Executive Branch Reorganization and Management Initiatives

Executive Branch Reorganization and Management Initiatives

Order Code IB93026
CRS Issue Brief for Congress
Received through the CRS Web
Executive Branch Reorganization
and Management Initiatives
Updated December 6, 2004
Harold C. Relyea
Government and Finance Division
Congressional Research Service ˜ The Library of Congress

CONTENTS
SUMMARY
MOST RECENT DEVELOPMENTS
BACKGROUND AND ANALYSIS
Reinventing Government
A New Administration
CONGRESSIONAL HEARINGS, REPORTS, AND DOCUMENTS
CHRONOLOGY
LEGISLATION
FOR ADDITIONAL READING
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Executive Branch Reorganization and Management Initiatives
SUMMARY
When President George W. Bush came
changes during the 105th Congress, major
into office in January 2001, he arrived from a
exceptions being the overhaul of the structure
campaign in which he had emphasized effi-
and operations of the Internal Revenue Ser-
ciency in government, particularly through the
vice and the consolidation of the foreign
use of information technology, but had not
policy agencies. During the 106th Congress,
revealed any plans for reorganizing the execu-
executive reorganization and reinvention were
tive branch.
neither major nor high-priority items.
The departing Clinton Administration
Following his 2001 inauguration, Presi-
had conducted an active effort at “reinventing
dent Bush announced plans to address a num-
government,” spearheaded by a National
ber of management problems in the federal
Performance Review (NPR). Announced
government. Then, in the aftermath of the
shortly after the 1993 inauguration, the NPR
September 11, 2001 terrorist attacks, the
sought to find ways to make the federal gov-
organization of the federal government for
ernment more efficient, economical, and
maintaining homeland security and combating
effective. The result was a series of reports
terrorism became an important consideration
proposing various organizational and opera-
for both the President and Congress. Estab-
tional reforms.
lishment of the Office of Homeland Security
in October 2001 as a coordinating entity was
Several major NPR recommendations
an important first step, followed by the cre-
were awaiting implementation when the No-
ation of a Department of Homeland Security
vember 1994 congressional elections resulted
during the final weeks of the 107th Congress.
in Republican majority party control of both
Oversight of the initial operations of the new
houses of the 104th Congress. Republican
department was a primary matter for the 108th
congressional leaders had unveiled a Contract
Congress, which, in the closing months of
With America reform plan in late September
2004, sought to implement the recommenda-
1994. Its core principles regarded the federal
tions of the national commission which had
government as being too big, spending too
investigated the circumstances of the Septem-
much, being unresponsive to the citizenry, and
ber 11 terrorist attacks.
perpetrating burdensome regulations. At the
conclusion of the 104th Congress, both the
This issue brief views reorganization and
President and Republican congressional lead-
management as involving the alteration of the
ers could claim some victories in downsizing
administrative structure and operations of the
government, but no department was elimi-
executive branch for reasons of efficiency,
nated, and only a few small agencies were
economy, and effectiveness. The underlying
abolished.
issue is who reorganizes or sets management
policy — Congress or the President — and by
Administration and congressional rein-
what authority and, also, for what purpose?
vention efforts resulted in mostly modest
Congressional Research Service ˜ The Library of Congress

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MOST RECENT DEVELOPMENTS
Although the November 20 conference committee version of the intelligence reform bill
is devoid of any authority for either the President or the National Intelligence Director (NID)
to reorganize the intelligence community, Representative Tom Davis, chairman of the
Committee on Government Reform, has indicated that reinstatement of the President’s
mandate to prepare and submit reorganization plans (5 U.S.C. 901-912) will be a top priority
for the 109th Congress. The House version of the reform legislation (H.R. 10), approved on
a 282-134 vote on October 8, would have authorized the President to prepare and submit
reorganization plans for fast-track congressional consideration and approval by a joint
resolution affirming them. This reorganization authority was limited to submissions of
reorganization plans for 11 named intelligence community entities, as well as elements of
other departments or agencies that may be designated by the President alone or jointly by the
NID and the head of the department or agency concerned. Allowance was made for the
abolition of all or part of the functions of a covered entity without limitation, and to allow
a plan to propose creation of a new agency. The President’s authority to submit plans with
respect to intelligence community reorganizations would have been permanent. Senate
counterpart legislation (S. 2845), adopted by a 96-2 vote on October 6, would have
authorized the NID, with the approval of the President and notice to Congress, to make
functional and structural reorganizations within the National Intelligence Program. Conferee
deliberations, which began on October 20, became prolonged due to considerable differences
between the two bills, including their institutional and organizational aspects. Agreement
on a November 20 compromise version of the legislation quickly unraveled in the House.
Opposition to the measure expressed in the House Republican Conference prompted the
Speaker to cancel a scheduled vote on the legislation. A vote on the bill could occur when
the House convenes on December 6.
BACKGROUND AND ANALYSIS
For well over a century, the structure and program responsibilities of the federal
executive branch, including all of the departments and agencies, were determined by
Congress. In the aftermath of World War I, however, with the rise of the new public
administration profession and growing sentiment for attaining efficiency and economy in
government, came efforts to strengthen the President’s management ability. In 1932, the
Chief Executive was statutorily authorized to issue executive orders proposing reorganization
within the executive branch for purposes of reducing expenditures and increasing efficiency
in government. A reorganization order became effective after 60 days unless either House
of Congress adopted a resolution of disapproval. When President Herbert Hoover submitted
11 different reorganization orders, all were disapproved by the House of Representatives on
the grounds that his newly elected successor, Franklin D. Roosevelt, might have different
reorganization ideas.
President Roosevelt did submit a number of reorganization orders pursuant to a revised
and extended version of the 1932 statute, which expired automatically in 1935. Some major
actions taken in these orders included creating procurement and disbursement divisions in
the Treasury Department, establishing an enlarged National Park Service in the Interior
Department, and making the Farm Credit Administration an independent agency.
