oversight

HUD Hired Employees in Accordance With Office of Personnel Management Guidelines for Streamlining the Federal Hiring Process

Published by the Department of Housing and Urban Development, Office of Inspector General on 2011-01-25.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

                                                              Issue Date
                                                                     January 25, 2011
                                                              Audit Report Number
                                                                     2011-PH-0001




TO:        Janie Payne, General Deputy Assistant Secretary/Chief Human Capital Officer,
             A
           //signed//
FROM:      John P. Buck, Regional Inspector General for Audit, Philadelphia Region,
             3AGA

SUBJECT:   HUD Hired Employees in Accordance With Office of Personnel Management
           Guidelines for Streamlining the Federal Hiring Process


                                  HIGHLIGHTS

 What We Audited and Why

           We audited the U.S. Department of Housing and Urban Development’s (HUD)
           process for hiring employees in accordance with Office of Personnel Management
           (OPM) guidelines. The audit was initiated due to concerns about whether HUD
           addressed the staffing needs of its Homeownership Centers in a timely manner to
           address significant increases in single-family mortgage workload. Our audit
           objective was to determine whether HUD effectively hired employees in accordance
           with OPM guidelines for streamlining the Federal hiring process.


 What We Found


           HUD generally hired employees in accordance with OPM’s 80-day timeframe goal
           for the Federal hiring cycle. HUD’s Office of the Chief Human Capital Officer
           made improvements that reduced its average cycle time for hiring employees by
           approximately 37 percent between fiscal years 2008 and 2010; and, met the staffing
           needs of HUD’s 4 Homeownership Centers within the confines of authorized
           staffing levels.
What We Recommend

           This report contains no recommendations.

Auditee’s Response


           We discussed the draft report with HUD during the audit and at an exit conference
           on January 12, 2011. HUD provided written comments on January 18, 2011, but did
           not respond to the report because there were no recommendations. The complete
           text of HUD’s response can be found in appendix A of this report.




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                            TABLE OF CONTENTS

Background and Objective                                                      4

Results of Audit
      Finding: HUD Met the Staffing Needs of Its Four Homeownership Centers   5

Scope and Methodology                                                         8

Internal Controls                                                             10

Appendix
   A. Auditee Comments                                                        12




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                       BACKGROUND AND OBJECTIVE

The U.S. Department of Housing and Urban Development’s (HUD) mission is to create strong,
sustainable, inclusive communities and quality affordable homes for all. HUD works to strengthen
the housing market to bolster the economy and protect consumers, meet the need for quality
affordable rental homes, use housing as a platform for improving quality of life, and build inclusive
and sustainable communities free from discrimination. Given its critical mission, HUD needs to
ensure that it maintains an adequate workforce with the skills needed to maintain this capacity
within its operations.

Before September 2009, HUD’s key recruitment and hiring functions were handled by the Office of
Human Resources, which was a suboffice under HUD’s Office of Administration. On September 8,
2009, HUD Secretary Shaun Donovan announced a reorganization to transform the Office of
Administration into the Office of the Chief Human Capital Officer (OCHCO). The goal was to
enable HUD to focus more strategically on human capital. The transformation process is ongoing.

The stated mission of OCHCO is to deliver services to enable HUD’s human capital to fulfill
HUD’s mission and make HUD a model workplace. The office is led by the Chief Human Capital
Officer, assisted by the Deputy Chief Human Capital Officer. As a result of the ongoing
reorganization, the key functions of the Office of Human Resources were transferred to a new
Office of Human Capital Services under OCHCO. The Office of Human Capital Services is
responsible for managing and administering HUD’s human capital programs. Its operational
responsibilities include strategic recruitment, staffing, position classification and management, pay
administration, benefits and retirement counseling, employee and labor relations, performance
management, personnel actions processing, maintaining official personnel records, personnel
security, and a full range of executive personnel programs and operations. OCHCO’s mission and
functional statements are subject to congressional approval.

To improve overall organizational performance, HUD engaged the National Academy of Public
Administration (NAPA) as an independent third party to assess its human resources, acquisition,
and information technology operations in October 2009. The study results were released in April
2010. NAPA identified several human resource challenges, along with challenges in the other areas
reviewed, and made related recommendations to HUD leadership. Following the release of the
NAPA report, OCHCO contracted with IBM Global Business Services (IBM) in July 2010 to assist
it with the implementation of the NAPA recommendations related to HUD’s human resources
challenges.

Our audit objective was to determine whether HUD effectively hired employees in accordance with
Office of Personnel Management (OPM) guidelines for streamlining the Federal hiring process.




