Posted by Anthony Curcio on 12/1/14 3:03 PM
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Calls for more transparent government spending led to the DATA Act’s passage. Previously, we discussed the motivations for the bill and its predecessors, including THOMAS and USASpending.gov. This post focuses on how the Act requires certain financial data to be submitted directly to Treasury, along with a number of other changes.
The Act was signed into law this May after being passed by a bi-partisan majority in the Congress. It mandates that agencies report most financial data to Treasury in compliance with the White House’s Office of Management and Budget’s (OMB’s) new and stricter standards. This data reporting must begin by 2017. Once collected, these data will be standardized and published online. As a separate measure, Treasury gained oversight of USASpending.gov earlier this year, so the Department will have direct responsibility for publishing the additional data to this site when the time comes.
Additionally, the Act requires that Federal lending programs refer delinquent debts to Treasury’s Debt Management Services (DMS) earlier in their servicing process. Previously, all debts 180 days past due were referred to Treasury; now, delinquent debts must be referred within 120 days. Coupled with the greater volume of data that Treasury is required to publish, the Act affects the Government in five ways:
- Federal lending programs must be more diligent in detecting delinquent debt.
- Federal lending programs must streamline their reporting processes to comply with faster turnaround time.
- DMS must handle larger volumes of delinquent debts.
- DMS must publish large volumes of data on debts.
- DMS must expand and re-optimize their debt collection procedures for earlier stages of delinquency.
By requiring earlier delinquent debt referrals, the DATA Act aims to collect outstanding debts faster, thereby helping to offset the cost of recovering the owed debts (such as investigations and analysis) as well as implementation of the Act itself (additional personnel, increased administrative costs associated with data handling, etc.).
However, Treasury and DMS must grow their analytic capabilities to handle both the influx of additional debts and the stricter reporting procedures. Next time, we will discuss how Treasury and DMS can prepare for these changes.