Detailed Information on the
Federal Personnel Background Investigations Assessment

Assist agencies to develop better caseload projections, adopt automated info processing systems, and adjudicate cases in a timely manner.

FISD will work with OMB to revise its customer satisfaction survey to gather information on all phases of OPM's investigations and interactions with customer agencies.

Measure: Full Cost Recovery

Explanation:Annual revenues generated meet or exceed expenses.

Measure: Timely Investigations -- Initial Clearance

Explanation:OPM measures the time from when it receives a background investigation request to the time it delivers a completed background investigation to the customer. This measure is mandated by statute (evidence) and reflects FISD's ability to deliver its initial clearance investigations in a timely manner. It is a key objective in OPM's Strategic Plan 2006-2010. For agencies to meet their human capital needs, particularly in sensitive positions, OPM must provide timely background investigations so that agencies can make timely adjudication decisions and permanently fill critical positions. Initial clearance investigations were cited by agencies as being especially important in this process, and therefore deserving of its own measure.

Measure: Timely Investigations -- All Other

Explanation:For all other investigations, OPM measures the time from when it receives a request to the time it delivers a completed product to the customer. This measure is an OPM strategic objective (evidence) and reflects FISD's ability to deliver its products in a timely manner. It is a key objective in OPM's Strategic Plan 2006-2010. For agencies to meet their human capital needs, OPM must provide timely delivery on the orders it receives so that agencies can make timely adjudication decisions and permanently fill positions.

Measure: Accumulated Results of Operations

Explanation:This measure is a part of OPM's strategic Plan 2006-2010 (E-21) and, expressed as a percent, measures the amount of cumulative earnings in a three year period divided by the total earned revenues for that period.

Measure: Indirect Costs

Explanation:This measure, expressed as a percent, measures the amount of indirect costs (defined as the costs of all activities and non-capital investments charges not adding direct value to the products for which customers pay) accrued in the period divided by the total revenue for that period. Excessive indirect costs can reduce the program's retained earnings and/or lead to price increases to customers. To reach its long term target level of retained earnings, the program must meet its annual targets which represent milestones in reaching the long-term target.

Measure: Aged Inventory - 95th percentile, Initial Clearances

Explanation:This measure is calculated by ranking all of the cases in its inventory by their time in the system (most current to least), then taking the cases in the 95th percentile (oldest) and averaging their time in the system. By identifying, completing and delivering the cases which have the longest processing times more quickly than the intake of new cases, the average processing time per case delivered will be reduced and agencies will be able to make adjudications more quickly. This has been also referred to as eliminating the backlog.

Measure: Aged Inventory - 95th percentile, All Others

Explanation:This measure is calculated by ranking all of the cases in its inventory by their time in the system (most current to least), then taking the cases in the 95th percentile (oldest) and averaging their time in the system. By identifying, completing and delivering the cases which have the longest processing times more quickly than the intake of new cases, the average processing time per case delivered will be reduced and agencies will be able to make adjudications more quickly. This has been also referred to as eliminating the backlog.

Measure: Customer Satisfaction

Explanation:This measure is calculated based upon an annual customer satisfaction survey (CSS) of FISD agency customers (evidence). FISD has developed a CSS to evaluate customer agencies' perception of the quality and service of its products, policies and guidance. While customer satisfaction is not the ultimate outcome with regard to the timeliness of adjudications, if customers are satisfied with the quality and service of FISD's products, policies and guidance, it is an indication that any delays in adjudications are not a result of factors which FISD can control.

Measure: Internal Cost Per Source

Explanation:This measure is a new measure designed to measure the cost per source of investigations conducted by federal investigators. Background investigations are made up of information from sources. Different cases require differing amounts of sources (dictated by policies and standards). Measuring the cost per source allows the program to gauge the efficiency of its non-contracted investigations, and benchmark itself against its contractors. A lower cost per source will positively impact retained earnings. This metric is currently under development and dependent on the quality of available information.

Measure: Direct Costs

Explanation:This measure, expressed as a percent, measures the amount of direct costs (defined as all expenditures directly incurred by the preparation of the product for delivery to the customer) for a product divided by the revenue received for that product. For direct work conducted by federal employees, the cost of those workers is allocated among the products they have successfully processed for that period. If FISD can successfully meet its targets, it is operating efficiently and contributing to its long term target level of retained earnings.

Measure: Case Returns

Explanation:This measure is calculated by taking the number of cases returned and dividing it by the number of cases delivered in the same period. The lower the number of cases returned, the faster agencies can make adjudication decisions. This is also a good indication of the effectiveness of FISD's quality control.

Is the program purpose clear?

Explanation: The primary purpose of the Federal Investigative Services Division (FISD), Office of Personnel Management (OPM) is to carry out high-quality, timely background investigations which will be used by Federal agencies to determine individuals' suitability for Federal civilian, military or Federal contract employment, and to determine individuals' eligibility for access to classified national security information. The security investigations can be broadly grouped in to two categories: Initial clearances, which are when a person is being investigated for the first time for a position that requires a national security clearance; and Other investigations, which include initial investigations for positions that do not require a national security clearance and reinvestigations, which is when a person is being investigated again due to passage of time, a change of positions, change of security clearance, or other factors. Secondarily, FISD has the responsibility for developing and, after Office of Management and Budget (OMB) approval, implementing uniform policies and procedures to ensure the effective, efficient and timely completion of security clearance investigations and adjudications by agencies. In carrying out this responsibility, FISD reviews and coordinates the development of tools and techniques for enhancing the conduct of investigations and the granting of clearances. OMB also requested OPM to review agencies that conduct their own background investigations by delegated authority and to provide recommendations about whether to retain or revoke the authority of those agencies to conduct such investigations. There are other activities in which FISD engages based upon statute and/or Executive Order includes: FISD compiles data and provides reports to agencies concerning their success or failure in reporting investigative and adjudicative information to FISD in a timely fashion [Executive Order 10450, Security Requirement for Government Employment]; FISD may take a suitability action against a competitive service applicant or employee in cases involving material, intentional false statement, deception or fraud in examination or appointment, or refusal to furnish testimony as required [Title 5 Code of Federal Regulations (CFR) Section 731.105, Suitability]; and maintains a database of all investigative actions which it conducts. In the execution of its duties dictated by its purpose above, FISD also conducts additional activities to enhance its performance and further the attainment of increased National Security and the overall goals of the Intelligence Reform and Terrorism Prevention Act of 2004 and related statutes and executive orders. For example, it now manages the former e-Gov initiative e-Clearance; provides policy support to Title 5 CFR parts 731, 732 and 736 and the conduct of investigations; delegates its investigative authority when appropriate; works diligently with 3rd party local, state and federal data repositories; and has significantly increased its capacity to conduct background investigations. FISD offers its products and services on a fee-for-service basis utilizing OPM's revolving fund authority.

Evidence: Executive Order 10450 [Security Requirement for Government Employment], Section 3(a) mandates that the appointment of each civilian officer or employee in any department or agency of the Government shall be made subject to investigation. Section 8(b) mandates that the investigation of persons entering or employed in the competitive service shall be primarily the responsibility of the Office of Personnel Management (OPM). The Atomic Energy Act of 1954 [Atomic Energy Act] requires investigation of those with access to nuclear material also be conducted by OPM. Title 5 U. S. Code Section 1304(e) (1) states that a revolving fund is available to the OPM without fiscal year limitation for the financing of investigations. Title 5, Code of Federal Regulations (CFR), part 731 section 104(a) (5 CFR 731.104(a)) [Suitability] mandates that to establish a person's suitability for employment, appointments to positions in the competitive service require the person to undergo an investigation by OPM or by an agency with delegated authority from OPM to conduct investigations. Under 5 CFR 736, requirements are specified for personnel investigations conducted by OPM. Unless otherwise provided for by law, 5 CFR 736.201(a) [Personnel Investigations] holds that the investigation of persons entering or employed in the competitive service, or by career appointment in the Senior Executive Service, is the responsibility of OPM. This applies to both to suitability investigations conducted under 5 CFR 731, and to national security investigations (including those conducted in order to grant access to classified information) conducted under 5 CFR 732 [National Security Positions] . Section 3001(c) of the Intelligence Reform and Terrorism Prevention Act of 2004 contemplates the designation of a single entity to conduct, to the maximum extent practicable, security clearance investigations of employees and contractor personnel of the United States Government. Executive Order 13381 [Determining Eligibility for Access] charges the Director, OMB with implementation responsibilities, and the Director designated the Deputy Director for Management as the responsible official. In a subsequent letter the Deputy Director for Management, Office of Management and Budget, designated OPM as the lead entity with responsibility for conducting such investigations, and for reviewing agencies that continue to conduct their own investigations. Title 5 United States Code (U.S.C.) sections 1301-1307 provide special authorities for OPM (including the establishment of a revolving fund).

Does the program address a specific and existing problem, interest, or need?