                                                  4
                                 RESULTS OF AUDIT

Finding: HUD Met the Staffing Needs of Its Four Homeownership
Centers

HUD generally hired employees in accordance with the OPM timeframe goal for the Federal hiring
cycle. HUD’s Office of Human Capital Services made improvements that reduced HUD’s cycle
time for hiring employees by approximately 37 percent between fiscal years 2008 and 2010. As a
result, HUD met the staffing needs of its four Homeownership Centers within the confines of
authorized staffing levels.



 OPM Established an 80-Day
 Goal for the Federal Hiring
 Cycle

              Recognizing the need for an improvement in the Federal recruitment and hiring
              process, OPM, in partnership with the Chief Human Capital Officer’s Council
              Subcommittee for Hiring and Succession Planning, launched the End to End Hiring
              Initiative in 2008. The goal of the initiative was to streamline the process and
              improve the overall experience for job applicants and hiring officials. The approach
              to streamlining the process was to strategically integrate and reengineer the five key
              components including workforce planning, recruitment, hiring process, security and
              suitability, and orientation. To this end, OPM designed and established roadmaps to
              address each of the five components from workforce planning through the first year
              of a new employee’s orientation. With respect to the hiring process, OPM’s
              roadmap established a timeframe goal of 80 days or fewer for the complete hiring
              process (i.e., from when a manager recognizes the need to fill a position to the time a
              new hire starts). HUD met OPM’s timeframe goal for the hiring cycle as discussed
              below.


 HUD Met OPM’s Timeframe
 Goal for the Federal Hiring
 Cycle

              Based on a review of information on the average time to fill vacant positions
              obtained from HUD’s Human Resources Tracker system, we determined that HUD’s
              average hiring cycle time decreased from about 117 days in fiscal year 2008 to
              approximately 74 days in fiscal year 2010. This hiring period complied with OPM’s
              80-day goal for the Federal hiring cycle timeframe. HUD’s Office of Human Capital
              Services ensured compliance with the goal by reducing the number of human
              resources steps from 40 to 15 and eliminating many reviews and signatures in the

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hiring process. The table below reflects a summary of the average hiring cycle time
from fiscal years 2008 through 2010.

           Fiscal year                  Average cycle time       Improvement
       October 1, 2009, to
                                             74 days                  37%
        August 17, 2010
       October 1, 2008, to
                                             108 days                  8%
       September 30, 2009
       October 1, 2007, to
                                             117 days
       September 30, 2008

To validate the information obtained from the Human Resources Tracker system, we
randomly selected 10 case files for review. The files were reviewed to determine the
validity of the dates used to calculate the elapsed days in the hiring cycle as reflected
in the Human Resources Tracker system. For each of the cases, we reviewed the
announcement opening and closing dates, applicant eligibility form, job offer letter
date, and date the certification was sent to the selecting official. In this regard, we
also reviewed qualifications and selection criteria. We determined that the elapsed
days as computed in the Human Resources Tracker system were accurate for all 10
cases.

We also performed limited testing to determine whether the Office of Human Capital
Services hired staff as needed for HUD’s four Homeownership Centers in
Philadelphia, PA, Atlanta, GA, Denver, CO, and Santa Ana, CA. The
Homeownership Centers insure single-family Federal Housing Administration
(FHA) mortgages and oversee the selling of HUD homes. We specifically reviewed
staffing at the Homeownership Centers because of the increased demand for FHA
loans, which consequently increased its workload. We obtained and reviewed
information on authorized staff compared with staff on board. The table below
shows the details for each of the four Homeownership Centers as of May 2010.

  Homeownership              Authorized              Onboard          Vacancies
       Center                employees              employees
  Philadelphia, PA              224                    219                  5
    Atlanta, GA                 232                    232                  0
    Denver, CO                  182                    181                  1
   Santa Ana, CA                183                    182                  1
       Totals                   821                    814                  7

The data showed that only 7, or 0.85 percent, of 821 authorized positions were
vacant. Therefore, the Homeownership Centers’ staffing needs appeared to have
been met within the confines of authorized staffing levels.




                                    6
HUD Is Taking Action to
Address Its Significant Human
Resource Challenges

             HUD is developing a plan to address recommendations in a report by NAPA
             regarding HUD’s human resources, acquisition, and information technology
             operations. HUD commissioned NAPA to perform the study in an effort to improve
             overall organizational performance. In its April 2010 report, the NAPA study panel
             recommended that HUD

                    1. Improve its short- and long-term staffing planning by establishing
                       departmentwide work force planning capability and reforming existing
                       agency resources and allocation processes;

                    2. Increase managerial engagement, ownership, and accountability for
                       human resources management;

                    3. Improve its performance management through increased managerial and
                       supervisory training, development, and accountability; and

                    4. Develop and implement a service delivery model framework that defines
                       how human resources services will be provided across the agency.

