SB 747 amends 31 U.S.C. 1105(a) to require the President’s annual budget to include program- and activity-level information on improper payments for every executive agency that must file improper payment reports under subchapter IV of chapter 33. The new requirement asks agencies to explain why improper payments occurred, to show three‑year trends (identifying increases, decreases, or no change), and to list incomplete corrective actions with the steps the agency will take.
The change embeds improper-payment disclosure in the budget submission rather than leaving it solely in annual agency improper-payment reports. That elevates improper-payment data into the budgetary narrative Congress uses for oversight and resource decisions, while creating new coordination and data-standardization work for agency CFOs and OMB.
At a Glance
What It Does
The bill adds a new item to 31 U.S.C. 1105(a) requiring the President’s budget to include narrative explanations of improper payment amounts and rates, three‑year trend analysis, and a list of incomplete corrective actions and planned steps for each covered program or activity. It ties the disclosure obligation to the statutory definition of “improper payment” in 31 U.S.C. 3351 and to agencies subject to subchapter IV of chapter 33.
Who It Affects
Executive agency budget offices, CFOs, program managers, and OMB (which assembles the President’s budget) must prepare and integrate this information; inspectors general and GAO will use the material for oversight; congressional budget and appropriations committees will receive more granular improper-payment information. Agencies required to submit improper-payment reports under subchapter IV are directly in scope.
Why It Matters
Putting improper-payment narratives into the President’s budget changes how Congress and OMB see and prioritize error reduction: it links program performance against improper payments to resource and policy decisions. That can sharpen oversight but will require agencies to standardize data, align reporting cycles, and absorb additional analytic and drafting costs.
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What This Bill Actually Does
SB 747 inserts a single new reporting item into the statutory checklist that defines what the President must include in the annual budget submission. Rather than creating a standalone new audit regime, it requires the same improper-payment data—defined by reference to existing law—to be explained and summarized in the budget documents that travel to Congress each year.
Concretely, agencies will need to produce program- and activity-level narratives answering two things: why improper-payment amounts and rates occurred, and how those amounts and rates have trended over the prior three years (flagging programs that on average increased, decreased, or stayed the same). Agencies also must list any corrective actions that remain incomplete, including items in corrective action plans under 31 U.S.C. 3352(d), and describe the steps they will take to finish them.Operationally, this shifts part of the Improper Payments Elimination and Recovery Act (IPERA)-style reporting into the budgeting calendar.
Because the bill ties the requirement to the President’s budget, OMB will play a gatekeeping and formatting role: agencies must deliver standardized narratives and trend metrics that OMB can fold into the budget documents. The statute does not create new penalties or enforcement mechanisms; compliance will be enforced through the budget submission process and congressional oversight.Several implementation questions follow immediately: how agencies will compute the “average” change over three years (statistical method and rounding), how to treat new programs or one-off emergency spending, and whether OMB will issue guidance to harmonize definitions and presentation.
Agencies will likely reallocate data-analysis resources and may need to coordinate IG and program-office inputs to produce defensible explanations suitable for public budget materials.
The Five Things You Need to Know
The bill amends 31 U.S.C. 1105(a) to add a new required item for the President’s budget specifically about improper-payment amounts and rates.
It applies to each executive agency required to submit improper-payment reports under subchapter IV of chapter 33 and references the statutory definition of “improper payment” in 31 U.S.C. 3351.
Agencies must provide a narrative explaining why improper payments occurred and separate three‑year trend analysis that identifies programs with average increases, decreases, or no change.
Agencies must list incomplete corrective actions—including those in corrective action plans under 31 U.S.C. 3352(d)—and describe steps the agency will take to address them.
The statute establishes a reporting obligation tied to the budget submission but contains no new enforcement mechanism or penalties; oversight and consequences will operate through OMB review and congressional scrutiny.
Section-by-Section Breakdown
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Short title
Gives the Act the short name “Improper Payments Transparency Act.” This is purely nominal and does not affect substance, but signals the bill’s single purpose: to increase transparency by moving improper-payment information into the statutory budget checklist.
