USDA Had a Plan for Determining the Best Place to Relocate Two Science Agencies. It Didn’t Follow It.

The Agriculture Department set up an evidence-based process for examining whether to relocate two of its science agencies outside of the Washington, D.C., area, only to abandon it ahead of the controversial 2019 decision to move them to Kansas City, a government watchdog reported Thursday.

The move of the department’s Economic Research Service and the National Institute of Food and Agriculture from Washington to Kansas City in 2019 rankled employees of both agencies, triggering unionization drives and eventually the departure of hundreds of workers. Officials ultimately rehired retired former employees to return to the two agencies, all while working from home or the department’s D.C. headquarters, to cope with the exodus.

The decision also became a flashpoint after then-Office of Management and Budget Director Mick Mulvaney cited the relocation as a "wonderful way" to reduce the size of the federal workforce.

The Government Accountability Office found that the department, with help from consulting firm Ernst and Young, initially created a system to weigh the suitability of regions through three main criteria: improving its ability to recruit and retain employees, placing the agencies closer to stakeholders and consumers, and reducing costs. But after the first round of narrowing down potential new locations, the department weeded out regions solely based on the amount of locality pay employees would receive, and then in the third round it eliminated regions if they could not accommodate co-locating both agencies together.

By tossing out the original evaluation method, which already gave the question of how much the agencies would have to pay employees in locality pay and other cost factors a weight of nearly 42%, GAO said the department focused only on cost reduction, and not its other two stated goals.

“By prioritizing [regions] with lower [cost of living adjustment] values and sufficient commercial space to co-locate ERS and NIFA, USDA may have limited its ability to achieve the relocation objective of attracting and retaining highly qualified staff and may have instead excluded [regions] with characteristics that would have made ERS and NIFA more appealing to existing and potential employees,” the report stated. “Our analysis of USDA documents showed that the five [regions] that USDA excluded from further consideration based on higher COLA values performed relatively well on the workforce characteristics related to attracting and retaining highly qualified staff, another key objective.”

The focus on eliminating regions with high locality pay also undermined the department’s stated goal of placing the two agencies closer to customers and other stakeholders, like agricultural producers, rural Americans and land grant universities, GAO found.

“The [region] with the second highest overall ranking, which was excluded due to its COLA value, also had the highest score on the indicator of proximity to farming, fishing and agriculture,” the report stated. “Another [region] with the highest score for proximity to USDA stakeholders was eliminated by the motivation to co-locate ERS and NIFA.”

Additionally, the department simply omitted a number of potential costs associated with relocation from its analysis of whether and where to move the agencies. GAO wrote that the department did not include any costs associated with attrition, including the loss of institutional knowledge; costs associated with hiring and training new employees; and reduced productivity associated with an exodus of workers, despite the fact that ERS employees told officials they expected 65% to 75% of the agency to quit rather than move.

“USDA officials told us that USDA excluded attrition-related costs from their estimates of taxpayer savings because they assumed that employee attrition would be about the same for all four alternative locations, and thus attrition-related costs would be about the same,” GAO wrote. “[While] excluding attrition-related costs may not have changed how estimated taxpayer savings at the four alternative locations compared to each other, doing so may have affected the magnitude of all of the estimates . . . Accounting for attrition-related costs may have changed these estimates for all four locations and may have led to the reconsideration of alternative locations.”

GAO did not offer recommendations to the department as part of its report, citing the fact that the relocation is already complete and that the Office of Management and Budget has since published more rigorous evidence-based policymaking guidance for agencies to follow. GAO is working on another report on what effects the relocation had on the two science agencies’ missions.

In its response to the report, the Agriculture Department objected to GAO’s use of the 2018 Foundations for Evidence-Based Policymaking Act as a framework for analyzing its decision-making process, since the decision came prior to OMB’s implementation of the law. The response also noted that then-Secretary Sonny Perdue was not “was not required” to conduct an analysis ahead of his decision.

“We agree that USDA was not required to comply with OMB guidance published after the relocation decision,” GAO wrote. “However, we continue to believe that OMB guidance on implementing the Evidence Act is reasonable criteria for assessing the extent to which USDA’s relocation decision was consistent with an evidence-based approach.”