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Subject: 8 November, 2000 Resource Board (RB).


1. Subject: On 8 November 2000 at 1530 hours, Mr. J. B. Hudson and LTG Pickler co-hosted a Senior Resource Board (RB) meeting on behalf of OA22. A list of attendees is attached. The briefing was presented by Mr. Robert L. Jaworski. The items discussed at the meeting included:

    1. OA22 Family Process
    2. OA22 Accounts Resourced
    3. FY00 & FY01 Funding Letter Profiles
    4. Congressional & HQDA Adjustments
    5. OA22 Fiscal Year Comparisons
    6. OA22 Fiscal Year Normalization
    7. OA22 Funding Alternatives
    8. Summary
  1. Background:

a. OA22 is divided into 25 families, with the family principal having the flexibility to cross-level operational and high visibility program funds within the family in coordination with RS-W, PBD.

b. OA22 accounts are broken into three category types: 1) High-Vis/Army Focus (special interests programs having senior leadership interest and executed by various functional families, examples: annuities to certain surviving spouses; disposition of remains; SA recruiting initiatives); 2) MACOM Operations (MACOM Ops) (programs resourced to keep the doors open, examples: civilian pay, HQDA automation, Pentagon rent, contracts); and 3) Open Allotments and Centrally Managed Accounts (OPEN/CMAs) (major accounts like DFAS, who performs accounting functions and provides payroll checks). In OA22, we pay for Army-wide programs and provide funding for the entire army having worldwide impact. Approximately 2/3ds of our resources go outside of the beltway.

c. In FY00, OA22 received $29M in the Funding Letter to pay some of its critical UFRs ‘up front’. We received another $181M during the rest of the year to fund critical UFRs or earmarked for specific projects like biometrics and Vision LIA. These additional resources came from multiple sources: Omnibus, Defense Stockpile, Leader Reserve and reprogramming.

d. In FY01, OA22 did not receive any ‘up front’ funding in the Funding Letter. No UFRs were paid. Open and CMAs are underfunded. In comparison to the endpoint of FY00 we are starting with $178M less funding.

e. For FY01, OA22 received Congressional and HQDA reductions that resulted in a 2% tax to all non-exempt programs. In addition, a 5% strawman tax was levied by OA22 to cross-level MACOM Ops accounts to achieve civilian pay funding at the FY00 endstrengh or workyears executed, cross-level GENOPS at 100% of the FY99/00 average, and partially funds several fixed costs such as postage, printing and commo.

3. Discussion:

a. Mr. Hudson opened the meeting by outlining the plight of the Headquarters and stated that the former VCSA (now CSA) and ASA (FM&C) emphasized to the Army two years ago to ‘stop underfunding the HQs’. Despite our success at fixing the HQs accounts in the POM, unexpected Program Budget Decision (PBDs) reduced the plus-up for Vision purposes. Because of this, we are meeting now to discuss the underfunded HQs. Mr. Hudson further stated that based on the current level of funding there are three options to consider:

1. Tax across OA22 2% for Congressionally mandated/HQDA taxes & 5% to cross-level MACOM Ops (a total of 7%). The 5% tax would give the families a working budget for the year. OA22 would not tax to try to pay for the Open/CMA UFR’s. OA22 would work with the families/functionals to get other sources of funds as in past years primarily coming from ASA (FM&C)’s mid-year reprogramming. This option was accepted by the RB.

2. OA22 could tax the families to pay all bills, or fully fund civilian authorizations. The amount needed would be over $500M ($180M just for the Open and CMAs). With 1% of tax being $7-9M, an additional tax of 56-71% above the 7% would be applied to each family’s non-exempt accounts. This option was not accepted by the RB.

3. OA22 could try to ‘fix’ some UFR’s by using its largest non-exempt account (Civilian Pay). However the RB rejected this option immediately as not feasible.

b. Several other options were discussed but not accepted by the RB: reduce the OA22 tax from 5% to 2.5% and compete at mid-year for additional funding; give the families their share without cross-leveling; reduce travel and GENOPS to 90% of the FY99/00 execution level (which would generate only $9M); or fully fund civilian authorizations.

4. Conclusions:

a.  Mr. Hudson stated that there are not a lot of choices, however it is essential that the family principals become engaged in the funding process  while in other forums. They can assist in paying for reprogramming actions for the current year and help build the right funding for the POM years. Mr. Hudson noted that in nine months we would be going through the same process for FY02 unless the family principals help.

b.  LTG Pickler concluded that we could probably mine more funding out of OA22, but as a team we can work the issues. The principals need to understand this process and their role. Also each principal can work on a ‘appetite suppressant’ on those things we can control. It is his mandate to ensure the VCSA & CSA understands the effects on OA22. Mr. Hudson will ensure the Under Secretary of the Army and Secretary of the Army understand.

c.  Mr. Hudson thanked the participants and concluded the meeting at 1710.

5. POC for this memorandum MAJ William D. Price (697-8600).





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