President-elect Donald Trump’s decision to nominate Rep. Mick Mulvaney (R-S.C.) to be the director of the Office of Management and Budget should elicit a lot of questions about the future of agency discretionary spending.

Mulvaney, who is a former small business owner, is best known for being a co-founder of the House Freedom Caucus and for co-authoring the Cut, Cap and Balance Act of 2011, which tried to address what it saw as unneeded federal spending, and create a balanced budget amendment to the Constitution. The House passed the bill in July 2011, but the Senate never voted on it and President Barack Obama threatened to veto it.

“With Mick at the head of OMB, my administration is going to make smart choices about America’s budget, bring new accountability to our federal government, and renew the American taxpayer’s trust in how their money is spent,” Trump said in a statement.

Mulvaney, who was elected in 2010 to Congress, will hold what is probably the most political position at OMB. So on one hand, his ability to influence agency’s budgets to cut unneeded spending will be helpful. Both the administrations of President George W. Bush and Obama tried to reduce the number of programs that were duplicative or no longer necessary, but ran into congressional roadblocks.

So maybe, just maybe, Mulvaney’s experience and relationships with lawmakers will help finally push through some long-needed changes in federal programs.

“Congressman Mulvaney has a great combination of experience advocating for fiscal discipline and a smaller, smarter government,” said Robert Shea, a former OMB official and now a principal with Grant Thornton. “That experience will serve him well as director of OMB, which has dual missions of budget and management of the Executive Branch.”

Mulvaney said in a statement that he believes the Trump administration will bring “budgetary and fiscal sanity back” to the government.

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A major dispute is brewing in the small business community. Just four months after the Supreme Court’s June 16 unanimous decision on the Kingdomware case, the Small Business Administration is taking a stand on the “rule of two” that is stressing out industry and agencies alike.

As a quick reminder, the nation’s highest court ruled in the Kingdomware case that the Veterans Affairs Department must continue to apply the “rule of two” for veteran-owned small businesses even if the agency surpassed its annual prime contracting goal. The “rule of two” states if an agency can find two or more qualified small businesses during market research of a contract under the Simplified Acquisition Threshold — between $3,000 and $150,000 — it must set aside the solicitation.

Now the Small Business Administration is expanding that Supreme Court ruling to apply to all task and delivery orders under SAT if the request for proposals comes under the General Services Administration’s schedules.

SBA issued a memo on Oct. 20 that was not widely known about until recently, telling its Procurement Center Representatives (PCRs) that the Kingdomware decision should apply to like statutes because task or delivery orders under multiple-award contracts are considered contracts.

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It’s always fascinating to look back on the year that was to see what stories rose to the top and which ones, at the same time, stood out in my memory.

Below are my top 10 notebook items for 2016. They are in order of popularity based on web traffic, but I also chose the stories that I thought were most provocative and captured the goals of the notebook — to be a place where topics receive analysis and discussion in a way that maybe a regular everyday news story wouldn’t.

For each item, I offer some commentary on the story and its impact on the federal community.

• 1) NASA’s ‘act of desperation’ demonstrates continued cyber deficiencies — This story was the fourth in a series investigating the space agency’s ongoing cyber challenges, particularly under its contract with Hewlett-Packard Enterprise Services. It stood out because Renee Wynn, NASA’s chief information officer, actually took a stand against HPES by not signing off on the contract’s authority to operate (ATO) after repeated unsuccessful attempts to fix outdated or missing software patches.

• 2) Oracle to leave GSA schedule: A signal of broader change? — This was one of the biggest surprise stories of the year, both for the decision by Oracle and for the popularity of the story. This story shows the power of social media — in this case, LinkedIn — in spreading news across the community.

• 3) Details emerge about new security clearance organization, processes — The lack of information around the new security clearance organization drove the popularity of this story. The details of the National Background Investigations Bureau (NBIB) were few and far between until the Office of Personnel Management sent this letter to Sen. John Tester (D-Mont.).

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If there was ever a case for agencies to change the way they plan and manage information technology projects, here it is.

