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gao_GAO-12-962T

gao_GAO-12-962T_0

However, in 2000, we reported that DOD’s approach to prior force reductions was not oriented toward shaping the makeup of the workforce, resulting in significant imbalances in terms of shape, skills, and retirement eligibility. We also have reported that the approaches DOD has relied on to accomplish past civilian workforce downsizing have sometimes had unintended consequences, such as workforce skills imbalances. The tools available to DOD to manage its civilian downsizing helped mitigate some adverse effects of force reductions. However, DOD’s approach to civilian workforce reductions was less oriented toward shaping the makeup of the workforce than was the approach it used to manage its military downsizing and resulted in significant imbalances in terms of shape, skills, and retirement eligibility. Eleven consecutive years of downsizing produced serious imbalances in the skills and experience of the highly talented and specialized civilian acquisition workforce, putting DOD on the verge of a retirement-driven talent drain. Further, we also found that attrition is often not sufficient to reduce employment levels in the short term. In 1995, we reported that the savings realized from government downsizing efforts are difficult to estimate. In addition, the ultimate savings would depend on what happened to the work previously performed by the eliminated personnel. For example, if some of the work was contracted out to private companies, contract costs should be considered in determining whether net savings resulted from workforce reductions. According to the department, as of January 2012, DOD’s total civilian workforce had grown to include about 783,000 civilians. To facilitate effective workforce planning, we and the Office of Personnel Management have identified six leading principles such workforce plans should incorporate, including: aligning workforce planning with strategic planning and budget involving managers, employees, and other stakeholders in planning; identifying critical skills and competencies and analyzing workforce gaps; employing workforce strategies to fill the gaps; building the capabilities needed to support workforce strategies through steps to ensure the effective use of human capital flexibilities; and monitoring and evaluating progress toward achieving workforce planning and strategic goals. For example, the National Defense Authorization Act for Fiscal Year 2006 directed DOD to create and periodically update a strategic human capital plan that addressed, among other things, the existing critical skills and competencies of the civilian workforce as well as projected needs, gaps in the existing or projected civilian workforce, and projected workforce trends. Subsequent acts established additional requirements for the human capital plan, including requirements to assess issues related to funding of its civilian workforce. In our September 2010 review of DOD’s 2009 update to its human capital strategic plan we found that, although DOD had demonstrated some progress in addressing the legislative requirements related to its Civilian Human Capital Strategic Workforce Plan, several key elements continued to be missing from the process—including such elements as competency gap analyses and monitoring of progress. Our work found that DOD’s plan addressed the requirement to assess critical skills. Specifically, the overall civilian workforce plan identified 22 mission- critical occupations that, according to the department, represent the results of its assessment of critical skills. Competency gap analyses enable an agency to develop specific strategies to address workforce needs and monitoring progress demonstrates the contribution of workforce planning to achieving program goals. We currently have ongoing work assessing DOD’s 2010 Strategic Workforce Plan, which the department released in March 2012. The results of this review are expected to be released in September 2012. Our reviews of DOD’s acquisition, information technology, and financial management workforces—which include a number of DOD’s identified mission-critical occupations—amplifies some of our overarching observations related to strategic workforce planning. In fiscal year 2011 alone, DOD obligated about $375 billion to acquire goods and services to meet its mission and support its operations in the United States and abroad. While DOD has acknowledged that rebuilding its acquisition workforce is a strategic priority, our most recent review of the Defense Acquisition Workforce Development Fund found that DOD continues to face challenges in strategic workforce planning for its acquisition workforce. However, we also reported in July 2011 that DOD’s strategic workforce plan lacked a competency gap analysis for its financial management workforce, thus limiting the information DOD has on its needs and gaps in that area and the department’s ability to develop an effective financial management recruitment, retention, and investment strategy to address other financial management challenges. DOD Civilian Personnel: Competency Gap Analyses and Other Actions Needed to Enhance DOD’s Strategic Workforce Plans. GAO-11-827T. Defense Civilian Downsizing: Challenges Remain Even With Availability of Financial Separation Incentives.

Why GAO Did This Study DOD’s workforce of 783,000 civilians performs a wide variety of duties, including some traditionally performed by military personnel, such as mission-essential logistics support and maintenance, as well as providing federal civilian experts to Afghanistan and other theaters of operations. With the long-term fiscal challenges facing the nation, reductions to the civilian workforce may be considered to achieve cost savings. Human capital has remained a critical missing link in reforming and modernizing the federal government’s management practices, even as legislation and other actions since 1990 have been put in place to address major management areas. In the past, GAO has observed that the federal government has often acted as if people were costs to be cut rather than assets to be valued. DOD previously experienced significant downsizing in the 1990s where it did not focus on reshaping the civilian workforce in a strategic manner. Particularly as decision makers consider proposals to reduce the civilian workforce, it will be critical to DOD’s mission for the department to have the right number of federal civilian personnel with the right skills. This testimony discusses DOD’s 1) prior experience with civilian workforce downsizing, and 2) current strategic human capital planning efforts. This testimony is based on GAO reviews issued from March 1992 through June 2012. What GAO Found Prior Department of Defense (DOD) civilian workforce downsizing efforts in the 1990s were not oriented toward shaping the makeup of the workforce, resulting in significant imbalances in terms of shape, skills, and retirement eligibility. Specifically, in a series of reviews GAO found that DOD’s efforts in the 1990s to reduce its federal civilian workforce to levels below that of 1987 were hampered by incomplete data and lack of a clear strategy for avoiding skill imbalances and other adverse effects of downsizing. For instance, in 1992, GAO found that DOD used incomplete and inconsistent data related to workers, workload, and projected force reductions. Further, the approaches DOD has relied on to accomplish downsizing have sometimes had unintended consequences. The use of voluntary attrition, hiring freezes, and financial separation incentives allowed DOD to mitigate some adverse effects of civilian workforce reductions, but were less oriented toward shaping the makeup of the workforce than was the approach the department used to manage its military downsizing. For DOD, this was especially true of the civilian acquisition workforce. The department, which in 2011 obligated about $375 billion to acquire goods and services, was put on the verge of a retirement-driven talent drain in this workforce after 11 consecutive years of downsizing, according to a DOD report. Finally, GAO has found that the use of strategies such as financial separation incentives makes it difficult to document or estimate the actual cost savings of government downsizing efforts, especially in cases where the work previously performed by the eliminated personnel continues to be required. For example, if the work continues to be required, it may need to be contracted out to private companies and contract costs should be considered in determining whether net savings resulted from workforce reductions. DOD has taken positive steps towards identifying its critical skills, but there are opportunities to enhance the department’s current strategic workforce plans. GAO and the Office of Personnel Management have identified leading principles to incorporate into effective workforce plans, such as the need to identify and address critical skills and competencies. DOD has been required to have a civilian strategic workforce plan since 2006. Currently, DOD is required to develop a strategic workforce plan that includes, among other things, an assessment of the skills, competencies and gaps, projected workforce trends, and needed funding of its civilian workforce. GAO has found improvements in DOD’s efforts to strategically manage its civilian workforce. For instance, GAO reported in 2010 that DOD’s 2009 strategic workforce plan assessed critical skills and identified 22 mission-critical occupations, such as acquisition and financial management. However, DOD’s plan only discussed competency gap analyses for 3 of its 22 mission-critical occupations, which GAO has reported is key to enabling an agency to develop specific strategies to address workforce needs. For example, GAO found that DOD had not conducted a competency gap analysis for its financial management workforce, and GAO remains concerned that DOD lacks critical information it needs to effectively plan for its workforce requirements. GAO is currently reviewing DOD’s latest strategic workforce plan, which was released in March 2012. The results of this review are expected to be released in September 2012.

