Leading Meeting Professionals

Professional Convention Management Association

May 01 2014

From Shutdown to Shutout: How Federal Cuts Are Impacting the Meetings Industry

By Regina McGee

Illustration by Janine Rewell

It's been two years since a U.S. General Services Administration (GSA) Office of Inspector General's report on excessive spending at a GSA conference in Las Vegas triggered an explosive media outcry, the exposure of high-profile spending abuses at other government conferences, and a cascade of new policies and legislation mandating spending cuts and increased oversight of federal travel spending. The bottom line: a slew of canceled or postponed government meetings, a steep drop in attendance by federal employees at conferences, and, according to the Office of Management and Budget (OMB), $3 billion in travel savings in fiscal 2013.

A month after the GSA scandal broke in 2012, OMB issued a memo calling on federal agencies to reduce travel spending by at least 30 percent from fiscal 2010 levels through fiscal 2016. It also mandated tighter oversight rules, including senior-level approval for expenditures exceeding $100,000 for hosting or attending a single meeting. More restrictive measures have been proposed in the U.S. House of Representatives and the Senate, but so far none have been enacted into law.

Read More: A Timeline of Federal Backlash Against Meetings

“The reality is that we are living through a new normal, a culture of restraint that is unlikely to change in the foreseeable future,” said Erik Hansen, senior director of domestic policy for the U.S. Travel Association. “Our goal at this point is to make sure that proposals that overly restrict travel and call for across-the-board cuts and caps are not enacted.”


For AGC, federal cuts have had a ‘chilling effect.’

GOVERNMENT MEETINGS TAKE A HIT


“The world of government meeting planning has changed quite a bit in the last few years, starting with the GSA scandal, the OMB mandates, sequestration, and the government shutdown. It's been one thing after another,” said Rob Bergeron, CAE, CGMP, executive director and CEO of the Society of Government Meeting Professionals (SGMP). “Our members are seeing increasing scrutiny, with the approval process, always lengthy, now even more so.”

Moreover, an all-member survey that SGMP conducted this past November found that, in the last two years, more than 50 percent of members had existing meetings postponed or canceled, as well as prospective meetings denied. Survey respondents also reported at least 26,100 “lost” training opportunities. Bergeron noted that SGMP has recently seen increased interest in its Certified Government Meeting Professional (CGMP) certification program, which focuses on protocols and processes unique to the government sector. “More than 600 people now have their CGMP,” he said. “It's been an effective tool in building public trust. Our members support reasonable oversight and budget management, and I think we've shown in recent years that we can self-police, that we don't need any additional caps or further restrictions imposed by Congress, where a couple of bills have pushed for that.”

Indeed, the legislative and regulatory crackdown is having an effect. “The Value of Government Meetings,” a comprehensive study conducted by Rockport Analytics LLC for U.S. Travel and released last year, evaluated the impact of sweeping cuts made to federal and state government travel budgets. It found that long-term costs far outweigh short-term savings, pointing specifically to the loss of productivity and knowledge transfer that happens when government employees are unable to attend private-sector meetings. “We hope these new findings will encourage congressional leaders to re-evaluate proposals to drastically cut government travel budgets across the country,” Roger Dow, U.S. Travel's president and CEO, said in a statement when the study was released. “When conducted responsibly, federal workers who travel for conferences and meetings deliver important services and real value to our nation.”

‘THROTTLING BACK’ ON INNOVATION


Professional organizations representing the science and technology community have been particularly vocal in raising concerns over how federal budget cuts and oversight rules “are having the unintentional consequence of restricting the open exchange of ideas among scientists, engineers, and technologists, and thereby adversely affecting important national interests by throttling back on the U.S. ‘innovation engine’ ” — part of the message delivered to Congress in a June 2013 memo signed by 64 technology and science associations. One of them was the American Institute of Aeronautics & Astronautics (AIAA), the largest aerospace professional society in the world, with 35,000 individual members. “We're seeing a spotty landscape of interpretations of the OMB guidelines, varying widely by agency or government department, and that's really a problem,” Sandra Magnus, AIAA's executive director, said in an interview. “We need more clarity, consistency, and perhaps a more strategic approach to applying these cuts and restrictions.”

