The Merit Systems Protection Board had another productive year in 2016, but Susan Tsui Grundmann, who resigned Jan. 7 from her position as chairman during a one-year hold over period, warned of future challenges that may complicate life for the small agency.

“MSPB must be prepared to face external challenges such as potential changes in law and jurisdiction proposed and enacted by the new Congress, possible reductions in federal appropriations in fiscal 2018 and beyond and other potential changes implemented by the new administration,” Grundmann wrote in the agency’s fiscal 2016 report.

The agency is particularly concerned about its budgetary future, as budget caps under sequestration are set to return unless Congress passes an alternative.

“Budget reductions could mean an increase in appeals involving furloughs, reductions in force or early retirements,” Grundmann said.

The agency didn’t issue quite as many decisions as it has in the past two years, in part because furlough cases made up the bulk of MSPB’s extra work in 2014 and 2015.

Yet MSPB issued more decisions in 2016 — 9,794 in total — than any one year from 2003 to 2013.

By now, MSPB has adjudicated nearly all, or 99.5 percent, of the initial furlough appeals that federal employees filed due to sequestration in 2013. It processed the majority of those appeals last year but wrapped up many of the remaining cases in 2016. The agency issued decisions on 33,186 appeals cases over the past four years, the report said.

Congress also kept MSPB busy in 2016, as House and Senate staff members asked agency employees to weigh in on several bills that had the potential to change the MSPB appeals process or civil service laws more broadly, the report said.

For example, the Senate Veterans Affairs Committee actively pushed legislation that would have expedited the adjudication process for VA employees who file appeals with the MSPB. The Veterans First Act had support from the VA itself, but the bill ultimately died in the Senate.

The agency didn’t go into much detail but predicts these conversations with Congress will continue into 2017.

“MSPB anticipates congressional action on similar bills in the next Congress,” Grundmann said in the report.

MSPB’s prediction seems inevitable, as some lawmakers grew particularly frustrated with the agency in 2016 after it overturned the VA’s punishment for a third senior executive and two others the previous year. And many lawmakers have argued it simply takes too long to fire a federal employee under current law.

“Proposed legislation … would expand the Department of Veterans Affairs Senior Executive Service appeals rights and processing changes to all VA employees,” the report said. “These changes would necessarily affect MSPB adjudication of these VA cases which would logically also affect our processing of all non-VA cases.”

Internally, the agency also faces personnel challenges. Roughly 22 percent of MSPB employees will be eligible to retire within the next two years, including about a quarter of the agency’s 70 administrative judges, the report said.

Grundmann announced her resignation a few weeks ago, leaving one board member to serve as chairman. Her term expired March 1, 2016, but she served for roughly one year in a hold over capacity. Administrative judges and regional and field offices will continue to issue some decisions, but with one board member, MSPB can’t publish merit system studies or decide on petitions for review.

“MSPB’s adjudicatory process, albeit truncated, will continue,” she said.

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