EACH FEDERAL AGENCY CONTAINS ONE OR MORE SPECIALIZED ORGANIZATIONS CALLED PAYMENT CENTERS TO DETERMINE THAT PAYMENT FOR GOODS AND SERVICES IS PROPER. ALTHOUGH THE ORGANIZATION OF PAYMENT CENTERS IS NOT STANDARD, BASIC PROCESSES INVOLVE ASSEMBLING THE NECESSARY DOCUMENTS, PREPARING A PAYMENT VOUCHER AND LIST OF CHECKS, AND REVIEWING ALL DOCUMENTS FOR PROPRIETY AND ACCURACY. THE 22 PAYMENT CENTERS VISITED FOR THE REPORT INCLUDED OPERATIONS OF VARYING SIZES AND REPRESENTED MOST OF THE MAJOR AGENCIES. IT WAS FOUND THAT PRODUCTIVITY RATES VARIED AS MUCH AS 600 PERCENT AMONG THE CENTERS STUDIED. MANAGERS AT HIGHLY PRODUCTIVE PAYMENT CENTERS SHOWED CONCERN ABOUT PRODUCTIVITY WHEREAS MANAGERS IN FACILITIES WITH LOW RATES FOCUSED ON EFFECTIVENESS AND MADE FEW ATTEMPTS TO MEASURE PRODUCTIVITY. DESPITE THE CONTENTION THAT PRODUCTIVITY AND EFFECTIVENESS CONFLICT, THE GAO FOUND THAT ONE CENTER WITH HIGH PRODUCTIVITY WAS JUST AS TIMELY IN PAYING BILLS AS ONE WITH VERY LOW PRODUCTIVITY. PAY CENTERS WITH A LARGE WORKLOAD NORMALLY ACHIEVED HIGHER PRODUCTIVITY RATES THAN CENTERS WITH LOW VOLUME BECAUSE THEY WERE ABLE TO USE ASSEMBLY LINE TECHNIQUES AND MORE AUTOMATION. THE CIVIL SERVICE REFORM ACT OF 1978, WHICH RELATES PAY TO PERFORMANCE, SHOULD MAKE MANAGERS MORE AWARE OF PRODUCTIVITY, BUT THE OFFICE OF PERSONNEL MANAGEMENT SHOULD AGGRESSIVELY SUPPORT PRODUCTIVITY MEASUREMENT, PARTICULARLY IN FUNCTIONS THAT ARE COMMON TO MANY AGENCIES. THE REPORT ALSO RECOMMENDED THAT SMALL PAYMENT CENTERS BE ELIMINATED OR CONSOLIDATED, THAT ALTERNATIVES BE DEVELOPED TO COUNTER DELAYS CAUSED BY UNTIMELY REPORTS ON ARRIVAL OF GOODS, AND THAT STATISTICAL SAMPLING TECHNIQUES IN AUDITING PAYMENT TRANSACTIONS BE USED. A PERIODIC EXCHANGE OF INFORMATION ON METHODS AND PROCEDURES AMONG PAYMENT CENTERS WOULD BE HELPFUL. THE APPENDIXES PROVIDE A LIST OF PAYMENT CENTERS VISITED, A TABLE ILLUSTRATING POTENTIAL DOLLAR SAVINGS ACHIEVABLE BY CENTERS REVIEWED, A CASE EXAMPLE OF HOW A PAYMENT CENTER CAN IMPROVE PRODUCTIVITY, A DESCRIPTION OF THE REPORT'S METHODOLOGY, AND A CHART SHOWING THE MAJOR FACTORS AFFECTING PROCESSING RATES. (MJM)