them, or if you a non-citizen and driving them, and we need to repair the roads based on the wear and tear and how many people are there. The same for mass transit and other things. We’re funding for everyone. And so, if we try and narrow our ask to citizens, we’re going to get our allocations of funds wrong, and citizens will then be also penalized. They’ll have roads that aren’t being repaired fast enough and they’ll have problems getting into emergency rooms and what have you. Citizens will also be affected because they will encounter the problems that the low funding leads to: poor maintenance on the roads, longer wait times for their health care. And so even though they may think this is about citizens/non-citizens, everyone’s affected when the funding gets impacted.

Terry Gerton Do you have a sense that members of Congress understand this connection? I mean, at the core, one of their jobs is to bring home money to their districts. If the census count is accurate, the better their funding will be. And yet, do you think they really understand the importance of the accuracy here?

Sean Moulton I don’t. You know, it is pretty buried. We had to do a lot of research to figure out the extent of this. And I can tell you that just a few years ago, the Census Bureau used to do a report somewhat along these lines, and their number was much, much lower. It’s only been in recent years that we’ve kind of expanded our understanding to realize just how important the Census Bureau numbers are in terms of guiding federal funds.

Terry Gerton Are there steps that Congress or the Census Bureau should take now to improve accuracy coming into the 2030 census? I mean, five years seems like a long way off, but Census is already getting ready.

Sean Moulton  A lot of people don’t realize there’s a lot that happens in between those 10 years, but right now probably one of the biggest things would be to get ready to participate in what’s called LUCA, Local Update of Census Addresses. And this is a process that the Census Bureau runs in the run-up to every decennial census where they reach out and they try and get participation of local officials — county, city, state — to update the addresses they have. And an interesting fact is, if the Census Bureau doesn’t have your address, then it doesn’t matter if you fill out the form or not. You can’t be counted. The address comes before the household’s response. And so if somehow you’re living in a recently refurbished apartment over a garage and the post office doesn’t have that address officially on file as a new residence, then you’re not going to get counted. And so we really need to update those addresses and keep them as up-to-date as possible because it’s the first step to getting the responses back.

Terry Gerton Just to wrap up sort of on a more systematic note, is having this much federal funding dependent on the census the best way to go forward? Are there other funding formulas that we should use? Maybe even, wrong, it is the best source of data that we have.

Sean Moulton It is. Obviously, there’s other funding formulas that get used; 371 is not the majority of federal programs out there. But when you’re talking about trying to assist individuals and households, then the census data really can help us find those households and say, inside a state or inside a city, how much should they get? And we’re going to use data to help drive and allocate those rather than simply dividing it up into one-fiftieth and every state gets that amount. It doesn’t make any sense. If one state needs more, it should get more, and the census data, while we’ve had our problems, is still a very accurate number based on getting a lot of the money allocated. We get some things wrong and we’re always trying to improve that, but it’s still an incredibly useful tool for the federal government and for private individuals. Corporations use a lot of census data to figure out where they’re going to put their next grocery store or what have you. That’s because it has proven to be such a reliable tool to help guide those kinds of decisions.

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Interview transcript:

Terry Gerton You participated in an annual report from the American Statistical Association, their latest assessment, which describes this system as being at risk. We’ll deal with some of the specifics here, but let’s start at the top. How risky and why does it matter?

Nancy Potok Well, we’re talking really about 13 primary statistical agencies that are decentralized and embedded in different cabinet departments or agencies. We also have about 100 statistical offices or units that are small statistical areas across different agencies that aren’t designated as the principal agencies. But we focused on the 13 agencies. To give a couple of examples of what I’m talking about, the Census Bureau is a statistical agency in the Department of Commerce. So is the Bureau of Economic Analysis, which puts out GDP numbers, for example. The Bureau of Labor Statistics is one of the agencies. They’re in the Department of Labor. We’ve got the Energy Information Administration in the Energy Department. National Center for Health Statistics, which is in CDC, which is in HHS. I hope everyone understands the acronyms. So there’s 13 of them, and they’re in all different agencies — Transportation, Social Security, Statistics of Income in IRS, etc. And there is a chief statistician whose job, actually in the Paperwork Reduction Act, is to coordinate the system and to help the system come up with standards and quality standard operating procedures, what you should be doing in terms of confidentiality of data and privacy protection. That position resides in OMB, the chief statistician. And then there’s an interagency council on statistical policy — that is, all of the statistical officials that come together periodically to try to coordinate.

