The Presidents Management Agenda: A Brief Introduction

The President’s Management Agenda:
A Brief Introduction
Virginia A. McMurtry
Specialist in American National Government
Government and Finance Division
This report provides an overview of the President’s Management Agenda,
announced in August 2001, and comprising five government-wide initiatives, including
strategic management of human capital, competitive sourcing, improved financial and
real property management, expanded electronic government, and performance
improvement (originally referred to as budget and performance integration). Related
developments, such as introduction of a Management Scorecard for gauging agency
achievement on the initiatives and development of a program assessment rating tool
(PART) for evaluating program performance, are also discussed. This report will be
updated as developments warrant.
Background on the Initiatives
In August 2001 the President’s Management Agenda was announced, with the stated
purpose of “improving the management and performance of the federal government.”1
The Agenda consisted of five government-wide initiatives (described below), and several
specific program activities. According to President Bush, these five main initiatives were
selected as addressing “the most apparent deficiencies where the opportunity to improve
is greatest.” The President’s initiatives reflect the view that management in the federal
government might be improved by adopting more business-like principles and practices
from the private sector, which emphasize performance and results.
!Strategic Management of Human Capital. The Office of Personnel
Management (OPM) has defined this initiative as transforming how the
federal government employs, deploys, develops, and evaluates its
workforce by focusing on results. Discussion in the FY 2007 Budget
suggests that with this initiative agencies “are strengthening their
performance appraisal systems, nurturing future leaders, ensuring their

1 U.S. Office of Management and Budget, The President’s Management Agenda — FY2002
(Washington: OMB, 2001), p. 1. Subsequently referred to as Agenda. For an online update about
developments related to Agenda initiatives, see [].

employees have the necessary skills, and reducing how long it takes them
to hire new staff.”
!Competitive Sourcing entails public-private competitions for federal
activities considered commercial and possible contracting out to the
private sector of work currently performed by federal employees, and
related revisions of OMB Circular A-76.
!Improved Financial Performance seeks to enhance the quality and
timeliness of financial information available to the agencies and
Congress when making decisions about federal programs. Two other
facets originally subsumed under this initiative later were designated as
separate program initiatives — improving management of real property
assets and eliminating improper payments.
!Expanded Electronic Government focuses on strengthening agencies’
management of information technology resources and using the Internet
to improve service delivery. The latter effort involves some two dozen
activities, such as and
!Performance Improvement (formerly budget and performance
integration) entails efforts to integrate performance reviews with budget
decisions in the federal government. Increasingly, agencies are to use
program performance information such as that generated by the program
assessment rating tool (PART) when making budget and management
Development of the Management Scorecard and PART
President Bush’s budget submission for FY2003, transmitted on February 4, 2002,
sought to incorporate the five management initiatives into agencies’ budgets, and
introduced a Management Scorecard to measure progress in each of the five reform areas.
Grades for the agencies on each of the initiatives, based on a traffic light motif of green
for success, yellow for mixed results, and red for unsatisfactory, have been updated
quarterly by OMB; OPM and OMB jointly determine the grades for the management of
human capital initiative. For each initiative, there are multiple “standards for success,”
or core criteria, which an agency must meet in order to get a green rating. There are
likewise listings for each initiative of conditions amounting to “fatal flaws”; if an agency
displays any one of these, it receives red. A yellow grade applies when an agency is free
of red conditions and has achieved some but not all of the core criteria. For example, with
respect to the improving financial performance initiative, an agency must meet four core
criteria to “get to green,” as listed in the FY2003 budget submission:
!financial management systems meet federal system requirements and
applicable federal accounting and transaction standards as reported by the
agency head;
!accurate and timely financial information;
!integrated financial and performance management systems supporting
day-to-day operations; and

!unqualified and timely audit opinion on the annual financial statements;
no material internal control weaknesses reported by the auditors.2
As of December 31, 2007, three agencies — Department of Labor, Environmental
Protection Agency, and the Social Security Administration — had attained green for all
five initiatives.3 On the other hand, two agencies (the Department of Veterans Affairs and
OMB) still had three reds, and the Department of Homeland Security received no green
on any initiative. There also have been differences in reaching the standards for success
among the respective initiatives. In December 2007, financial performance displayed the
most red grades (nine), followed by competitive sourcing (six reds). The human capital
initiative arguably reflected the most progress to date, with17 agencies at green, none
failing at red, and nine receiving a transitional grade of yellow. Performance improvement
followed, with 14 green, 12 yellow, and no red.
In addition to the current status grades, agencies also receive a progress score for
each initiative: green for implementation proceeding as planned, yellow for some
slippage, and red warning of an initiative in serious jeopardy. OMB’s grading of the
agencies on the scorecard for progress in implementation, as of December 31, 2007, is
higher overall than that given by OMB for current status of the initiatives, with green
predominating, and only nine (of 130 total grades) being red. Eleven agencies have green
for progress in implementation on all five initiatives, while eight have green on all but one
of the initiatives.
The Administration also developed a new program assessment rating tool in 2002,
known as PART, for evaluating program performance. The PART questionnaire contains
four sections, which focus on program purpose and design, strategic planning, program
management, and program results and accountability.4 For various reasons, OMB
translates PART numerical scores into qualitative ratings, as listed below in Table 1.
PART was first used by agency program managers and OMB budget examiners to
evaluate some 20% of federal programs in the fall of 2002 during the budget review
process for the President’s FY2004 budget. Each subsequent year an additional 20% of
programs were to receive PART reviews, with the goal of reaching virtually 100%
coverage in the FY2008 budget.5
On February 3, 2003, President Bush transmitted his budget for FY2004, which
contained a separate volume devoted to the Scorecard and PART, titled Performance and
Management Assessments. On February 2, 2004, the budget for FY2005 was released,
containing a brief discussion of PART in the Analytical Perspectives volume, but with the