gao_GAO-17-120

gao_GAO-17-120_0

2. Applicant Eligibility Criteria and Program Requirements To meet the statutory requirements of the DFC Support Program for initial eligibility—years 1 and 6—a coalition must: submit an application to the ONDCP Administrator; consist of one or more representatives from each of the 12 sectors— at least one representative per sector—as illustrated in figure 1; demonstrate that the representatives of the coalition have worked together on substance abuse reduction initiatives for at least 6 months (prior to applying); demonstrate substantial participation from volunteer leaders in the have as its principal mission the reduction of substance abuse in a comprehensive and long-term manner, with a primary focus on youth in the community; describe and document the nature and extent of the substance abuse problem in the community; provide a description of the substance abuse prevention and treatment programs and activities underway at the time of the grant application and identify substance abuse programs and service gaps in the community; develop a strategic plan to reduce substance abuse among youth; and work to develop a consensus regarding the priorities of the community to combat substance abuse among youth; establish a system to measure and report outcomes; conduct an initial benchmark survey of drug use among youth and provide assurances that the entity conducting the evaluation has sufficient experience in gathering data related to substance abuse among youth or in evaluating the effectiveness of community anti-drug coalitions; and demonstrate that the coalition is an “ongoing concern” by demonstrating that it has established itself as an appropriate legal entity or organization that receives financial support from non-federal sources and has a strategy to solicit substantial financial support from non-federal sources after the expiration of the grant term. 2. Perception of Risk—youth who reported that the use of alcohol, tobacco, marijuana, or illicit use of prescription drugs is harmful. ONDCP and SAMHSA Employ Leading Collaboration Practices and Have Funded a Range of Drug Prevention Activities ONDCP and SAMHSA Use Leading Practices for Interagency Collaboration ONDCP’s and SAMHSA’s efforts to jointly manage the DFC Support Program are consistent with relevant, key collaboration practices. DFC Grantee Activities Include Drug Abuse Education Campaigns and Efforts to Reduce Access and Strengthen Enforcement DFC grantees have engaged in a range of activities, including drug abuse education campaigns and efforts to enhance enforcement, and they report on these activities in their semi-annual progress reports to SAMHSA. Enhancing Skills: To enhance the skills of those in the community to be on alert for and vigilant against potential drug abuse, one grantee sponsored a session for local realtors on precautions to take when preparing for open houses—warning realtors that leftover prescription drugs in medicine cabinets present the potential for abuse among those walking through the home for sale. Enhancing Access/Reducing Barriers: To reduce cultural barriers, one grantee developed signs emphasizing the legal purchase age for alcohol in multiple languages to respect the diversity of languages spoken across its community—as seen in figure 4. Providing Information: To provide greater information to parents on what drug prevention steps they could take, one grantee chose to address the challenges parents may face when hosting teenage parties at their home. The grantee used the slogan to remind parents of their children’s needs: “Be my Parent, not my Bartender,” which they told us parents found particularly compelling. Agencies Have Established Operating Procedures but Could Enhance Grantee Compliance and Performance Monitoring ONDCP and SAMHSA Developed Procedures to Help Ensure Compliance with Statutory Requirements ONDCP and SAMHSA have developed standard operating procedures to collect relevant information from new applicants and current grantees and to document grantees’ compliance with eligibility requirements in governing statutes. For example, one term and condition of the grant is that grantees must agree in writing to comply with federal grant requirements through the use of a checklist from the U.S. Department of Health and Human Services— SAMHSA’s parent agency. SAMHSA Has Not Consistently Followed Documentation and Reporting Procedures Based on our file review and analysis of the files encompassing the more than 20 types of required documents from 30 grantees, we found that SAMHSA does not consistently follow documentation and reporting procedures to ensure grantees’ compliance with both the statutory provisions and established grant program terms and conditions. Specifically, we found that SAMHSA followed all processes for ensuring that initial applicants had submitted the required documentation before awarding these applicants their initial grant funding. However, SAMHSA was less consistent in its adherence to procedures for confirming documentation for grantees in later years of their grants. Of the 18 grantees that should have had sustainability plans in their official grantee files, 14 were missing the required plans. These sustainability plans are to outline how the grantee intends to maintain the resources necessary to achieve its long-term goals and continued progress after exiting the DFC Support Program. According to ONDCP and SAMHSA officials, SAMHSA did routinely relay reports to ONDCP on grantees’ status. Recommendations for Executive Action To better ensure grantees’ compliance with the Drug-Free Communities Support Program’s statutory requirements and to strengthen monitoring of grantee activities, we recommend that SAMHSA take the following two actions: develop an action plan with time frames for addressing any deficiencies it finds through its reviews and making systemic changes to mitigate deficiencies on a prospective basis to strengthen the grant monitoring process, and develop and implement a method for ensuring that the grantee status reports it provides to ONDCP are complete and accurate. In their comments, both agencies concurred with our recommendations.

Why GAO Did This Study In 2015, approximately 2.2 million adolescents aged 12 to17 were current users of illicit drugs. The Drug-Free Communities Act of 1997 established the DFC Support Program—a federal grant program supporting drug abuse prevention efforts that engage schools, law enforcement, and other sectors of a community. The program targets reductions in the use of alcohol, tobacco, marijuana, and the illicit use of prescription drugs. The Office of National Drug Control Policy Reauthorization Act of 2006 includes a provision that GAO routinely assess ONDCP's programs and operations. This report addresses: (1) the extent to which ONDCP and SAMHSA use leading practices to coordinate program administration and the types of activities funded; and (2) the extent to which ONDCP's and SAMHSA's' operating procedures both ensure DFC grantees comply with governing statutes and provide a basis for performance monitoring. To conduct this work, GAO analyzed agency policies from 2013-2015 (most recent available); interviewed agency officials; and analyzed coordination efforts against relevant key practices GAO identified previously. GAO reviewed files obtained from a non-generalizable random sample of 30 grantees and interviewed a random subset of 10. What GAO Found The Office of National Drug Control Policy (ONDCP) and the U.S. Department of Health and Human Services' Substance Abuse and Mental Health Services Administration (SAMHSA) employ leading collaboration practices to administer the Drug Free Communities (DFC) Support Program and have funded a range of drug prevention activities. Both agencies have improved their collaboration since GAO last reported on the DFC program in 2008. Their current efforts to jointly manage the DFC Support program are consistent with GAO's relevant key collaboration practices. For example, ONDCP and SAMHSA defined and agreed upon common outcomes, such as prioritizing efforts to increase participation from under-represented communities. The two agencies have also funded a range of DFC grantees' activities and report on these activities in their annual evaluation reports. For example, ONDCP reported that from February through July 2014, grantees educated more than 156,000 youth on topics related to the consequences of substance abuse. To illustrate, the 10 grantees GAO interviewed described their specific efforts, including programs for Enhancing Skills: To enhance the skills of those in the community, one grantee sponsored a session for local realtors on precautions to take when preparing for open houses—warning them that leftover prescriptions in medicine cabinets present the potential for abuse among those walking through the home for sale. Enhancing Access/Reducing Barriers: To reduce cultural barriers, another grantee developed signs with text in the multiple languages spoken throughout the community that shopkeepers could display to emphasize the legal purchase age for alcohol. Providing Information: To provide greater information to parents on the consequences of providing alcohol in their homes, a grantee created a slogan to remind parents of their children's needs, “Be my Parent, not my Bartender.” The agencies have operating procedures in place, but could enhance grantee compliance and performance monitoring. In particular, SAMHSA does not consistently follow documentation and reporting procedures to ensure grantees' compliance with governing statutes. SAMHSA also has not been accurately reporting to ONDCP on grantee compliance. Specifically for the files GAO reviewed, SAMHSA followed all processes for ensuring that initial applicants had submitted required documentation before awarding them initial grant funding. However, SAMHSA was less consistent in adhering to procedures for confirming documentation in later years of the program. For example, 14 of the 18 grantees that should have had sustainability plans in their files did not. These plans outline how the grantee intends to maintain necessary resources to achieve long-term goals after exiting the program. Prior to GAO's review, ONDCP and SAMHSA officials were not aware of the missing data in the grant files. Without close adherence to existing procedures, and a mechanism to ensure that the documentation it reports to ONDCP is accurate and complete, SAMHSA's performance monitoring capacity is limited and it cannot be certain that grantees are engaging in intended activities and meeting long-term goals. What GAO Recommends GAO recommends that SAMHSA develop an action plan with time frames to strengthen DFC grant monitoring and ensure it sends complete and accurate information to ONDCP. SAMHSA concurred with these recommendations and identified actions to address them.

