The Data Act Debrief: More than Meets the Eye

The Data Act was just signed into law last week – and it’s going to have far-reaching effects on federal agencies and hundreds of thousands of recipient of federal funds, such as grantees, contractors, universities, nonprofits, states and localities.

The new law gives agencies three years to implement a set of new reporting requirements to track federal spending, but it will be unbelievably complex – requiring changes in federal regulations, and in the written terms of every federal grant, contract and loan agreement of $25,000 or more.

The law will mean a lot of work for agencies and state and local governments as well. So why do it? Mike Hettinger, Senior Vice President of Public Sector at TechAmerica, told Chris Dorobek on the DorobekINSIDER program that the Data Act matters because a transparent government matters.

“[The Data Act] is a major piece of legislation trying to get a better sense of what our government’s finances look like,” said Hettinger.

The act will, according to the Senate’s committee report, “expand current requirements to publish federal spending information online to cover virtually all forms of federal spending.”

The sweeping nature of this new law, privacy concerns, and its relatively tight implementation timeframe will make it challenging for public managers to comply. “The main concern was the disclosure of either proprietary information or any kind of information that could in some way be used against us from a national security standpoint,” said Hettinger.

But, says Hettinger, the time is right. “There’s definitely an increased demand by the people for transparency in government,” he said. “The Data Act will take us in that direction. I ran the financial management subcommittee when I was on the Hill. When you get into legislation like what was proposed with the Data Act, you’re getting into the nuts and bolts of the government’s financial management systems. USAspending.gov gets into contract spending; it gets you information at the obligation level. The Data Act is talking about direct outlays and real dollars being spent.”

Implementation of the data collection and reporting is being placed in the hands of the Treasury Department, where it can be integrated into the overall financial management framework for the federal government. In fact, Treasury will integrate implementation into a broader framework it is developing to follow the entire “life cycle of federal spending.”

“There is an awful lot of data that’s coming, so we’re going to need to figure out, can our existing systems handle it?” said Hettinger. “As you look at the entire lifecycle of government spending there’s a lot of levels to that. Usually we see this information at a rolled up level, but the intent of Chairman Issa and his folks when they drafted the legislation was to get down to a checkbook level.”

GovExec reports there is a strong evidence to support the Data Act will be successful. “The Government Accountability and Transparency Board, created by executive order in 2011, has already begun to develop a roadmap to develop unique identification standards for each transaction, focusing on grants and contracts (which account for one-third of total spending each year). In its just-released annual status report, it summarizes the results of four ongoing working groups that are addressing standardization for procurement and grant data, among other issues.”