Explanation: The careful screening of civilian, military, and contract personnel is very important. For national security positions and those requiring access to sensitive information, FISD provides background investigations. National security positions also require periodic re-investigation during continuing employment or contract duration. FISD also conducts background investigations on public trust positions and recommends that some of these positions also be re-investigated on a regular basis. FISD also conducts investigations on non-sensitive positions. The Government needs to minimize the risk to national security and effective program operations by ensuring that employees or contractors who are employed with the Federal government. The consequences of failure or poor execution in personnel background investigation and adjudication could be catastrophic to individual and national interests. There are considerable risks posed due to unauthorized disclosure of classified information as well as the compromise of unclassified data. Persons with access to classified information can be enticed to divulge such information to entities not authorized to receive it in return for financial gain, intangible compensation, or through allegiance to a foreign power. The cases of Aldrich Ames, Robert Hansen (both of whom divulged classified information to the Soviets/Russians) and others, led to costs to national security and lives lost due to the compromise of cover identities, which highlight the great need for proper security and suitability re-investigations. The government maintains massive amounts of financial, personal and other sensitive, though unclassified, data or material. Individuals seeking personal financial gain could see in this data or material a means by which to achieve their goal. For instance, in the 1990's, employees of the Bureau of Engraving and Printing stole thousands of dollars in un-circulated U.S. currency. Background investigations serve to minimize this risk initially and subsequent periodic screening serves to detect changes in an individual's behavior and circumstances that may affect their position. In light of these few examples, and in consideration of security concerns, it is imperative that the Government take measures to ensure the integrity and suitability of its workforce and the security of the information it possesses. The investigation of applicants and contractors to, and employees of, the Government is the key component of this process. The personnel investigations program managed by FISD is not only a critical part of good government and National Security; but also vital for critical National priorities. In times of crisis or whenever swift government action is required, an organization with FISD's resources and capabilities is an absolute necessity. The Transportation Security Administration (TSA) turned to OPM for investigation of airport screener candidates when background information provided by TSA's contractor was found to be substantially erroneous. The GAO investigation found that private sector companies' privacy protection practices are not fully consistent with the Fair Information Practices. The FISD program uses trained Federal and contractor investigators, and has fully consistent privacy protection practices thereby avoiding the issues found by GAO. In the wake of the 9/11 attacks, FISD held a Federal Air Marshal "hiring camp" in Atlantic City, at which OPM provided a portable fingerprinting process, assistance in filling out and submitting investigative forms required to help TSA properly process desperately needed staff, as well as conducting the actual investigations.

Evidence: The first paragraph of the preamble of EO 10450 states that "the interests of national security require that all persons privileged to be employed in the departments and agencies of the Government shall be reliable, trustworthy, of good conduct and character, and of complete and unswerving loyalty to the United States." The first paragraph of the preamble of Executive Order 12968 [Access to Classified Information] dictates that the "national interest requires that certain information be maintained in confidence through a system of classification in order to protect our citizens [and] our democratic institutions," the second paragraph of the preamble indicates that "Security policies designed to protect classified information must ensure consistent, cost-effective and efficient protection of our Nation's classified information." Section 1.2 of EO 12968 states that "No employee shall be granted access to classified information unless that employee has been determined to be eligible in accordance with this order." Access to Classified Information Senate Committee request for GAO Investigation Personal Information Air Marshal "Hiring Camp"

Is the program designed so that it is not redundant or duplicative of any other Federal, state, local or private effort?

Explanation: Investigative work is required for all public sector positions and increasingly by state, local and private sector organizations. There are numerous private and public sector organizations which perform this work. The primary providers of investigative services for federal employees, applicants and contractors are OPM, Department of State, FBI and CIA. Each provider has clear boundaries and mandates set by law and Executive Order which ensure that the programs are not redundant or duplicative. OPM currently conducts about 90% of all federal background investigations. The Departments of Justice, Army, Navy, Air Force, State, Treasury, Agriculture and the U. S. Postal Service, as well as the Intelligence Community, have statutory authority to conduct their own background investigations, as do excepted authority agencies like the Tennessee Valley Authority and the Peace Corps. Some of these "original delegation" organizations, in whole or in part, have chosen to use FISD. OPM has delegated investigative authority to: Bureau of Alcohol, Tobacco, Firearms, and Explosives; U. S. Bureau of Customs and Border Patrol; U. S. Department of Homeland Security headquarters; Internal Revenue Service; Small Business Administration, Office of Inspector General, Investigations Division; Federal Law Enforcement Training Center; U. S. Millennium Challenge Corporation; U. S. Secret Service; U. S. Trade and Development Agency; the Broadcasting Board of Governors; and the U. S. Agency for International Development. These organizations conduct investigations on their own workforce, while OPM conducts investigations for the remaining Federal and/or Federal contractor workforces, and also has authority to provide investigative services to the government of the District of Columbia. A list of who conducts the background investigations for each of the original and delegated authority organizations is contained in the evidence. OPM does not have authority to provide any services to State and local governments or to private organizations. State and local authorities may conduct some type of investigations on their employees and applicants, but do not have the ability to obtain information from Federal databases or conduct the full range of investigative activities required by 5 CFR 731, 732 and 736. Some private-sector companies provide investigative services through contracts let by Federal agencies, including OPM, to assist them in managing the Federal investigative workload. However, these private companies cannot, by themselves, conduct the full-range of investigative activities principally due to their lack of access to key Federal databases to include criminal history repositories.

Evidence: Section 8(b) of Executive Order 10450 provides that the investigations of persons entering or employed in the competitive service shall primarily be the responsibility of OPM, except in cases in which the head of a department or agency assumes that responsibility pursuant to law or by agreement with the OPM. OPM conducts about 90% of the background investigations for federal employees, applicants and contractors (based upon a query of PIPS for the number of OFI 79 Notifications compared to the number of FISD investigations). Of the investigations it performs, approximately 66% are for civilian positions, 22% are for Military positions and 12% are for contractor positions. There are a number of Federal agencies which conduct their own background investigations (see tables below). Delegated Investigative Authority Investigative Service provider Bureau of Alcohol, Tobacco, Firearms, and Explosives ATF U. S. Bureau of Customs and Border Patrol Customs U. S. Department of Homeland Security headquarters DHS Internal Revenue Service IRS Small Business Administration SBA Office of Inspector General, Investigations Division IG Federal Law Enforcement Training Center IRS U. S. Millennium Challenge Corporation State U. S. Secret Service USSS U. S. Trade and Development Agency State the Broadcasting Board of Governors BBG U. S. Agency for International Development AID Original Investigative Authority Investigative Service provider Intelligence Community IC / OPM (NSA re-investigations) Army OPM Navy OPM Air Force OPM Department of Justice OPM (except FBI, BPD, IRS) Department of State State Department of Treasury OPM (except BEP, BPD, and IRS) Department of Agriculture OPM U. S. Postal Service OPM and USPS Based upon the italicized language cited above, OPM (then the U.S. Civil Service Commission) defined "pursuant to law" in the context of its 71st Annual Report. Specifically, the first paragraph on page 55 reads, in part, "[OPM] makes the full field investigations for sensitive positions as a service to the agencies which do not have investigative facilities. This is done on a reimbursable basis.

Is the program design free of major flaws that would limit the program's effectiveness or efficiency?

Explanation: The current design is free from major flaws that would limit the program's effectiveness or efficiency. The boundaries set for the program are appropriate, allowing sufficient volume to realize significant savings to the government through volume purchasing and providing central quality control while allowing the flexibility through its delegation authority to respond to agencies' special requirements and requests. No significant programmatic flaws have been identified either by internal or external sources. At one time, all investigations were conducted by federal employees. This proved costly and cumbersome in the face of fluctuating demand. For example, in the early 1990's the Department of Energy required a large increase of investigations, for which OPM hired many new investigators. The federal hiring process prohibited a fast reaction to the increased demand. Once the demand was met and workload decreased, OPM could not reduce its labor force appropriately, causing millions of dollars of program losses that ultimately caused a massive Reduction-in-Force of over 400 OPM employees. In response, OPM privatized its entire investigative workforce by creating an employee-owned company called the US Investigative Service, which thereafter conducted all investigations. The privatization was estimated to save the government millions of dollars; it also proved sub-optimal, due to the lack of competition. At the time of the privatization, there were no existing private-sector providers of sufficient size and expertise to handle the existing workload at the necessary quality level. It was also determined that it was in the best interest of the government to give the newly privatized organization time to adjust to operating as a private company. In 2004, FISD held a new background investigations contractor competition and signed contracts with multiple private sector providers, creating price competition, adjustable capacity and quality alternatives. Prior to privatization, a model whereby OPM would give delegated authority to all agencies was considered, but was rejected due to concerns about quality, the number of entities that would need to approach 3rd party data repositories, and the cost of maintaining multiple investigation programs in about 100 Federal agencies. The current design allows for multiple investigative contractors with a limited core of federal investigators. This design assures price and performance competition, scalable capacity to support increasing or decreasing demand, and provides an experienced cadre of federal employees to handle sensitive investigations, assure the quality of investigations by all parties, and provide immediate resources in times of crisis, while keeping FISD in touch with the realities of running investigations that meet statutory and customer demands. While the program is free of design flaws, it could operate more efficiently and effectively if there were laws better governing the environment in which it operates, as indicated in the following examples. OPM is required by law to complete its work within certain time periods [Security Clearances]. However, there is no law requiring local, state and other federal data repositories to provide the information needed in a timely fashion so that OPM can complete its work in the prescribed timeframes. OPM is also responsible for ensuring the timely adjudication of security clearances, yet there are no consequences for agencies who, for whatever reason, consistently fail to do so despite continuous efforts on OPM's part. Finally, OPM requires explicit support in its efforts to impel agencies to provide accurate and timely workload forecasts (with consequences for failure to do so) so that it and its contractors may plan for required capacity. The effects of poor agency workload forecasting are increased costs and/or less timely investigations.

Evidence: Over the course of the past two years, during and after the transition of the investigative resources of the DSS to OPM, FISD and its policies and procedures have been subjected to unusually close scrutiny by OMB and by Congress. While these inquiries have occasionally identified operational short-comings (i.e. investigations or adjudications not being completed in a timely fashion), they have failed to identify any significant program design flaws. Those operational issues which have been identified are almost exclusively related to resource issues that OPM officials have presented in testimony such as that provided during 2005 and 2006 [OPM officials' testimony]. Supporting testimony was also presented on June 28, 2005 by the Director, Strategic Integration, Office of the Deputy Under Secretary of Defense, Counterintelligence and Security. The consolidation of approximately 90% of the government's background investigative workload in one organization reflects the confidence that OMB and Congress have in FISD's overall program design, most recently through designation of OPM as the lead entity for security clearance investigations. Affirmation of the FISD program comes from agencies like Treasury, which despite having original authority to conduct investigations, has opted to request OPM services for most of their investigative needs. Further support for maintaining a centralized investigative capability stems from cases where OPM had delegated authority to agencies like the Drug Enforcement Administration, but later did not renew that authority.