gao_GAO-04-820

gao_GAO-04-820_0

In addition, if a drug is susceptible to deterioration and must, for example, be maintained in a temperature-controlled environment, it must be packaged and labeled in accordance with regulations and manufacturer standards. FDA-approved drugs manufactured in foreign countries, including those sold over the Internet, are subject to the same requirements as domestic drugs. Most of the Targeted Prescription Drugs Were Purchased from Multiple Internet Pharmacies Without Providing a Prescription We were able to obtain the majority of prescription drugs we targeted for purchase from a wide variety of domestic and foreign Internet pharmacies without providing a prescription. Five U.S. and all 18 Canadian pharmacies from which we obtained drug samples required a patient-provided prescription, whereas the remaining 24 U.S. and all 21 other foreign pharmacies from which we obtained samples either provided a prescription based on an online medical questionnaire or had no prescription requirement. Although we obtained samples of most of the drugs we targeted for purchase, some drugs, such as those with special safety restrictions and narcotics, were available from fewer sources or were more difficult to obtain. In total, we placed 90 orders—each with a different Internet pharmacy in the United States, Canada, and other foreign countries—and received 68 samples. Drug samples we received from other foreign pharmacies came from Argentina, Costa Rica, Fiji, India, Mexico, Pakistan, Philippines, Spain, Thailand, and Turkey. Despite extensive searching of Internet pharmacy sites, we found few that sold these drugs without a prescription. Most Problems Identified among Drug Samples Received from Other Foreign Internet Pharmacies We identified several problems associated with the handling, FDA-approval status, and authenticity of the 21 drug samples we received from other foreign Internet pharmacies. Manufacturers reported that most of the samples they reviewed at our request from other foreign pharmacies were not approved by FDA for the United States—although most had a comparable chemical composition to the product we ordered—and 4 were either counterfeit products or otherwise not comparable to the product we ordered. All Drug Samples Received from Other Foreign Pharmacies Exhibited Problems Associated with Their Handling None of the 21 prescription drug samples we received from other foreign Internet pharmacies included a dispensing pharmacy label that provided patient instructions for use, and only 6 of the samples came with warning information. 1.) 2.) 3.) Most Drug Samples Received from Other Foreign Pharmacies Were Unapproved, Four Were Not Authentic Among the 21 drug samples from other foreign pharmacies, manufacturers determined that 19 were not approved for the U.S. market for various reasons, including that the labeling or the facilities in which they were manufactured had not been approved by FDA. In all but 4 instances, however, manufacturers determined that the chemical composition of the samples we received from other foreign Internet pharmacies was comparable to the chemical composition of the drugs we had ordered. Two samples of one drug were found by the manufacturer to be counterfeit and contained a different chemical composition than the drug we had ordered. However, the samples were all found to be comparable in chemical composition to the products we ordered. Some Internet Pharmacies Were Not Reliable in Their Business Practices We observed questionable characteristics and business practices of some of the Internet pharmacies from which we received drugs. Finally, the return addresses on samples of Humulin N and Zoloft were found to be private residences in Lahore, Pakistan. About 21 percent of the Internet pharmacies from which we received drugs (14 of 68) were under investigation by regulatory agencies. The reasons for the investigations by DEA and FDA include allegations of selling controlled substances without a prescription; selling adulterated, misbranded, or counterfeit drugs; selling prescription drugs where no doctor-patient relationship exists; smuggling; and mail fraud. One Canadian pharmacy was also included among those under investigation. Concluding Observations Consumers can readily obtain many prescription drugs over the Internet without providing a prescription—particularly from certain U.S. and foreign Internet pharmacies outside of Canada. Agency and External Comments In commenting on a draft of this report, FDA generally agreed with our findings and conclusions and made suggestions to clarify or expand upon its contents (see app. We modified the report to indicate that we determined the location of the Internet pharmacy Web sites from which we received drug samples based on information contained in the pharmacy Web sites and the return addresses and postmarks on the packages we received.

Why GAO Did This Study As the demand for and the cost of prescription drugs rise, many consumers have turned to the Internet to purchase drugs. However, the global nature of the Internet can hinder state and federal efforts to identify and regulate Internet pharmacies to help assure the safety and efficacy of products sold. Recent reports of unapproved and counterfeit drugs sold over the Internet have raised further concerns. GAO was asked to examine (1) the extent to which certain drugs can be purchased over the Internet without a prescription; (2) whether the drugs are handled properly, approved by the Food and Drug Administration (FDA), and authentic; and (3) the extent to which Internet pharmacies are reliable in their business practices. GAO attempted to purchase up to 10 samples of 13 different drugs, each from a different pharmacy Web site, including sites in the United States, Canada, and other foreign countries. GAO determined whether the samples contained a pharmacy label with patient instructions for use and warnings on the labels or the packaging and forwarded the samples to their manufacturers to determine whether they were approved by FDA and authentic. GAO also confirmed the locations of several Internet pharmacies and identified those under investigation by regulatory agencies. What GAO Found GAO obtained most of the prescription drugs it targeted from a variety of Internet pharmacy Web sites without providing a prescription. GAO obtained 68 samples of 11 different drugs--each from a different pharmacy Web site in the United States, Canada, or other foreign countries, including Argentina, Costa Rica, Fiji, India, Mexico, Pakistan, Philippines, Spain, Thailand, and Turkey. Five U.S. and all 18 Canadian pharmacy sites from which GAO received samples required a patient-provided prescription, whereas the remaining 24 U.S. and all 21 foreign pharmacy sites outside of Canada provided a prescription based on their own medical questionnaire or had no prescription requirement. Among the drugs GAO obtained without a prescription were those with special safety restrictions and highly addictive narcotic painkillers. GAO identified several problems associated with the handling, FDA approval status, and authenticity of the 21 samples received from Internet pharmacies located in foreign countries outside of Canada. Fewer problems were identified among pharmacies in Canada and the United States. None of the foreign pharmacies outside of Canada included required dispensing pharmacy labels that provided instructions for use, few included warning information, and 13 displayed other problems associated with the handling of the drugs. For example, 3 samples of a drug that should be shipped in a temperature- controlled environment arrived in envelopes without insulation. Manufacturer testing revealed that most of these drug samples were unapproved for the U.S. market; however, manufacturers found the chemical composition of all but 4 was comparable to the product GAO ordered. Four samples were determined to be counterfeit products or otherwise not comparable to the product GAO ordered. Similar to the samples received from other foreign pharmacies, manufacturers found most of those from Canada to be unapproved for the U.S. market; however, manufacturers determined that the chemical composition of all drug samples obtained from Canada were comparable to the product GAO ordered. Some Internet pharmacies were not reliable in their business practices. Most instances identified involved pharmacies outside of the United States and Canada. GAO did not receive six orders for which it had paid. In addition, GAO found questionable entities located at the return addresses on the packaging of several samples, such as private residences. Finally, 14 of the 68 pharmacy Web sites from which GAO obtained samples were found to be under investigation by regulatory agencies for reasons including selling counterfeit drugs and providing prescription drugs where no valid doctor- patient relationship exists. Nine of these were U.S. sites, 1 a Canadian site, and 4 were other foreign Internet pharmacy sites. In commenting on a draft of this report, FDA generally agreed with its findings and conclusions.