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Congress subsequently mandated a similar arrangement in a 1939 statute. Once again,
the objective was to achieve efficiency and economy in administration. A presidential
reorganization plan, submitted to Congress, became effective after 60 days unless both
houses of Congress adopted a concurrent resolution of disapproval. In his initial
reorganization plan, President Franklin D. Roosevelt created the Executive Office of the
President.
Such reorganization authority, renewed periodically a dozen times between 1945 and
1984, with slight variation, remained available to the President for nearly half a century. At
different junctures, qualifications were placed upon its exercise. For example, reorganization
plans could not abolish or create an entire department, or deal with more than one logically
consistent subject matter. Also, the President was prohibited from submitting more than one
plan within a 30-day period and was required to include a clear statement on the projected
economic savings expected to result from a reorganization.
Modification of the President’s reorganization plan authority was made necessary in
1983 when the Supreme Court, in the Chadha case (462 U.S. 919), effectively invalidated
continued congressional reliance upon a concurrent resolution to disapprove a proposed plan.
Under the Reorganization Act Amendments of 1984, which were signed by President Ronald
Reagan on November 8, several significant changes were made in the reorganization plan
law. Any time during the period of 60 calendar days of continuous session of Congress
following the submission of a reorganization plan, the President might make amendments
or modifications to it. Within 90 calendar days of continuous session of Congress following
the submission of a reorganization plan, both houses must adopt a joint resolution (which,
unlike a concurrent resolution, becomes law with the President’s signature — a central issue
in the Chadha case) for a plan to be approved. This amendment, however, continued the
President’s reorganization plan authority only to the end of 1984, when it automatically
expired (see 5 U.S.C. 901-912 (1988)). Neither President Reagan nor President George H.
W. Bush requested its reauthorization. President William Clinton did not seek its renewal,
although his National Performance Review (see below) recommended this course of action
in September 1993. The National Strategy for Homeland Security, released by President
Bush on July 16, recommended the restoration of reorganization plan authority to allow
reconfiguring portions of the executive branch to better combat terrorism and maintain
homeland security. In his FY2003 budget message, President George W. Bush had indicated
that his Administration would “seek to re-institute permanent reorganization authority for
the President to permit expedited legislative approval of plans to reorganize the Executive
Branch.” However, no draft legislation was subsequently offered in this regard. When the
National Commission on the Public Service presented its report in January 2003, one of its
recommendations was to give the President “expedited authority to recommend structural
reorganization of federal agencies and departments.” In an April 3, 2003, hearing, the House
Committee on Government Reform, under chairman Tom Davis, began congressional
consideration of restoring the President’s reorganization authority (see below).
Currently, in the absence of reorganization plan authority, the President may propose
executive branch reorganizations to be realized through the normal legislative process. The
Departments of Energy, Education, Veterans Affairs, and, most recently, Homeland Security
were established in this manner. This approach, however, does not incorporate action-
forcing deadlines or a required final congressional vote on proposed reorganization plans that
are thought to expedite the consideration of reorganizations. The President might attempt
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a minor reorganization, such as establishing a small, temporary entity within the Executive
Office of the President, by issuing a directive, such as an executive order. Attempting more
ambitious reorganizations through a presidential directive, if not ultimately found to be
illegal, may incur congressional displeasure and subsequent legislative and fiscal reaction.
As a result of the absence of reorganization plan authority, more recent reform efforts to
improve the efficiency and economy of government operations have emphasized
management improvements of both a governmentwide and specific program variety,
including applications of information technology that some have characterized as electronic
government.
Reinventing Government
An ambitious effort at realizing executive branch reorganization and management
reform was launched by President Clinton at the outset of his Administration when, on
March 3, 1993, he initiated a National Performance Review (NPR) to be conducted under
the leadership of Vice President Albert Gore, Jr. Six months later, on September 7, the
initial NPR report was delivered to the President. Various accompanying supplemental
reports on both specific agencies and functional areas of government were subsequently
published during 1994. The bulk of the report’s almost 380 major recommendations (broken
into over 1,230 action items) was directed to management reforms; several proposals
addressed executive reorganization, including one for congressional restoration of
presidential reorganization plan authority.
During the 12 months after the NPR report was issued, its recommendations were
implemented by 22 presidential directives, several enacted bills, and various agency actions.
Anniversary reports, marking progress in implementing NPR recommendations, were issued
in September of 1994, 1995, and 1996. The last of these indicated that 43% of the NPR’s
initial 833 agency action items were completed and 42% were in progress, and that 38% of
its initial 430 management systems action items were completed and 49% were in progress.
Of an additional 187 agency recommendations, 19% were completed and 62% were in
progress. As of January 1996, the executive workforce had been reduced by nearly 240,000.
In addition, almost 2,000 obsolete field offices had been closed and approximately 200
programs and agencies — such as the Tea-Tasters Board, Bureau of Mines, and wool and
mohair subsidies — had been eliminated. As of September 1996, said the report, “savings
of about $97.4 billion have been ensured through legislative or administrative action.”
According to the report, of the original $108 billion in savings projected in 1993, about $73.4
billion had been realized.
The Clinton Administration renewed its reinventing government effort in mid-January
1995 with Phase 2 of the NPR, which was detailed in the President’s FY1996 budget.
Shortly thereafter, in late February, the President announced new regulatory reform
proposals, including page-by-page review of federal regulations to determine those that were
obsolete, replaceable by private sector alternatives, or better administered by state and local
government. He also proposed to abolish the Interstate Commerce Commission (ICC) and
reconstitute the Federal Aviation Administration’s air traffic control services as a wholly
owned government corporation. The elimination of the ICC was subsequently realized in
December 1995. Certain functions of the Commission were transferred to the Surface
Transportation Board, newly established within the Department of Transportation by the
termination statute (109 Stat. 803).
