This is correct. The HQ team is a part of OMB, the White House's Office of Management and Budgest.
The agency teams can be thought of as a franchise model, we work closely with the HQ team and the other agency teams, but we're also a for real part of the agency we work at.
(Just realized who I was replying to, welp!)
The broad notion is that private-sector IT culture has undergone major change in the last couple of decades. The failure of HealthCare.gov under the old model and its subsequent turnaround using the sort of modern methods common in Silicon Valley woke people up to the possibility of doing something new.
The question, then, is how to get government working like we do. (At least where it's beneficial; we solve a lot of our mistakes by shutting down companies, but government departments can't work like that.)
A number of things have been tried, starting with the Presidential Innovation Fellows. [1] The US Digital Service is the latest pass. The USDS HQ is under the US CTO, which I believe makes it part of the Office of Science and Technology Policy [2], which is part of the Executive Office of the President [3]. The agency teams are embedded in the agencies themselves, and so I'd assume those are legally under the appropriate cabinet secretaries. I get all this mainly from the USDS pages. [4]
Personally, I suspect that this is not a lot of money. It's mainly people, and they made clear that they will be paying industry salaries, not government salaries. And given that it is getting government to reduce waste and learn from the private sector, I expect it has bipartisan appeal.
Even if the next administration dissolves it all, though, I expect it will still have a fair bit of effect. As anybody in the industry knows, the switch from 18- to 36-month cycles to 1-4 week cycles is pretty much permanent because the culture has shifted. People just expect stuff sooner now.
But I hope the next administration continues the effort. At the meeting it was clear there were a lot of people in tech who really want to go serve their country by taking a couple years to make the government run better. It'd be foolish not to take advantage of that yearning for public service.
[1] https://www.whitehouse.gov/innovationfellows
[2] http://en.wikipedia.org/wiki/Office_of_Science_and_Technolog...
[3] http://en.wikipedia.org/wiki/Executive_Office_of_the_Preside...
[4] https://www.whitehouse.gov/digital/united-states-digital-ser...
Regarding pay, I dunno. Based on quotes from this[1] article, the pay scale seems to cap out at GS15 Step 10 which is ~132k. Now obviously this is still a lot of money but if I'm reading between the lines of his quotes right, this is the most an engineer can make w/ USDS without bumping up to SES (Senior Executive Service) levels. Not to say that's substantively less than industry salaries, but they definitely are paying government salaries (by definition).
As far as dissolution, I'm talking more from the perspective of attracting & retaining top talent. With a private sector startup, you trade job security for potentially out-sized payoff. But here... Anyway, point being I think the risks should be articulated well.
[1] http://fcw.com/articles/2014/10/27/red-tape-holding-back-hir...
(source: I almost took an offer at the VA-embedded Digital Service. Still wishing I could have made it work)
And frankly, $132k in the DC area is about as pitiful in the Bay Area if you ask me. Defense contractors alone command $140k salaries for senior developers frequently (the contractors that still do have contracts that is). If you're in "cybersecurity" (whatever BS that actually means is beyond me when it comes to the technical definitions) you can get that with some pretty solid experience beforehand and reach into $200k as an engineer (not being management, which is usually where the caps on compensation tend to lift - see the ES pay scale compared to the GS).
Also, one of the big points about USDS is they are paying at or above market rate for developers which is something they have not done in the past. I think all the speculation in your comment is off the mark.
Regardless, I greatly welcome change to the federal service system in any way to promote better retention and progress for its tech workers. Federal service used to mean good and service a source of genuine pride. I went into federal service a long time ago with enthusiasm for change and left pretty damn disillusioned rather quickly.
The phrase "US Digital Service" makes it sound like a "reified" civil service organization in its own right. There is a USDS Headquarters, which seems to support this notion.
In the copy[1], however, it says that the bulk of the work is done by "agency teams" which, if I'm understanding right, kind of "embed" with their assigned gov't agency. The copy also says they're recruiting founding members for new agency teams. The phrase "founding members" makes it sound, almost, like the teams are independent operations but knowing the federal gov't as I do, that can't possibly be right.
Does anyone here have any light they can cast on whether the USDS is an agency unto itself? If not, what cabinet secretary does it fall under? I have a ton of questions about how this works.
edit: My biggest fear with the USDS is that it can be smothered in the cradle by the next administration. There simply doesn't seem to be enough employees to make dissolving it -- or, maybe more likely, starving it to death budget-wise -- a big deal.
[1] https://www.whitehouse.gov/digital/united-states-digital-ser...