gao_GAO-12-465

gao_GAO-12-465_0

PRA Is Applied to Natural Hazards to a Limited Extent Licensees and NRC apply PRA to natural hazards at operating U.S. nuclear power reactors to a limited extent, according to information provided by nuclear power industry representatives, NRC officials, and several experts in assessing nuclear reactor risks that we interviewed and data we obtained. Prior to its response to the Fukushima Daiichi disaster, the last time NRC requested licensees to assess natural hazards was in 1991 when the agency initiated the IPEEE program. Although PRA was suggested by NRC as one of several possible methods for licensees to use in their examinations, most licensees opted to use methods other than PRA. NRC Has Not Analyzed Whether It Should Require PRAs That Address Natural Hazards While NRC has endorsed PRA as a means to enhance and extend traditional deterministic assessments, the agency has not conducted the analyses to determine whether or not it should require licensees of operating reactors to develop and maintain PRAs that address natural hazards. Experts Offered a Range of Views on NRC Assessment Processes The 15 experts in assessing natural hazards and/or nuclear reactor risks that we interviewed offered a range of views on (1) the adequacy of NRC processes for assessing the threats that natural hazards pose to operating U.S. nuclear power reactors and (2) what, if any, changes to those processes are warranted. Experts Noted Strengths and Limitations of NRC Assessment Processes The 15 experts we interviewed had varied views on the overall adequacy of NRC processes for assessing the threats that natural hazards pose to operating U.S. nuclear power reactors and identified a number of strengths and limitations of those processes. Several experts said they believe NRC processes are generally adequate. More Than Half of Experts Suggested Expanded Use of PRA More than half of the 15 experts we interviewed suggested expanding the use of PRA for assessing natural hazards at operating nuclear power reactors as a complement to traditional deterministic assessments, and several experts cited a number of advantages, as well as challenges to doing so. PRA can help identify design vulnerabilities that might otherwise be overlooked by relying on traditional deterministic assessments alone. NRC and industry officials we interviewed agreed that the A few experts identified other challenges to expanding the use of PRA for natural hazards, including the cost of developing those risk assessments, the regulatory hurdles to NRC requiring licensees of operating reactors to use PRA, and the care that must be taken when deciding which natural hazards to include in a PRA and which to screen out of the analysis. We recognize that NRC must undertake a thorough review to require licensees of operating reactors to develop and maintain PRAs that address natural hazards. While NRC suggested PRA in the 1990s as one potential option for licensees to use to assess natural hazards, most licensees opted not to do so, and agency officials and industry representatives told us they believe that licensees today have only applied PRA to natural hazards to a limited extent. NRC agreed with the report recommendation. Appendix I: Objectives, Scope, and Methodology Our review provides information on: (1) the extent to which probabilistic risk assessment (PRA) is applied to natural hazards at operating U.S. nuclear power reactors and (2) expert views on and suggested changes, if any, to Nuclear Regulatory Commission (NRC) processes for assessing natural hazards at operating U.S. nuclear power reactors. This approach extends the traditional deterministic approach in part by incorporating PRA—a systematic method for assessing what can go wrong, its likelihood, and its potential consequences to determine quantitative estimates of risk.

Why GAO Did This Study On March 11, 2011, an earthquake triggered a tsunami wave that exceeded the seawall at Japan’s Fukushima Daiichi nuclear power plant, leading to the release of radioactive material into the environment. The disaster raised questions about the threats that natural hazards, such as earthquakes and floods, may pose to U.S. commercial nuclear power reactors. NRC licenses and regulates U.S. nuclear power reactors. NRC criteria for licensees to assess natural hazards were developed using an approach that required reactors to be designed according to a set of potential accidents using deterministic analysis. Since the 1990s, NRC has been encouraging the use of PRA as part of a risk-informed, performance-based approach. GAO was asked to (1) determine the extent to which PRA is applied to natural hazards at operating U.S. reactors and (2) describe expert views on and suggested changes, if any, to NRC processes for assessing natural hazards at such reactors. GAO reviewed documents; analyzed responses from 15 experts in assessing nuclear reactor risks and/or natural hazards; visited five selected nuclear power plants; and interviewed NRC officials and industry and public interest group representatives. What GAO Found The Nuclear Regulatory Commission (NRC) and companies licensed to operate nuclear power reactors (or licensees) apply probabilistic risk assessment (PRA) to natural hazards at operating U.S. nuclear reactors to a limited extent. When the 104 operating reactors were originally licensed before 1997, NRC required licensees to assess natural hazards using deterministic analysis, which—informed by historical experience, test results, and expert judgment—considers a specific set of potential accidents and how the consequences of those accidents can be prevented and mitigated. Subsequent to most of these initial licenses being issued, NRC, through policy statements and other documents, has endorsed PRA—a systematic method for assessing what can go wrong, its likelihood, and its consequences, resulting in quantitative estimates of risk—as a means to enhance and extend traditional deterministic analysis. In 1991, NRC requested that licensees voluntarily examine their reactors’ vulnerability to natural hazards and suggested PRA as one of several possible methods for licensees to use in their examinations. However, most licensees opted to use other methods. According to NRC officials and nuclear power industry representatives—and reflected in data GAO obtained from five licensees that together operate 25 reactors—few licensees are likely to have developed or updated since the 1990s PRAs that address natural hazards. NRC would have to conduct an analysis to determine whether or not to require licensees to develop PRAs that address natural hazards. According to agency officials, NRC has not conducted such an analysis. The experts in assessing natural hazards and/or nuclear reactor risks that GAO interviewed offered a range of views on (1) the overall adequacy of NRC processes for assessing the threats that natural hazards pose to operating U.S. nuclear power reactors and (2) what, if any, changes to those processes are warranted. Several experts said they believe NRC processes are generally adequate for assessing the threats that natural hazards pose to operating reactors. However, more than half of the experts GAO interviewed suggested expanding the use of PRA for assessing natural hazards as a complement to traditional deterministic analyses to provide a more robust approach. Those experts cited a number of advantages to doing so, including that PRA can help identify vulnerabilities that might otherwise be overlooked by relying on traditional deterministic analyses alone. Several experts also identified challenges to expanding the use of PRA for assessing natural hazards, including the limited number of experts qualified to develop PRAs and the costs of doing so. What GAO Recommends GAO recommends that NRC analyze whether licensees of operating reactors should be required to develop PRAs that address natural hazards. NRC agreed with the recommendation and stated it will conduct the analysis in the context of ongoing initiatives.