Is the program design effectively targeted so that resources will address the program's purpose directly and will reach intended beneficiaries?

Explanation: All of FISD's resources are utilized in fulfilling it purpose. OPM established the FISD organization in September 2005 under an Associate Director, headquartered in Boyers, PA and subsequently re-organized in January 2006, in order to exercise the authority and fulfill the obligations set forth in Question 1.1 in the most efficient and effective manner Each organization has targeted staff levels. Performance expectations are made clear down to the lowest levels of each organization. Costs are tracked in the accounting system according to organizational codes. In this way, the program resources are used in a manner that directly and efficiently supports the program's purpose. Since agencies reimburse FISD for services requested and received, and because the prices for the services reflect the program's cost, there are no unintended beneficiaries. FISD does not provide investigative services to agencies or activities outside the scope of its authority. FISD does not provide funding to any activity that does not directly relate to its purpose.

Evidence: There are Centers for Investigative Program Services which provides direction and control of all investigative services and Investigative Program Operations which provides direction and control of all investigative operations, along with support organizations, all with necessary staff to carry out their responsibilities. Within the Center for Investigative Program Services is the Agency Liaison Group based in Crystal City, VA. The employees of this group are in regular daily contact, both telephonically and in person, with the agencies which receive services.

Does the program have a limited number of specific long-term performance measures that focus on outcomes and meaningfully reflect the purpose of the program?

Explanation: FISD's four long-term measures reflect its primary purpose to carry out high-quality, timely background investigations, and to determine individuals' eligibility for access to classified national security information. The long term measures are: ?? 1.0 Full Cost Recovery. Annual revenues generated meet or exceed expenses. ?? 2.0 Timely Investigations - Initial Clearance. OPM measures the time from when it receives a background investigation request to the time it delivers a completed background investigation to the customer. This measure is mandated by statute and reflects FISD's ability to deliver its initial clearance investigations in a timely manner. It is a key objective in OPM's Strategic Plan 2006-2010. For agencies to meet their human capital needs, particularly in sensitive positions, OPM must provide timely background investigations so that agencies can make timely adjudication decisions and permanently fill critical positions. Initial clearance investigations were cited by agencies as being especially important in this process, and therefore deserving of its own measure. ?? 3.0 Timely Investigations - All Other. For all other investigations, OPM measures the time from when it receives a request to the time it delivers a completed product to the customer. This measure reflects FISD's ability to deliver its products in a timely manner. It is a key objective in OPM's Strategic Plan 2006-2010. For agencies to meet their human capital needs, OPM must provide timely delivery on the orders it receives so that agencies can make timely adjudicative decisions and permanently fill positions. ?? 4.0 Cumulative Results of Operations. This measure is a part of OPM's Strategic Plan 2006-2010 (E-21) and, expressed as a percent, measures the amount of cumulative earnings in a three year period divided by the total earned revenues for that period. The program must be recovering its full costs over a three year period.

Evidence: The primary evidence is contained in the measure tab. Other evidence includes CFO financial statements 2004, 2005 FISD timeliness reports 2004, 2005 OPM's Strategic and Operational Plan 2006-2010, and the FY2006 FISD Strategic Plan Organizational Goals and Objectives document.

Does the program have ambitious targets and timeframes for its long-term measures?

Explanation: FISD's targets and timeframes for its long-term measures are realistic yet ambitious. FISD must achieve full cost recovery on an annual basis. This will ensure that the program remains viable. On initial clearance cases the timeliness targets are mandated by law and are very ambitious. Of the four long-term measures, it may be most challenging for FISD to achieve the timely delivery of its products to agencies (2.0 and 3.0) in the timeframes dictated. FISD has endured significant challenges to its program in the last few years, including: ?? an increase in demand which has consistently averaged at least 50% above customer workload projections; ?? absorption of over 1800 new employees and a backlog of cases that substantially exceeded DOD projections when the DSS program was transferred to OPM; ?? the addition of 5 new contract investigation firms, which all required significant training and 100% quality control; ?? implementation of new IT systems (e-QIP and imaging); and ?? establishing an overseas network to complete background investigations on those cases where individuals have recently lived outside the United States. These and other challenges have created greater stress on the program than was originally anticipated when the law was passed. For example, upon the merging of DSS, it was assumed that the investigators would have productivity levels close to OPM's investigations contractor US Investigative Service (USIS). However, an analysis of differences in quality standards, IT systems, and operational policies and procedures at DSS indicated the need for the surcharge OPM implemented. Further, it was expected that the former DSS employees would begin working new cases during the 3rd quarter of fiscal year 2005. However, because of the unexpected backlog of cases, the transferred employees did not begin working new cases until near the end of the 2nd quarter of fiscal year 2006. There was also a compounding factor with new contractor investigators who had a longer learning curve than projected and experienced difficulty meeting the minimum standards for quality and timeliness outlined in their contracts. These problems are being addressed (discussed in later sections), but the effect is to make FISD's targets for these measures very ambitious. FISD's cumulative results of operations over a three year period for the last two years has been about 2.5%. In order to stay viable, that ratio will have to stay at 2.5% over the next 3 years.

Evidence: See measures tabs for selected performance measures.

Does the program have a limited number of specific annual performance measures that can demonstrate progress toward achieving the program's long-term goals?

Explanation: FISD has seven annual measures which together provide a comprehensive picture of how FISD carries out high-quality, timely background investigations to be used by Federal agencies to determine an individuals' suitability for Federal civilian, military or Federal contract employment, and to determine an individuals' eligibility for access to classified national security information. The attainment of the long-term retained earnings target is tracked through three financial efficiency measures: ?? 1.1 Indirect Costs, ?? 1.2 Direct Costs, and ?? 1.3 Internal Cost per Source. FISD has one annual timeliness measure, split into two groups: 2.1 Aged Inventory - 95th percentile Initial clearances and 3.1 Aged Inventory - 95th percentile All other investigations. FISD has two annual customer measures: ?? 4.1 Customer Satisfaction. ?? 4.2 Case Returns.

Evidence: ?? Indirect Costs. This measure, expressed as a percent, measures the amount of indirect costs (defined as the costs of all activities and non-capital investment charges not adding direct value to the products for which customers pay) accrued in the period divided by the total revenue for that period. ?? 1.2 Direct Costs. This measure, expressed as a percent, measures the amount of direct costs (defined as all expenditures directly incurred by the preparation of the product for delivery to the customer) for a product divided by the revenue received for that product. ?? 1.3 Internal Cost per Source. This is a new measure designed to determine the cost per source of investigations conducted by federal investigators. Measuring the cost per source allows the program to gauge the efficiency of its non-contracted investigations, and benchmark itself against its contractors. 2.1 and 3.1 Aged Inventory - 95th percentile. This measure is calculated by ranking all of the cases in the inventory by their time in the system (most current to least), then taking the cases in the last 5 percent (oldest) and averaging their time in the system. ?? 4.1 Customer Satisfaction. This measure is calculated based upon an annual customer satisfaction survey (CSS) of FISD agency customers. ?? 4.2 Case Returns. This measure is calculated by taking the number of cases returned for quality errors and dividing it by the number of cases delivered in the same period.

Does the program have baselines and ambitious targets for its annual measures?

Explanation: FISD's annual targets are ambitious, in that they require improving current performance levels or maintaining already high levels of existing performance standards. ?? 1.1 Indirect Costs. For FY2007, FISD has targeted to keep indirect costs at the same percent of revenues as in FY2006. This is ambitious due to the fact that payments to OPM will increase substantially in FY2007 and the program will be making significant investments in technology, not all of which will be capitalized. In FY2008, FISD has set a target of 13.8% of revenues, a reduction from FY2007. ?? 1.2 Direct Costs. FISD is targeting to hold direct costs flat at 82% of revenues for FY07 and FY08 (direct costs were 81.9% in FY2006). This reflects efforts to reduce direct costs (become more efficient) while holding price increases to a minimum, thereby increasing the value to its customers. ?? 1.3 Internal Cost per Source. FISD is refining the data for this measure to arrive at a methodology which it can apply to all coming years. The FY06 baseline data is expected to be finalized in the first quarter of FY07, at which time, targets will be established. ?? 2.1 Aged Inventory - 95th percentile Initial Clearances. FISD is targeting a reduction of average age of the oldest 5% of these cases to just over 14 months from the FY06 result of almost 16 months (475 days), a 11% reduction. This is ambitious due to the labor intensiveness of these cases, and the difficulty of closing them as well as meeting the timeliness targets for the newer cases. In FY08, FISD is targeting further reduction of two months so that the average age of the oldest 5% would be 1 year (365 days), a reduction of 14% over the FY07 target. ?? 3.1 Aged Inventory - 95th percentile All Other Cases. FISD is working through its backlog of old cases, and as they clear expects to see a reduction in the average age of the oldest 5% of over 2 months in FY07 (75 days) to 575 days from FY06 results of 650 days. For FY08, it is targeting a greater reduction of 100 days as the oldest of these cases are cleared from the inventory. If the targets are realized, it would represent a 27% reduction over FY2006 results in only 2 years. ?? 4.1 Customer Satisfaction. Customer satisfaction with the quality of FISD's products is already high at 95% for content and quality of investigations. Maintaining 95% will be a struggle with the rapid growth of this program. The concern is that service levels may have slipped with conflicting priorities due to the factors mentioned in section 2.2. It is ambitious to set a goal for "recovering" from this rapid growth period to restore 95% or better satisfaction. FISD is reviewing its survey instrument to include further questions regarding investigations products and services. ?? 4.2 Case Returns. Case returns have historically been very low, primarily as a result of FISD's strong quality control operations. Improving on these values, even by a small factor, will require a significant effort.

Evidence: The primary evidence is contained in the measures tab. As for financial efficiency measures, FISD reports that while it has no information to compare itself with other reimbursable organizations in the Federal Government, it can compare its cost per case to the prices it is charged by its contractors. Before it can conduct that comparison, it must first develop the information for cost per source, expected to be completed in FY2007. At that time, it will benchmark itself against the most current contractor cost as a result of its new Indefinite Delivery Indefinite Quantity (IDIQ) contracting vehicle for contract investigators completed by the end of FY 2006.

