5.15 EB8829 GOVERNMENT

The Digital Accountability and Transparency Act:From Obligation to Opportunity

DATA ACT: FROM OBLIGATION TO OPPORTUNITY2

A quick look at the current availability of federal spending data provides a strong case for improved transparency of federal expenditures. DJ Patil, the first U.S. Chief Data Scientist, recently spoke in an interview about how the government can assist American taxpayers with gaining access to open government data. He said:

“You need to be able to press a button and get access. What you don’t need is to make 50 calls that take you 30 hours of waiting on hold…to finally get access to a form you have to go read through and then fax in and follow up. That should not happen. It’s your data.”

Also, consider that in 2014 the Government Accounting Office (GAO) reported that $619 billion in federal awards were missing from USAspending.gov and, of the award information that was represented, between only two and seven percent was consistent with agencies’ actual records2. Indeed, the time for improved accessibility to quality data is long overdue.

Data: A Strategic Asset

Many agencies have concerns about requirements under the DATA Act, and with some understandable reservations. However, forward-looking agencies are the ones that, for quite some time, have understood the value of consolidating their financial data to better facilitate good decision-making and improve justification for agency investments. For them, data—and the capability to extract useful knowledge from it—is regarded as a key strategic asset. There are a broad range of opportunities for extracting value from data, many of which are frequently overlooked, such as:

• Improving overall agency performance through better decision-making

• Enhancing controllership by lowering improper payments and increasing debt collection

• Achieving greater transparency; simplifying compliance reporting with more complete, accurate and timely data

The State of MichiganFor example, consider the State of Michigan. It has long known that consolidation of data can dramatically improve communications across individual agencies. The state’s data warehouse touts some amazing results, including the improvement of children’s lives in the Foster Care program through collaboration between the Department of Human Services and the State Court Administrative Office.

They have also made a quantum leap in understanding homelessness and the effects of efforts to improve the lives of homeless individuals and families, in turn enabling the most effective use of scarce resources. As a result of the innovative use of its data warehouse, Michigan has determined that the state, and its constituents, enjoy an impressive savings of $1 million per business day by way of fraud identification, operational efficiencies, and cost and sanction avoidance.

Introduction

Passed on May 9, 2014, the Digital Accountability and Transparency Act (DATA Act) legislation requires federal agencies to report all expenditures—grants, loans, and contracts—in order to provide American citizens and policy makers better visibility into federal spending. At first glance, new federal requirements—which are scheduled to go in effect May 2017—can seem like imposed obligations with unknown benefits to the implementers. However, wise agencies and early adopters recognize how to transform this new compliance obligation into an opportunity to advance their federal agency by becoming more data driven. The Federal Government maintains vast amounts of data, and the DATA Act establishes data standards and sharing protocols that will help agencies exploit the benefits of data mining and analytics.

No other state in America has achieved more impressive, concrete business results from the innovative use of a data warehouse for improving outcomes, reducing costs, streamlining operations, and managing programs.

TERADATA.COM3

The Department of InteriorConsider also the work done by the Department of Interior’s (DOI) Office of Financial Management, which is an impressive illustration of what can happen when an agency brings its financial data together onto a single system to reduce agency reporting burdens and improve compliance. Imagine the types of Congressional inquiries that could be answered, quickly and with a minimal amount of resources, by using DOI’s Expenditures maps. Doug Glenn, the Agency’s Deputy Chief Financial Officer and Director of the Office of Financial Management, has described the ease with which his agency can make quick decisions—or zoom in to better understand a particular challenge or anomaly—simply by consolidating financial data into a single repository.3

Optimizing Agency Efficiency and Opportunity

The panicked days of scrambling to respond to data calls can become a memory when agencies consolidate their financial data, and make it easily and quickly accessible via a few confident keystrokes. Just as the internet makes obscure facts and trending topics readily available to inquisitive minds, an intelligently-designed financial data system provides improved views into federal financial award-level data that allow rapid responses to questions such as:

• Which regions of the country received the most grants from our agency? How can we improve coordination?

