OMB warns against more budget belt tightening for OPM, IRS

The Office of Management and Budget’s director urged the Senate to reconsider the budget belt-tightening it has in store for the IRS, the Office of Personnel Management and federal IT.

Shaun Donovan
Shaun Donovan

In a letter to Sens. Thad Cochran (R-Miss.) and Barbara Mikulski (D-Md.), the chair and vice-chair of the Senate Appropriations Committee, OMB Director Shaun Donovan  warned against underfunding the IRS and OPM in the fiscal 2016 budget at a time when both agencies are responding to crises.

“Sequestration was never intended to take effect,” Donovan said. “Rather, it was supposed to threaten such drastic cuts to both defense and non-defense funding that policymakers would be motivated to come to the table and reduce the deficit through smart, balanced reforms.”

The Financial Services and General Government Appropriations bill, which outlines spending for fiscal 2016,  funds government at $4 billion, or about 16.3 percent, below what President Barack Obama had outlined in his spending plan.

Donovan cautioned that maintaining sequestration-level spending for agencies “undermines the basic functioning of Government.” These cuts come at a time when both agencies are dealing with the aftermath of major scandals.

The bill’s funding level for OPM, following its massive data breach, is $7.6 million below what Obama proposed, and would significantly cut its on-going information technology (IT) modernization effort.

The IRS operated with its lowest level of customer service ever this tax season, during which only four in 10 callers reached a live operator to answer their tax filing questions. Donovan estimated that about 28 million calls went unanswered.

IRS Commissioner John Koskinen has repeatedly decried budget shortfalls at this agency. Compared to fiscal 2010, the IRS has 13,000 fewer employees and a 10 percent reduction to its budget.

Donovan said the agency expects to lose an additional  1,800 personnel in its enforcement division. On average, IRS systems are three software upgrades behind the current release, he said.

The fiscal 2016 budget gives the IRS $2.5 billion, or 20 percent, less than what Obama proposed. compared to the President’s Budget, or $4.7 million less than its fiscal 2015 budget.

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