Do all partners (including grantees, sub-grantees, contractors, cost-sharing partners, and other government partners) commit to and work toward the annual and/or long-term goals of the program?

Explanation: All of FISD's contractors have performance-based contracts. FISD monitors the results of the performance metrics, as well as capacity and pricing information, and allocates work accordingly. These performance metrics are tied to FISD's timeliness and quality goals. Workload forecasting is an area where FISD is increasingly working with agencies to jointly commit to meeting specified tolerances in forecasting. Recently DOD signaled its willingness to improve communication with OPM with regard to background investigations (article evidence). FISD reports on agency adjudication timeliness. Where appropriate, FISD will contact agencies with below average results, and work with them to solve any problems they may be having. Refer to Question 3.1. FISD chairs or participates in many inter-agency groups with the goal of improving the overall security clearance process. Thanks to such groups, FISD has improved standard security forms, reciprocity and is currently working to more clearly define the standards for background investigations. This would include one investigations handbook to be used by all agencies conducting background investigations.

Evidence: Evidence for 2.5 is contained in the contractor performance standards, quality Assurance Plan for Contractors, Contractor Policy Notices, workload forecasting initiatives with agencies and the GAO Letter (GAO-06-693R, June 14, 2006) entitled Questions and Answers about DOD Personnel Clearances.

Are independent evaluations of sufficient scope and quality conducted on a regular basis or as needed to support program improvements and evaluate effectiveness and relevance to the problem, interest, or need?

Explanation: FISD will arrange for an independent evaluation in FY 2007 for its operations to determine if the program meets its goals. FISD also regularly receives, or in certain instances on an as-needed basis (the DSS merger, for example), high quality evaluations from non-biased, independent organizations which cover almost every major area of FISD's performance. Within the last three years, GAO has issued six testimonies, three responses for the record, and two reports on investigative issues. It currently has two audits in process. OPM's OIG has three completed audits and currently has one audit in process. OPM's Center for Internal Control and Risk Management has completed one audit. These evaluations provide important input to FISD's plan of program improvements. In addition to the GAO and OPM evaluations, Congressional committees, OMB and others have studied and reported on the issues. The relatively new Office of the Director of National Intelligence chairs committees and issues reports concerning background investigations. These independent evaluations touch on the need for high quality and timely investigations as well as progress in program improvements. Specifically, the GAO letter cited under the explanation for question 2.5 expresses encouragement with the governmentwide plan developed by OMB and OPM to address clearance related problems.

Evidence: Executive Order (E.O.) 13381, Determining Eligibility for Access, extended by E.O. 13408 ensures that OMB and OPM can continue to provide leadership for improving the Government's personnel investigations program. GAO testimony on September 23, 2003, about OPM's e-clearance initiative [GAO-03-1169T] confirmed OPM's progress on objectives to increase use of electronic processing and imaging to improve the investigations process. An additional GAO report [GAO-04-632] and further testimony [GAO Testimony] continued to track timeliness and backlog issues with DOD's clearance process. GAO has also initiated audits at OPM, which now provides investigative services for DOD, with a focus on the clearance process for contractor personnel and electronic systems to support investigations. OPM's Inspector General has also conducted audits of the FISD program, primarily the IT systems which are improving the investigative process for agencies and OPM. Audited systems and processes include an electronic questionnaire for applicants, agencies and OPM processing [e-QIP], an imaging system, and a fingerprint system. The IG is also auditing the outcome of the transfer of DOD's personnel security investigations function to OPM (4A-is-00-06-049). To ensure actions under audit recommendations are completed, the IG employs a reporting and tracking system. While internal management control reviews are not fully independent evaluations, the annual assurance statements [FMFIA] are subject to independent review. Similarly, reports to OMB and Congress like the report on use of information technology in the investigative process provide a basis for discussion and recommendations for improvement or change [IT Report]. A final internal tool is the Program Improvement Plans [Improvement Plans].

Are Budget requests explicitly tied to accomplishment of the annual and long-term performance goals, and are the resource needs presented in a complete and transparent manner in the program's budget?

Explanation: FISD is a 100% reimbursable organization with funding generated from fees collected from its customers for investigative services. FISD currently sets its budget based upon past performance and a reasonable projection of future costs and investments, as well as customer demand for its products and services. FISD's financial measures and performance targets help drive these projections, and performance measure targets are included in the FY 2007 operating plan, and the FY 2008 Congressional Budget Justification. Taking into account the OPM revolving fund guidance as to the level of retained earnings it should maintain, FISD budgets for all direct costs (salary, benefits, travel, contractor costs, etc.) and indirect costs (OPM's common service/IT charges, administrative support, management salaries, etc.); and FISD reports performance data. The revenue, cost, and performance information is used by FISD to improve program effectiveness and efficiency in achieving performance targets, evaluating managers, preparing all budget-related reports (Congressional Budget Justification, Performance Analysis Report, operating budget and quarterly reports to OPM's CFO, etc.), and setting new performance targets. FISD sets its prices by estimating the sales volume of each product type, calculating the direct costs of those products and adding to that the total program indirect costs and full cost recovery target. It then performs revenue scenarios based upon various prices (usually a percentage above the direct costs for each product) to determine the price increase necessary for each type of case. The pricing levels which allow the program to come closest to the established full cost recovery target becomes FISD's pricing proposal for that year. FISD analyzes its cost figures and looks at reduced cost scenarios to help minimize any price increases. FISD's indirect costs include common service charges allocated by Office of Chief Financial Officer. On August 31, 2006, FISD signed FY 2007 Service Level Agreements for common services with the Management Services Division, Office of the Chief Financial Office and OPM Executive Offices [SLAs].

Evidence: FISD includes long-term and annual performance measures and targets in key budget documents including the FY2008 Budget and the PAR. These measures and targets have been adjusted over time which can be seen in the differences between the FY2008 Congressional Budget Justification that is awaiting pass-back and the older FY2005 Performance Analysis Report (PAR). Revenue & Expense Statements from the OPM Chief Financial Officer are the source for financial data used in the measures, budget and performance documents. The Service Level Agreement details what FISD will receive and the performance standards for the fees it pays for common services.

Has the program taken meaningful steps to correct its strategic planning deficiencies?

Explanation: OPM's new Strategic and Operational Plan 2006-2010 sets straightforward and identifiable goals tied to FISD with dates for clear accountability. Budget submissions tie resource requests to these (and other) operating goals. OPM has created a new, comprehensive governance process. Progress reviews with senior program management are held on a regular basis to review the progress in achieving the operational goals detailed in the new strategic plan and by law. Through the Office of the Chief Financial Officer, there are quarterly operations reviews, including budget and performance data, targets and operational plans. In FY 2006, an OPM reorganization led to creation of the Federal Investigative Services Division. Subsequently, FISD completed an internal reorganization which established new units, restructured existing ones, and elevated some to independent organizations within FISD to put proper emphasis on areas of growing significance. Key among these are: ?? The new Training and Staff Development Group which coordinates logistics, develops educational materials and oversees the delivery of training to investigators, adjudicators, reviewers and all other professional and support staff affiliated with the investigative process. ?? Creation of the Quality Management Group to conduct quality reviews of casework that has been deemed deficient by the operational review team. In addition they resolve policy issues regarding quality, to ensure a consistent standard is applied to all field work. ?? The Records Access and Research and Development Group have new responsibility as the focal point of all efforts being carried out under the Intelligence Reform Act of 2004. ?? Elevation of International Investigations to Group level to deal with the highly complex and politically sensitive international investigations as part of the comprehensive investigative operation. The result of these and other changes is clearer responsibility and accountability for managers leading to improved program performance. The FISD organization is responsible for three operational goals in OPM's strategic plan, and is using a quarterly strategic review process of management meetings and performance status reports. In addition to tracking performance against goals and targets, this work provides the basis for changes to succeeding strategic plans to continue achieving the vision of FISD's and OPM's leadership through clear, measurable goals for each of its key managers. For FY 2007, FISD has established 15 initiatives designed to improve its operations and performance. Examples include: Sustaining Initial Clearance Case Timeliness (80% closed within 90 days); Revise Close Pending Process; Update PIPS Reporting format for Agents; and Develop and implement a Management Dashboard. FISD is launching a renewed effort to improve agency workload forecasts, particularly with regard to DOD. This strategic initiative supports FISD's full cost recovery and timeliness goals (Intelligence Reform Act) under OPM's strategic plan. FISD's quarterly investigative performance reports to OMB provide the basis for discussions between FISD and OMB and customer agencies at executive, management and operating levels, about workload projections, FISD timeliness and service quality, and agency adjudications. FISD also works with agencies on compliant and timely adjudications through Suitability Roundtables that provide training and discussion forums for agency personnel responsible for completing adjudications and reporting to OPM. Electronic reporting capability was recently implemented and is expected to improve results. FISD also incorporates insights from the audits of its Imaging, Fingerprinting, and electronic questionnaire programs into strategic plans, as recommendations from the audits are implemented.

Evidence: OPM's Strategic and Operational Plan 2006-2010 [Strategic Plan] assigns three goals to FISD: Achieve full cost recovery annually for each revolving fund program (E-21); Meet Intelligence Reform Act goals - complete 80 percent of initial clearances within 90 days by the end of 2006 (E-23); and achieve rate of no more than one percent of completed investigations returned from agency security/adjudication offices each year (E-26) FISD is well positioned to meet these goals, in part because of the reorganization that improved alignment of their structure with desired outcomes and priorities. Operating plans with financial and performance targets are in place for FY 2006, and in process for FY 2007 and FY 2008, reflecting organization goals and objectives. The quarterly management meetings which are part of the FISD governance structure, review performance against established goals, initiatives and targets, and plan for new ones. For FY 2007, the August 2006 management meeting decided on 15 initiatives. These goals and initiatives are incorporated in FISD work plans at the executive, management and supervisory levels to ensure human and financial resources are focused on actions to achieve the goals. Performance against these work plans and assigned goals are tracked through quarterly management reviews to ensure progress and develop corrective actions or adjust efforts as needed. FISD also uses information and recommendations from audits to strengthen the program and strategic plans. FISD's quarterly reports to OMB provide details about investigative cases and their status at the government-wide and agency level.