High-level data from the Federal IT Dashboard compiled exclusively for Federal News Radio shows the average time it takes agencies to complete an IT program is 1,018 days and the average cost is $23.2 million per program.

The Defense Department, on average, takes the longest time to deliver value — 1,915 days per IT Dashboard program at an average cost of $115.5 million per program.

On the other side of the spectrum is the Energy Department, which takes on average 272 days per IT Dashboard program at an average cost of $2.6 million.

But before you gasp for air and call for hearings and inquiries, this raw data doesn’t tell the entire story.

Current and former federal chief information officers say the data, in and of itself, is interesting, but also shows the problem with the IT Dashboard and the way agencies track projects.

“I see this as an artifact of different agencies defining projects differently or breaking them down to different levels of granularity. Almost an apples to oranges kind of thing,” said Simon Szykman, who spent seven years as a federal CIO in the Commerce Department, and now is chief technology officer for federal services for Attain. “Inherently there’s a problem. Many times major IT programs include multiple projects so maybe there needs to be more transparency in how agencies break down programs for public reporting?”

The problems with the data on the IT Dashboard are not new. The Government Accountability Office has been pressing OMB since the portal’s inception about keeping the information current to ensure maximum transparency.

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A lot of personnel moves are coming or expected in the next month, with 10 federal chief information officers walking out the door and all the management leadership at the Office of Management and Budget.

We’ve learned a few are happening before Jan. 20, including Dave Mader, OMB controller. Mader’s last day is Jan. 4, sources say. No surprise that Mader is leaving, only that he’s out the door sooner than Jan. 20.

Anne Rung, the former administrator at the Office of Federal Procurement Policy, left Oct. 31.

So that leaves Director Shaun Donovan, federal CIO Tony Scott and Lisa Danzig, the associate director for Performance and Personnel, as the only remaining political appointees in OMB focused on management issues.

And of course, the political appointees in the Office of Science and Technology Policy that focus on technology issues, including U.S. Chief Technology Officer Megan Smith and deputy CTOs DJ Patil, Ed Felten, Alexander Macgillivray and Cori Zarek, along with a host of other senior policy advisers, also are expected to leave in the coming month or so.

When all of these appointees plan to leave is unclear, but the exodus is coming, and they will be replaced by President-elect Donald Trump appointees.

It’s also worth noting that OMB lost one of its best public affairs leaders. Jamal Brown, an OMB press secretary, left after six years of working with media on management issues, putting out fires and helping with speaking engagements. Brown was an all-around professional despite being over-protective at times. He took the time to understand the management issues we covered, respected the trade press and the role it plays in covering Washington, and, I believe, did his best to promote the good news stories that too often get lost in the shuffle while putting out the fires in any administration.

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It’s easy to focus on agency grades and lawmakers’ praise and/or outrage during the twice-a-year hearing as part of overseeing the Federal IT Acquisition Reform Act (FITARA). The House Oversight and Government Reform Committee held its biannual session Dec. 6, where we heard mostly good news with 12 agencies improving their grades and 11 agencies earning the same grade as last time.

But what’s really great about these FITARA hearings is finding out what’s happening in agencies underneath the grades.

The State and Homeland Security departments’ chief information officers offered a better understanding of their progress in reforming IT in their respective agencies.

Here are my three takeaways from the FITARA 3.0 hearing:

DHS congruence

Lawmakers spent a large portion of the hearing rightly concerned about the reporting structure of agency chief information officers. The reason both DHS and State CIOs and CFOs testified before the committee was because neither agency’s most senior IT executive reports directly to the deputy secretary or secretary.

One of the reasons the Clinger-Cohen Act — the predecessor to FITARA — fell short was many agencies never met the spirit or intent of the bill’s requirement to elevate the CIO position so it was a true partner at the decision-making table.

Lawmakers honed in on this issue at the hearing and added a new grading section to the latest FITARA scorecard measuring agency CIO reporting structure. The reason for this focus is clear. As the Government Accountability Office’s David Powner, the director of IT management issues, explained the importance in simple terms: CIOs who report to their secretary or deputy secretary scored better than those who didn’t.