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With the convening of the 105th Congress, the reinvention effort entered yet another
new phase, emphasizing improved service delivery; use of partnerships and
community-based strategies to solve problems, not big government; and techniques for
improving performance in a time of diminishing resources, including the use of
performance-based organizations (PBOs). As a reflection of this third revamping, the NPR,
known heretofore as the National Performance Review, became the National Partnership for
Reinventing Government in January 1998.
Support for the performance of selected governmental functions through PBOs was
reiterated in the President’s FY1998 budget. The PBO innovation involved rechartering
certain federal executive agencies to permit them to negotiate alternative approaches to
procurement and personnel rules and to increase their accountability for financial and
program results. The anticipated increased efficiency would allow the agencies to downsize
their workforce or use their cost savings to improve services. Legislation to convert the
Patent and Trademark Office (PTO) of the Department of Commerce into a PBO was
proposed by the Clinton Administration in 1995, but it received little attention during the
104th Congress; similar legislation remained on the Senate legislative calendar when the
105th Congress adjourned. When the agency was restructured by the American Inventors
Protection Act of 1999 (113 Stat. 1537-564), the reconstituted PTO insisted it was a PBO,
but that characterization was doubtful in the view of many analysts.
Testifying at a May 4, 2000, hearing conducted by a subcommittee of the Senate
Committee on Governmental Affairs, Donald F. Kettl, a University of Wisconsin professor
who had conducted extensive research on the NPR reforms, gave the effort an overall grade
of “B,” saying there was “room for improvement.” Brookings Institution scholar Paul C.
Light added that the NPR program had created “unnecessary politicization of government
reform.” Two other analysts were also critical of the NPR effort. A few months later, in
September, a GAO report (GAO/GGD-00-145) concluded that the NPR reinvention effort
had been largely successful, with more than 90% of key Clinton Administration
recommendations having been fully or partly implemented. The report was based upon a
review of 72 NPR recommendations by 10 federal agencies, which found that 33 of them
were fully implemented and another 30 were partly implemented.
A New Administration
During his campaign for the presidency, Texas Governor George W. Bush emphasized
efficiency in government, particularly through the use of information technology, but
revealed no plans for reorganizing the executive branch. The terrorist attacks of September
11, 2001, however, prompted various structural modifications. A major objective of
restructuring was to realize governmental arrangements resulting in more efficient,
economical, and effective homeland security. Reinstatement of the President’s
reorganization plan authority was proposed to allow the Chief Executive to create the
structure he deemed appropriate, and legislation creating a Department of Homeland Security
was introduced (S. 1534) and later expanded (S. 2452 and H.R. 4660). On February 14,
2002, the leadership of the House and Senate intelligence committees announced a bipartisan
investigation of the operations and activities of the intelligence community pertaining to the
September 11 attacks. This joint investigation resulted in a report (S.Rept. 107-351; H.Rept.
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107-792), which, among other recommendations, called for the appointment of a Cabinet-
level national intelligence chief, who would rank above the Director of Central Intelligence.
Another long-standing reorganization matter concerned border security administration.
For many years prior to the September 11 terrorist attacks, proposals had been made from
time to time to consolidate various aspects of border security within a single entity or
minimum number of federal agencies. Such proposals attracted greater interest after the
attacks as part of counterterrorism efforts to secure the nation’s northern and southern
borders. In late December 2001, Office of Homeland Security staff reportedly produced a
tempest within the Bush Administration when they unveiled a broad proposal to create an
agency consolidating border security management responsibilities. Opponents represented
a wide range of agencies, including five Cabinet departments.
This proposal, however, was used by presidential assistants to formulate the Department
of Homeland Security plan unveiled by President Bush on June 6. His surprise
announcement was viewed not only as an attempt to regain the initiative in the nation’s
efforts at combating terrorism, but also to move beyond the coordination efforts of the Office
of Homeland Security to a strong administrative structure for managing consolidated
programs concerned with border security and effective response to domestic terrorism
incidents. On June 18, the President transmitted to the House of Representatives proposed
legislation to established a Department of Homeland Security. This legislation was
subsequently introduced by request (H.R. 5005) on June 24. According to a legislative
strategy announced by Speaker Dennis Hastert and Minority Leader Richard Gephardt,
standing committees of jurisdiction would make recommendations regarding the bill,
followed by a review and markup by the special, ad hoc House Select Committee on
Homeland Security. On July 19, the House select committee marked up the legislation and
ordered it to be reported (H.Rept. 107-609). Meeting during July 24-25, the Senate
Committee on Governmental Affairs authorized Chairman Joseph Lieberman to withdraw
his version of a Department of National Homeland Security bill (S. 2452) that had been
amended and ordered favorably reported on May 22, modified his offered amendment in the
nature of a substitute to the text of the bill, and approved the amendment as modified. Floor
action on the measure, however, was postponed until the Senate returned from a summer
recess in early September. During July 25-26, the House of Representatives began floor
debate and amendment of its counterpart department bill (H.R. 5005), and then approved the
legislation, as amended, on a 295-132 vote.
Senate consideration of the House-passed bill began on September 3, 2002, when
Senator Lieberman submitted an amendment (S.Amdt. 4471) containing the language of his
modified department bill as a substitute for the text of the House-passed legislation. Initial
amendments to the Lieberman substitute were adopted on September 5. Additional
amendments were considered and adopted, but, by the end of September and into October,
the Senate found itself in deadlock, unable to reach closure on the department legislation.
Further discussion of the matter was discontinued in the Senate, and both houses
subsequently adjourned on November 8 for the fall elections.
When the House and the Senate reconvened on November 12, it was clear from the
recent election returns that the President’s political party would have majority control of both
houses of the l08th Congress. Furthermore, Representative Dick Armey, the House Majority
Leader and chairman of the Select Committee on Homeland Security, had introduced, with
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bipartisan support, a new bill (H.R. 5710) to establish a Department of Homeland Security,
which was supported by the Bush Administration. The bill was brought up for floor
consideration the following day under a closed rule (no amendments), and was approved on
a 299-121 vote.