Require improper-payment disclosures in the President’s budget
Adds a new paragraph to 31 U.S.C. 1105(a) directing that the President’s budget include program- and activity-level improper-payment amounts and rates for agencies subject to subchapter IV. By changing the content list for the President’s budget, the bill forces agencies to prepare these data on the budget timetable and in a format that OMB can include in the transmittal materials to Congress. Practically, this raises coordination needs between agency CFOs, program offices, and inspectors general to produce concise, defensible narratives suitable for a public budget document.
Trend explanations and causes
Specifies that the disclosure must include a narrative description explaining why improper payments occurred and a detailed explanation of trends: programs and activities that have increased or decreased on average over the previous three years, and programs whose improper-payment amounts and rates did not change. That language creates implementation work around defining the averaging method, handling year-to-year volatility, and deciding how to present metrics for new or episodic programs.
Unfinished corrective actions and planned steps
Requires agencies to report any corrective actions that are incomplete, including items in corrective action plans under 31 U.S.C. 3352(d), and to state the steps the agency will take to address the issues. This ties the budget narrative to agency remediation plans, effectively asking agencies to justify outstanding remediation work in the same package where they request funding.
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Explore Finance in Codify Search →Who Benefits and Who Bears the Cost
Every bill creates winners and losers. Here's who stands to gain and who bears the cost.
Who Benefits
- Congressional budget and appropriations committees — gain standardized, budget-tied improper-payment narratives that help prioritize oversight and funding decisions across programs.
- Office of Management and Budget (OMB) and Executive branch oversight — receives consolidated, comparable material to assess agency progress and to make trade-offs in budget proposals.
- Inspectors General and GAO — obtain explicit, government-wide budget documents that cite causes and incomplete corrective actions, simplifying follow-up and risk assessments.
- Civil watchdogs and taxpayers — benefit from having program-level error trends and agency remedial plans placed in a single, publicly available budget document for easier public scrutiny.
Who Bears the Cost
- Executive agency CFOs and budget offices — must compile, analyze, and draft program-level narratives and trend metrics on the President’s budget timetable, increasing staff time and analytic workload.
- Smaller agencies and program offices with limited data capacity — will likely need to expend significant resources or reassign staff to produce defensible trend analyses and to coordinate with IG offices.
- Office of Management and Budget — must receive, validate, standardize, and publish the new material in the budget, adding review and editing burden and likely necessitating new guidance templates.
- Program managers and corrective-action leads — face higher scrutiny and pressure to close outstanding corrective actions because incomplete plans must be disclosed in the budget.
Key Issues
The Core Tension
The bill balances a legitimate demand for budget-centered transparency about wasteful payments against the administrative reality of producing consistent, comparable explanations on the budget timetable: greater visibility helps Congress and the public hold agencies accountable, but without precise definitions, standardized methods, or implementation funding, the requirement risks producing inconsistent, boilerplate, or misleading narratives that burden agencies more than they inform oversight.
The bill improves visibility into improper payments by requiring narrative and trend information in the President’s budget, but leaves several important implementation choices unspecified. It does not define statistical methods for the required “three‑year average” language, nor does it say how to treat programs lacking a three-year data history (new initiatives, programs expanded by emergency appropriations, or programs with one-time corrective efforts).
Those gaps create real comparability challenges across agencies and increase the chance that agencies will default to noncomparable or boilerplate language.
Another unresolved issue is overlap and duplication with existing improper-payment reporting under subchapter IV and IPERA-style submissions to OMB and IG offices. The bill relies on OMB to harmonize presentation but does not allocate funding or set a timetable for guidance, so agencies could face a window of inconsistent implementation.
Finally, because the statute creates a disclosure obligation rather than a sanction, the practical effect will depend on OMB review practices and congressional follow-up; absent strong central guidance, agencies may comply in form but not produce analytically useful explanations, limiting the intended oversight gains.
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