DATA Act

On May 9, 2014, President Barack Obama signed the Digital Accountability and Transparency Act (DATA Act), Public Law No. 113-101, which had been passed unanimously by both the House of Representatives and the Senate. The DATA Act's passage and successful implementation had been the Data Transparency Coalition's top priority since its founding in February 2012.

The DATA Act is the nation’s first legislative mandate for data transparency.

dataactinfographic

Click here for the Data Act Infographic

It requires the Department of the Treasury and the White House Office of Management and Budget to transform U.S. federal spending from disconnected documents into open, standardized data, and to publish that data online. The Data Transparency Coalition is committed to working with the executive branch and encouraging Congressional oversight to ensure that the DATA Act is fully implemented.  Stakeholders from among the tech industry, non-profit sector, executive and legislative branches of government convened on April 29, 2014 for the Data Transparency Summit to build a shared vision for making the DATA Act a success. Coalition members are working to assist agencies, grantees and contractors to advantage of the DATA Act’s first-ever government-wide data standards for federal spending. Industry-leading white papers have been published by StreamLink Software, focusing on grant reporting (PDF), and by Citizant, focusing on systems integration (PDF).

How does the DATA Act change federal spending?

The full text of the DATA Act is available here. The DATA Act directs the federal government to standardize and publish its wide variety of reports and data compilations related to spending: financial management, payments, budget actions, procurement, and assistance. The DATA Act amends the Federal Funding Accountability and Transparency Act of 2006 (FFATA) by changing existing sections of FFATA and adding new sections to FFATA. Therefore, all citations below are to FFATA, after amendment by the DATA Act.

 

Before DATA Act: No Data Standards After DATA Act: Data Standards Result
Data Standards, Generally No entity in the government has the authority to impose government-wide data standards on federal spending. The Treasury Department and the White House Office of Management and Budget (OMB) will “establish Government-wide financial data standards for any Federal funds made available to or expended by Federal agencies and entities receiving Federal funds.” FFATA sec. 4(a)(1). Federal spending information from different reports and compilations will become interoperable.
Data Standards: Common Data Elements The federal government lacks common data elements to identify agencies, programs, grantees / contractors, awards, and other common concepts Treasury and OMB will adopt “common data elements for financial and payment information required to be reported by Federal agencies and entities receiving Federal funds” FFATA sec. 4(a)(2).  These common data elements must include “unique identifiers for Federal awards and entities receiving Federal awards that can be consistently applied Government-wide.” FFATA sec. 4(b)(3). Common data elements will unite information from different reports and compilations.  For example, a unique identifier for grantees will bring together information on a particular grantee from Treasury’s payment requests, the Census Bureau’s Federal Assistance Award Data System, OMB’s Single Audit Clearinghouse, and agencies’ separate grant-writing systems–even though all of those systems are separately maintained.
Data Standards: Common Data Format Agencies report their financial account balances to Treasury, submit payment requests to Treasury, disclose budget actions to OMB, summarize grants to the Census Bureau, and report contracts to the General Services Administration. Meanwhile, grantees and contractors report their use of federal funds to the agency that awarded each grant / contract, and also to various databases maintained by the GSA.  All of these separate reporting streams use different, and incompatible, data formats. Treasury and OMB will establish government-wide data standards that “incorporate a widely accepted, nonproprietary, searchable, platform-independent computer-readable format,” such as XML or XBRL. FFATA sec. 4(a)(2). A common data format will automate the federal government’s many separate spending reports and allow them to be checked for quality and analyzed for waste, fraud, and abuse–without changing the substance of the reporting requirements or replacing existing data systems.
Before DATA Act: Some Publication After DATA Act: Full Publication Result
Awards Summaries of federal grants and contracts are published on USASpending.gov. Same. Same.
Appropriations The federal government does not publish any details on Congressional appropriations, aside from legislative text. Treasury must publish a breakdown of each appropriation on USASpending.gov. FFATA sec. 3(b)(1). Appropriations data will be publicly available on USASpending.gov in a machine-readable format.
Accounts The federal government does not publish any official list of Treasury accounts. Because appropriations are sometimes divided into separate accounts, and some accounts receive funds from multiple appropriations, there is no way to trace the flow of funds between appropriations and Treasury accounts. Treasury must publish a breakdown of each account, showing the amounts received, obligated, and spent, further broken down by program activity and by object class. FFATA sec. 3(b)(2)-(3). The flow of federal funds from appropriation to account to expenditure will be publicly available on USASpending.gov in a machine-readable format.
Payments Most federal payments are processed by Treasury. But neither Treasury nor any other entity publishes government-wide checkbook-level data identifying each payment. The DATA Act does not directly require Treasury to publish checkbook-level payment data. But Treasury has announced in Congressional testimony that it intends to do so. If Treasury keeps its promise to Congress and publishes checkbook-level payment data, and applies the government-wide common data elements to such data, the flow of federal payments, searchable by agency, proram, appropriation, account, grant/contract, and grantee/contractor, will be publicly available in a machine-readable format.