On November 13, the Senate resumed consideration of the initial House-passed bill
(H.R. 5005) establishing a Department of Homeland Security. Pending on the floor was the
Lieberman substitute (S.Amdt. 4471), which was subsequently tabled on a 50-47 vote.
Senator Fred Thompson offered the text of the second House-passed bill (H.R. 5710)
creating a Department of Homeland Security as an amendment (S.Amdt. 4901) for later
consideration as a substitute to the language of the initial House-passed department bill. The
following day, Senator Lieberman offered an amendment (S.Amdt. 4911) to make certain
provisions of the Thompson substitute noneffective. On November 15, the Senate, on a 65-
29 vote, ended further debate on the Thompson substitute (S.Amdt. 4901). Four days later,
the Thompson substitute was adopted on a 73-26 vote, and the Senate then passed the House
bill (H.R. 5005), as amended, on a 90-9 vote and returned the measure to the House. The
House agreed to the Senate-amended version of the bill on November 22, clearing the
measure for the President’s signature. President Bush signed the legislation into law on
November 25, 2002 (116 Stat. 2135).
The primary issue for Congress and the President was determining the program
composition and administrative organization of the new department. In the course of
mandating the Department of Homeland Security, this overarching consideration broke down
into a series of lesser, more finite issues, not the least of which were threshold questions
concerning the value of the new entity. President Bush contended that his proposal did not
constitute an expansion of the federal government, but merely consolidated existing
programs within a more efficient and effective management structure. However, neither the
President’s proposal nor the principal congressional bills made use of a definition of the
concept of homeland security to guide the component composition of the new department.
Moreover, whole agencies were proposed for transfer to the department with very little effort
to sort out non-homeland security functions and programs for more appropriate
administration elsewhere other than the new department. Some contended that the creation
of any new department would result in budget expansion. In a July 9, 2002 cost estimate, the
Congressional Budget Office proffered that the initial House-passed bill (H.R. 5005)
establishing a new Department of Homeland Security “would cost about $3 billion over the
2003-2007 period,” which would be “in addition to projected net spending for ongoing
activities of the transferred agencies — about $20 billion in 2002, growing to $31 billion by
2007.”
There were, as well, those who doubted that merely rearranging programs within a new
department would truly improve the nation’s defenses against terrorism. Others maintained
that, no matter how well management and operating arrangements were fine-tuned, the
effectiveness of the department and its leadership could not be legislatively guaranteed. And
still others wondered aloud who would be willing to serve, for very long, in the leadership
of such a department. Additional issues concerning the scope of the President’s proposal,
the transfer of non-homeland security functions, and certain operating arrangements of the
new department are discussed below.
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Some initially criticized the President’s proposal as an inadequate response to what they
viewed as intelligence failures, suggesting that, in the context of considering the components
of the new homeland security department, the Federal Bureau of Investigation (FBI) and the
federal intelligence community, particularly the Central Intelligence Agency (CIA), should
not escape scrutiny. Two FBI units — the National Domestic Preparedness Office (15
employees) and the National Infrastructure Protection Center (795 employees) — would have
been transferred to the new department under the President’s plan, and ultimately were in the
bill that was signed into law. The criticism, however, suggested that those developing the
President’s plan had not given adequate consideration to the prospect of transferring or
restructuring FBI and CIA counterterrorism responsibilities. Others questioned why the
Bureau of Alcohol, Tobacco, and Firearms, the Drug Enforcement Administration, and the
Nuclear Regulatory Commission were not included. GAO, among others, noted that,
because the concept of “homeland security” had not been defined, “certain organizational,
management, and budgetary decisions cannot currently be made consistently across
agencies.” As the House and the Senate were giving final approval to legislation establishing
the department, questions about its scope arose anew when the chairman of a
counterterrorism study commission recommended the creation of a national counterterrorism
center to improve cooperation among intelligence agencies, and it was reported that senior
Bush Administration officials were seriously discussing the creation of a domestic
intelligence agency.
In creating the new department, Congress had the responsibility for determining the
appropriate administrative structure for the Secretary to manage, with efficiency, economy,
and effectiveness, an organization of some 170,000 employees (many of whom would be
working in field facilities), composed of diverse units, with shared responsibility and
partnership with state and local governments, as well as the private sector. A key
consideration was the Secretary’s span of control over the operations of primary divisions
and internal agencies (e.g., the Coast Guard and Secret Service), together with such broad
departmental functions as human and information resources management, budget setting, and
financial management. Initial versions of both the House and Senate bills appeared to
support strong vertical management structures, and both were seemingly weak in detailing
horizontal working arrangements among headquarter’s divisions and internal agencies and
among field staff. Under the bill initially adopted by the House, the Secretary of Homeland
Security might have had as many as 15 senior officials of the department reporting directly
to him or her (or more if the assistant secretaries actually had this relationship); under the
Senate bill recrafted in committee, 17 senior officials seemingly would have been reporting
directly to the Secretary.
Ultimately, the statute mandating the Department of Homeland Security placed most
of the entities and functions transferred to the new department within four primary
directorates for border and transportation security, emergency preparedness and response,
science and technology, and information analysis and infrastructure protection. The Coast
Guard and the Secret Service were excepted from this arrangement and enjoy independent
status within the department. The heads of these six components, along with upwards of 12
assistant secretaries and approximately 14 other senior officials, appeared to report directly
to the Secretary. In general, the administrative framework statutorily established for the
department appeared to support strong vertical management structures while being somewhat
weak in detailing horizontal working arrangements among headquarter’s divisions and
internal agencies.
