Standing Panel on the Federal System
Meetings

NATIONAL ACADEMY OF PUBLIC ADMINISTRATION STANDING PANELS ON FEDERAL SYSTEMS AND EXECUTIVE ORGANIZATION
AND MANAGEMENT

MEETING OF JANUARFY 16, 2004
DRAFT MINUTES

PANEL ATTENDEES: Paul Posner, Panel Chair; Tom Stanton, Panel Chair; Enid Beaumont, Jonathan Breul, Holly Canaveri, Mort Cohen, Phil Cooper (via phone), Dick Daniels, Alan Dean, Jim Freck, Dave Garrison (via phone), Dan Guttman, Dwight Ink, Tom James, Herb Jasper, Fred Kaiser, Richard Keevey, Al Kliman, Bernie Martin, Bruce McDowell, Nancy Potok, Beryl Radin, Justine Rodriquez, Dan Skoler, Carl Stenberg, Barry White, Ralph Weidner and Charles Wise (via phone).

STAFF ATTENDEES: Meridith Calandra, Suellen Keiner, Eric Landau, and Ann Mladinov

GUEST ATTENDEES: Michael Byrne Microsoft and former director of national capital area programs, Department of Homeland Security. Tim Conlan, professor of public administration, George Mason University,, Tim Raduca-Grace, professional staff, Senate Governmental Affairs Committee, and Tracy Trauman, Office of Domestic Preparedness, Department of Homeland Security

WELCOME AND ADMINISTRATIVE MATTERS
Tom Stanton welcomed everyone to the joint meeting of the Federal System and EOM Standing Panels. EOM approved the minutes from their last meeting on December 19, 2003.

ISSUES OF FEDERAL GRANT DESIGN AND THE GRANTS NOW BEING MADE TO STATE AND LOCAL GOVERNMENTS FOR HOMELAND SECURITY
Paul Posner said this is the first joint meeting between Federal System and EOM. The panel today has been assembled to carry forward the theme of homeland security, which the Academy has been focused on for the last year. The invited panel will help us gain some guidance.

• Tim Raduca Grace - works for Senator Collins who developed a grant reform bill.
  
• Michael Byrne - Director Homeland Security - now with Microsoft.
  
• Tracey Trautman - Office of Domestic Preparedness, Department of Homeland Security
  
• Tim Conlan - Political Science Professor - George Mason University

Posner directed the Panel's attention to the handout. Homeland security illustrates how the environment for federal management has shifted from the management of single entities at one level of government to the encouragement of many entities - both governmental and private - to address common challenges across conventional boundaries. How you design and manage governance tools to engage various partners in our system has become the key to effectively managing toward outcomes.

Working in this environment causes a shift in focus, specifically in Homeland Security. Posner said that the following are federal policy tools:

• Grants
  
• Mandates
  
• Preemption
  
• Partial Preemption
• Information

At least three agencies (HHS, DHS, DOJ) are involved in funding over 20 specific grants for first responders alone. There is considerable inconsistency, overlap and duplication.

Posner suggested the following grant reform options:

• Block Grants
  
• Performance Partnerships
  
• Administrative Streamlining
  
• One Stop Shopping

Posner explained the following major issues involving how you structure intergovernmental roles:

• States roles in funding, planning and standards
  
• Local government preparedness responsibilities
  
• Regional governmental arrangements and incentives

Tim Raduca-Grace

Raduca-Grace said that the debate on Homeland Security Act led to fragmented process. The bill proposes to put all the administrative funds into one process. However there are two problems:
1. The Office of Preparedness was under the jurisdiction of another Senate committee, which did not want to lose jurisdiction.
2. The law enforcement community resists the consolidation of ODP grants, formerly funded from Justice Department, with FEMA grants, which traditionally have funded fire departments. They waged a lobbying campaign to make ODP responsible for grant funding.

Senator Collins wanted to restructure the grant funding and application process for homeland security and introduced Homeland Security Legislation.

The proposed bill would make it easier to apply for grants, increase flexibility and accountability, and protect programs that work. For example, the State Homeland Security Block Grant will be reduced from a 12-step process to a 2-step process. The bill also has a 25% soft match cost share. The administration proposed 25% hard match in their budget, but state and local governments did not favor that.