Attendance by federal employees at AIAA meetings declined 44 percent between 2011 and 2013, according to Magnus, who worries that the loss of collaboration between government and industry at technical and science conferences threatens the advancement of research and development. “Really bright people feed off of each other,” she said. “The informal exchange that takes place at conferences is where innovation takes place. You just can't get that with videoconferencing.”

What's more, conferences are often where young professionals and graduate students are able to broaden their career horizons, but there are fewer opportunities for this to happen in the current environment. “It's a lost opportunity to engage the future workplace,” Magnus said, “and can we really afford that?”

AIAA has taken steps to make its conferences a more valuable experience for attendees by combining previously separate technical forums into multidisciplinary events, creating opportunities for synergy between different sectors of research and development. For example, the AIAA Aviation and Aeronautics Forum and Exposition now brings aviation and aeronautics together under one umbrella. Steps like this help, Magnus said, but don't solve the bigger problem. “Until we tackle the fundamental issue, which is making decisions about how government spends non-discretionary dollars,” she said, “we're going to be resetting to a new normal of spending cuts every few years. We've been cutting back discretionary budgets for years, and at this point there are no easy wins.”

BEYOND SCIENCE AND TECHNOLOGY


The American Institute of Certified Public Accountants (AICPA) is another professional group that is actively working to mitigate the fallout of government restrictions on travel. AICPA was among dozens of organizations, along with AIAA, that submitted written statements to a U.S. Senate Committee on Homeland Security & Governmental Affairs hearing on government conference and travel spending this past January.

The world's largest member association for the accounting profession, AICPA expressed concern that the more stringent oversight rules would discourage federal officials from participating as speakers and government CPAs from pursing professional education and certification at conferences. “Obviously, we're not thrilled with a 30-percent cut in federal travel budgets,” said Diana Huntress Deem, CPA, AICPA's director of congressional and political affairs, “but our main concern is that conferences continue to provide the transparency that comes from interaction between government regulators and CPAs, as well as the education that government CPAs need to maintain professional standards. And we want to stave off legislative action that would trigger even more onerous restrictions and budget caps.”

The Associated General Contractors of America (AGC), a trade organization for commercial construction contractors, is similarly concerned. With 30,000 member firms, AGC focuses on job-site safety, expanding use of new technologies, and strengthening dialogue between contractors and owners. Lately, the group is having a much harder time getting federal representation at its Annual AGC Convention and various other meetings, even though government entities contract billions in commercial construction annually. “These cuts and restrictions have had a chilling effect,” said Jimmy Christianson, AGC's public-affairs director. “We used to have dozens of federal employees attending our convention, working with our members on safety issues and technical advancements and just having informal dialogue where any potential issues could be worked out. But now there's so much red tape and uncertainty that we had just one Army Corps of Engineers representative at our convention in March.”

It didn't help that the meeting was held in Las Vegas, where the optics are still bad for federal attendance after the Inspector General report on GSA's 2010 Western Regions Conference, held at a resort casino in nearby Henderson, Nev. But Christianson said that getting government employees to come to meetings in general has become challenging, thanks to a “hierarchical” approval process. “We know we need to move meetings to where the particular agency is rather than ask them to travel,” he said. “The one place where we still have good participation is Washington, D.C.”

MOVING FORWARD


This past January, more than 24 meetings- and travel-industry groups gathered at PCMA's Convening Leaders 2014 annual meeting in Boston to re-launch Meetings Mean Business, a public-relations and advocacy effort focusing on the economic value of meetings and their critical role as a business tool. The campaign was first created in 2009, spearheaded by U.S. Travel.

“We need to constantly push the value of face-to-face meetings,” said Jim Clarke, CAE, senior vice president of public policy for ASAE, which is a member of the Meetings Mean Business coalition. Although neither Clarke nor U.S. Travel's Hansen sees a reversal of the new normal in government travel spending any time soon, they both point to some positive signs that the “scandal mentality” that has pervaded the last two years is beginning to change. For example, Hansen said, in March the Government Accounting Office released a study of the effects of sequestration-related travel cuts in 23 federal agencies. “The report found that in many cases you can't have these deep cuts without affecting an agency's mission,” he said. “We will continue to work to see more change like this.”

Regina McGee is a writer and editor based in central Massachusetts.

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