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Agencies balk at OPM's rising prices for background investigations

Mar. 28, 2012 - 06:00AM   |  
By SEAN REILLY   |   Comments
Office of Personnel Management Director John Berry
Office of Personnel Management Director John Berry (File)

The fees that the Office of Personnel Management charge to other agencies to conduct employee background investigations is ballooning, and some agencies appear to have had enough.

The average cost per investigation including a growing number of "add-on items" such as special interviews rose from about $521 in 2005 to $882 in 2011, according to figures in a Government Accountability Office report released Wednesday.

As a result, agencies are increasingly looking at avoiding OPM when doing background checks, the GAO said.

At the Department of Homeland Security, for example, officials said there is "a significantly lower cost'' for top secret security clearance investigations when dealing directly with contractors. Officials at other agencies that are authorized to do their own investigations told GAO that they can save as much as $1,500 on the price of a top secret clearance inquiry by using a contractor instead of going through OPM.

OPM officials attributed the rising costs and prices to several factors, including higher FBI fees for checking its fingerprint database and to determine whether an applicant has ever been the subject of a bureau investigation, wider-ranging interviews on applicants, and the need to meet tighter investigation deadlines.

From 2005 to 2011, OPM's annual expenses for handling the investigations soared almost 79 percent, from about $602 million to almost $1.1 billion in inflation-adjusted dollars, according to the GAO review. Those expenses, which are reflected in the prices that OPM charges agencies for conducting the investigations, kept climbing even though the number of individual investigations dropped to 1.2 million last year, down 30 percent from a peak of approximately 1.7 million in 2008.

Overall, the prices for carrying out suitability determination and security clearance investigations rose about 5 percent a year on average, according to the report double the yearly increases in the Consumer Price Index from 2005 to 2011.

All agencies do suitability determinations to make sure that an applicant has the character needed for a particular job; the Defense Department and other national security agencies require security clearance investigations before allowing employees access to classified information. The costs of different types of investigations vary dramatically. A top-secret clearance inquiry, for example, currently costs more than $4,000, compared to $105 for one type of suitability investigation.

While OPM lists its prices to agencies before the start of each fiscal year, it doesn't explain how those prices are linked to costs, leaving managers at other agencies in the dark, GAO said.

In the report, GAO urged OPM Director John Berry to provide customer agencies more information on costs and to explore ways to save money in carrying out investigations.

In a six-page response, Berry agreed with those recommendations, but said GAO auditors failed to balance their criticisms with recognition of the "incredible improvements" made in the process, such as cutting the time needed for investigations from 145 days in 2005 to 40 days now.

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