Terry Gerton I really appreciate the clear perspective there. And you participated in an annual report from the American Statistical Association, their latest assessment, which describes this system as being at risk. We’ll deal with some of the specifics here, but let’s start at the top. How risky and why does it matter?

Nancy Potok It’s very risky, and we’ll delve into the details of why it is, but it matters because these statistical agencies are what I would call essential infrastructure. They produce information that policymakers depend on, and when that information is not trusted or when there are holes in the system, that can really affect decision-making at the local, state and federal levels. In fact, sometimes local and state officials are much stronger advocates for federal statistical data than we’re seeing right now in Congress, where we need some champions. There are so many critical decisions that are made based on federal statistical data. I mean, for example, the Census everybody knows about — an apportionment of Congress, and that’s in the Constitution. But also, recently the head of the Federal Reserve was talking about his concern about Bureau of Labor Statistics information because it feeds right into their decisions on interest rights. So all across the board, there’s really a lot of key decisions that affect peoples’ lives that are based on this information. We want it to be accurate, high-quality, objective, not politicized and readily available to people to use, and people trust it and know that it is protected.

Terry Gerton The report documents a number of pressures on the system. The first one is staffing. It says that most of these agencies have lost 20% to 30% of their staff in the last year. How are you seeing that play out in operations, in data collection and reliability? How does it show up?

Nancy Potok It shows up in very scary ways. I’ll start with the most extreme example. I do have to say in fairness, some of these staffing reductions are just what I would call collateral damage of what we have seen across all agencies in all areas for staffing reduction. But I’ll start with the Department of Education. So the Department of Education has a National Center for Education Statistics. It’s a relatively small agency, but they put together critical information about how we are doing with educational achievement, and they gather that from all the states. As part of the downsizing in the Department of Education, their staff — everybody was fired, and there were only three people left in that agency. And the head of the agency was fired. So not only did they not have a leader, but they had three people left to do this job. And a lot of what they’re doing is required by statute, and they’re just unable to fulfill that. That’s at one end. The other end, the largest statistical agency is the Census Bureau. The Census Bureau had several field operations that were scheduled. They’re actually special censuses that they do for localities that need to update their populations because they’re rapidly growing and they can’t wait 10 years. And they couldn’t do them, they had to cancel them because they lost staff. In between what we saw was a multiyear effort that the statistical agencies had gone out to really get data scientists and people who could work with AI and who just were up on all the latest techniques that statistical agencies are using. All those new hires got laid off when…people who were on probation, because they were new hires, all got laid off. Years of recruiting, because a lot of the statisticians and data scientists are going to work in the private sector for very high salaries, so getting them into government was a huge multiyear effort, and then boom, they were gone. So, the next generation, gone. And then lots of senior people who were really keeping things going and had the institutional knowledge, they took the retirement. They just left. So we have gaps at the early stages. We have gaps in the leadership across the board. And then in some agencies, we have no staff at all.

Terry Gerton Nancy Potok is the CEO of NAPx Consulting and former Chief Statistician of the United States. Nancy, you mentioned public trust at the beginning, and your report shows that trust in federal data dropped from 57% to 52% in just four months, from June to September. What’s driving that decline and what does it mean for evidence-based policy?