Does the agency regularly collect timely and credible performance information, including information from key program partners, and use it to manage the program and improve performance?

Explanation: FISD uses a wealth of data generated from the Personnel Investigations Processing System (PIPS) to manage its program and improve performance. Typically, paper cases are keyed into the case tracking system PIPS by a contractor. PIPS tracks the number of cases per worker and the quality of input, information FISD uses to gauge contractor performance and make improvements in the PIPS interface. In one effort to improve quality and timeliness, FISD is assisting agencies to convert to electronic investigations submissions through Electronic Questionnaires for Investigations Processing (e-QIP). e-QIP is a secure website designed to house all personnel investigative forms. It allows individuals to electronically enter, update, and release their personnel investigations over a secure Internet connection to their sponsoring agency for review, approval, and submission to the investigation provider. Agencies are encouraged to utilize this program, and have OPM support with implementation and training when they decide to do so. Through PIPS FISD tracks the number of overall cases submitted through e-QIP. FISD also uses PIPS data on workloads, quality reports, and price to minimize backlog and allocate case work among federal and contract investigators. The Contract Management Branch, Contract Performance Evaluation Team (CPET) reviews case assignments weekly to monitor the current caseload and capacity of the contract investigative workforce. The team even adjusts assignment levels on a daily basis if necessary, based on organizational needs, staffing levels for Federal and contractor field elements, and contractor performance. Furthermore, all contractors are obligated by the terms of their contract to have a certain percentage of cases completed within the specified time limits. Investigator productivity is measured primarily by the average number of sources an investigator is able to contact in an 8-hour work day. A source is defined generally as any person or record that contains information about the subject of the investigation. Performance reports are generated monthly and used by managers to identify those investigators that may need additional training or support in order to meet standards. In addition to timeliness, the quality of all casework submitted is reviewed by the Case Review Group. All deficient cases are returned to the investigative arm that conducted the case, along with the reason for the return. These reports are used to help determine which contractors will receive additional casework. For example, a timely contractor with a high deficiency rate may receive less work than one with a slightly slower rate but a much lower deficiency rate. Analyzing these reports has led FISD to improve training and raise the standards for "deficient" cases, leading to fewer deficient cases. In a separate effort, FISD management created the Records Access and Research/Development Group to monitor the timeliness in which third party data repositories respond to FISD's requests for data. FISD then reports this information quarterly to OMB. Generally, the Records Access group meets with the agency to review the agency's records access process and identify obstacles to timeliness. Once cases are completed and delivered to the requesting agency, FISD also tracks the amount of time that it takes for the requesting agency to make adjudication decisions on initial national security cases. This information is compiled and reported to the agency and OMB monthly and quarterly and used to identify agencies that may need additional adjudication training or support.

Evidence: The FISD organization and its business processes and systems yield essential data to manage the investigations program in all its aspects. When agencies submit cases for entry in the PIPS, the system assigns the case for Federal or contractor investigation based on the type of investigation needed, the cost to process (based on contractor pricing) and the workload already assigned among other things. Data is also collected on cases in process, tracking resources, timeliness, quality and related information. One of the key uses of this data is to set Reimbursable Billing Rates to agencies for different types of cases as costs increase or decrease. Another key use is to determine the optimum number of Federal FTE. FISD's contractor investigators are subject to performance metrics set by their employing companies, but FISD does monitor and track overall contractor performance in areas such as timeliness and quality through analyses of statistical reports generated by the PIPS. PIPS generates weekly and monthly status reports which track pending cases, cases closed, and other metrics. These reports provide visual documentation of contractor trends in the overall flow of cases. The performance of each contract investigator is also tracked as if they were a Federal employee. This contractor performance data is compiled in monthly and quarterly reports that are used by FISD for program management, and are provided to our contractors as well. CPET generates reports through PIPS to track oldest cases, cases with no items updated, and cases that are past the due date. Reports on quality are provided monthly and timeliness reports are provided quarterly to FISD management and to the contractors, and are discussed in the quarterly Program Management Reviews. If the contractor consistently fails to perform at the mandated level, FISD management can require improvement plans, cure notices, and if necessary terminate contracts. For example, after a problem was identified with one contractor, by mutual agreement, a contractor's workload factor (the number of cases assigned to it per investigator) was reduced until their investigators became more proficient. In an example of how FISD puts data on third party responsiveness to use, the program has had extensive meetings with the FBI to address their tardiness in addressing OPM requests for information. As a result of these meetings, OPM approved FBI's request to supply staff from July through December 2006 to reduce the backlog of record requests. Also, daily contact with CIA has assisted in reducing the number of pending items since March 2006. OPM is currently working with the Navy to establish secure web access to military service records. FISD's experience with the Department of Veterans' Affairs (VA) serves as an illustration of how FISD has applied adjudication reporting data to improve the performance of its agency partners. In early 2004, VA had an adjudication reporting rate of 64 percent, which implies that the agency reported to OPM that only 64 percent of cases were completed within [a certain period of time]. FISD contacted the agency, and worked with them to develop and implement a get-well plan. Actions included creating a "timely adjudication team" with FISD that had regular teleconferences; and working with the USDA Graduate School and FISD to provide additional training to the agency's security office personnel in three regional sessions, including an OPM adjudicator as the subject matter expert. FISD also ensured VA had accurate lists of overdue cases. By early 2006, the VA had vastly improved adjudication compliance to a 93 percent rate.

Are Federal managers and program partners (including grantees, sub-grantees, contractors, cost-sharing partners, and other government partners) held accountable for cost, schedule and performance results?

Explanation: FISD's Federal management staff is subject to demanding and specific performance measures and goals which directly relate to organizational efficiency and effectiveness in terms of cost, schedule and outcomes. The program's executives and managers are held accountable for performance results through the performance appraisal process. OPM's Director holds FISD Associate Director (AD) accountable for achieving OPM's strategic and operational goals in the background investigation area through monthly reviews. The FISD AD holds the Deputy Associate Directors (DADs) accountable through their performance plans that are linked to operational goals and strategic objectives. All manager performance plans are currently being reviewed in light of FISD's restructuring and OPM's new strategic plan, and operational goals are being incorporated into individual performance plans to contain quantifiable performance standards. Department managers reporting to DADs are held accountable for cost, schedule, and performance results through the annual performance review, mid-year performance review, and quarterly financial and performance metric reviews. Managers in turn hold their employees accountable through their performance plans for providing work products that meet standards for quantity, quality, and timeliness. Program performance goals are also directly related to metrics cited in the National Intelligence Directive [Security Clearances]. The majority of FISD's employee and contract staff are investigators. At the present time the split is approximately 80% contractor and 20% Federal [FISD Staffing]. Investigator and adjudicator performance is assessed using a variety of metrics which are meant not only to further FISD's organizational goals, but also to enable FISD management to manage the program more efficiently. FISD holds its contractors accountable through its performance contracts [Investigation Field Work; Investigations Support; Data Entry; Case Review; Janitorial; Courier; and IT]. These are built into task orders, and FISD continuously monitors partner performance [Contract Oversight Report]. Agencies receive reports regarding their performance in reporting adjudications within 90 days [Security/Suitability Investigations]. For severely delinquent agencies, FISD will contact the agency and work with them to resolve any problems.

Evidence: OPM has in place an Executive Performance Agreement and a Standard for Executive Excellence. These documents apply equally to all executive employees of OPM, including three executive positions within FISD [Associate Director, Deputy Associate Director (DAD) for Investigative Services, and DAD for Investigative Operations]. Each provides detailed expectations and performance rating guidance regarding the assessment of the effectiveness and efficiency of executive employees. These expectations and the rating guidance are drawn directly in many cases from the President's Management Agenda [PMA] and from OPM's Strategic and Operational Plan, 2006-2010. Further, the FISD executives, managers and supervisors are also accountable for achieving a specific yearly work plan which, while also drawing upon the President's Management Agenda and the Strategic and Operational Plan, goes into much greater depth and detail regarding their specific obligations. FISD has four field investigative regions, the Capital, Northern, Southern, and Western Groups. Each is headed by a GS-15 Regional Chief. Each Regional Chief is subject to a general annual performance appraisal which rates the individual in several broad categories related to organizational efficiency and effectiveness. Each chief is also held accountable to an annual action plan for his or her particular region. The action plan sets forth numerous very specific and detailed tasks to be undertaken and/or completed during the year. A chief's success or failure in accomplishing these tasks will be reflected in his or her performance appraisal. The specific tasks in the action plan relate directly back to the general performance elements in the performance appraisal, which in turn relate back to FISD's executive goals, and ultimately to OPM's Strategic and Operational Plan and the President's Management Agenda. FISD's contractor partners are likewise held accountable for cost and performance results. Please refer to the response to question 2.5, and to the supporting evidence supplied. Each Federal investigator is rated annually on his or her performance in four critical areas: Quality of Investigative Reports. Each report reviewed by a manager is assigned a numeric score according to the following quality scale - 4 = Superior; 3 = Exceeds Adequate; 2 = Adequate; 1 = Below Adequate. Investigators must achieve a certain cumulative average to be rated Outstanding, Exceeds Fully Successful, Fully Successful or Minimally Successful in this category. Timeliness in Completing Investigations. The degree to which investigators completed their work within established time standards. Cut-off points for performance ratings in this element include at least 98% of cases completed by due date for Outstanding, at least 95% for Exceeds Fully Successful, at least 90% for Fully Successful and at least 85% for Minimally Successful. Productivity. The productivity of Federal investigators is measured primarily by how many sources they are able to contact in an 8-hour work day, on average. A source is defined generally as any person or record containing information about the subject of the investigation. Depending on their General Schedule (GS) grade, investigators must obtain at least 3 or 4 sources per day to be rated minimally successful, and at least 6 or 7 to be rated outstanding. Professionalism. The success of the program depends to a large part upon the level of professionalism displayed by FISD's investigators, both in going about their business within FISD or OPM, as well as in their contacts with external persons and organizations, particularly those in the private sector.

