Bigger Cash Bonuses for Federal Employees Who Identify Unnecessary Spending (S. 1830)

What is S. 1830?

(Updated July 4, 2019)

This bill would authorize the head of a federal agency to pay a cash award to any employee whose identification of unnecessary expenses resulted in cost savings for the agency. The maximum dollar amount of such an award would be increased from $10,000 to $20,000. Current law only allows Inspectors General (IG) to pay bonuses for federal workers who identify waste, fraud, or mismanagement of funds.

If the agency’s Chief Financial Officer determines that the potential unnecessary expenses identified by the employee meet applicable, the unnecessary funds would be transferred to the Treasury’s general fund to be used to reduce the deficit or federal debt (if there’s no current deficit). An agency head wouldn’t be able to retain more than 10 percent of amounts transferred to the general fund.

Certain federal employees would be ineligible for the cash awards, including:

• An officer serving in a position at level I of the Executive Schedule;

• The head of an agency;

• An officer or employee of the Office of the Inspector General of an agency;

• A commissioner, board member, or other voting member of an independent establishment.

Argument in favor

Federal agencies should make a concerted effort to find ways to save taxpayer money, and increasing cash bonuses for employees who identify unnecessary expenses will get them proactively involved in that effort.

Argument opposed

There’s no reason to broaden the cash bonus program for federal employees who identify unnecessary costs — such awards are already available through agencies’ Office of the Inspector General on a smaller scale.

Impact

Federal employees who identify unnecessary expenses; federal agencies; and the Treasury.

Cost of S. 1830

The CBO estimates that enacting this bill’s identical House companion wouldn’t increase spending or significantly reduce the federal budget.

Additional Info

In-Depth: Senator Rand Paul (R-KY) introduced this bill to strengthen the cash bonus incentive system for federal employees who identify and report unnecessary spending:

“Federal employees, under the current law, have a perverse incentive to spend all of their agency’s annual budget before the end of  the year. Through bonus incentives, my amendment will reduce the federal deficit and reverse the trend toward agency bloat, by combating inefficiency and mismanagement of funds in the government.”

This bill has the support of one cosponsor, Sen. Mark Warner (D-VA) its identical companion passed the House on a voice vote in October 2017.

A version of this bill that’d only apply to the Dept. of Homeland Security (DHS) was adopted by the Senate Homeland Security & Governmental Affairs Committee as an amendment to a bill reauthorizing the DHS.

Media:

• Sen. Rand Paul (R-KY) Press Release (Previous Version)
  
• Sen. Rand Paul (R-KY) Press Release (Amendment Version)
  
• CBO Cost Estimate (House Version)