Cost-saving measures

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FOR IMMEDIATE RELEASE                                             April 20, 2009

President Obama will hold the first cabinet meeting of his Administration this morning. As part of his commitment to go line by line through the budget to cut spending and reform government he will challenge his cabinet to cut a collective 100 million dollars in the next 90 days.   Agencies will be required to report back with their savings at the end of 90 days.

Below are examples of some of the cost cutting measures agencies have begun to implement:

AGRICULTURE

Improper Payments - USDA has worked with the Treasury Department to identify potential fraud and improper payments in farm programs.  Beginning with the 2009 crop year and in successive years, all farm program payment recipients will be required to sign a form which grants the Treasury Department the authority to provide income information to USDA for verification purposes.  The reform proposal would render those out of compliance ineligible for USDA payments.  Savings under this proposal could reach $16 million a year.

Office Leases - USDA is working to combine 1,500 USDA employees from seven leased locations into a single facility in early 2011, saving $62 million over a 15-year lease term. 

Training - The Rural Development office has been utilizing Internet training in place of in-person training with projected annual savings of $1.3 million.

EDUCATION

Computer Consolidation - The Department has reduced the ratio of computers per employee requiring that most employees use laptop computers (as opposed to keeping a desktop and also receiving a laptop).  This will result in annual savings of about $2 million.  Additionally, savings from increasing the ratio of people who use a given printer will save an additional $6.7 million. 

International Office Closure - Since August 2003, the Department has maintained a full-time employee acting as an education policy attaché at the U.S. Mission to UNESCO in Paris.  By eliminating the position and closing the office, the Department will save $635,000 a year. 

HOMELAND SECURITY

Office Supplies and Computer Software - DHS spends $100 million a year on office supplies, but virtually none of the supplies are purchased through agreements that leverage the Department's collective buying power.  DHS estimates that it could save up to $52 million over five years by purchasing in bulk for the Department.  An additional $10 million over five years could be saved by procuring multi-purpose office equipment, such as a combined copier, printer, fax, and scanner all in a single unit, which will save space, reduce service costs, and lead to volume discounts.  DHS agencies also purchase computer software independently, which increases greatly the number of software licenses that have to be acquired.  Simply by buying these licenses as one entity, DHS estimates it can save $47 million a year. 

Energy Efficiency - DHS will reduce its energy use by purchasing hybrid or alternative fuel vehicles.  Where possible, the Department is also looking to use on-site renewable energy generation instead of grid power.  It has set a target of saving $3 million a year in energy costs. 

Branding - Since 2003, DHS has spent $3 million on consulting contracts to create new seals and logos for its components.  The Department is putting an end to that.

JUSTICE

Going Paperless - The U.S. Attorneys and the U.S. Marshals Offices' Asset Forfeiture program is converting publication of judicial forfeiture notices from newspapers to the Internet.  This change is expected to save $6.7 million over the first 5 years.

STATE

Going Paperless - The Department of State's National Visa Center (NVC) will implement electronic correspondence for immigrant visa processing.  NVC anticipates cost savings in the first year of implementation will be approximately $1 million.

Consolidation in Posts - Consolidation in over 30 posts over the last few years have enabled USAID and State to save an estimated $5 million annually.  The Department plans to expand consolidation to the 30 missions in USAID and State that will not be co-located by FY 2010 for an additional $5 million of savings.

Contract Consolidation - In a number of areas - including cell phones, PDAs, office supplies, furniture and medical supplies - the Department is reducing costs by consolidating purchases under one vendor or a small number of vendors, thus taking advantage of volume discounts.  With office supplies alone, the Department anticipates cost savings between 7 and 10 percent. 

Excess Inventory - In the past six months, the Bureau of Information Resource Management (IRM) has identified 15,000 obsolete items valued at $5 million from IRM's inventory stock and has turned them in to the Department of Agriculture Centralized Excess Property Operation.  This purge of equipment has freed up much needed warehouse space at a State Annex and will save tens of thousands of dollars in storage facility fees.

TRANSPORTATION

Recovery Act Savings - To promote efficiency, the Department has established a team of senior officials who work to bring Recovery Act projects in under budget.  Across the country, contractor's bids are coming in at 15 to 20 percent below the estimated costs.  Colorado reports bids as much as 30 percent below estimates, and California indicates that some contractors are offering to do work at half the projected cost.  These cost savings mean that more projects can be funded. 

VETERANS AFFAIRS

Travel Savings - The Department cancelled or delayed 26 conferences for a savings of almost $17.8 million.  VA will be relying on less costly alternatives, such as video conferencing, as ways to complete training requirements.