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OPM needs to better explain charges for investigations, GAO says

The Government Accountability Office advised the Office of Personnel Management to provide agencies with better data on how OPM sets the prices it charges agencies for background investigations.

The Government Accountability Office advised the Office of Personnel Management to provide agencies with better data on how OPM sets the prices it charges agencies for background investigations. The report containing the recommendation, dated Feb. 28, was released March 28.

As the investigative service provider for the most of the federal government outside the Intelligence Community, OPM—through the Federal Investigative Service—conducted more than 2 million background investigations in fiscal 2011, about 788,000 of those for its biggest customer, the Defense Department. DOD’s investigations alone came at a cost of over $787 million in fiscal 2011, GAO said.

OPM’s reported costs to conduct background investigations grew nearly 79 percent between 2005 and 2011, according to the report, increasing from about $602 million in fiscal 2005 to about $1.1 billion in fiscal 2011.

GAO said investigation fieldwork and support contracts—which accounted for almost half of OPM’s fiscal year 2011 reported costs for background investigations—were chief among the “cost drivers” examined by GAO. These contracts totaled about $532 million.

Personnel compensation and benefits for OPM’s background investigation federal workforce accounted for another 25 percent of those 2011 reported costs—about $265 million. Another cost driver, IT investments, represented less than 10 percent of fiscal 2011 reported costs—but GAO noted that IT costs have grown by more than 682 percent over six years, from about $12 million in fiscal 2005 to more than over $91 million in fiscal 2011. 

OPM, for its part, said the rising costs are the result of more comprehensive subject interviews, higher FBI fees, and compliance with investigation timeliness requirements. 

But because OPM does not provide agencies with detailed information on how it sets the prices its charges agencies for the background investigation services, agencies have expressed dissatisfaction over the lack of transparency. This has caused some agencies who fear they are being overcharged to look at alternative means for carrying out investigations, the report said.

Those efforts, however, could lead to duplication “that is contrary to the goals of the governmentwide suitability and personnel security clearance reform effort,” the report stated. 

In addition to advising OPM to provide more transparent pricing information to agencies, the report also advised OPM to seek ways to reduce costs by looking for new efficiencies and other cost-saving measures.

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