Mark Warner, Rand Paul introduce bill to reduce wasteful end-of-year federal spending

U.S. Sens. Mark R. Warner (D-VA) and Rand Paul (R-KY) have teamed up on a bipartisan proposal to empower federal workers to identify and cut down on unnecessary federal spending. The Bonuses for Cost-Cutters Act of 2015, introduced today, would build on existing law by expanding a program that allows U.S. government inspectors general to reward federal employees with a bonus for finding and reporting wasteful or fraudulent spending.

Under the proposal, that program would be expanded to include “unneeded or surplus” end-of-year funds. Spending at federal agencies in the last week of the fiscal year is 4.9 times higher than the weekly average the rest of the year but research shows that the quality of spending is lower than the rest of the year. Under the Bonuses for Cost-Cutters Act, federal employees who identify unneeded or surplus funds will be eligible for a bonus worth 10 percent of the savings, up to $10,000.

“This bipartisan proposal encourages federal agencies to return unused funds instead of rushing to spend-down their appropriations at the end of every fiscal year,” said Sen. Warner. “When we empower federal employees to identify surplus funds instead of encouraging the ‘use it or lose it’ mentality, we are better stewards of taxpayers’ dollars.”

“Use it or lose it” is a well-known problem where government agencies race to spend unused budget authority before it expires at the end of a fiscal year, often on unneeded goods and services. Under the Bonuses for Cost-Cutters Act, federal employees on the front lines of government spending will have a personal incentive to save taxpayer money and counter the current end-of-year rush to exhaust all funds, while ninety percent of the identified savings will be redirected to the U.S. Treasury to reduce the deficit.

“Under the current law, federal employees have a perverse incentive to spend all of their agency’s annual budget before the end of the year, and subsequently, bonuses will reverse the incentive to the benefit of the employee and the taxpayer,” said Sen. Paul. “The Bonuses for Cost-Cutters Act will reduce the federal deficit and reverse the trend toward agency bloat, by combating inefficiency and mismanagement of funds in the government.”

In addition to Sens. Warner and Paul, the bill was sponsored by Sens. Cory Gardner (R-CO), Pat Toomey (R-PA), and Mike Enzi (R-WY).

National Taxpayers Union and Citizens Against Government Waste have endorsed the legislation.

A copy of the bill text is available here.