Nancy Potok We didn’t delve deeply in the surveys that we were doing, which were conducted by NORC at the University of Chicago as part of their AmeriSpeak ongoing surveys. We’d like to delve into more of why, so I would just be speculating. But I assume it’s everything that people are reading about the federal government and the way information is being used. So if you’re reading that information is being used for law enforcement, for example, that agencies are sharing data for law enforcement — in the public’s mind, it may be difficult to sort that out. They are not necessarily that familiar with all the protections around statistical data and that it cannot be used for anything other than a statistical purpose. So if they’re worried about information being shared and their privacy and confidentiality, that could also reflect on their willingness to participate in the surveys. And we’re seeing response rates drop, which affects the quality. So it’s a bad cycle. In addition, when the head of the Bureau of Labor Statistics was fired, we had words that came from the president saying how bad the statistics were and really impugning the quality. So if people are listening to the president, which they are, that would also affect their trust.

Terry Gerton The report mentions nine new recommendations, and there were other outstanding recommendations. If Congress could move forward on these, which would you want to see them take on first?

Nancy Potok I know a lot of people talk about the staff and the resources, and there’s sort of a baseline at which these agencies operate that needs to be met. I think in my mind, and in the minds of my colleagues on this study, the thing that we want to see most is a strategy with some muscle to it to modernize the system. A lot of people have talked about, should we centralize these 13 agencies into one Office of National Statistics, which most countries in the world have? We have this very decentralized system. That’s a topic that’s been around a long time. What we’re saying is, look, there’s many things that can be done to improve this system. It’s not just money. We need a really strong chief statistician. We need some statutes that will drive modernization and innovation, kind of like a technology innovation fund almost, where we bring together strong leadership and give them the resources they need to work with partners outside the federal government. We put in a very strong pitch for bringing in the private sector and academia to do some of this heavy duty research on how we modernize statistics, and then bring them back to the agencies who are kind of busy maintaining, and then give them the resources to implement it. So let’s see some money go outside the government for this research. Let that research be directed towards how we have better federal data and statistics, and then let’s implement. But we need a strategy for that, and really strong leadership. I think for some people, when they were looking at the report, they viewed it as, “oh, they’re just asking for more money, like all agencies,” and that is absolutely not the case. I want to be clear about that. We are advocating for coordination inside and outside the government, removing the barriers to that and putting enough money in to fund what a strategic approach would prioritize. Because they’re doing a lot of stuff they don’t need to do, but they don’t have the leverage to stop doing those things. They still have to do those. So we just want to see almost like a remake of the system, a rethinking.

Terry Gerton Where in Congress does that responsibility lie?

Nancy Potok Well, that’s the problem because we’ve got 13-plus agencies and they’re all in different subcommittees. That’s part of what we identified as an issue, is that first, there’s no enough oversight. Two, the agencies, many of them are buried deep in the bureaucracy and they never get to talk to Congress directly. And third, kind of in the days when it was what I would call really the heyday of federal statistics, when they were very strong and supportive, there were champions in Congress. A couple of members in the Senate and House really understood the value of data and worked across all of these many different appropriations subcommittees and oversight committees to really think about this as a whole. We do have what I would call data champions in Congress right now, but a lot of times they’re focused on open data and just AI in general and those types of things. They haven’t really understood the role of the statistical agencies in that greater data ecosystem. And so that’s the challenge — getting the focus on that, to understand this is basic infrastructure of our country. It’s super important. Somebody’s got to pay attention.

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The IRS is weeks away from the start of a busier-than-usual filing season. But a group of senators is warning that the agency may be stretched too thin after losing more than a quarter of its employees.

Sen. Elizabeth Warren (D-Mass.), a member of the Senate Finance Committee, and Sen. Angus King (I-Maine) led 15 other senators in a Dec. 21 letter raising concerns about the start of the IRS filing season.

The letter, addressed to Treasury Secretary Scott Bessent — who is also serving as acting IRS commissioner — and IRS Chief of Taxpayer Services Ken Corbin, states the 2026 tax filing season “will present a huge test for the IRS.”

“We write with serious concerns that the Internal Revenue Service (IRS) is not prepared for the upcoming tax filing season and that American taxpayers may face delays and difficulties in filing their tax returns and receiving their tax refunds,” the senators wrote.

All senators on the list are Democrats, except for King and Sen. Bernie Sanders (I-Vt.) — both of whom caucus with Senate Democrats.

The IRS lost about 25% of its workforce last year through voluntary separations and retirements.

