Senate investigators took a new look yesterday at one of the oldest problems in government, "hurry-up" spending in which agencies hastily get rid of their money in the final hours of each fiscal year so they won't have to give any back to the Treasury.
In fiscal 1978, for example, the subcommittee on oversight of government management was told that monthly outlays jumped from $44.8 billion in August, the next to last month, to $86.8 billion in September. That was a 94 percent increase.
The Maritime Administration, in the last two days of one fiscal year, obligated 42 percent of its budget for contracts. The department of Health, Education, and Welfare, in the last three days, awarded eight contracts in a year's batch of 15.
In addition,said Sen, William S. Cohen (Maine), the unit's ranking Republican, there's the extra cost of poorly negotiated contracts, including those for noncompetitive procurement, and overtime needed to process tidal waves of procurement at year end.
By contrast, W. Bowman Cutter, an official of the White House's Office of Management and Budget, conceded only that "some" abusive year-end buying occurs. But, he said, "I am persuaded that the extent of the problem has been exaggerated and in a way that could cause harm to rational government."
Most year-end spending increases result from "predictable occurrences," principally slow congressional approval of appropriations, "normal obligation patterns, management efficiencies, and bookkeeping procedures," Cutter said.
Through the years, hurry-up spending has been regularly exposed and decried while persisting and flourishing. As Cohen sees it, the principal cause is that federal program managers and budget officials, who are supposed to spend public money with utmost care, are in "a Catch-22 situation" for which some blame goes to Capitol Hill habit of focusing on dollars rather than program quality.
If the officials "plan effectively, budget prudently, spend less, and manage to return tax dollars to the federal treasury, they face the prospect of having their budgets slashed for the next year," Cohen said.
He assigned his staff to a three-month investigation that led subcommittee chariman Carl Levin (D-Mich.) to schedule the first series of oversight hearings on the problem.
The staff said that "dozens" of officials in numerous agencies privately acknowledged hurry-up spending abuses, but that only one, Joe N. Pate, contracting officer of the Justice Department's Law Enforcement Assitance Administration, consented to testify.
Terming LEAA buying practices typical of the executive branch, Pate tld how it got around tough new General Services Administration rules for buying $200,000 in word-processing equipment.
Under the rules, GSA approval to buy such equipment was to be required after last Oct. . But on Sept. 28, Pate's office was asked to approve a noncompetitive three-day lease for such equipment. The intent "was to use a loophole" to bypass GSA, he testified. Pate refused to approve the lease, His supervisor, W. W. Hudson, did.
LEAA's reaction to GSA's threat to its purchasing power was to speed up "like a car flying through an intersection seconds before the light turns red," Pate said.
Pate, appearing at yesterday's opening hearing "as an individual, a concerned taxpayer, a concerned citizen and . . . a professional civil servant," said peers warned him that he was "putting my career at stake."
He has been in the contracting field, in various agencies, for 21 years. His performance at LEAA was praised at the hearing by two of his bosses, general counsel Thomas Madden and Comptroller Robert Goffus, although they dusputed some of his facts. But Cohen told a reporter, "His overall point of view was absolutely confirmed."