In summary the bill proposed:

• More local input
  
• Standards - interim performance standards
  
• High threat funding - certain percentage is allocated to high threat areas.
  
• Streamlining the planning process.
  
• One stop-shopping - trying to move all the grant programs into ODP.
  
• States and localities are allowed to get a waiver from the Secretary for unspent Homeland Security Dollars

Fred Kaiser asked if high threat areas are eligible for money from other areas. Raduca- Grace said that yes, you could get money from the high-threat fund and the block grant fund.

Alan Dean said the Mayor of LA was recently quoted saying that the city is responsible for a lot of extra costs. Raduca-Grace said Senator Collins does think that is a concern.

Michael Byrne

The first thing is that we need to be honest about what we are trying to fund. Prior to 9/11 grants at state and local for domestic preparedness was a couple hundred million. After 9/11 it was 3.5 billion.

The focus has shifted over what we are asking the communities to do with the money. . Public Safety was a local decision to what there toleration for risk they are willing to take. The scenarios considering terrorism shifts things….no one community can handle it on their own. We need to be prepared for larger threats, but also work together statewide. As time has passed, communities have improved. The Department is asking that the money be sent in a different, more regional way for certain grants, including the urban security funds.

What does readiness look like? It is a question of standards. Two new Presidential directives clarify the federal role for homeland security and the responsibility of DHS to develop standards for first responders and critical infrastructure protection -- HSPD5and. HSPD8 Initial wave of funding are going towards "boots and suits." The community is spending the money wisely because they care about the personal protection of the responders as well as the citizens.

Among the controversies that have emerged is the eligibility of local personnel expenses for federal reimbursement. DHS has a policy to not pay for salaries for first responders, on the grounds that these costs would be funded in the absence of federal funds. In their view, staffing is a local responsibility while federal funds should finance training, equipment and other programmatic needs

Tracey Trauman

Trauman works for the Office for Domestic Preparedness, which was founded in April 1998. Previously the office was under the Department of Justice, but it was moved over to DHS last year.

In FY04 $4billion was appropriated. They have made some strides this year as far as streamlining the application process. In 04 they used a basic standard form. Now, they have added additional allowable categories - gone from 12 to 18 equipment categories.

Many states have not already spent their funds. Some states may be holding on to it for another "orange alert"

Trauman explained that grants are provided based on the following three main goals:

• Prevention
  
• Response
  
• Recovery

Nancy Potok asked how do you know what the general public knowledge and preparedness is? Do most people know what to do? Is this part of the performance measures for these regional groups?

Trauman said that the Citizencorps is working on the issue, but it depends on the state. Some state programs are stronger than others. Byrne said that the point is valid, but that resources are being put against that.

Radin asked what have the most difficult issues been when negotiating with states? Trauman said there are about 10 state strategies. The one thing we have uniformly pushed states on is time specific goals.

Dean asked how we assure that the funds go to the places where there is some significant danger? How do we know that the states are passing money down to the localities?

Trauman said that states conduct a baseline assessment. Some target funds based on formula; others do it based on threat. Byrne said it is prudent to have some level of capability in every community (i.e. who would have thought that Oklahoma City would have been a place of significant danger.)

Many questions were raised about the tensions between state and local governments over homeland security grant funds. Stanton asked what is the proper role for DHS to mediate between states and local governments to ensure they are working within this system? Carl Stenberg asked what are the processes that states use to decide how the money is passed to localities?

Trauman said that the pass-down requirement is legislatively mandated. Raduca-Grace pointed out that federal law requires states to pass down 80% of funding or resources - some states are satisfying this mandate by providing centrally procured equipment to local governments.
Dwight Ink asked to what extent did ODP examine past practices in grants management.

Trauman said that ODP did look at past practices to address what issues? Did she say?

Tim Conlan

" Conlan explained the following characteristics issues and tensions associated with federal assistance in general that are manifesting themselves in homeland security There will always be tradeoffs between goals between competing goals, such as whether to emphasize accountability for federal goals or flexibility for state and local governments to tailor programs to unique state and local needs.
" The federal system is incredibly diverse - states vary significantly for example in the way that power and resources are allocated to substate areas. .
" There is a need to look at grants systematically and not just programmatically since most overarching outcomes such as protection from bioterrorism are so often the product of mix of programs and tools.
" "The freedom to succeed is the freedom to fail." - state and local governments asking for more discretion and flexibility to chart their own course will be exposing themselves to blame if their initiatives fail or a crisis happens on their watch.
" The greater the variance between federal, state, and local interests; the greater the need for federal guidance.
" Grants are premised on some degree of shared values between the federal, state, and local governments.
" Grants are an area of constant evolution - even within a single program area, power among governments can shift, as does the form and design of the grant itself.