             Following the release of the NAPA report, OCHCO contracted with IBM to assist it
             with the implementation of the NAPA study recommendations related to HUD’s
             human resources challenges. The goal was for IBM to develop an actionable plan
             for the implementation of the NAPA recommendations as well as the continuous
             improvement of OCHCO’s functions and processes. HUD needs to continue to
             work to ensure that the recommendations made by NAPA are implemented, and
             must particularly make it a priority to develop planning strategies to address its
             workforce needs.

Conclusion


             HUD generally hired employees in accordance with the OPM timeframe goal for the
             Federal hiring cycle. HUD is in the process of developing a comprehensive action
             plan to address challenges related to its workforce needs, as well as other challenges.
             Implementing a plan to address its workforce challenges will ensure that HUD has
             the staff it needs in the future to accomplish its mission.




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                                   SCOPE AND METHODOLOGY

We performed our audit at HUD headquarters, Washington, DC, and our regional office in
Philadelphia, PA, from April through September 2010. The audit covered the period October 2006
through April 2010 but was expanded as necessary to include other periods.

We used computer-processed data only in conjunction with other supporting documents and
information to reach our conclusions and determined that the data were sufficiently reliable for our
purposes.

To accomplish our objective, we

    •   Interviewed various HUD personnel in headquarters 1 and HUD’s Philadelphia
        Homeownership Center to determine or become familiar with the following:

                Duties, responsibilities, and functions of the Staffing and Classification Division in
                 headquarters.

                The role of the Director of the Office of Human Resources, HUD headquarters, in
                 the hiring process, duties, responsibilities, and functions.

                Duties, responsibilities, and functions of the Office of Budget and Administrative
                 Support and its role in the hiring process.

                The role of the Director of Administration Information Technology, HUD
                 headquarters, in the hiring process and the current and proposed systems used by the
                 Office of Human Resources.

                The Philadelphia Homeownership Center’s hiring process and its management’s
                 feedback regarding the hiring process.

    •   Reviewed the goal and scope of the IBM consultants as they relate to the NAPA study.

    •   Analyzed OPM’s SWAT Team initiatives as they relate to streamlining the hiring process.

    •   Applied the U.S. Army Audit Agency’s Statistical Sampling System to select a random
        sample of 15 files from a universe of 1,513. Of the 15 files selected, 10 were reviewed and
        reconciled with data in HUD’s Human Resources Tracker system to verify the accuracy of
        system data on key milestone dates in the hiring process and determine the timeframes
        associated with the hiring process/cycle.



1
 During our review, the reorganization of HUD’s Office of Administration and its related suboffices was not complete.
Therefore, some of the personnel we interviewed were still in their roles under the prior organizational structure.

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   •   Verified that HUD’s Integrated Human Resources and Training System was accredited and
       certified for data integrity for fiscal year 2009.

We conducted the audit in accordance with generally accepted government auditing standards.
Those standards require that we plan and perform the audit to obtain sufficient, appropriate
evidence to provide a reasonable basis for our findings and conclusions based on our audit
objective. We believe that the evidence obtained provides a reasonable basis for our finding and
conclusion based on our audit objective.




                                                 9
                                INTERNAL CONTROLS

Internal control is a process adopted by those charged with governance and management, designed
to provide reasonable assurance about the achievement of the organization’s mission, goals, and
objectives with regard to

   •   Effectiveness and efficiency of operations,
   •   Reliability of financial reporting, and
   •   Compliance with applicable laws and regulations.

Internal controls comprise the plans, policies, methods, and procedures used to meet the
organization’s mission, goals, and objectives. Internal controls include the processes and
procedures for planning, organizing, directing, and controlling program operations as well as the
systems for measuring, reporting, and monitoring program performance.



 Relevant Internal Controls


               We determined that the following internal controls were relevant to our audit
               objectives:

                  •   Program operations – Policies and procedures that management has
                      implemented to reasonably ensure that a program meets its objectives.

                  •   Validity and reliability of data – Policies and procedures that management has
                      implemented to reasonably ensure that valid and reliable data are obtained,
                      maintained, and fairly disclosed in reports.

                  •   Compliance with laws and regulations – Policies and procedures that
                      management has implemented to reasonably ensure that resources use is
                      consistent with laws and regulations.

               We assessed the relevant controls identified above.

               A deficiency in internal control exists when the design or operation of a control does
               not allow management or employees, in the normal course of performing their assigned
               functions, the reasonable opportunity to prevent, detect, or correct (1) impairments to
               effectiveness or efficiency of operations, (2) misstatements in financial or performance
               information, or (3) violations of laws and regulations on a timely basis.

               We evaluated internal controls related to the audit objective in accordance with
               generally accepted government auditing standards. Our evaluation of internal
               controls was not designed to provide assurance regarding the effectiveness of the

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internal control structure as a whole. Accordingly, we do not express an opinion on
the effectiveness of the Agency’s internal control.




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                 APPENDIX

Appendix A

             AUDITEE COMMENTS




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