gao_GAO-05-391T

gao_GAO-05-391T_0

Among the key provisions is a performance-oriented and market-based pay system. However, as DHS develops its implementing directives, the experiences of leading organizations suggest that DHS should reconsider its position to merely allow, rather than require, the use of core competencies that employees must demonstrate as a central feature of its performance management system. DHS is to require the use of a least three summary rating levels for other employee groups. A Chief Operating Officer/Chief Management Officer (COO/CMO) or similar position can effectively provide the continuing, focused attention essential to successfully completing these multiyear transformations. Especially for such an endeavor as critical as DHS’s new human capital system, such a position would serve to elevate attention that is essential to overcome an organization’s natural resistance to change, marshal the resources needed to implement change, and build and maintain the organizationwide commitment to new ways of doing business; integrate this new system with various management responsibilities so they are no longer “stovepiped” and fit it into other organizational transformation efforts in a comprehensive, ongoing, and integrated manner; and institutionalize accountability for the system so that the implementation of this critical human capital initiative can be sustained. Involving Employees and Other Stakeholders in Implementing the System We reported in September 2003 that DHS’s and OPM’s effort to design a new human capital system was collaborative and facilitated participation of employees from all levels of the department.We recommended that the Secretary of DHS build on the progress that had been made and ensure that the communication strategy used to support the human capital system maximize opportunities for employee and key stakeholder involvement through the completion of design and implementation of the new system, with special emphasis on seeking the feedback and buy-in of frontline employees. It is equally important for the agency to ensure it has the necessary infrastructure in place to implement the system, not only an effective performance management system, but also the capabilities to effectively use the new human capital authorities and a strategic human capital planning process. “Highlights” from Selected GAO Human Capital Reports At the center of any agency transformation, such as the one envisioned for the Department of Homeland Security (DHS), are the people who will make it happen. Thus, strategic human capital management at DHS can help it marshal, manage, and maintain the people and skills needed to meet its critical mission. DHS and the Office of Personnel Management (OPM) have now jointly released the final regulations on DHS’s new human capital system. GAO believes that the regulations contain many of the basic principles that are consistent with proven approaches to strategic human capital management. Thus, DHS has considerable work ahead to define the details of the implementation of its system and understanding these details is important in assessing the overall system. Last year, with the release of the proposed regulations, GAO observed that many of the basic principles underlying the regulations were consistent with proven approaches to strategic human capital management and deserved serious consideration. However, some parts of the human capital system raised questions for DHS, OPM, and Congress to consider in the areas of pay and performance management, adverse actions and appeals, and labor management relations. GAO also identified multiple implementation challenges for DHS once the final regulations for the new system were issued. A key implementation step for DHS is to assure an effective and on-going two-way communication effort that creates shared expectations among managers, employees, customers, and stakeholders. This testimony provides preliminary observations on selected provisions of the final regulations. While GAO strongly supports human capital reform in the federal government, how it is done, when it is done, and the basis on which it is done can make all the difference in whether such efforts are successful. The final regulations for DHS’s new system are especially critical because of the potential implications for related governmentwide reforms. Congress provided DHS with significant flexibility to design a modern human capital management system. 1.

Why GAO Did This Study People are critical to any agency transformation, such as the one envisioned for the Department of Homeland Security (DHS). They define an agency's culture, develop its knowledge base, and are its most important asset. Thus, strategic human capital management at DHS can help it marshal, manage, and maintain the people and skills needed to meet its critical mission. Congress provided DHS with significant flexibility to design a modern human capital management system. DHS and the Office of Personnel Management (OPM) have now jointly released the final regulations on DHS's new human capital system. Last year, with the release of the proposed regulations, GAO observed that many of the basic principles underlying the regulations were consistent with proven approaches to strategic human capital management and deserved serious consideration. However, some parts of the human capital system raised questions for DHS, OPM, and Congress to consider in the areas of pay and performance management, adverse actions and appeals, and labor management relations. GAO also identified multiple implementation challenges for DHS once the final regulations for the new system were issued. This testimony provides overall observations on DHS's intended human capital system and selected provisions of the final regulations. What GAO Found GAO believes that DHS's regulations contain many of the basic principles that are consistent with proven approaches to strategic human capital management. Positively, the final regulations provide for (1) a flexible, contemporary, performance-oriented, and market-based compensation system, including occupational clusters and pay bands; (2) continued involvement of employees and union officials throughout the implementation process, such as by participating in the development of the implementing directives and holding membership on the Homeland Security Compensation Committee; and (3) evaluations of the implementation of DHS's system. On the other hand, GAO has three areas of concern that deserve attention from DHS senior leadership. First, DHS has considerable work ahead to define the details of the implementation of its system and getting those details right will be critical to the success of the overall system. Second, the performance management system merely allows, rather than requires, the use of core competencies that can help to provide reasonable consistency and clearly communicate to employees what is expected of them. Third, the pass/fail ratings or three summary rating levels for certain employee groups do not provide the meaningful differentiation in performance needed for transparency to employees and for making the most informed pay decisions. Going forward, GAO believes that especially for this multiyear transformation, the Chief Operating Officer/Chief Management Officer concept could help to elevate, integrate, and institutionalize responsibility for the success of DHS's new human capital system and related implementation and transformation efforts. Second, a key implementation step for DHS is to assure an effective and on-going two-way communication effort that creates shared expectations among managers, employees, customers, and stakeholders. Last, DHS must ensure that it has the institutional infrastructure in place to make effective use of its new authorities. At a minimum, this infrastructure includes a human capital planning process that integrates human capital policies, strategies, and programs with its program goals, mission, and desired outcomes; the capabilities to effectively develop and implement a new human capital system; and importantly, the existence of a modern, effective, and credible performance management system that includes adequate safeguards to help assure consistency and prevent abuse. While GAO strongly supports federal human capital reform, how it is done, when it is done, and the basis on which it is done can be the difference between success and failure. Thus, the DHS regulations are especially critical because of their potential implications for related governmentwide reform.