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The President’s proposal contained a provision not included in the initial version of the
Senate bill authorizing the Secretary of Homeland Security, in regulations prescribed jointly
with the director of the Office of Personnel Management, to establish and, from time to time,
adjust a human resources management system for some or all of the organizational units of
the department, “which shall be flexible, contemporary, and grounded in public employment
principles of merit and fitness.” In testimony before the Senate Committee on Governmental
Affairs on June 20, 2002, OHS Director Ridge indicated that the President would request for
the department “significant flexibility in hiring processes, compensation systems and
practices, and performance management to recruit, retain, and develop a motivated, high-
performance and accountable workforce.”
The provision raised various issues concerning staffing requirements, such as adequate
numbers of personnel and planning for the replacement of retiring staff; hiring, particularly
direct hiring which would not involve traditional guarantees of being merit-based and free
of political influence and lacked preference for veterans; and pay, particularly pay parity or
equity for employees who are performing similar jobs. Civil service protections and
collective bargaining rights for department workers were among the most contentious issues
surrounding the establishment of the Department of Homeland Security. Ultimately, the
statute mandating the new department largely supported the President’s position on these
matters. (See CRS Report RL31493.)
Upon signing the Homeland Security Act of 2002 into law (P.L. 107-296) on November
25, President Bush transmitted, pursuant to Section 1502 of the statute, his reorganization
plan for the Department of Homeland Security. This document set deadlines for the transfer
of agencies, programs, and functions to the new department, and specified related agency
consolidations, reorganizations, or streamlinings. The Department of Homeland Security
became operational on January 24, 60 days after its statutory mandate was signed into law.
That same day, presidential adviser Tom Ridge was sworn in as the Secretary of Homeland
Security. A reorganization of border agencies was announced by Secretary Ridge on January
30. Formulation of the Department of Homeland Security took a major step on March 1
when, in accordance with the President’s reorganization plan, some three dozen agencies and
programs were transferred to the new department. Ultimately, all such transfers were
completed by September 30, 2003. (See CRS Report RL31751.)
Testifying before the House Select Committee on Homeland Security at a May 20,
2003, hearing, Secretary Ridge announced plans to create regional offices that would serve
as primary contact points with state and local government officials. Pursuant to Section 706
of the Homeland Security Act, the Secretary filed a report on department plans for field entity
consolidations on February 4, 2004. While very few actual consolidations were evidenced,
the report indicated ongoing efforts were underway to develop a strategic real estate and
facilities management plan to realize more flexible, effective, efficient and mission-enabling
field arrangements.
On June 6, 2003, department officials announced the creation of a National Cyber
Security Division within the Information Analysis and Infrastructure Protection Directorate.
A main objective of the new entity will be implementing the recently unveiled National
Strategy to Secure Cyberspace. The head of the division will also be the President’s chief
cybersecurity adviser, moved from the National Security Council staff to the Department of
Homeland Security. Critics view this move as not only a loss of status for the position, but
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also a loss of authority, as the incumbent would be at least three steps below the office of
Secretary of Homeland Security Tom Ridge.
Earlier, at an April 3, 2003, hearing, the House Committee on Government Reform,
under the chairmanship of Representative Tom Davis, began considering the restoration of
presidential reorganization authority as specified in Chapter 9 of Title 5, United States Code.
No legislation on this matter was before the panel at that time. The authority had
automatically expired at the end of 1984. One course of action open to the committee was
to report legislation simply reauthorizing the chapter. During the course of the hearing,
however, it became clear that certain caveats might be necessary, such as protecting the rights
of federal employees in reorganization efforts, to garner adequate support for restoring the
authority. Favorable views for the action were expressed by OMB Deputy Director Nancy
Dorn, Comptroller General David Walker, and representatives of the public administration
community, while two labor union officials were not supportive. In his FY2003 budget
message, President George W. Bush had indicated that his Administration would “seek to
re-institute permanent reorganization authority for the President to permit expedited
legislative approval of plans to reorganize the Executive Branch.” However, no draft
legislation was subsequently offered in this regard until late September 2004. When the
National Commission on the Public Service presented its report in January 2003, one of its
recommendations was to give the President “expedited authority to recommend structural
reorganization of federal agencies and departments.” The primary House bill for realizing
intelligence community reforms (H.R. 10), introduced on September 24, 2004, included
among its provisions authority for the President to prepare and submit to Congress for
affirmation plans to reorganize components of the intelligence community (see below).
The future of the Office of Homeland Security (OHS), created by E.O. 13228 of
October 8, 2001, came into question in late July 2003 when House appropriators, in their
report on the Departments of Transportation and Treasury and Independent Agencies
Appropriations Bill, 2004 (H.R. 2989), revealed that the Bush Administration had changed
the “Office of Homeland Security” account to one for the “Homeland Security Council.”
The current council is mandated by the Homeland Security Act of 2002. The report (H.Rept.
108-243) questioned the role of OHS, saying “it is not clear what work remains that cannot
be effectively performed by the Department of Homeland Security.” The account change
apparently also implied the shift of 66 staff from OHS to the council, which the report
questioned “given the existence and support of the Department of Homeland Security.” The
committee cut the President’s request for the council of $8.3 million to $4.1 million. The
full House approved the recommended amount. In the Senate counterpart bill (S. 1589),
appropriators recommended $8.3 for the council, the amount requested, but placed the funds
in a separate account (S.Rept. 108-146). Conferees on the Consolidated Appropriations Act,
2004 (H.R. 2673), which included funding for agencies of the Executive Office of the
President, made no recommendation of funds for OHS, but did propose $7.2 million for the
Homeland Security Council in the White House Office account. The House agreed to the
conference report (H.Rept. 108-401)on December 8 and adjourned sine die; the Senate
completed action on the legislation on January 23, 2004, and the President signed the
measure the following day (P.L. 108-199). OHS disappeared from the President’s budget
request for FY2005.
In a first-year assessment of the Department of Homeland Security (DHS), Donald F.
Kettl, a veteran public administration analyst and professor at the Robert M. LaFollette
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School of Public Affairs of the University of Wisconsin-Madison, gave it a grade of C+.