2 OMB, Fiscal Year 2003 Budget, Analytical Perspectives (Washington: GPO, 2002), p. 413.
3 Electronic versions of the Dec. 31, 2007, scorecard along with previous ones are available at
[ h t t p : / / www.whi t e house.go v/ r e sul t s / a ge nda/ s cor ecar ml ] .
4 For further discussion, see CRS Report RL32663, The Bush Administration’s Program
Assessment Rating Tool (PART), by Clinton Brass.
5 OMB stated in the FY2008 budget submission (transmitted to Congress on Feb. 5, 2007) that
to date “the Administration has assessed nearly 1000 programs, representing approximately 96%
of the Federal budget.” See Fiscal Year 2008 Budget, Analytical Perspectives (Washington,
GPO, 2007), p.14.

detailed information on PART reviews now provided on a CD-ROM; this format has
continued. Access to PART data was facilitated in 2006, when OMB launched a new
website,, which contains PART summaries for all programs assessed to
date (as of February 2008, covering some 98% of all federal programs).
Table 1. Program by PART Rating Categories, FY2002-FY2007
Rating GroupFY2002(234)FY2003(407)FY2004(607)FY2005(794)FY2006(977)FY2007(1011)
Effective 6 % 11% 15% 15% 17% 18%
Moderately Effective24%26%26%29%30%31%
Ad equate 15% 20% 26% 28% 28% 29%
Inefctive 5%5%4%4%3%3%
Results not Demonstrated50%38%29%24%22%19%
Source: OMB, Analytical Perspectives, FY2009 Budget, p. 14.
As indicated in Table 1, half of the 234 programs subject to PART evaluations in
2002 were rated as “results not demonstrated,” due to inadequate performance goals or
unavailability of data to provide evidence of results. Programs in this category declined
each year, until 19% fell in this category in FY2007. From FY2002-FY2007, programs
in the effective group increased from 6% to 18%; programs deemed moderately effective
increased from 24% to 31%; and programs in the adequate category increased from 15%
to 29%. The percentage of programs rated ineffective declined, from 5% to 3%.
Implementation and Oversight
In his “Message” to Congress accompanying the Agenda in August 2001, President
Bush observed:
These proposals will often require the cooperation of Congress. Congress’ agenda is
a crowded one, and there is an understandable temptation to ignore management
reforms in favor of new policies and programs. However, what matters most is
performance and results. In the long term, there are few items more urgent than
ensuring that the federal government is well run and results-oriented. (p. 1)
On March 26, 2003, the House Subcommittee on Government Efficiency and
Financial Management held an oversight hearing on “Management and the President’s
Budget.”With regard to accomplishments of the Agenda to date, officials from OMB
offered this assessment:
The Scorecard is working. Clearly it still shows a lot of agencies in the ‘red’ for
status. And that reflects the nature of the problems we are trying to solve — chronic
longstanding management challenges that defy quick fixes. However, there is6

significant improvement since our initial evaluation.
6 U.S. Congress, House Committee on Government Reform, Subcommittee on Government
Efficiency and Financial Management, Management and the President’s Budget, hearing, 108th