gao_GAO-11-635T

gao_GAO-11-635T_0

A few examples from our March report follow. Teacher quality programs: In fiscal year 2009, the federal government spent over $4 billion specifically to improve the quality of our nation’s 3 million teachers through numerous programs across the government. Federal efforts to improve teacher quality have led to the creation and expansion of a variety of programs across the federal government, however, there is no governmentwide strategy to minimize fragmentation, overlap, or duplication among these many programs. Military health system: The Department of Defense’s (DOD) Military Health System (MHS) costs have more than doubled from $19 billion in fiscal year 2001 to $49 billion in 2010 and are expected to increase to over $62 billion by 2015. The responsibilities and authorities for the MHS are distributed among several organizations within DOD with no central command authority or single entity accountable for minimizing costs and achieving efficiencies. Under the MHS’s current command structure, the Office of the Assistant Secretary of Defense for Health Affairs, the Army, the Navy, and the Air Force each has its own headquarters and associated support functions. Employment and training programs: In fiscal year 2009, 47 federally funded employment and training programs spent about $18 billion to provide services, such as job search and job counseling, to program participants. Most of these programs are administered by the Departments of Labor, Education, and Health and Human Services (HHS). Forty-four of the 47 programs we identified, including those with broader missions such as multipurpose block grants, overlap with at least one other program in that they provide at least one similar service to a similar population. Surface transportation: The Department of Transportation (DOT) currently administers scores of surface transportation programs costing over $58 billion annually. The current federal approach to surface transportation was established in 1956 to build the Interstate Highway System, but has not evolved to reflect current national priorities and concerns. Over the years, in response to changing transportation, environmental, and societal goals, federal surface transportation programs grew in number and complexity to encompass broader goals, more programs, and a variety of program approaches and grant structures. DOD-VA Electronic Health Record Systems: Although they have identified many common health care business needs, DOD and the Department of Veterans Affairs (VA) have spent large sums of money to develop and operate separate electronic health record systems that each department relies on to create and manage patient health information. Expenditures on Information Technology Could Be Reduced by Consolidating Federal Data Centers, Improving Investment Management and Oversight, and Using Enterprise Architectures The federal government’s expenditures on IT could be reduced by, among other things, consolidating federal data centers, improving investment management and oversight, and using enterprise architectures as a tool for organizational transformation. Each year the federal government spends billions of dollars on IT investments; federal spending on IT has risen to an estimated $79 billion for fiscal year 2011. In recent years, as federal agencies modernized their operations, put more of their services online, and increased their information security profiles they have demanded more computing power and data storage resources. Increase the overall IT security posture of the government. Improving Federal Contracting Could Save Billions The federal government spent about $535 billion in fiscal year 2010 acquiring the goods and services agencies need to carry out their missions. Our March report highlighted four areas where improvements could be made to realize significant savings. These are: (1) minimizing unnecessary duplication among interagency contracts, (2) achieving more competition in the award of contracts, (3) using award fees more appropriately to promote improved contractor performance, and (4) leveraging the government’s vast buying power through expanded use of strategic sourcing. As the nation rises to meet the current fiscal challenges, we will continue to assist Congress and federal agencies in identifying actions needed to reduce duplication, overlap, and fragmentation; achieve cost savings; and enhance revenues. As part of current planning for our future annual reports, we are continuing to look at additional federal programs and activities to identify further instances of duplication, overlap, and fragmentation as well as other opportunities to reduce the cost of government operations and increase revenues to the government.

Why GAO Did This Study This testimony discusses our first annual report to Congress responding to the statutory requirement that GAO identify federal programs, agencies, offices, and initiatives--either within departments or governmentwide--that have duplicative goals or activities. This work can help inform government policymakers as they address the rapidly building fiscal pressures facing our national government. Our simulations of the federal government's fiscal outlook show continually increasing levels of debt that are unsustainable over time, absent changes in the federal government's current fiscal policies. Since the end of the recent recession, the gross domestic product has grown slowly, and unemployment has remained at a high level. While the economy is still recovering and in need of careful attention, widespread agreement exists on the need to look not only at the near term but also at steps that begin to change the long-term fiscal path as soon as possible. With the passage of time, the window to address the fiscal challenge narrows and the magnitude of the required changes grows. This testimony is based on our March 2011 report and provides an overview of federal programs or functional areas where unnecessary duplication, overlap, or fragmentation exists and where there are other opportunities for potential cost savings or enhanced revenues. In that report, we identified 81 areas for consideration--34 areas of potential duplication, overlap, or fragmentation and 47 additional areas describing other opportunities for agencies or Congress to consider taking action that could either reduce the cost of government operations or enhance revenue collections for the Treasury. The 81 areas span a range of federal government missions such as agriculture, defense, economic development, energy, general government, health, homeland security, international affairs, and social services. Within and across these missions, the report touches on hundreds of federal programs, affecting virtually all major federal departments and agencies. The testimony highlights (1) some examples from our March report; (2) needed improvements in the federal government's management and investment in information technology (IT); and (3) opportunities for achieving significant cost savings through improvements in government contracting. What GAO Found A few examples of duplication: (1) Teacher quality programs: In fiscal year 2009, the federal government spent over $4 billion specifically to improve the quality of our nation's 3 million teachers through numerous programs across the government. Federal efforts to improve teacher quality have led to the creation and expansion of a variety of programs across the federal government, however, there is no governmentwide strategy to minimize fragmentation, overlap, or duplication among these many programs. (2) Military health system: The Department of Defense's (DOD) Military Health System (MHS) costs have more than doubled from $19 billion in fiscal year 2001 to $49 billion in 2010 and are expected to increase to over $62 billion by 2015. The responsibilities and authorities for the MHS are distributed among several organizations within DOD with no central command authority or single entity accountable for minimizing costs and achieving efficiencies. Under the MHS's current command structure, the Office of the Assistant Secretary of Defense for Health Affairs, the Army, the Navy, and the Air Force each has its own headquarters and associated support functions. (3) Employment and training programs: In fiscal year 2009, 47 federally funded employment and training programs spent about $18 billion to provide services, such as job search and job counseling, to program participants. Most of these programs are administered by the Departments of Labor, Education, and Health and Human Services (HHS). Forty-four of the 47 programs we identified, including those with broader missions such as multipurpose block grants, overlap with at least one other program in that they provide at least one similar service to a similar population. (4) Surface transportation: The Department of Transportation (DOT) currently administers scores of surface transportation programs costing over $58 billion annually. The current federal approach to surface transportation was established in 1956 to build the Interstate Highway System, but has not evolved to reflect current national priorities and concerns. Over the years, in response to changing transportation, environmental, and societal goals, federal surface transportation programs grew in number and complexity to encompass broader goals, more programs, and a variety of program approaches and grant structures. (5) DOD-VA Electronic Health Record Systems: Although they have identified many common health care business needs, DOD and the Department of Veterans Affairs (VA) have spent large sums of money to develop and operate separate electronic health record systems that each department relies on to create and manage patient health information. The federal government's expenditures on IT could be reduced by, among other things, consolidating federal data centers, improving investment management and oversight, and using enterprise architectures as a tool for organizational transformation. Each year the federal government spends billions of dollars on IT investments; federal spending on IT has risen to an estimated $79 billion for fiscal year 2011. In recent years, as federal agencies modernized their operations, put more of their services online, and increased their information security profiles they have demanded more computing power and data storage resources. The federal government spent about $535 billion in fiscal year 2010 acquiring the goods and services agencies need to carry out their missions. Areas where improvements could be made to realize significant savings: (1) minimizing unnecessary duplication among interagency contracts, (2) achieving more competition in the award of contracts, (3) using award fees more appropriately to promote improved contractor performance, and (4) leveraging the government's vast buying power through expanded use of strategic sourcing.