This overall grade derived from evaluations of five areas of department responsibility:
aviation security (B-), intelligence (B-), immigration (C+), coordination with state and local
governments (C), and departmental management (C+). “As is scarcely surprising given the
enormity of the task it faced,” wrote Kettl, “the department’s performance has varied widely.
In some areas, the DHS has done exceptionally well, yet in other areas, conditions are worse
than before the DHS was created. The biggest areas needing improvement,” he proffered,
“in fact, deal with the very coordination — ‘connecting the dots’ — problems that the
department was created to solve.” Kettl’s study, made available in an advance copy in early
March, subsequently appeared in a book published by the Century Foundation of New York.
The Office of Inspector General at the Department of Homeland Security also released
a report, Review of the Status of Department of Homeland Security Efforts to Address Its
Major Management Challenges, in March. Discussing the results of the review, the
assessment stated that “DHS has made significant progress in addressing all of its
management challenges. However,” it added, “some of the planned improvements will take
years to develop and implement, and much remains to be done.” The following examples
were offered: “many ... support services operations, including financial management,
contracting, and human resources ... are still not under central control, and contracts
management and information technology present formidable challenges”; while “proposed
human resources regulations ... could serve as a model for the whole federal government ...,
finalizing and implementing these regulations will be challenging”; and “tight legislative
deadlines, funding difficulties, a shortage of trained and qualified personnel to oversee and
implement ... legislation, delays in the acquisition and implementation of technological
solutions, and a shortage of critical infrastructure to support homeland security initiatives,
continue to challenge the department.”
The first authorization bill for the Department of Homeland Security was introduced
(H.R. 4852) on July 19 by Representative Christopher Cox, but an attempt to mark up the
measure within the Select Committee on Homeland Security stalled due to differences over
how action on the measure should proceed. Among the provisions in the legislation for
improving homeland security management and coordination among federal agencies, as well
as state and local governments, is one relocating the department’s Management Directorate
in the office of the department’s Deputy Secretary, with the result that some management
officials, such as the Chief Information Officer (CIO), would report directly to the Deputy
Secretary. Another provision mandates an interagency Homeland Security Information
Requirements Board, chaired by the Secretary of Homeland Security, to oversee the
establishment of homeland security requirements and collection management for all
terrorism-related and other homeland security information, and to prioritize the collection
and use of such information. Seven other House committees may consider, mark up, and
report portions of the bill within their jurisdictions. Action on the measure, however,
generally has been delayed by public demands for Congress to respond to the
recommendations of the National Commission on Terrorist Attacks Upon the United States
(9/11 Commission).
In its final report, released July 22, 2004, the 9/11 Commission recommended, among
other proposals, the creation of a board within the executive branch to monitor the federal
government’s commitment to defending civil liberties, a National Counterterrorism Center
(NCTC), and a National Intelligence Director (NID) to replace the current Director of Central
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Intelligence. It also suggested establishing other national intelligence centers — for example,
on counterproliferation, crime and narcotics, and China — and folding the responsibilities
of the Homeland Security Council into the National Security Council. During the August
recess, several House and Senate committees began hearings to explore the commission’s
recommendations.
Legislative efforts to implement the 9/11 Commission’s recommendations began in
earnest when Congress convened after Labor Day. Among the first major proposals in this
regard were bills introduced by Senator John McCain and Representative Christopher Shays
(S. 2774/H.R. 5040) and by Representative Nancy Pelosi (H.R. 5024) implementing all of
the recommendations of the commission. Included were proposals for a civil liberties
oversight board, a National Counterterrorism Center (NCTC), and a National Intelligence
Director (NID). In August, Senator Pat Roberts, chairman of the Senate Select Committee
on Intelligence, offered a draft intelligence community and activities reform proposal, which
he said had the support of eight Republican members of his panel. The measure, which
appeared to be more extensive than the reorganization recommended by the 9/11
Commission, would break up the Central Intelligence Agency and divide its responsibilities
among three new intelligence entities — national assessments, national clandestine service,
and technical support — under the direct supervision of an NID, who would have virtually
complete control over the intelligence budget, including the counterterrorism and
counterintelligence programs of the Federal Bureau of Investigation. The extent to which
an NID would have budgetary, personnel, and managerial control of the intelligence
community was rapidly becoming a primary issue in the intelligence reform debate, as was
the location of the NID and NCTC within the executive branch. Meeting with congressional
leaders on September 8 to discuss reforming and strengthening the federal intelligence
services, President Bush endorsed establishing an NID who, among other considerations,
would be located within the executive branch, but not within the Executive Office of the
President; would not serve in the Cabinet; would receive National Foreign Intelligence
Program funds and allocate them, as apportioned by OMB, to the intelligence community;
would supervise the NCTC; and would have a role in the appointment of any individual to
a position that heads an organization or element within the intelligence community. The
President subsequently sent to Congress a September 16 draft proposal to strengthen the
intelligence capabilities of the federal government.
During the latter weeks of September, the principal legislative vehicles for
implementing 9/11 Commission recommendations and strengthening intelligence capabilities
emerged. The Senate bill (S. 2845) was developed in the Committee on Governmental
Affairs, introduced on September 23, and initially considered in the Senate on September 27.
The legislation would have mandated a National Intelligence Authority (NIA) as an
independent establishment within the executive branch, which would have been headed by
a NID, who would have been appointed by the President with Senate confirmation. A NCTC
would have been established within the NIA; the head of this entity also would have been
appointed by the President with Senate confirmation and would have reported to the NID on
the NCTC budget, programs, and activities and to both the President and the NID on the
planning and progress of joint counterterrorism operations. A Privacy and Civil Liberties
Oversight Board would have been established within the Executive Office of the President.
Its chair and four additional members would have been appointed by the President with
Senate confirmation for six-year terms.
