Following are sections from a CRS report on issues surrounding the Trump administration’s proposed reorganization of OPM.
“Reorganizing the U.S. Office of Personnel Management”
Brief Proposal Summary
The Office of Personnel Management (OPM) is an “independent establishment in the executive branch” with a director who is “appointed by the President, by and with the advice and consent of the Senate.” It is not a Cabinet agency. As a central personnel agency, OPM carries out numerous functions related to human resources (HR) management for much of the executive branch. The Trump Administration’s plan proposes to realign these OPM functions: Employee Services (ES), which performs HR policy functions, would be placed under the Executive Office of the President (EOP); the Retirement Services (RS) program office would be moved over to the renamed “Government Services Administration” (GSA, formerly the “General Services Administration”); and Human Resources Solutions (HRS), which provides HR products and services to agencies on a reimbursable basis through individual program offices and user-centric IT systems that automate agency core HR functions, also would be transferred to the renamed GSA. In suggesting the possible realignment of ES, the proposal seeks to “centralize policy decisions” and “drive strategic management of the workforce” characterized by and “committed to: A holistic view of the Federal workforce; Assessment of innovations and contextual changes that drive the future of work; Data-driven policy development; Data analytics and strategic workforce management; Agency policy advice and change management assistance; and Identification and advancement of leading practice throughout the Federal Government.” In general, the RS and HRS proposals: “would yield an organization with a focus on providing Government-wide services and solutions associated with the full Federal employee lifecycle.”
Affected Departments, Agencies, or Programs
• OPM/ES: Includes Recruitment and Hiring, Pay and Leave, Senior Executive Service (SES) and Performance Management, Partnership and Labor Relations, Veterans Services, Chief Learning Officer, OPM Human Resources, Strategic Workforce Planning, and Talent Management.
• OPM/RS: This proposal would affect the two programs administered by RS: the Civil Service Retirement System (CSRS) and the Federal Employees’ Retirement System (FERS). Currently, CSRS and FERS benefits are mandatory entitlements authorized in statute: Chapter 83 (CSRS) and Chapter 84 (FERS) of Title 5 of the U.S. Code. This office determines eligibility and administers benefits for almost 2.6 million federal retirees and their survivors under CSRS and FERS; these pension systems cover the majority of the civilian federal workforce. Both CSRS and FERS include retirement, disability, and survivor components. CSRS and FERS benefits are financed through a dedicated federal trust fund, the Civil Service Retirement and Disability Fund (CSRDF).
• OPM/HRS: Realignment of HRS to GSA could include the transfer of (1) five separate program areas that encompass multiple institutions and programs, and (2) six separate IT systems.
• OPM’s statutory authority is codified in Chapter 11 of Title 5 of the U.S. Code and establishes OPM as an “independent establishment in the executive branch” (5 U.S.C. §1101); provides for a Director, Deputy Director, and Associate Directors (5 U.S.C. §1102); vests the Director with specific functions and responsibilities (5 U.S.C. §1103); and provides for delegation of authority for personnel management (5 U.S.C. §1104). To the degree that implementation of the proposal entails the transfer of functions currently vested by statute in OPM or its Director to another agency, OPM’s organic act might need to be amended.
• Other statutes reference OPM and its director. For example, 5 U.S.C. §8461 specifically sets out the “Authority of the Office of Personnel Management.” Therefore, it seems likely that the retirement proposal would require statutory amendments throughout Chapters 83 and 84 of Title 5 in order to remove/edit references to OPM and the OPM Director (and potentially replace them with references to the new GSA).
Under OPM’s current statutory authority, the director generally has administrative discretion to organize the agency to carry out its functions. For example, in October 2017, the agency established new and restructured existing internal units. Changes included creating the new Office of Strategy and Innovation, establishing a new Employee Services/Outreach, Diversity, and Inclusion center, establishing the agency’s internal Human Resources office as a stand-alone staff office, and realigning the USAJOBS program office from the Office of the Chief Information Officer to HRS and the Office of Actuaries to Healthcare and Insurance.
The proposal stated that the placement of other OPM offices and functions would be determined later. These other offices and functions may include some 16 remaining agency functions (including Merit System Accountability and Compliance) that are included on OPM’s current organizational chart. In the absence of further details on this reorganization proposal, it is unclear whether there would be any additional changes to the composition and staffing levels of the current ES, RS, and HRS workforces.