gao_GAO-04-710T

gao_GAO-04-710T_0

Further, to increase information sharing and coordination of terrorist financing investigations, the Agreement required the FBI and ICE to (1) detail appropriate personnel to each other’s agency and (2) develop specific collaborative procedures to determine whether applicable ICE investigations or financial crimes leads may be related to terrorism or terrorist financing. Opportunities Exist to Improve the National Money Laundering Strategy In September 2003, we reported that, as a mechanism for guiding the coordination of federal law enforcement agencies’ efforts to combat money laundering and related financial crimes, the NMLS has had mixed results but generally has not been as useful as envisioned by the Strategy Act. For example, we reported that HIFCA task forces were expected to have a central role in coordinating law enforcement agencies’ efforts to combat money laundering but generally had not yet been structured and operating as intended and had not reached their expectations for leveraging investigative resources or creating investigative synergies. We further reported that, while Treasury and Justice had made progress on some NMLS initiatives designed to enhance interagency coordination of money laundering investigations, most had not achieved the expectations called for in the annual strategies, including plans to (1) use a centralized system to coordinate investigations and (2) develop uniform guidelines for undercover investigations. Our September 2003 report recommended that—if the Congress reauthorizes the requirement for an annual NMLS—the Secretary of the Treasury, working with the Attorney General and the Secretary of Homeland Security, should take appropriate steps to strengthen the leadership structure responsible for strategy development and implementation by establishing a mechanism that would have the ability to marshal resources to ensure that the strategy’s vision is achieved, resolve disputes between agencies, and ensure accountability for strategy implementation; link the strategy to periodic assessments of threats and risks, which would provide a basis for ensuring that clear priorities are established and focused on the areas of greatest need; and establish accountability mechanisms, such as (1) requiring the principal agencies to develop outcome oriented performance measures that must be linked to the NMLS’s goals and objectives and that also must be reflected in the agencies’ annual performance plans and (2) providing the Congress with periodic reports on the strategy’s results. Most Key Memorandum of Agreement Provisions Have Been Implemented, but Terrorist Financing Investigations Still Present Operational and Organizational Challenges As mentioned previously, the NMLS was adjusted in 2002 to reflect new federal priorities in the aftermath of the September 11 attacks, including a goal to combat terrorist financing. However, due to difficulties in reaching agreement over which agency should lead investigations, the 2002 NMLS did not address agency and task force roles and interagency coordination procedures for investigating terrorist financing. Law enforcement officials told us that the lack of clearly defined roles and coordination procedures contributed to duplication of efforts and disagreements over which agency should lead investigations. Also, the FBI and ICE have developed collaborative procedures to determine whether appropriate ICE money laundering investigations or financial crime leads may be related to terrorism or terrorist financing. Another provision in the May 2003 Memorandum of Agreement required that the FBI and ICE jointly report to the Attorney General, the Secretary of Homeland Security, and the Assistant to the President for Homeland Security on the implementation status of the Agreement 4 months from its effective date. As of May 2, 2004, the FBI and ICE had not yet produced the required joint report on the implementation status. Also, most of the NMLS initiatives designed to enhance interagency coordination of money laundering investigations have not yet achieved their expectations.

Why GAO Did This Study Money laundering provides the fuel for terrorists, drug dealers, arms traffickers, and other criminals to operate and expand their activities. GAO focused on two issues. The first is whether the nation's annual National Money Laundering Strategy has served as a useful mechanism for guiding federal law enforcement efforts to combat money laundering and terrorist financing. Unless reauthorized by the Congress, the annual requirement ended with the 2003 strategy. The second issue is the implementation status of a May 2003 Memorandum of Agreement, signed by the Attorney General and the Secretary of Homeland Security, that was designed to enhance the coordination of terrorist financing investigations conducted by the Federal Bureau of Investigation (FBI) and the U.S. Immigration and Customs Enforcement (ICE). What GAO Found GAO's September 2003 report noted that the annual strategy generally has not served as a useful mechanism for guiding the coordination of federal law enforcement agencies' efforts to combat money laundering and terrorist financing. For example, although expected to have a central role in coordinating law enforcement efforts, interagency task forces created specifically to address money laundering and related financial crimes generally had not yet been structured and operating as intended and had not reached their expectations for leveraging investigative resources or creating investigative synergies. Also, while the Departments of the Treasury and Justice had made progress on some strategy initiatives designed to enhance interagency coordination of money laundering investigations, most initiatives had not met expectations. Moreover, even though adjusted in 2002 to reflect a new federal priority--combating terrorist financing--the strategy did not address agency and task force roles and interagency coordination procedures for investigating terrorist financing, which contributed to duplication of efforts and disagreements over which agency should lead investigations. GAO's February 2004 report noted that the FBI and ICE had implemented or taken concrete steps to implement most of the key provisions in the May 2003 Memorandum of Agreement on terrorist financing investigations. For instance, the agencies had developed collaborative procedures to determine whether applicable ICE investigations or financial crimes leads may be related to terrorism or terrorist financing--and, if so, determine whether these investigations or leads should thereafter be pursued under the auspices of the FBI. However, as of May 2, 2004, the FBI and ICE had not yet issued a joint report on the implementation status of the Agreement, which was required 4 months from its effective date. Also, GAO noted that the FBI and ICE have confronted and will continue to confront a number of operational and organizational challenges, such as ensuring that the financial crimes expertise and other investigative competencies of both agencies are appropriately and effectively utilized.

gao_GAO-15-405

gao_GAO-15-405_0

1.) CMHS’s Criteria for Awarding Grants to Grantees Varied by Program, but CMHS Did Not Document Its Application of Criteria for About a Third of the Grantees We Reviewed The criteria CMHS established for awarding grants to grantees for the MHBG, PAIMI, and selected discretionary grant programs varied by program. For example, one of the five programs that awarded grants to grantees we reviewed—Project LAUNCH—required its grantees to state that they will use evidence-based practices to treat individuals with mental illness in their applications when such practices are available, while the others did not. CMHS Did Not Document Its Application of Criteria for About a Third of the Grantees We Reviewed and CMHS Lacked Program-Specific Guidance for How to Document This Information During the 2-year period covered by our review, CMHS did not document its application of the criteria it used to award grants to 6 of the 16 grantees we reviewed. For fiscal year 2012, CMHS officials did not clearly document the application of most criteria for any of the four MHBG grantees we reviewed; however, officials did document how they applied most of the criteria for fiscal year 2013. We found that there were a variety of reasons why CMHS did not adequately document the application of criteria when awarding grants to grantees. CMHS Stated That It Uses Various Types of Information for Oversight, but the Documentation of This Information Was Often Missing or Not Readily Available CMHS officials said they use various types of information to oversee grantees awarded grants through the MHBG, PAIMI, and selected discretionary grant programs. Documentation of Some Information CMHS Officials Said They Used to Oversee Grantees Was Either Missing or Not Readily Available for Each of the Grantees We Reviewed and CMHS Lacked Program-Specific Guidance For each of the 16 grantees we reviewed, we found at least one instance during the period covered by our review in which the documentation CMHS officials said they used to oversee grantees was missing or not readily available—meaning it was either missing entirely, stored outside of the systems CMHS designated for storing the information, or was not readily available to all officials involved in the oversight of grant documentation. The grants manual states that CMHS must create and maintain files that allow a third party, such as an auditor, to “follow the paper trail” beginning with program initiation through closeout of individual awards, including decisions made and actions taken in between. CMHS officials said that they follow the grants manual. CMHS could not produce documentation of its review of the required annual program performance reports covering fiscal year 2012 data for any of the four PAIMI grantees we reviewed. Without proper documentation of information used to oversee grantees that is readily available, CMHS runs the risk that it does not have complete and accurate information needed to provide sufficient oversight of its grant programs. CMHS Takes A Variety of Steps When Reviewing Performance Measure Data to Demonstrate How Its Grant Programs Further the Achievement of SAMHSA’s Goals CMHS officials told us that they take a variety of steps when reviewing grantees’ performance measure data to demonstrate how CMHS’s grant programs furthered the achievement of SAMHSA’s goals, which are identified through the strategic initiatives contained within SAMHSA’s strategic plan. Specifically, CMHS produces summaries by grant program that are included as part of its budget justification. Second, some grant programs produced additional reports that demonstrated how these grant programs furthered the achievement of SAMHSA’s goals. According to SAMHSA, analyzing performance measure data across SAMHSA’s centers can assist the agency in evaluating the overall effectiveness of its grant programs and in ensuring that each program furthers the achievement of SAMHSA’s goals. Conclusions CMHS’s grant programs support services for individuals with mental illness, which is widespread in the United States. Recommendation for Executive Action To assure the consistent documentation of the application of criteria to award grants to grantees and of the information used for oversight, the Administrator of SAMHSA should direct CMHS to take steps, such as developing additional program-specific guidance, to ensure that it consistently and completely documents both the application of criteria when awarding grants to grantees, and its ongoing oversight of grantees once grants are awarded.