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The House bill (H.R. 10) was introduced on September 24 by Representative Dennis
Hastert and was referred to 13 committees, five of which — Armed Services, Financial
Services, Government Reform, Intelligence, and Judiciary — conducted markups and
ordered reported on September 29 amended versions of the bill. As introduced, the bill
would have created a NID, who would have been appointed by the President with Senate
confirmation and not located within the Executive Office of the President. A NCTC would
have been established within the office of the NID and would have been headed by a director,
who would have been appointed by the NID. A Civil Liberties Protection Officer, who
would have been appointed by the NID, also would have been created within the office of
the NID to serve as a civil liberties and privacy overseer of the intelligence community, but
no provision was made for a civil liberties oversight board. The President would have been
authorized to prepare and submit to Congress for affirmation plans to reorganize components
of the intelligence community. On October 7, the Committee on Rules reported a version
of the legislation for floor consideration and made 23 amendments in order for consideration
(H.Rept. 108-751). The House completed its action on the legislation on October 8 when its
approved the modified bill on a 282-134 vote.
Conference committee deliberations on the reform bills began on October 20, but
became prolonged due to considerable differences between the two bills, including their
institutional and organizational aspects. Agreement on a November 20 compromise version
of the legislation quickly unraveled in the House. Opposition to the measure expressed in
the House Republican Conference prompted the Speaker to cancel a scheduled vote on the
legislation. A vote on the bill could occur when the House convenes on December 6. (See
CRS Report RS21906 and CRS Report RL32501.)
CONGRESSIONAL HEARINGS, REPORTS, AND DOCUMENTS
U.S. Congress. House. Committee on Rules. Providing for Consideration of H.R. 10, 9/11
Recommendations Implementation Act. Report to accompany H.Res. 827. 108th
Congress. 2nd session. H.Rept. 108-751. Washington: GPO, 2004.
——. Select Committee on Homeland Security. H.R. 5005, the Homeland Security Act of
2002, Days 1 and 2. Hearings. 107th Congress, 2nd session, July 15, 16, 2002.
Washington: GPO, 2002.
——. Homeland Security Technical Corrections Act of 2003. Report to accompany H.R.
1416. 108th Congress, 1st session. H.Rept. 108-104. Washington: GPO, 2003.
——. Senate. Committee on Governmental Affairs. Homeland Security Technical
Corrections Act of 2003. Report to accompany H.R. 1416. 108th Congress, 1st session.
S.Rept. 108-214. Washington: GPO, 2003.
CHRONOLOGY
07/22/04 —
The National Commission on Terrorist Attacks Upon the United States issued
its final report with 41 recommendations for combating terrorism and
strengthening homeland security.
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11/25/02 —
President George W. Bush signed the Homeland Security Act, establishing
the Department of Homeland Security, into law (P.L. 107-296, 116 Stat.
2135).
06/06/02 — President George W. Bush called for the creation of a Department of
Homeland Security by Congress and provided a plan for the structure and
programs of the new entity.
08/25/01 —
President George W. Bush, in his radio address to the nation, announced the
release of The President’s Management Agenda, a report identifying 14
management problems in the federal government and offering specific
solutions to address them.
07/18/01 —
OMB Director Mitchell E. Daniels, Jr., on behalf of President Bush, apprised
executive department and agency heads of administration efforts to develop
an electronic government action plan using an interagency task force to be
headed by OMB Associate Director for Information Technology and E-
Government Mark Forman.
01/01/98 — The National Performance Review became the National Partnership for
Reinventing Government.
09/09/96 — The National Performance Review marked its third-year anniversary,
reporting that 43% of its initial 833 agency action items were completed and
42% were in progress, and 49% of its initial 430 management systems action
items were completed and 49% were in progress; of an additional 187
recommendations, 19% were completed and 62% were in progress; “savings
of about $97.4 billion have been ensured through legislative or administrative
action” and an “additional $5.2 billion in savings is contained in legislation
pending before Congress;” and, as of January 1996, an executive workforce
reduction of nearly 240,000 employees had been realized.
09/11/95 — The National Performance Review marked its second year anniversary,
reporting that 32% of its initial agency action items were completed and 61%
were in progress, and 27% of its initial 417 management systems action items
were completed and 63% were in progress; more than 180 additional
recommendations had been made; and “about $57.7 billion of [approximately
$108 billion] projected savings have been achieved” and an “additional $4.3
billion in savings are currently pending before Congress.”
09/27/94 — Republican leaders of the House of Representatives unveiled a “Contract
With America” reform plan with core principles that regard the federal
government as being too big, spending too much, unresponsive to the
citizenry, and the perpetrator of burdensome regulations.
09/14/94 —
The National Performance Review marked its one-year anniversary, reporting
that over 90% of its recommendations “are under way,” implementation
occurring through 22 presidential directives, several enacted bills, and a
variety of agency actions, with the result that “$46.9 billion of NPR’s $108
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billion in proposed savings are already enacted” and another “$16 billion in
savings is pending before Congress.”
09/07/93 — The National Performance Review provided its first report to President
Clinton, offering some 380 major recommendations for government reform.
The bulk of these proposals concerned management improvement, but several
were directed at agency reorganization, consolidation, and field structure
overhaul.
03/03/93 — President Clinton announced he was initiating a National Performance
Review, to be headed by Vice President Gore, to evaluate the efficiency,
economy, and effectiveness of every federal program and service, and make
recommendations for “reinventing government,” including proposals for
executive branch reorganization.