Dean said how informative this discussion has been. It increases his knowledge and concerns. Homeland Security has become extremely expensive. He can't understand why places like Burns, Oregon need money to fight against terrorism. He wants more assurance that we don't have mechanisms working that give states or localities money that don't need it.

Raduca-Grace said that the vast majority of funds are going to large threat areas. In terms of rural areas there are other concerns than terrorist bombing. (e.g., agroterrorism. As we have seen from Mad Cow disease, this could cause billions of dollars of damage to the economy.)

Kaiser asked if anyone has ever said no to a substantive federal aid request? Have requests been turned down based on content?
Bruce McDowell said that Homeland Security does not just mean terrorism. National disasters also qualify as issues of homeland security. Compliance with the law and best practice and capacity need to be judged. [AS WE DISCUSSED, PLEASE ASK BRUCE TO FILL IN HIS EXCELLENT REMARKS HERE]

Posner discussed the panel that Jonathan Breul led in December at the Academy.

Byrne discussed urban areas security grants for these grants, DHS is requiring a regional body to develop proposals for an area, as the grant requires the creation of an urban area-working group.

Radin said that homeland security does include the old FEMA world. At the same time that we are really focusing on terrorism many things that we have done already and kind do make it easier to respond to natural disasters. She is not sure that the packaging has to be done to make it clear that the funds and equipment can go past terrorism.

Mort Cohen asked if a risk assessment studies has been made? Does this show where the funds go?

Trauman said that risk assessments are done at the state level as part of the planning.
Byrne said that proportionally New York City and State have gotten a tremendous amount of money.

Posner thanked the speakers and the panel for an excellent discussion. He added that the Academy has an opportunity to serve as a neutral forum.

Stanton said that there is a tremendous amount of knowledge sitting at the table. To capture the knowledge on a conceptual level and then make it real, an institution needs to be created to serve as a focal point and neutral forum to bring together leading thinkers and doers to address generic and specific problems across government. The former Advisory Commission on Intergovernmental Relations (ACIR) and Administrative Conference of the United States (ACUS) once had this function, but they were abolished in the 1990s. A new smaller agency is needed to carry out these important functions and create communities of practice that can help inform departments and agencies such as DHS about issues such as design and administration of grant programs to carry out important national purposes such as homeland security. NAPA would benefit from such an agency, which could become an inside-the-government partner with NAPA and other organizations and people who want to see increased emphasis on proper organizational and program design and administration.

Al Kliman said that unfortunately, Ron Moe is not here, but he would say that we are lacking a central body of knowledge on administration. Kliman believes that there is a clear need for this.

Radin said that we shouldn't jump to create a new government agency right away. We should see if NAPA could do a feasibility study. NAPA should look into the positive and negatives of ACIR and ACUS.

Dan Guttman said that ACIR had agreed-upon administrative procedures. In order to construct that today there needs to be an understanding of statutory framework.

Ralph Wider said that the first task is to get the seed of a design or proposition put together and then talk to funding sources. After a few years of working within the Academy this could be spun out independently. He suggested a survey to the members of the panel that request the problems with the federal system. This could be the core of a proposal of an ACIR.

Posner said that this document could be an agenda-setting document for a subsequent focal point.

Ink said that he strongly supports establishing something that would carry out a similar function to ACIR. He also has no problem trying to get federal funding for it. The Academy could initially carry out much of the role, however, he is not sure that he would recommend it. The Academy can play an important role that deals more with the implementation of these policies.

Justine Rodriguez said that we have an e-government process that improves things. She does not see it starting from zero.

Guttman said remember that NAPA is place where ideas are conceived. He added that access and data are more important than receiving a lot of money.

Dean noted the need for a law.

Dick Daniels said that if you want to get things started and established you don't want to threaten people already engaged.

Stanton suggested that this issue be brought to Morgan Kinghorn, NAPA President and the other panels.

Stanton and Posner adjourned the meeting at 1pm.