• What would happen if we could combine and analyze agency information with government-wide data?

• How many cases of fraud or improper payments exist, and how can they be reduced over time?

• Based on trends over the past 3 to 5 years, what financials can we expect moving forward; what program and policy adjustments will be needed?

• What could be gained by benchmarking our agency’s performance government-wide on any key financial metric?

• How can we develop stronger relationships with constituents, Congress and beneficiaries through consolidated financial data?

One concern some agencies share is the loss of control of their DATA Act data as it flows from the agency to the U.S. Treasury, and on to public view. Data is powerful. It makes headlines and influences decisions. So agencies are justified in their concern over proper care of their submitted data to ensure its integrity and to avoid misinterpretation. Agencies should rest assured that, by design of the data submission process, they will have total control over the quality of their federal financial data—throughout the entire course of sharing data with the public.

As part of their responsibilities to comply with the DATA Act, agencies will perform all Extract, Transform, Load (ETL) and data validation activities themselves, prior to transferring data to the U.S. Treasury for reporting. This means that individual agencies will be responsible for reading existing/internal agency financial data; converting the extracted data into a form required by the U.S. Treasury; and finally, preparing the data to be written to its final location prior to uploading it to USAspending.gov.

From initial extraction to its final publishing on USAspending.gov, agency expenditure data will retain the format and quality as it originally resided within the individual agency. This, of course, further necessitates that

agencies conduct the proper due diligence to establish the people, processes and systems to help ensure their data is ready for public viewing in May 2017.

Getting the Most from the DATA Act

Federal agencies that will get the most from the DATA Act will be those that recognize the potential benefits of implementation go far beyond compliance. While the scope of the DATA Act pertains to federal financial data, the data governance, data quality, and other data management tools, policies and processes developed and adopted to comply with the law’s requirements are easily scaled and applied to the data throughout an agency. This means that, if an agency chooses, it can leverage the work required to provide transparency to federal financial data, replicate it, and gain vast new insights into its program performance, human resources, infrastructure and other program and operational data.

As agencies implement the DATA Act with the purpose of getting more value from financial data, they will see opportunities to turn compliance efforts into a greater benefit for their agency as a whole. Concern will be replaced with greater operational efficiencies and well-founded confidence in their data.

Most importantly, the data needed to understand the flow of tax dollars from appropriation to payment for programs and services will be easily available to federal workers and citizens alike, providing insight for greater improvements in the use of federal resources.

Teradata and the Data Transparency Coalition

Teradata, a global leader in analytic data platforms, has analyzed DATA Act requirements and identified an array of services such as data visualization, analytics, warehousing, integration and others that agencies can consider for more seamless adoption of the data standards and reporting. Teradata is a founding member of the Data Transparency Coalition (DTC), and helped lead the charge in getting the legislation passed. Through the DATA Act, the DTC is transforming federal spending, thanks to Teradata’s support and the growth we have championed.

About Teradata

Teradata helps government agencies get more value from data than any other company. Our big data analytics solutions, integrated marketing applications, and team of experts can help your organization achieve actionable insights with data. Teradata helps organizations leverage all their data so they can know more about their citizens and agency outcomes and do more of what’s really important. For more information, visit teradata.com/government.

Resources: 1. Source: “U.S. Data Chief Aims to Empower Citizens with Information,” Elizabeth Dwoskin, Wall Street Journal, March 10, 2015. http://www.wsj.com/articles/white-house-data-chief-aims-to-empower-citizens-with-information-1426024220

2. Source: “Effective Implementation of the DATA Act Would Help Address Govern-ment-wide Management Challenges and Improve Oversight,” United States Government Accountability Office, December 2014 http://www.gao.gov/products/GAO-15-241T.

3. Source: ACT-IAC DATA Act Panel 2: July 9, 2014 https://actiac.org/

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5.15 EB8829

Transforming obligation to opportunity starts with an understanding that the primary purpose of the DATA Act is to enable federal workers to get more value from financial data.