LEGISLATION
H.R. 10 (Hastert)
9/11 Recommendations Implementation Act. Provides for reform of the intelligence
community, terrorism prevention and prosecution, border security, and international
cooperation and coordination. Introduced September 24, 2004, and referred to the Permanent
Select Committee on Intelligence, as well as the Committees on Armed Services, Education
and the Workforce, Energy and Commerce, Financial Services, Government Reform,
International Relations, the Judiciary, Rules, Science, Transportation and Infrastructure,
Ways and Means and (Select) Homeland Security; markups held and bill ordered to be
reported (Armed Services, Financial Services, Government Reform, Intelligence, Judiciary)
September 29 (H.Rept. 108-724 5 parts); debate begun on amendment in the nature of a
substitute and other amendments (H.Rept. 108-751) October 7; approved as amended on
282-134 vote October 8; conference committee consideration begun October 20.
H.R. 1416 (Cox)
Homeland Security Technical Corrections Act of 2003. Makes technical corrections to the
Homeland Security Act of 2002. Introduced March 25, 2003, and referred to the Select
Committee on Homeland Security; hearing held March 28; markup held and bill ordered to
be reported March 31; reported with amendments (H.Rept. 108-104) and placed on Union
Calendar May 15; considered under suspension of the rules and subsequently adopted on a
415-0 roll call vote June 24; received in the Senate and referred to the Committee on
Governmental Affairs June 25; ordered to be reported with an amendment October 22;
reported with amendments (S.Rept. 108-214) and placed on Senate Legislative Calendar
November 25, 2003.
H.R. 4852 (Cox)
Department of Homeland Security Authorization Act for Fiscal Year 2005. Authorizes
appropriations for the Department of Homeland Security for the next fiscal year, and effects
other modifications of the organization and operations of the department. Introduced July
19, 2004, and referred to the Select Committee on Homeland Security and Committees on
Science, Transportation and Infrastructure, Energy and Commerce, the Judiciary,
Government Reform, and Agriculture, and the Permanent Select Committee on Intelligence.
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H.R. 5024 (Pelosi)
9/11 Commission Recommendations Implementation Act of 2004. Implements the
recommendations of the National Commission on Terrorist Attacks Upon the United States
by establishing the position of National Intelligence Director, by establishing a National
Counterterrorism Center, by making improvements to enhance the national security of the
United States, and for other purposes. Introduced September 8, 2004, and referred to the
Permanent Select Committee on Intelligence, and the Committees on Armed Services,
Energy and Commerce, Financial Services, Government Reform, International Relations,
Judiciary, Rules, Science, Transportation and Infrastructure, and Ways and Means.
H.R. 5050 (Jackson-Lee)
Director of National Intelligence Act of 2004. Establishes the Director of National
Intelligence as a Cabinet level position in the Executive Office of the President to oversee
budget, operations, and personnel of the entire intelligence community of the federal
government. Introduced September 9, 2004, and referred to the Permanent Select Committee
on Intelligence.
S. 2774 (McCain)/H.R. 5040 (Shays)
9/11 Commission Report Implementation Act of 2004. Implements the recommendations
of the National Commission on Terrorist Attacks Upon the United States, and for other
purposes. S. 2774 introduced September 7, 2004, read the first time, and placed upon the
Senate legislative calendar. H.R. 5040 introduced September 9, 2004, referred to the
Permanent Select Committee on Intelligence, Committees on Armed Services, Energy and
Commerce, Government Reform, International Relations, Judiciary, Rules, Transportation
and Infrastructure, Ways and Means, and Select Committee on Homeland Security.
S. 2840 (Collins)/S. 2845 (Collins)/ H.R. 5150 (Shays)
National Intelligence Reform Act of 2004. Provides for reform of the intelligence
community and the intelligence and intelligence-related activities of the United States. S.
2840 reported from the Committee on Governmental Affairs as an original bill; introduced
September 23, read twice, and place on the Senate calendar. S. 2845 introduced September
23 and read once; September 24 read the second time and placed on the Senate calendar;
September 27 consideration proceeded by unanimous consent agreement; October 6
approved as amended on 96-2 vote; conference committee consideration begun October 20.
H.R. 5150 introduced September 24 and referred to the Permanent Select Committee on
Intelligence.
FOR ADDITIONAL READING
Daalder, Ivo H., et al. Assessing the Department of Homeland Security. Washington,
Brookings Institution, 2002. 63 p.
Kettl, Donald F. Reinventing Government: A Fifth-Year Report Card. Washington,
Brookings Institution, 1998. 71 p.
——, ed. The Department of Homeland Security’s First Year: A Report Card. New York,
Century Foundation, 2004 (draft manuscript available at [http://www.tcf.org/
Publications/HomelandSecurity/overview.pdf]). 33p.
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National Commission on the Public Service. Urgent Business for America: Revitalizing the
Federal Government for the 21st Century. Washington, Brookings Institution, 2003.
49 p.
National Performance Review. Most literature may be found at the NPR website “library”
at [http://govinfo.library.unt.edu/npr/default.html].
U.S. Department of Homeland Security. Office of Inspector General. Review of the Status
of Department of Homeland Security Efforts to Address Its Major Management
Challenges. OIG-04-21. Washington, March 2004. 73 p.
CRS Reports
CRS Report RL31751. Homeland Security: Departmental Organization and Management
— Implementation Phase, by Harold C. Relyea.
CRS Report RL31493. Homeland Security: Department Organization and Management —
Legislative Phase, by Harold C. Relyea.
CRS Report RL31500. Homeland Security: Human Resources Management, by Barbara L.
Schwemle.
CRS Report RL31148. Homeland Security: The Presidential Coordination Office, by
Harold C. Relyea.
CRS Report RS21412. Limited-Term Appointments to Presidentially Appointed, Senate
Confirmed Positions, by Henry B. Hogue.
CRS Report RL30596. The National Performance Review and Other Government Reform
Initiatives: An Overview, 1993-1999, by Harold C. Relyea, Maricele J. Cornejo
Riemann, and Henry B. Hogue.
CRS Report RS21906. 9/11 Commission Recommendations: A Civil Liberties Oversight
Board, by Harold C. Relyea.
CRS Report RL32501. 9/11 Commission Recommendations: New Structures and
Organization, by Harold C. Relyea.
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