Testimony from the General Accounting Office likewise was supportive of the effort:
Overall, there has been continuing progress in implementing the governmentwide
PMA initiatives. This progress, however, has been uneven and a continued focus is
needed to improve the management and performance of the federal government and7
to ensure accountability.
At an oversight hearing on February 11, 2004, OMB Deputy Director for
Management Clay Johnson III testified that due to efforts associated with the Agenda,
“Agencies are better managed and achieving greater results than they were two-plus years
ago,” as reflected in the Scorecard. Further, according to Deputy Director Johnson, the
PART process offers a vehicle for improving program performance, while building on the
foundation provided by the Government Performance and Results Act (GPRA). The
strategic and performance plans prepared by agencies pursuant to GPRA provide a basis
on which “to judge an agency’s performance management practices or the goals by which
it measures success. The PART reinforces the law’s important requirements to set8
outcome-oriented goals and measure progress against those goals.”
In his opening statement at the hearing, subcommittee chairman Todd Platts
suggested an interest in discussing “how best to codify the requirement for a coordinated
program-by-program evaluation such as PART.” Pledging continued attention to GPRA
implementation, Mr. Johnson noted, “Codification of the requirement to conduct
assessments of program performance would be a welcome complement to the statutory
management framework laid by GPRA.” On February 25, 2004, Representative Platts
introduced H.R. 3826, the Program Assessment and Results Act (PARA), to amend
GPRA and establish a statutory requirement for program reviews. The bill would have
required OMB to review each program activity at least once every five years, but not
mandated the use of PART specifically. H.R. 3826 was reported favorably in the House,
and a Senate companion bill was introduced, but no further action occurred. Early in the
109th Congress, Representative Platts reintroduced a PARA bill as H.R. 185, which was
again reported favorably by the Government Reform Committee (H.Rept. 109-26), but
saw no further action.9
The 109th Congress considered other measures relating to the President’s
management initiatives. In the FY2006 and FY2007 budget submissions, the President
had called for establishment of two new types of statutory commissions. “Results
Commissions” would consider and revise proposals from the President to restructure or
consolidate overlapping programs and then submit the plans to Congress for consideration

6 (...continued)
Cong., 1st sess., Mar. 26, 2003 (Washington: GPO, 2003), p.71.
7 Testimony of Patricia A. Dalton, ibid., pp. 16-17.
8 U.S. Congress. House Committee on Government Reform, Subcommittee on Government
Efficiency and Financial Management, The President’s Management Agenda: Are Agenciesthnd
Getting to Green? hearing, 108 Cong., 2 sess, Feb. 11, 2004 (Washington: GPO, 2004), pp.

9, 12.

9 For further discussion of this measure, see CRS Report RL32671, Federal Program
Performance Review: Program Assessment and Results Act and Other Developments, by Virginia
A. McMurtry.

under expedited procedures.10 President Bush also called for creation of a Sunset
Commission to conduct systematic reviews of federal programs according to a set
schedule. Absent action by Congress to reauthorize them, programs would terminate
following the reviews. Several states, including Texas, have sunset commissions, and for
many years sunset commission bills have been introduced in Congress.11
Outlook in the 110th Congress
President Bush issued Executive Order 13450 (E.O. 13450), “Improving
Government Program Performance,” on November 13, 2007. The order requires agency
heads to set clear annual and long-term goals and to prepare specific plans for achieving
the goals, including the means to measure progress and efficiency in use of resources.
E.O. 13450 also requires agency heads to designate an “agency performance improvement
officer” and establishes a new “Performance Improvement Council,” to be chaired by
OMB’s Deputy Director for Management.
The order arguably reflects an effort by the Bush Administration to help ensure that
the performance improvement initiative of the PMA becomes a lasting legacy, following
the unsuccessful efforts to advance legislation to provide a statutory basis for PART in
the 108th and 109th Congresses, as discussed above. In the Budget for FY2009, OMB
provided this rationale for E.O. 13450:
To institutionalize the results-driven culture of the PMA, Bush issued
an Executive Order (EO) on November 13, 2007, that formalizes the
commitment of the Government to spend taxpayers’ money wisely and
effectively every year. The EO ensures agency and program performance
is transparent so that taxpayers have the critical information needed to hold
Government accountable. (p. 29)
Some seemed less certain, however, about its favorable impact; according to an article
appearing in Daily Report for Executives, E.O. 13450 “appears aimed at institutionalizing
within the executive branch much of the controversial program rating tool” (PART), used12
by OMB to evaluate federal programs.
Congressional oversight of the Agenda initiatives seems likely to continue and
possibly to increase in light of interest generated by E.O. 13450. The 110th Congress may
choose as well to revisit sunset legislation, such as S. 1731, introduced by Senator
Cornyn on June 28, 2007, or other program review bills.

10 In the 109th Congress, H.R. 2470 would have created a Commission on the Accountability and
Review of Federal Agencies (CARFA), modeled on the Base Realignment and Closure
Commission (BRAC) approach. For discussion of CARFA bills, see CRS Report RS21980,
Commission on the Accountability and Review of Federal Agencies (CARFA): A Brief Overview
of Legislative Proposals, by Clinton T. Brass.
11 For further background, see CRS Report RS22181, A Sunset Commission for the Federal
Government: Review of Developments, by Virginia A. McMurtry.
12 Ralph Lindeman, “Bush Issues Executive Order to Create Agency Review of Program
Performance,” Daily Report for Executives, Nov. 15, 2007 (No. 222).