DHS CIO Luke McCormack didn’t disagree with the committee or GAO’s opinion on the importance of reporting structure, but he offered an interesting alternative.

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The General Services Administration’s decision to award IBM a $149 million contract to modernize its human resources systems and create a private-sector shared services provider is a head scratcher.

It’s not so much that GSA is choosing to upgrade legacy technology, nor is it the size of the deal. What is confounding is the decision to go to the private sector instead of a federal shared services providers and the message that sends to the rest of government.

First, let’s get some of the basics out of the way. GSA is replacing the Comprehensive Human Resources Integrated System (CHRIS) as well as its time and attendance system and its authorized leave and overtime help application (ALOHA). GSA wrote in its fiscal 2016 business case on the IT Dashboard for its HR systems that “Legacy CHRIS is likely approaching obsolescence due to lack of integration of the various tools, limited hardware scalability, high customization and functionality of applications. Note: additionally CHRIS, PAR, ETAMS, and ALOHA are not integrated causing delays, handoffs, and possible errors.”

Additionally, GSA decided in September 2013 to get out of the HR Line of Business as a shared service provider for other agencies. GSA was one of the original federal providers, offering payroll and other HR services at one point to 40 agencies and about 25,000 employees of which 12,500 are its own employees.

GSA’s decision to get out of the HR Line of Business makes sense. It told the Office of Management and Budget in its 2016 business case that it’s facing consistent losses, doesn’t have a competitive rate structure to allow for full cost recovery and has a declining customer base.

So this leads us back to the 10-year deal with IBM to outsource its HR systems.

It’s unclear why GSA went with a private sector provider, given all the emphasis on using federal providers, especially for financial management.

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Two mythbusters memos from the Office of Federal Procurement Policy; the reestablishment of the Frontline Forum for contracting officers; a host of Web and in-person educational sessions over the last five years, and still the idea that government and industry can communicate about contracts is hard for many acquisition workers to grasp.

Someone called it a matter of breaking through the “institutional density” of an organization.

The latest attempt to break through that historic blockage is a proposed rule by the Federal Acquisition Regulatory Council in Nov. 29’s Federal Register.

The proposed rule says “government acquisition personnel are permitted and encouraged to engage in responsible and constructive exchanges with industry, so long as those exchanges are consistent with existing laws and regulations, and promote a fair competitive environment.”

The council says they hope this change “will better equip federal acquisition officials with the information needed to issue high-quality solicitations.”

Seems simple enough. No?

But for a variety of reasons, most agencies — and there are few true exceptions — continue to struggle with how frequent, when and why they should talk to contractors.

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The Homeland Security Department’s hiring fair in July was such a success, it’s having another one.

In fact, it’s happening this week — virtually — and focused on interns and recent college graduates under the Pathways program.

Angie Bailey, the DHS chief human capital officer, said the goal is not just to hire cybersecurity positions like the last one. DHS now is looking for an assortment of skills from IT to acquisition to financial management to human resources to readiness and to security.

“We are doing it again to bring the power of DHS together,” Bailey said at the recent Human Capital Management Government conference in Alexandria, Virginia. “What we’ve decided … is if we just hire one person then it’s a success. It’s more about the intangible benefits of DHS acting as one agency. Some of the things was so cool down in the room was we had these set ups so if a manager from Immigration and Customs Enforcement got a resume and didn’t have a job, they could walk over to Customs and Border Protection, to Transportation Security Administration or to FEMA, and introduce you to the hiring manager because the person would’ve been a really good fit there. That never, ever would’ve happened without these guys being together, sitting side-by-side and seeing the value of helping each other out to place people.”

Bailey, DHS Chief Information Officer Luke McCormack and Deputy Undersecretary for Management Chip Fulghum deserve a lot of credit for making the first hiring event happen and bringing the components together.

So often in many large organizations, good ideas fall victim to a lack of leadership or broad support.

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