STEP Act

Introduced on January 13, 2025 by James Lankford

This bill aims to cut down on wrong or fraudulent payments made by federal programs. It updates the rules on “improper payments,” gives each agency’s chief financial officer a clear role, and requires better measuring and reporting of these problems .

• Who is affected

  • Federal agencies and their chief financial officers, especially programs in areas like payroll, benefit payments, grants, large contracts, and government purchase or travel cards.
  • New federal programs with large spending in their early years.

• What changes

  • New programs expected to spend over $100 million in any of their first three years, and still within their first four years, must be flagged as “at risk” for improper payments, unless a review shows otherwise.
  • For at‑risk programs, agencies must produce a statistically valid—or otherwise approved—estimate of improper payments and include it with their annual financial report .
  • The agency’s chief financial officer must certify that the list of at‑risk programs is reliable and explain how they are overseeing fixes and corrective action plans.
  • Each year for 10 years after this becomes law, agencies must report progress on putting strong fraud and payment‑control systems in place, following Government Accountability Office fraud‑risk standards and Office of Management and Budget guidance, and on finding risks in payroll, benefits, grants, big contracts, and purchase/travel cards.
  • No new funding is provided to carry this out.

• When

  • These annual progress reports begin in the first fiscal year after the bill becomes law and continue for the next nine fiscal years (10 years total).
  • The “new program” risk check applies during a program’s first four years of operation.