What does the DATA Act require?

Immediately, the Secretary of the Treasury may decide whether to establish a data analysis center to examine federal spending data to prevent and reduce improper payments and improve efficiency. If the Secretary of the Treasury decides to establish a data analysis center, the accountability platform of the Recovery Accountability and Transparency Board will be transferred to the Treasury Department to form the core of the data analysis center. FFATA sec. 6(c).

No later than one year after enactment, the Treasury Department and the White House Office of Management and Budget will issue guidance on government-wide data standards for federal spending. FFATA sec. 4(c)(1).

No later than one year after enactment, OMB (or another agency that it designates) will start a pilot program to test the benefits of applying the government-wide data standards to the reports that federal grantees and contractors submit to the agency that disbursed the funds, and to government-wide databases. FFATA sec. 5(b)(1).

No later than two years and six months after enactment (or 18 months after the Treasury / OMB guidance on government-wide data standards), the inspector general of each agency will publish a report on the completeness, timeliness, quality, and accuracy of each agency’s standardized spending data. Each inspector general will report twice more on these issues along with its regular financial audits, on alternating years. FFATA sec. 6(a)(2)(A)-(B).

No later than three years after enactment (or two years after the Treasury / OMB guidance), each agency will report its financial and payment information in accordance with the government-wide data standards. FFATA sec. 4(c)(2).

No later than three years after enactment (or two years afer the pilot program starts), the pilot program will terminate, and no more than 90 days after the pilot program terminates, OMB will report to Congress on whether data standardization can successfully consolidate, automate, and simplify reports by grantees and contractors. FFATA sec. 5(b)(5)-(6).

No later than three years and six months after enactment (or 30 months after the Treasury / OMB guidance on government-wide data standards), the Government Accountability Office will publish a report on the completeness, timeliness, quality, and accuracy of standardized spending data, government-wide and on the implementation of the government-wide data standards. FFATA sec. (6)(b)(2).

No later than four years after enactment (or three years after the Treasury / OMB guidance), Treasury and OMB will ensure that all information published on USASpending.gov conforms to the government-wide data standards. FFATA sec. 4(c)(3).

No later than four years and 90 days after enactment (or one year after OMB’s report on the benefits of data standardization for grantee and contractor reporting), OMB will issue guidance to all agencies applying the government-wide data standards to all grantee and contractor reporting. FFATA sec. 4(c)(7).

What will be the results of the DATA Act?

By replacing inaccessible documents with standardized, searchable data–freely accessible to all–the DATA Act will create better accountability for taxpayers and citizens; improve federal management by illuminating waste and fraud; and reduce compliance costs by automating the creation of reports by grantees and contractors.

The Data Transparency Coalition’s members are ready to help citizens, government managers, and recipients of federal funds accomplish all three results.

Better accountability. Once federal financial statements, budget actions, grant reports, and contract reports are available as open data, rather than trapped in inaccessible documents, tech companies will be able to make the data fully searchable for citizens, taxpayers, and companies.

More effective federal management. Government-wide data standards for spending will allow Big Data analytics to illuminate waste and fraud. Coaltion members showed how at the DATA Demo Day on Capitol Hill in May 2013.   Automated compliance. When federal agencies begin collecting grant and contract reports as standardized data instead of as documents, solutions like Parrascope and AmpliFund will help grantees and contractors comply with existing reporting requirements more cheaply than they can today.

 

What is Coalition doing to implement the DATA Act?

The DATA Act requires the Treasury Department and the Office of Management and Budget to consult with public- and private-sector stakeholders as they establish government-wide data standards for U.S. federal spending. The Data Transparency Coalition was the primary private-sector supporter of the DATA Act during its long Congressional process. Now that the DATA Act is law, the Coalition has shifted its advocacy from the legislative branch to the executive branch.   The Coalition plans to work with Treasury and OMB to bring together private-sector companies, standard setters, and nonprofits to advise on implementation. At events like the Data Transparency Summit and Data Transparency 2014, the executive branch leaders working to implement the DATA Act will join the law’s supporters to discuss the opportunities and ongoing challenges of opening up the federal government’s spending information. The Coalition will also showcase its members’ leading solutions to apply standards, republish federal information for taxpayers and investors, illuminate waste and fraud by applying analytics to newly-standardized data, and automate formerly-manual compliance tasks.

DATA Act Resources