Legislation Reintroduced to Combat Year End Agency Spending Sprees

Senator Rand Paul (R-KY) has reintroduced legislation that would pay bonuses to federal employees who report wasteful spending in their agencies.

Senator Rand Paul (R-KY) has reintroduced legislation that he hopes would help reduce what he calls “wasteful spending at the end of the fiscal year.”

When the government’s fiscal year is winding down, it is common for federal agencies to ramp up their spending to make sure they utilize their allocated budgets for the fiscal year. This is known as the “use it or lose it” concept; if the money fails to all get spent, Congress might not appropriate as many funds for the agency the following year.

Senate Hearing on Year End Spending

Paul is reintroducing the bill in conjunction with a Senate hearing that was held yesterday called “he last week of the fiscal year to which Paul was referring.

Bar chart showing aggregate data from 2004 to 2009 on agency spending highlighting a significant spike in the last week of the fiscal year


Paul also said in the hearing:

We have seen data indicating that on the last day of the fiscal year, money actually moves to the west as the sun sets and they continue to spend it as five o’clock approaches on the west coast.

The stories we have heard may be even more telling. We have been told of the military hovering aircrafts at the end of runways just to burn off fuel, and soldiers sent to the shooting range sometimes for an entire day just to expend ammunition.

Of course I cannot forget when we took over this subcommittee, we found toner cartridges for an obsolete printer stacked to the ceiling in the subcommittee’s office space because the chairman preceding had said, “We’ve got to spend it; we have this money; we’ve got to get rid of it.” I don’t know what happened to those cartridges, but they obviously were a waste of money.

Bonuses for Cost Cutters Act

The bill Paul just reintroduced, known as the Bonuses for Cost Cutters Act (S. 1830), would expand current law to allow an agency’s Inspector General to pay bonuses to federal employees that identify unneeded or surplus funds. Current law allows an agency’s Inspector General to pay bonuses up to $10,000 of savings realized when a federal employee identifies waste, fraud, or mismanagement of funds.

The bill would also ensure that 90% of the savings are automatically directed toward deficit reduction and allow agencies to apply any remainder toward other agency priorities (subject to current law).

The bill has been introduced in the past but ultimately failed to be passed into law.

About the Author

Ian Smith is one of the co-founders of FedSmith.com. He has over 20 years of combined experience in media and government services, having worked at two government contracting firms and an online news and web development company prior to his current role at FedSmith.