| Also disturbing — “18F does not have a viable plan to achieve full cost recovery,” the report said. Project officials don’t deny the shortcomings. David Shive, an acting commissioner, acknowledged that “past practices and controls were insufficient.” Staffing is an example. “Over the past three years, increased staffing costs have been a significant driver of 18F’s overall financial position,” the IG reported. “18F has continued to hire staff despite underperforming revenues.” The project had 33 staffers at the beginning. Three years later, that had jumped more than 500 percent, to 201 employees in March, with projections to add more by the end of fiscal 2016. Activities that can’t be billed to other agencies are another drain. One example is staff time totaling 727 hours on a logo change. The old logo was a blue square with 18F in the lower-right-hand corner. The new logo, a black square with 18F centered and a different font, wasn’t worth the time and doesn’t look as good. Fittingly, 18F’s acting executive director, V. David Zvenyach, responded to the IG with a blog post. Zvenyach said 18F has “taken significant steps to strengthen 18F’s operations,” including obtaining an independent third party to review financial controls, transitioning to monthly customer billing and refining business operations to ensure full cost recovery. “Since the launch of 18F, we have learned much about customer demand, which has allowed us to continue to improve our business strategy,” Zvenyach added. “We have seen significant positive signs, including a 69 percent increase in revenue from 2015 to 2016.” Not wanting the bad news to overshadow the good works, Shive’s response, included with the report, pointed to 18F’s 252 projects helping 37 agencies deliver services “at significant cost savings for the American taxpayer.” Those projects, according to the IG, include developing cloud.gov to help small federal IT teams create cloud Web services, “ghostwriting services” for the Department of Health and Human Services related to a child welfare data system and assisting federal agencies seeking to modernize their digital services. Despite Zvenyach’s and Shive’s words, the IG’s office said it “found internal discussions by 18F senior management that raise doubts about their intent to break even. GSA records show that in discussions in February 2016 regarding the merits of the three break-even scenarios, 18F’s Director of Operations stated, “‘to be frank, there are some of us that don’t give rip about the losses.’” It shows. Read more: [GSA says cyber ‘mistake’ was ‘no breach'; involved “over 100 GSA Google Drives."] | 