The Office of Management and Budget (OMB) has directed federal agencies to reduce travel spending and institute tougher management controls for participation in conferences.  

This new guidance follows an Executive Order (“Promoting Efficient Spending”) issued by the president last fall directing agencies to cut administrative costs in the FY2013 budget to 20 percent below FY2010.  This action also comes on the heels of a recent Inspector General report that in 2010 the General Services Administration (GSA) spent close to one million dollars on a training conference in Las Vegas.  Congressional committees have held hearings on this issue and legislation to control government spending on conferences is working its way through the Congress.

In a memo to agency heads Acting Director Jeffrey Zients said they are responsible for ensuring “Federal funds are used for purposes that are appropriate, cost effective, and important to the core mission of executive departments and agencies.”

The Zients memo acknowledges many federal agencies have already implemented “creative and innovative practices to reduce costs and improve efficiencies” in areas such as travel, conferences, real estate, and fleet management.  He points out that OMB was able to identify $8 billion in savings in the FY2013 budget resulting from these efforts. The new guidance, he says, builds on these efforts.

Zients directs agencies to hold travel spending in FY2013 to at least 30 percent less than they spent in FY2010 and to maintain that level through FY2016.  Agencies are to report to OMB within 90 days on their proposed savings efforts.  In their FY2014 budget requests, agencies will describe how they plan to “make these travel reductions sustainable.”  In addition, OMB directs DOD and GSA to review the Joint Federal Travel Regulations to “ensure that the policies reduce travel costs without impairing the effective accomplishment of agency missions.”

OMB issues new policies for conference sponsorship, hosting, and attendance.  The memo directs agency Deputy Secretaries to review and approve spending for every conference that will be sponsored or hosted by the agency if expenses exceed $100,000.  The review is to ensure that the activity complies with acquisition and travel regulations and that “no Federal funds are used for unnecessary or inappropriate purposes.”   Agencies are also prohibited from spending more than $500,000 of its funds for a single conference, unless the agency head determines that the conference “is the most cost-effective option to achieve a compelling purpose.”  Spending levels and a description of all conferences over $100,000 will be posted on the agency website.

The OMB memo also directs agencies to move aggressively to get rid of excess property and to improve the management and use of government-owned vehicles.

Under the new guidance, agencies can not increase the size of the civilian real estate inventory.  Agencies will be allowed to acquire new civilian real estate only if the total square footage of the acquisition is offset through consolidation, co-location, or disposal of existing inventory.  GSA will also issue additional guidance on definitions of covered properties and procedures for identifying exceptions.

Agencies are also directed to adhere to the Federal Management Regulation (FMR) when using GSA fleet services to ensure that the vehicle fleet is maintained and operated effectively and efficiently.  For example, cars are to be driven for 60,000 mile before being replaced.  GSA is directed to regularly review fleet management policies to identify areas for potential efficiency improvements.