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Inspection and Evaluation Report 3-28: Problems with SBA’s Directives Systems

Date Issued: 
Thursday, May 22, 2003
Report Number: 

On May 23, 2003, the SBA OIG issued Inspection and Evaluation Division Report 3-28, Problems with SBA’s Directives Systems.  This report detailed the SBA’s existing directives system and use of varied policy and procedural notices.  For example, the OIG found that the SBA utilized temporary directives without fully implementing them at the conclusion of the one year temporary status, even though they are required to be incorporated into the pertinent permanent directive.  Further, the OIG found that draft versions of proposed— but unissued— Standard Operating Procedures or SOPs, were used by program staff ahead of time.  For example, a draft SOP for small purchases, grans, and cooperative agreements was prepared in August 1998.  Staff members were directed to follow the draft SOP even thought it had not been cleared or assigned an effective date.  The OIG found that Procedural Notices were often issued in lieu of modifying an SOP.  However, modifying an SOP involves essentially the same process.  Specifically, SOP 00 23 5 acknowledges that “issuing a revision to an SOP generally requires as many clearances, and takes the same amount of time, as issuing a Procedural or Policy Notice.”  Program officials appear to prefer issuing Policy Notices because, according to one official, program staff may perceive Policy Notices as easier to process than SOP revisions.  The OIG recommended that the Associate Deputy Administrator for Management and Administration immediately establish, chair, and consult with a working group of representatives from major Agency offices and at least one field office.  Within 60 days after creation of the group, it should develop a plan for revising the fundamental structure of the directives systems.