Are funds (Federal and partners') obligated in a timely manner, spent for the intended purpose and accurately reported?

Explanation: The program is managed consistent with the goals and priorities outlined in OPM's strategic plan [Strategic Plan]. No funds allocated to the program are redirected to other OPM programs. Together with the OCFO, formal quarterly assessments of actual and projected expenditures are conducted with the Director. This assessment covers costs associated with salaries and benefits, travel, and other objects. This process facilitates resource planning and management, allowing for adjustments as needed to accomplish identified program needs. To ensure that funds are obligated and spent as intended, the program analyzes OPM's Government Financial Information System (GFIS) transactions to identify and resolve any problems pertaining to funds being obligated and expensed. OPM budget staffers establish budgetary resource levels in GFIS for each fiscal quarter against which the program charges appropriate business expenses, most of which are payroll costs, contractor expenses, facility management fees, and overhead charges. OPM budget and financial management staff post in GFIS, or record on the financial statement worksheets, any necessary corrective entries so that the financial information received by management is complete and accurate. OPM's FY 2005 financial statements have been audited and received a clean opinion. FISD employs a number of automated tools which together provide a seamless authorization, obligation, billing and payment cycle, ensuring that funds are obligated and spent in accordance with program requirements. For example, FISD's use of automated EFT payments to contractors provides for payments within prompt payment act standards based upon receipt of products and services. FISD is working with the GFIS staff to improve the timeliness and accuracy of revenue and expense statements, and to get them in a more user-friendly format.

Evidence: OPM's Government Financial Information System (GFIS) is a transaction-driven financial management system that permits budgetary transactions to be recorded in a timely manner, including FISD's allocated share of OPM indirect costs. FISD direct costs are obligated and accounted for in GFIS once program staff obligate/expend funds for each business line's individual contracts and/or projects after checking the relevant legal authority, contractual terms, the OPM Strategic and Operational Plan, and associated annual performance plans. In addition, the vast majority of FISD expenses are in the form of payments to its investigative contract companies for investigative services delivered by them to FISD. FISD's PIPS sends investigative billing and payment to contractor information to GFIS through a middleware system called the PIPS Financial Information System (PFIS). A typical FISD transaction would be processed as follows: FISD receives an investigative request, electronically or in hard copy, and information from the forms is entered into PIPS; PIPS opens the investigation for work by a contractor or our own Federal staff; A customer billing record is sent from PIPS, through PFIS, to GFIS, allowing OPM to bill the customer for the case, and A payment record is sent from PIPS, through PFIS, to GFIS which allows OPM to pay one of our contract companies if the case has been assigned to one of our contractors for work. Once the case is completed, PIPS sends a closing record to GFIS through PFIS to complete the cycle. Each set of investigative papers is a reimbursable agreement which has been signed by an authorized agency representative (either physically or electronically) which obligates funds from the agency and allows OPM to bill for the service to be delivered. FISD bills in advance for all investigative work at the time the request is received and entered into PIPS. OPM's CFO staff post any required corrective entries in GFIS, ensuring that the financial information received by management is complete and reliable at any point in time. Examples Include: CFO reports include income statements and operating plan budget reports, including travel expenses; Quarterly Director's reviews demonstrating that OPM monitors obligations closely; reports used by managers from OPM's central financial and payroll IT systems, such as Summary Reimbursement Reports which present revenue and expenses by project and object class; various customized reports used by staff and managers to provide a comprehensive status and accounting of a particular project or center; budget execution spending plans; and obligation reports. Financial information is also used for program management and external reporting in documents like the FY 2005 OPM Performance and Accountability Report, including OPM's submission for risk assessments under the Improper Payments Information Act.

Does the program have procedures (e.g. competitive sourcing/cost comparisons, IT improvements, appropriate incentives) to measure and achieve efficiencies and cost effectiveness in program execution?

Explanation: One of the primary FISD program goals, which is also in executive and management performance and work plans, is maintaining a fee-for-service structure that ensures full cost recovery. In order to keep costs low and improve efficiencies, FISD has undertaken a number of actions recently to lower costs and improve performance. It has a procedure to outsource as many non-core functions as possible. Indefinite Delivery, Indefinite Quantity (IDIQ) contracts were recently awarded for investigative fieldwork services, data entry support, case review, janitorial, courier and IT support functions. While FISD has not been subject to a formal A-76 competitive sourcing competition, all positions have undergone an internal competitive sourcing review. FISD is constantly looking for ways to incorporate technology into its operations to improve timeliness, quality and customer service. OPM has an Investment Review Board which reviews all IT spending decisions. FISD has upgraded its IT systems significantly, including adding an imaging system to improve records access times, working on improved interfaces with FBI's data repository, improving its Clearance Verification System to speed reciprocity, and developed its Fingerprint Transaction System (FTS) to have direct interaction with IAFIS. It is releasing a new version of its Investigator Handbook, with updates reflecting new guidance and standards which can improve efficiencies while providing better quality. At the same time, it is instituting a standardized training curriculum for all of its federal and contract investigators utilizing methods which have proven to be the most effective at bringing new investigators quickly up to speed.

Evidence: FISD has maintained full cost recovery status since FY 2002, following the guidance in OPM's Financial Management Manual. An updated version is expected in the near future. FISD has initiated several IT initiatives that not only improve operating efficiency, but also reduce overall cost to the government. FISD has invested heavily in the Electronic Questionnaires for Investigations Processing (e-QIP). e-QIP allows subjects of investigations to submit their forms in an electronic environment, thereby decreasing the burden to complete forms and eliminating delays in case processing due to mailing times and incomplete submissions. e-QIP has not yet totally eliminated the human factor in case processing. Releases and other investigative documents can be scanned and attached to the e-QIP submission. Fingerprints can be captured electronically and then be separately transmitted to FTS. Releases, fingerprints charts and other documents may also still be mailed) Overall it has helped to bring greater efficiencies to what has traditionally been a cumbersome and time-consuming activity. FISD measures its progress by tracking the number of cases submitted electronically. e-QIP also includes validation features which greatly reduce the frequency of rejections due to agency or subject errors on the forms. FISD has also established a files imaging process and begun creating electronic copies of our investigative files. This innovation will allow faster response to agencies requesting copies of older files, thereby allowing them to make quicker and more reliable security processing determinations. A detailed description of these and many other IT initiatives undertaken by FISD was presented earlier this year to OMB and Congress in the form of FISD's first annual report on the "Use of Information Technology in OPM Background Investigations". Incentives to achieve cost and financial efficiencies exist for management staff in the context of their various performance metrics. Their success, and eligibility for performance awards, relies to a great deal on these measures. OPM's 2006 FAIR Act Inventory includes justification for FISD's Inherently Governmental Positions, with supporting citations from OMB circular A-76. Additionally, the Inventory includes justification covering all other positions under Commercial Reason Code A, involving oversight, adjudicative, investigative and other responsibilities. As such, FISD has determined that it is in the best interest of the Government that they be performed by Federal employees. FISD has numerous efficiency measures it tracks, reports on and utilizes to improve operations. The results of these measures are used to make improvements and determine performance ratings for its managers.

Does the program collaborate and coordinate effectively with related programs?

Explanation: Like no time before in memory, the individual members of the investigative community are working together to bring about real, substantive change and improvement to the entire adjudication process. FISD works closely in a variety of ways and in a variety of forums with other Federal investigative agencies to make certain that the shared mission of ensuring the nation's security, and the security, safety and trustworthiness of the Federal workforce, is performed effectively and efficiently. FISD has forged strong relationships with its inter-dependent community partners. It interacts with them regularly and works together to achieve greater efficiencies in the Federal investigations field. The principal partners it has in this endeavor include the Director of National Intelligence (DNI), the Department of State, and the FBI. In 2005, FISD created the Background Investigations Stakeholders' Group [BISG] which meets approximately monthly to discuss matters relevant to the investigations field. The BISG is chaired by FISD and meets regularly to discuss, debate and provide solutions to issues pertinent to FISD's investigative services, FISD's relationship with its customers, investigative policies and procedures, and relevant regulatory matters. All agencies serviced by FISD are members of this body, and its deliberations are primarily concerned with the relationship between FISD and the agencies. FISD regularly issues formal notifications alerting the agencies of service changes and enhancements and matters of interest. FISD periodically hosts intergovernmental round-tables to discuss current issues in the suitability adjudication field. The Personnel Security Working Group reports to the National Security Council and is presently chaired by the Department of Justice. It meets to discuss, debate and provide solutions to issues pertinent to national security investigations and adjudications throughout the Federal government. Additionally, OMB sponsors a group chaired by the Information Security Oversight Office (ISOO) and charged with promoting reciprocity of security clearances among Federal agencies. FISD also collaborates with those agencies which conduct their own investigations, whether under statutory or delegated authority. FISD works with them in the context of the aforementioned working groups, of which many of them are members. For example, one critical project currently underway is the development and issuance of a standard investigators manual to be used by all investigators. This handbook will create uniform investigative procedures and products government-wide, leading to higher quality and more consistent adjudication decisions, and improved confidence in reciprocity.

Evidence: Recent accomplishments of the partner bodies mentioned above include: -Revisions to the adjudicative guidelines for access to classified national security information; -Investigative coverage goals when investigating activities in overseas locations; and -Enhancements to FISD's Clearance Verification System which promote the reciprocity of security clearances. Ongoing initiatives of these bodies include: -Proposed revisions to Standard Forms are currently out for comment. Adopted forms will also lead to an update of the e-QIP system and PIPS; -Review of and modification to existing regulations to make them more practical and relevant in today's investigative environment; and An ad hoc effort by OPM, DOD and GSA is underway with international partners on an effort to standardize ID Cards and credentials.

