This dialogue is not a pilot program.
Section 5 of the DATA Act of 2014 requires the Office of Management and Budget (OMB) to establish a pilot program to test whether standardizing the data elements used in recipient reporting can reduce the burden that grantees and contractors experience in reporting on the federal funds that they receive and spend.
In this fiscal year, federal agencies have awarded $540 billion in grants and $297 billion in contracts. The number of transactions on these awards is in the millions. Each transaction requires grantees, contractors, and other recipients to fill out more forms. But new information technologies can reduce the burden if the government replaces document-based forms with standardized data.
To that end, the DATA Act requires OMB to test whether data standards can allow grantees and contractors to automate some of their their compliance activities. In theory, if the fields and formats for recipients’ reports are made uniform, TurboTax-style software can help them report more easily than today's manual document creation.
But the pilot program doesn’t really exist yet.
First, OMB’s Acting Deputy Director for Management and Controller, David Mader, testified before Congress in a July 2015 hearing that the pilot program was launched on May 8, 2015, and includes three components: 1) this dialogue, 2) a Grants.gov website, and 3) the Department of Health and Human Services’ (HHS) Common Data Elements Repository Library website.
The existence of this online forum, plus two other online resources, does not equal a pilot program.
Second, OMB has designated HHS to lead the pilot for grantee reporting. But no agency or entity has been appointed to conduct the same work for contractor reporting.
To further complicate matters, Mr. Mader’s written testimony from the abovementioned hearing says four agencies are now driving the pilot program: OMB, HHS, General Services Administration (GSA), and the Chief Acquisition Officers Council (CAOC) -- leaving doubt as to which agency is actually in charge.
The reason the pilot was mandated under the DATA Act in the first place was to test whether the new law’s data standards might allow recipients to compile and submit their federal reports more efficiently. The only way to test that possibility is to have grantees, contractors, and other recipients prepare and submit standardized electronic reports encoded using the DATA Act data elements and schema that Treasury and OMB have now established. But neither OMB nor HHS has explained when recipients will be invited to voluntarily use the DATA Act data standards within official reports – a necessary step for the pilot to yield any results.
We know that data standards have the potential to reduce compliance costs. In 2012, the Recovery Accountability and Transparency Board’s Grant Reporting Information Project (GRIP) required participating grant recipients to submit their reports in a standardized electronic form rather than as plain-text documents. GRIP results demonstrated, according to participating recipients, that transmitting reports in a standard data format reduces burden and improves efficiency.
Simply put, until a meaningful number of recipients are invited to prepare and submit standardized reports encoded using the DATA Act fields and formats, OMB is not following the law and the goals of Section 5 will not be met.