A recent report from the Treasury Inspector General for Tax Administration found these staffing cuts will make it more difficult for the IRS to detect fraud, process tax returns, and provide tax help over the phone and in-person at its Taxpayer Assistance Centers.

The TIGTA report also raises concerns that staffing cuts in the IRS’s IT department are delaying the agency’s ability to modernize its systems, including an initiative to digitize much of its paper-based workload.

“Taxpayers deserve to have the information and assistance they need to file their taxes and receive their refunds in a timely manner,” the senators wrote. “The Trump administration’s relentless attacks on the IRS threaten its ability to serve the public and undercut its mission to provide taxpayers with top-quality service and ensure that our tax laws are enforced with integrity and fairness.”

The IRS paused its IT modernization efforts in March. But internal documents show the agency is planning to modernize a more than 50-year-old IT system that’s critical to its work every filing season.

Internal documents obtained by Federal News Network show the agency is working on a “future state” of its Integrated Data Retrieval System (IDRS), a massive clearinghouse of taxpayer data.

IDRS allows IRS employees to review an individual’s tax information when they call asking for help, or send tax notices to individuals. The system also makes it possible for taxpayers to track the status of their federal tax return refund check.

The IRS expects that this modernization project, once complete, will make it much easier for employees to retrieve a taxpayer’s records when they contact the agency asking for help.

The internal documents show the IRS is working with several tech companies on this project, including Salesforce, Amazon Web Services and Palantir.

IRS employees were told last summer that layoffs were off the table. But during the recent government shutdown, the Treasury Department sent reduction-in-force notices to nearly 1,400 IRS employees.

Employees affected included those working in tax enforcement, IT and human resources. Those RIFs were rescinded, but layoff protections contained in a stopgap spending bill are set to expire on Jan. 30.

The agency lacks a permanent commissioner. Seven acting commissioners led the agency last year. Former congressman Billy Long, President Donald Trump’s first permanent pick to lead the agency, stepped down last August.

During his two-month tenure at the IRS, Long fell out of step with senior Treasury officials on several decisions. Those included rescinding RIFs within its Office of Civil Rights and Compliance, announcing that Direct File was “gone” months ahead of the agency’s official announcement, and stating the 2026 filing season would begin in mid-February, later than usual, to give the IRS workforce more time to prepare.

The IRS has not yet announced the start date of this year’s filing season. Federal News Network has reached out to the Treasury Department and the IRS for comment.

National Taxpayer Advocate Erin Collins, in her mid-year report to Congress last summer, said this year’s filing season was “largely successful.” But taxpayers may see delays during the 2026 filing season, given major staffing cuts.

This year’s filing season will be busier than usual. The IRS must update dozens of federal tax forms to reflect changes made under the One Big Beautiful Bill Act.

The IRS, as part of its fiscal 2026 budget request, said it needs to hire 11,000 call center representatives to “maintain” its current level of phone service. Without those hires, the agency warned it would only be able to answer about 16% of phone calls during next year’s filing season.

The IRS in July put out hiring notices to fill 4,500 full-time contact service representative jobs, but quickly pulled down those notices from USAJobs.

Months later, the IRS announced it would fill more than 2,150 frontline customer service positions. More than 70% of those job posts are for seasonal hires that can’t stay on the job for more than four years.

Term appointments generally don’t count toward career tenure, making it harder for employees to qualify for certain competitive service rights or transfer opportunities.

The Trump administration proposed giving the IRS more than $850 million to help the IRS hire those employees and roll out new automation tools to assist taxpayers.

But the House Appropriations Committee advanced its fiscal 2026 spending bill without these funds — and deeper overall IRS budget cuts than what the administration proposed.

The IRS recently moved about 1,000 IT employees out of its tech shop as part of a reorganization plan that’s been underway for months.

Impacted employees say they have few details about what work they’ll be doing, reportedly advised by the agency to instead “focus on completing an orderly transition of your current work.” The notice they received states that they will no longer be working on IRS IT projects.

According to the notice, obtained by Federal News Network, the reassignments went into effect on Dec. 28.