Does the program use strong financial management practices?

Explanation: OPM's annual consolidated financial statements are independently audited by a well-recognized international CPA firm. These auditors reported no material internal control weaknesses from their audit of OPM's financial statements for FY 2005. FISD provides reimbursable services utilizing OPM's revolving Fund authority. In addition, the program has procedures in place to ensure that payments are made properly for the intended purpose and OPM has identified no erroneous payments. OPM's financial management systems meet statutory requirements and financial information is recorded accurately and timely. The program utilizes weekly, monthly and quarterly financial and performance data to support its day to day operations. For example, weekly timeliness reports track operations, monthly financial reports track spending versus budget, quarterly agency Director's reviews track the progress towards both financial and operational goals, and OPM's Investment Resources Board (IRB) reports track IT project implementation progress.

Evidence: Among the practices and tools FISD uses to ensure strong financial management are: -The PIPS system, described in detail in 3.3, drives the billing of customers and payments to contractors. The vast majority of all our financial transactions occur in this forum. It is an automated process with a direct interface to GFIS, through the middleware PFIS system. Current and historical data for expenses and investigative workloads are used to set prices each fiscal year, and to ensure that revenues cover expenses each year [Workload and Expenses]. -Financial management practices for the procurement of goods and services include controls on credit card assignment and use; financial thresholds, checks and balances for warranted contracting officers; and financial tiers of management approvals [Financial Delegations]. -Strong, ongoing negotiations take place with contractors to ensure that FISD receives good value in exchange for the money it pays -The Associate Director's performance plan points to achieving full cost recovery in support of OPM's operational goals. This cascades into other managers' work plans to ensure that employee performance standards reflect a level of production which will support sufficient revenue to cover operating expenses.

Has the program taken meaningful steps to address its management deficiencies?

Explanation: During FY 2006, OPM, under the leadership of its new Director, undertook an extensive review of its mission and strategic plan. As a result, it recently issued a new Strategic and Operating Plan 2006-2010. This new plan represents a clear effort to make OPM's goals and operations more transparent and accountable. It places an emphasis on getting things done. A system of review has been put into place whereby progress in operational goal attainment is discussed, as well as plans to correct any deficiencies in execution. This system is cascaded throughout management, with the Director discussing performance with the Associate Directors, who discusses performance with the Deputy Associate Directors, and so on. OPM continues to focus its efforts to substantially improve the agency's financial management, internal controls, operations, and reporting. OPM's CFO has received the agency's sixth consecutive unqualified ("clean") opinion on the agency's FY 2005 annual consolidated financial statements. The OCFO identified that it was not meeting the requirements of the prompt payment act. It reviewed its procedures and made changes to improve payment processing. It generates monthly reports of prompt payment metrics, reviews the results and continues to modify its processes and procedures as needed. As a result, payments made within guidelines have increased.

Evidence: In September of 2005, FISD became its own Division reporting directly to the Director of OPM. In January of 2006, FISD reorganized to better align its management structure and accountability with its operational goals. It is too early to concretely gauge the performance results, but each organizational unit has clearer purpose and accountability. OPM's Center for Internal Control and Risk Management oversees OPM internal certification process for the Federal Managers Financial Integrity Act [FMFIA] and tracks corrective actions regarding all recommendations accepted from independent auditors and third party reviews [GAO-06-233T ; GAO Letter 1/17/2006; GAO Reports and Testimony; and Industry and Media] of OPM programs.

Has the program demonstrated adequate progress in achieving its long-term performance goals?

Explanation: FISD is a new organization, created in FY 2005 as part of OPM's acquisition of DSS investigative operations. FISD achieved its targets in 3 of its 4 Long Term measures, and the target it missed was due to factors outside of its control. The program is well on its way to achieving its long-term goals for FY07 and FY08. ?? 1.0 Full Cost Recovery. FY2006, FISD exceeded it target level of retained earnings by 50%. This is primarily due to the greater than expected volume (revenues grew by 44% from FY04 to FY05 and another 33% from FY05 to FY06), effects of cost control measures, and the fact that some capital spending planned in FY 2006 will not be completed until FY 2007. FISD is clearly on track to meet its ambitious targets for FY07 and FY08. ?? 2.0 Timely Investigations - Initial Clearance. While the unexpected increase in volume noted above helped FISD meet its financial targets, it had an adverse effect on efforts to meet its timeliness targets, particularly the labor-intensive initial clearance cases. FISD did not meet its target for FY2006 and it will take an extraordinary effort to achieve its target for FY2007. The significant challenges FISD has endured in the last two years, include: ?? an increase in demand which has consistently averaged at least 50% above customer workload projections; ?? absorption of over 1800 new employees and a backlog of cases that substantially exceeded DOD projections when the DSS program was transferred to OPM; ?? the addition of 5 new contract investigation firms, which all required significant training and 100% quality control; ?? implementation of new IT systems (e-QIP and imaging); and ?? establishing an overseas network to complete background investigations on those cases where individuals have recently lived outside the United States. These and other challenges have created greater stress on the program than was originally anticipated when the law was passed setting timelines standards for FISD. For example, upon the merging of DSS, it was assumed that the investigators would have productivity levels close to OPM's investigations contractor US Investigative Service (USIS). Further, it was expected that the former DSS employees would begin working new cases during the 3rd quarter of fiscal year 2005. However, because of the unexpected backlog of cases, the transferred employees did not begin working new cases until near the end of the 2nd quarter of fiscal year 2006 and the investigators did not meet productivity expectations. A compounding factor was that new contractor investigators had a longer learning curve than projected and experienced difficulty meeting the minimum standards for quality and timeliness outlined in their contracts. As stated earlier, these problems are being addressed, but the cumulative effect was that FISD's FY06 results were below its target. ?? 3.0 Timely Investigations -- All Other. FISD was able to meet its FY06 target and fully expects to meet its targets for FY07 and FY08. FISD has actively been automating its operations and improving its interactions with third parties, which has had the effect of improving the timeliness of its less labor-intensive cases. Further capital spending and initiatives (see PART Improvement Plan) will continue this trend into FY07 and beyond. ?? 4.0 Cumulative Results of Operations. FISD exceeded its target for FY06 and fully expects to meet or exceed its targets for FY07 and FY08. As discussed above, the cost control initiatives coupled with increased revenues has allowed the program to recover its costs and make significant progress in reaching the level of retained earnings deemed the "Tolerable Net Position" by OPM's OCFO. FISD's partners are actively engaged in helping FISD achieve its long term targets. A substantial portion of FISD's investigations are completed with the assistance of contractors. The contracts with these 3rd party vendors have clear timeliness performance clauses tied directly to FISD's measures.

Evidence: As of June 30, 2006 FISD completed 7,952 Priority Service SBI's with an average processing time of 48 days; 56,669 Standard Service SBI's with an average processing time of 226 days; 9,601 Priority Service NACLC's/ANACI's with an average processing time of 62 days; and 322,481 Standard Service NACLC's/ANACI's with an average processing time of 154. FISD has consistently made dramatic improvements each fiscal year. The target for timeliness for all other investigations is 90% by predetermined deadlines, which varies by case type, by the end of FY 2008. By case type and service, FISD records reflect through June 30, 2006, it received 1,428 Priority BI/LBI/MBI investigations which were completed in 35 days. It received 1,295 Standard Service BI/LBI/MBI investigations which were completed in 144 days. The 2007 Congressional Budget Justification reflects FISD long term measures. FISD's Measures Matrix reflects selected targets and time frames. In the 2008 Congressional Budget Justification - see long-term measures. These evidence sources provide management focus for setting performance targets and keeping the important FISD deliverables on track both short and long term. These documents clearly show progress and results from baseline, showing annual targets are on track to meet longer term goals. Marketing Web Site: http://www.opm.gov/Products_and_Services/Investigations/. This evidence source is a tool for establishing customer expectations for high quality and timely support from OPM/ FISD deliverables.

Does the program (including program partners) achieve its annual performance goals?

Explanation: FISD has 7 annual measures that drive the four long-term measures. Three of these measures are new measures for which targets were not set in FY06 because the results are being used as baseline data. Of the remaining 4, FISD results are exceeding targets in 3 of its measures and came very close to meeting the target for the fourth. ?? 1.1 Indirect Costs and 1.2 Direct Costs. Prior to the acquisition of DSS operations from DOD, investigations work was completed by a contractor (USIS), and the large majority of FISD expenses were to this contractor and considered "Direct" expenses. The program concentrated its cost control efforts on its own program operations, as well as the effort to expand the number of contractors (successfully completed in FY06). Therefore, prior to FY06, it did not set specific targets for direct and indirect costs, but had internal program spending targets. With the addition of 1800 new employees (the majority of which were federal investigators) and new contractors, FISD began tracking its expenses as direct and indirect costs, and established its baseline for these measures in FY06. It should be noted that from FY05 to FY06, the program was able to reduce its indirect costs as a percent of revenues from 21.0% to 14.0% while its direct costs only increased from 77.6% to 81.9%. It fully expects to meet its ambitious targets for FY07 and FY08 through holding its contractors to their contractual obligations with regard to cost and timeliness, and closely tracking its indirect cost expenditures. ?? 1.3 Internal Cost per Source. This is a new measure implemented in FY06. As discussed above, the recent acquisition of new operations has made this measure necessary. Prior to FY06, no complete data existed. Accordingly, it is establishing the baseline in FY06 and will set appropriately ambitious targets for FY07 and FY08. It will initiate actions to achieve those targets once they are clearly defined. ?? 2.1 Aged Inventory - 95th percentile Initial Clearances. In FY06, FISD targeted the average age of the oldest 5% of initial clearance cases to be 15 months (456 days), and the final results show the average age at the end of FY06 to be 16.5 months (475 days). Given the factors noted for measure 2.0 in Section 4.1 above, FISD considers this target largely met. It should be noted that FISD reduced the average age of the oldest 5% of these cases by over 3 months (17%) from FY04 levels, even with a 93% increase in revenues over the same period. With its on-going program improvements, and the effort of its contractors, FISD fully expects to meet its targets for FY 2007 and FY2008. ??3.1 Aged Inventory - 95th percentile All Other Cases. For the average age of the oldest 5% of all other cases, FISD was able to achieve 650 days, a full 25 days (4%) better that its target of 675 days. This represents an improvement of almost 1 year (344 days) over the average age at the end of FY04 of 994 days. FISD fully expects this trend to continue, and to achieve its ambitious targets for FY07 and FY08. ?? 4.1 Customer Satisfaction. FISD is still receiving and tabulating data from its FY06 Customer Satisfaction survey, but with over half of the expected responses received, the result is over 94% indicated they were satisfied. FISD expects to have final figures in first quarter FY07 and meet this target. ?? 4.2 Case Returns. Case returns due to quality issues were 0.13% for FY06, well below FISD's target of less than 1%. FISD and its partners have very strong quality control and FISD expects to meet its targets for FY07 and FY08. As with its long term goals, FISD's partners are actively engaged in helping FISD achieve its annual targets. A substantial portion of FISD's investigations are completed with the assistance of contractors. The contracts with these 3rd party vendors have clear timeliness, price and quality performance clauses tied directly to FISD's measures.