The proposal does not discuss the magnitude or integration of the possible realignment of HRS functions to GSA. Regarding magnitude, realignment could involve transferring all, or only some, of HRS program areas and IT systems (and related functions, staff, and funding) to GSA. Regarding integration, HRS program areas could be maintained as separate units within GSA, merged into a single GSA unit, or divided among multiple GSA units. Further, the proposal does not discuss potential impacts of the proposed realignment on HRS’s funding structure. HRS is primarily financed through OPM’s revolving fund, which can only be used for specific types of activities. Consequently, the following remains unclear: (1) whether GSA possesses the statutory authority to use its existing revolving funds to finance HRS functions, and any statutory changes required to provide that authority; (2) how, and what portion of, OPM’s revolving fund might be transferred to GSA to finance HRS functions; and (3) additional appropriations, if any, needed to finance HRS staffing and activities upon transfer to GSA.
It does not appear that this reorganization proposal would make any changes to CSRS or FERS programs or benefits themselves. Rather, there would be a shift in the federal entity that administers these benefits from OPM to the newly reconstituted GSA. It is unclear whether there would be additional impacts, including unintended ones (i.e., beyond the intended administrative shift), on CSRS and FERS. Although OPM has administered FERS since its creation in 1986 under the Federal Employees’ Retirement System Act of 1986 (P.L. 99-335), the initial creation of CSRS under the Civil Service Retirement Act of 1920 (P.L. 66-215) predated the existence of OPM. Prior to the creation of OPM under the Civil Service Reform Act (CSRA) of 1978 (P.L. 95-454), the Civil Service Commission administered the CSRS program.
OPM’s budget request for FY2019 did not include the proposals that are suggested in the Administration’s plan. The agency’s funding is provided in the annual Financial Services and General Government (FSGG) Appropriations Act. Congress could include any directives for the agency in the FSGG bill.
Protection of the merit system has been a bedrock principle underlying the Civil Service and OPM’s administration of HRM functions since the agency’s creation. The potential impact of the Administration’s plan on the capacity of OPM to protect the merit system has been mentioned. For example, a former OPM Director expressed the views that “a central personnel agency” creates a “firewall between the agency and the political personnel at the White House as it relates to personnel practices, particularly hiring and other actions, to be sure the oversight for compliance for merit systems principles is handled independently” and that the plan “at a minimum creates a perception that [the] firewall is gone.”
The final staff report of the 1977 President’s Reorganization Project stated that: “Serious consideration was given to recommending that the new central personnel agency be placed in the Executive Office of the President, particularly in view of the close cooperation needed between the central personnel agency and the Office of Management and Budget. This was rejected, however, in accordance with the desire of the President to keep the Executive Office of the President as small as possible.” The staff report recommended an “independent administrative agency” with a director appointed by the President with Senate confirmation, and “Cabinet rank status.”
“Transfer of Background Investigations from the Office of Personnel Management to the Department of Defense”
Brief Proposal Summary
This proposal would transfer the entirety of the National Background Investigation Bureau (NBIB) from the Office of Personnel Management (OPM) to the Department of Defense (DOD).
Affected Departments, Agencies, or Programs
• Office of Personnel Management: OPM would no longer perform any background checks.
• Department of Defense: DOD would become the single, consolidated provider of executive branch background checks.
• National Background Investigation Bureau: NBIB would be located entirely within DOD.
This proposal, if implemented as discussed above, might necessitate changes to certain statutes, including the following:
• National Defense Authorization Act for Fiscal Year 2018 (P.L. 115-91): This proposal might result in changes to Section 925 of P.L. 115-91, which mandated the phased transition of background checks for DOD personnel from NBIB to the Defense Security Service within DOD. The law might be amended so that all NBIB investigations are transferred to DOD. In addition, under this proposal, appropriations for NBIB would be provided through DOD appropriations bills rather than Financial Services and General Government (FSGG) bills. The NBIB received $1.4 billion in appropriations in FY2018.
• Executive Order: The NBIB was established by executive order, so it is possible that the Administration might seek to transfer NBIB’s responsibilities through similar administrative action.
The proposal is specific and limited to the transfer of the NBIB to DOD.
The Administration stated that this proposal, by consolidating background investigations in a single organization, would reduce duplicative functions and make the process more efficient. These objectives are consistent with the Securely Expediting Clearances through Reporting Transparency Act of 2018 (P.L. 115-173), which required additional reporting on the backlog of personnel security clearance investigations and the costs associated with maintaining a bifurcated system wherein NBIB and DOD function separately.