Rand Paul: Agencies Use It Or Lose It Philosophy On Gov’t Spending Needs To Stop

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Juliegrace Brufke Capitol Hill Reporter
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Republican Sen. Rand Paul of Kentucky said the government should encourage agencies to spend less federal dollars instead of creating an incentive to spend frivolously in fear of losing future appropriations.

“Well what happens is, for example, they give a $12 billion budget and you spend $11 billion and you have a billion dollars left at the end of the year, a lot of times it stays in your agency, you get to spend it, but the appropriators may say, ‘Well, we gave them twelve and they only spent eleven, so we’ll only give them eleven this year,” Paul told The Daily Caller News Foundation Thursday.

The senator said something needs to change, citing two of his office’s recent waste reports: one on Veterans Affairs spending $300,000 on 300 unusable TVs that are sitting in storage, and the other on the city of Honolulu dumping nearly $10 million of Community Development Block Grant (CDBG) money into buying apartments over property value to remain eligible for the funds.

Paul noted polices similar to those in Hawaii, where communities may lose access to CDBG dollars if year-end available funds exceed 150 percent of the current grant two years in a row, motivates agencies to dump money into contracts last-minute regardless of how unnecessary the project.

“The one in Hawaii is similar to the one about the VA television sets in that agencies have money at the end of the year and they sort of have this use it or lose it philosophy, they either spend it or they don’t get it the next year, so they tend to just rush it out the door,” he said.

Paul said if changes were made to encourage employees to save instead of spend, it would help alleviate the country’s debt problem.

“We actually have a solution to it, or we think part of the solution, which would be giving bonuses to federal employees if they turn money back in, so if you’re in charge of a $12 billion budget and you turn a billion back in, we give you personally a bonus,” he told TheDCNF. “Right now it’s the opposite, you think, ‘My job won’t be here next year if I spend all this money,’ so this is a perverse incentive to spend it.”

The senator said his office has tallied billions of government funds annually, which invalidates advocates of big government spending’s argument there is no room in the budget to make cuts.

Despite releasing weekly reports highlighting senseless federal spending regularly over the course of the past year, Paul said he hasn’t had much luck on breaking through to those doling out funding.

“Our goal is by putting it out, that perhaps the people next year won’t appropriate it again, but so far we’re finding the appropriators just keep appropriating the same amount every year,” he said.

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Juliegrace Brufke