Evidence: See Measures Tab. Other evidence includes the FY 2007 Congressional Budget Justification This evidence source lines out targets and performance results for four years (past year actuals and future targets.) This evidence document consolidates the full range of performance targets and measures - both long-term measures from the Congressional Budget document and measures for supporting activities. Exhibit 3: FY 2008 Operational Goals and Performance Targets. This provides the longer view of the direction and performance commitments that FISD has made to its customer base.

Does the program demonstrate improved efficiencies or cost effectiveness in achieving program goals each year?

Explanation: FISD has demonstrated significant improvements in efficiency and cost effectiveness over the last two years. It continues to employ new IT solutions to further improve cost and efficiency. Financially, the organization has reduced overall costs as a percent of revenue from 98.6% in FY05 to 96% in FY06. It has decreased the percent of indirect costs (those costs not adding direct value to FISD's products and services) by a third from 21% to 14% of revenues, while the percent of direct costs (those costs directly incurred in providing the product or service) has risen only 5.6% to 81.9% of revenues over the same period. FISD's timeliness and efficiency closing cases has also substantially improved. Initial Clearance cases closed grew by 275,000 cases or 86% FY04 to FY06. In the same period, the age of the oldest 5% dropped from 570 days to 475 days, indicating that FISD was improving the rate at which it closed cases faster than the growth in new cases. In FY05, FISD closed 191,405 cases within 90 days of receipt. In FY06, FISD closed 241,888 within 90 days, an improvement of 26% and a clear indication of improvements in efficiency. Improvements have also been made in closing all other cases. These cases grew by 19% from FY04 to FY06. In the same period, the age of the oldest 5% dropped from 994 days to 650 days, a 35% drop. In FY05, 453,232 cases were closed within their targeted time frame. In FY06, that number increased to 508,691. The e-QIP system is a secure web-application designed to automate and facilitate the processing of common security questionnaires that are required to conduct federal background investigations. The e-QIP system allows applicants for federal employment to electronically enter, update, and release their personal investigative data over a secure Internet connection to their sponsoring agency for review, approval, and submission to OPM. The e-QIP system is part of a government-wide initiative designed to improve the speed and efficiency of background investigation process and is now in use in all major Federal agencies. On any given day e-QIP contains between 90,000 to 100,000 active investigative requests in-process. In FY06 e-QIP has scheduled over 200,000 investigations that were submitted via e-QIP and the week ending July 15, 2006, ended with the highest weekly total ever with over 11,000 cases coming in. The Clearance Verification System (CVS) enables agencies to verify clearances granted by other agencies in near real time. The CVS consists of a cross-agency system providing a single search capability to locate investigative and clearance information from any agency. The CVS functionality was made available on January 31, 2003. Since its deployment, the CVS has provided unified access to 98% of all clearances in a single portal system by connecting the DOD's JPAS with OPM's SII. Since the Fingerprint Transaction System (FTS) was initiated in March 2000, FISD has offered customers the ability to electronically transmit fingerprints to FTS. As of July 2006 FISD has 230 offices submitting electronically. That number is expected to grow to over 100 offices by the end of calendar 2006. The Security and Suitability Investigations Index (SII) - Defense Clearance Investigations Index (DCII) - Joint Personnel Adjudication System (JPAS) systems are linked through the connection of the primary database warehouses storing investigative processing, clearance, and eligibility information for all civilian, military, and contractor personnel. The SII contains investigative and clearance-eligibility data from civilian agencies. The DCII contains historical processing information from DoD components, while JPAS manages current investigative processing as well as clearance-eligibility information from that community. The linkage allows any user of any of the systems to conduct a seamless search of the other databases while working from their native systems.

Evidence: See the Measures Tab. other evidence includes the Congressional Budget Justification. This evidence matrix provides the framework for capturing cost and effectiveness measures which inform the program management. These measures give the managers early warning to help keep performance on target and take corrective steps. Having the measures matrix, allows any FISD employee to see how their program is contributing to accomplishment of long -term goals. These statements provide the high-level view of financial performance and are the official OPM statement of results that show FISD's revenue to expense relationship. They also ensure consistency between FISD's internal financial data and the data of record.

Does the performance of this program compare favorably to other programs, including government, private, etc., with similar purpose and goals?

Explanation: FISD has collected cost and timeliness data concerning other federal and private sector service providers. The cost data shows that FISD, on average, has the lowest prices. The average of the prices for other service providers ranges anywhere from 3% to over 400% more than FISD's price, depending on the case type. While certain providers may have a lower price per one certain type of case, the average savings per case type ranges from $88 to $565. Based on the volume of cases processed by FISD, the total savings add up to over $336 million. The only other service provider to give timeliness data shows that FISD takes about twice as long to clear a case as the State Department. However, FISD's timeliness figures have been reduced by over a third from one year ago and reflect three conditions not affecting the State Department: 1) the integration of DSS operations; 2) the addition of 5 new contractors; and 3) the tremendous volume increase coupled with a lack of accurate workload forecasting by its customers. Given these factors, and the ambitious goals it has set for itself, FISD's performance has, and will continue to be, at a high level.

Evidence: FISD pricing for FY 2006 was published through Federal Investigations Notice (FIN) 05-02, dated September 16, 2005 [FISD Prices]. FISD has been working with original or delegated investigative authority agencies to obtain pricing and timeliness information. Agencies are struggling to assemble the data and only limited information is currently available [Agency Pricing]. There are also comparable prices from a General Services Administration schedule contractor. The Omniplex website [Omniplex GSA Schedule Price List] outlines available services and pricing across multiple fiscal years, including pricing through August 29, 2006, which covers the FY 2006 year-to-date cost information for FISD [Benchmark Pricing]. FISD has been provided proprietary information through a third party, based on a September 2005 proposal by a major international risk consulting company (Company A). FISD has also obtained some pricing information from other agencies providing investigative services. Price comparisons are shown in the chart below. Savings are based on the price differences and volume of cases [Cases Received]. See the performance chart contained in evidence Another key benchmark is timeliness. As discussed in the response and evidence under question 1.4, FISD has been and continues to deal with a sizeable backlog of cases from the transfer of function from DOD. FISD has been working with agencies to get FY 2006 timeliness data, and currently has limited information from the Department of State. See the performance chart contained in evidence

Do independent evaluations of sufficient scope and quality indicate that the program is effective and achieving results?

Explanation: FISD regularly receives, or in certain instances on an as-needed basis (the DSS merger, for example), high quality evaluations from non-biased, independent organizations which cover almost every major area of FISD's performance. The final reports received to date from these evaluations indicate that the program has areas for improvement but on the whole is performing well under the circumstances. The program is making progress in a number of key areas including electronic system enhancements which will improve the quality, efficiency and effectiveness its investigative products and services. FISD takes the recommendations it has received very seriously. These results of completed evaluations and those currently in process are being used in FISD's strategic planning for program improvements during FY 2007 and FY 2008. For example, of the 20 recommendations in OPM's OIG audit of FISD's new Electronic Questionnaire for Investigative Processing (e-QIP), implementation of 19 has been completed. FISD is also planning on implementing the 7 recommendations in 2 other OPM OIG reports. Based in part upon these evaluations and reviews, including its customer surveys, and from its internal reporting and analysis, FISD has identified and begun implementation of over 15 strategic initiatives for FY 2007 designed to address the major findings from these reports. Examples include: Comprehensive IT Modernization and Integration Analysis; Sustaining Initial Clearance Case Timeliness (80% closed within 90 days); Revise Close Pending Process; Update PIPS Reporting format for Agents; and Develop and implement a Management Dashboard. FISD will also arrange for an independent evaluation in FY 2007 for its operations to determine if the program meets its goals.

Evidence: GAO testimony on September 23, 2003 about OPM's e-clearance initiative [GAO-03-1169T] confirmed OPM's progress on objectives to increase use of electronic processing and imaging to improve the investigations process. An additional GAO report [GAO-04-632] and further testimony continued to track timeliness and backlog issues with DOD's clearance process. GAO has also initiated audits at OPM which now provides investigative services for DOD, with a focus on the clearance process for contractor personnel and electronic systems to support investigations. OPM's Inspector General has also conducted audits of the FISD program, primarily the IT systems which are improving the investigative process for agencies and OPM. Audited systems and processes include an electronic questionnaire for applicants, agencies and OPM processing, an imaging system, and a fingerprint system. The IG is also auditing the outcome of the transfer of DOD's personnel security investigations function to OPM. To ensure actions under audit recommendations are completed, the IG employs a reporting and tracking system. Another independent review of FISD performance comes from the Customer Satisfaction Survey. However, FISD is considering changes to their customer satisfaction surveys to better assess the broad scope of their activities.