Employees who received the email have until Jan. 9 to complete an “orderly transition.” That includes wrapping up current work, offloading assignments and supporting project handoffs.

Employees in question have been told that their reassignment is “permanent realignment out of the CIO organization,” but the move to the Office of the Chief Operating Officer is temporary. The agency’s HR office is looking to reassign the employees to jobs across the IRS and Treasury.

Reassigned employees are being asked to upload their resumes no later than Jan. 23, 2026.

The IRS stayed open on Dec. 24 and Dec. 26, even though President Donald Trump gave most federal employees those days off. The agency sought volunteers to work those days, offering holiday pay to those who signed up.

The agency’s acting chief human capital officer told staff in a memo that keeping the IRS open would allow employees to “continue to work mission-critical efforts.”

The post ‘A huge test for the IRS’: Senators warn shrinking workforce may hamper upcoming filing season first appeared on Federal News Network.

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Congressional appropriators are looking to maintain, and in some cases increase, the National Institute of Standards and Technology’s work in areas like artificial intelligence, cybersecurity and quantum research.

The appropriations agreement released by House and Senate negotiators this week would include $1.8 billion for NIST, instead of funding cuts for the agency proposed by the Trump administration. The “minibus” appropriations package rejected many of the administration’s proposed budget cuts and limited agency reorganizations.

The agreement includes $1.25 billion for NIST’s research and services division, more than $542 million above the Trump administration’s request. The White House had proposed cutting NIST funding and positions in areas like cybersecurity and privacy; health and biological systems measurements; and physical infrastructure and resilience.

Meanwhile, industry and lawmakers had urged Commerce Secretary Howard Lutnick to protect NIST’s budget and workforce.

The agreement also $405 million for NIST’s “Community Project Funding,” more commonly referred to as earmarks. The White House had proposed phasing out that funding in fiscal 2026.

The appropriations agreement also includes $175 million to continue funding NIST’s Hollings Manufacturing Extension Partnership Program. The MEP program includes 97 positions and helps fund a national network of centers across all 50 states and Puerto Rico that provide services to small- and medium-sized U.S. manufacturers.

The Trump administration had proposed defunding the MEP program, arguing it was outdated and had struggled to address challenges facing the U.S. manufacturing sector.

Language in the explanatory section of the appropriations agreement, however, includes strong language that forbids Commerce from revising the MEP program without gaining “explicit approval” from the committees as part of the appropriations process.

“The secretary is directed to continue the program under the same terms and conditions as were required in fiscal year 2024 and to issue awards at no less than the amounts in fiscal year 2024,” appropriators wrote. “Further, the agreement directs that no funds are provided to execute or plan for a program that reduces the number of active MEP Centers and that the secretary shall minimize, by rapidly executing funding competitions and renewing existing Centers in a timely manner, the periods of time when no MEP Center is active in any state or Puerto Rico.”

The funding in the agreement includes $55 million for NIST’s AI research and measurement efforts. Up to $10 million is intended to expand NIST’s Center for AI Standards and Innovation. NIST plays a key role in the Trump administration’s AI agenda. 

Lawmakers also want NIST to conduct various evaluations, including one comparing Chinese and U.S. AI capabilities and another evaluating foreign AI models.

The bill also includes $128 million in base construction funding to repair and upgrade major research facilities, including facilities at NIST’s main campus in Gaithersburg, Md.

The post Lawmakers boost funding for NIST after proposed cuts first appeared on Federal News Network.

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In June, the White House released a budget proposal for fiscal year 2026 that slashed funding for NASA's science programs by nearly 50 percent. Then, in July, the Trump administration began telling the leaders of dozens of space science missions to prepare "closeout" plans for their spacecraft.

Things looked pretty grim for a while, but then Congress stepped in. Congress, of course, sets the federal government's budget. In many ways, Congress abdicated authority to the Trump administration last year. But not so, it turns out, with federal spending.

Throughout the summer and fall, as the White House and Congress wrangled over various issues, lawmakers made it clear they intended to fund most of NASA's science portfolio. Preliminary efforts to shut down active missions were put on hold.

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