Why GAO Did This Study In 2013, SAMHSA estimated 43.8 million—or 18.5 percent—of adults in the United States suffered from a mental illness. SAMHSA, an agency within HHS, has various programs that aim to reduce the impact of mental illness through CMHS grants awarded to grantees that include states, territories, and nonprofit organizations. GAO was asked to provide information on CMHS's oversight of mental health grant programs. This report identifies (1) CMHS's criteria for awarding grants to grantees, and how CMHS documents the application of these criteria; (2) the types of information CMHS uses to oversee its grantees; and (3) the steps CMHS takes to demonstrate how its grant programs further the achievement of SAMHSA's goals. GAO reviewed information related to CMHS grants management; reviewed grant documentation from fiscal years 2012 and 2013 for a nongeneralizable selection of 16 grantees within 5 grant programs: the MHBG, PAIMI, and 3 selected discretionary grant programs that GAO selected based on factors such as size of award and type of grantee; and interviewed SAMHSA officials. What GAO Found The Substance Abuse and Mental Health Services Administration's (SAMHSA) Center for Mental Health Services (CMHS) established criteria for the five grant programs covered by GAO's review that varied by program, but GAO found that CMHS did not document its application of criteria for about a third of the 16 grantees GAO reviewed. An example of how criteria varied by program is that one of the five grant programs required its grantees to state that they will use evidence-based practices to treat individuals with mental illness while the others did not. In addition, CMHS did not document its application of the criteria it used to award grants to 6 of the 16 grantees GAO reviewed. For example, for fiscal year 2012, CMHS did not clearly document the application of most criteria for any of the four Community Mental Health Services Block Grant (MHBG) grantees GAO reviewed. The Department of Health and Human Services' (HHS) grants manual, which CMHS officials told GAO they follow, states that CMHS must maintain appropriate documentation to support funding decisions. GAO found a variety of reasons why CMHS did not adequately document the application of criteria, including a lack of program-specific guidance. CMHS officials said they use various types of information to oversee grantees, but the documentation of this information was often missing or not readily available during the period GAO reviewed. For each grantee GAO reviewed, there was at least one instance in which the documentation used to oversee grantees was either missing or not readily available—meaning it was either missing entirely, stored outside of the systems designated for storing the information, or was not readily available to all officials involved in the oversight of grant documentation. For example, GAO found that CMHS could not produce documentation of its review of required annual program performance reports covering fiscal year 2012 data for any of the four Protection and Advocacy for Individuals with Mental Illness (PAIMI) grantees GAO reviewed. The grants manual states that CMHS must create and maintain files that allow a third party, such as an auditor, to “follow the paper trail” from program initiation through closeout of individual awards. GAO found a variety of reasons why grant documentation was missing or not readily available, including a lack of program-specific guidance. Without proper documentation of information used to oversee grantees that is readily available, CMHS runs the risk that it does not have complete and accurate information needed to provide sufficient oversight of its grant programs. CMHS officials told GAO that they take a variety of steps when reviewing grantees' performance measure data to demonstrate how CMHS's grant programs furthered the achievement of SAMHSA's goals. For example, CMHS produces summaries by grant program that are included as part of its budget justification. In addition, CMHS is working to ensure that the performance measure data it collects can be analyzed with performance measure data collected from other grantees awarded through programs across SAMHSA. According to SAMHSA, this analysis can be helpful when demonstrating how CMHS's grant programs further the achievement of SAMHSA's goals. What GAO Recommends GAO recommends that the Administrator of SAMHSA direct CMHS to take steps, such as developing additional program-specific guidance, to ensure that it consistently and completely documents both the application of criteria when awarding grants to grantees, and its ongoing oversight of grantees once grants are awarded. HHS concurred with this recommendation.

gao_RCED-95-32

gao_RCED-95-32_0

Federal Regulation Three federal agencies play a role in ensuring the safety of cellular telephones by sharing responsibility for regulating devices that emit radio-frequency radiation and protecting the public from exposure to radiation: the Food and Drug Administration (FDA), the Environmental Protection Agency (EPA), and the Federal Communications Commission (FCC). Objectives, Scope, and Methodology The Chairman of the Subcommittee on Telecommunications and Finance, House Committee on Energy and Commerce, requested that we review (1) the status of scientific knowledge on the potential health risks of radio-frequency radiation emitted by portable cellular telephones and federal involvement in any related research and (2) the actions of the responsible federal agencies to ensure the safety of portable cellular telephones and similar communications devices. Existing Data on Exposure to Low-Level Radio-Frequency Radiation Are Inconclusive To date, neither the federal government nor the telecommunications industry has completed any studies to determine specifically if the use of portable cellular telephones poses health risks. However, this study did not attempt to assess whether exposure to these electric field emissions could present risks to human health. FDA and National Science Foundation officials said that both epidemiological and laboratory research are needed to determine whether portable cellular telephones present risks to users. Motorola is funding a series of laboratory studies on the effects of radiation from portable cellular telephones on animals and cells but no epidemiological studies observing the effects on humans. FDA is working with cellular telephone manufacturers on possible design changes for these telephones and improved instructions for use. In 1993, FCC proposed adopting the revised version of the ANSI standard to update its environmental rules.

Why GAO Did This Study Pursuant to a congressional request, GAO reviewed the biological effects of radio-frequency radiation emitted by portable cellular telephones and the federal government's regulatory actions to ensure the safety of these telephones. What GAO Found GAO found that: (1) no research has been completed on long-term human exposure to low levels of radiation from portable cellular telephones, and research findings on exposure to other sources of low-level radio-frequency radiation are inconclusive; (2) existing research does not provide enough evidence to determine whether portable cellular telephones pose a risk to human health; (3) although the cellular telecommunications industry is planning to carry out both epidemiological and laboratory studies on the effects of portable cellular telephone use on human health, federal regulators need to ensure that these studies are carried out objectively; (4) the Food and Drug Administration (FDA) is working with cellular telephone manufacturers to minimize cellular telephone users' exposure to radiation; (5) the Environmental Protection Agency (EPA) is assessing the status of scientific knowledge on prolonged exposure to radio-frequency radiation; and (6) the Federal Communications Commission (FCC) has relied on a 1982 American National Standards Institute (ANSI) safety standard to regulate cellular telephones, but is considering adopting the revised version of the ANSI standard for equipment it approves for use.

gao_GGD-98-31

gao_GGD-98-31_0

In its recent draft report to Congress on the costs and benefits of federal regulations, OMB said that one of these changes was “to increase the openness and accountability of the review process.”Specifically, section 6 of Executive Order 12866 requires OIRA to “make available to the public all documents exchanged between OIRA and the agency during the review by OIRA under this section.” Section 6 of the order also requires agencies to (1) “dentify for the public, in a complete, clear, and simple manner, the substantive changes between the draft submitted to OIRA for review and the action subsequently announced” and (2) “dentify for the public those changes in the regulatory action that were made at the suggestion or recommendation of OIRA.” The order does not require agencies to document when no changes are made during OIRA’s review or at the suggestion or recommendation of OIRA. Our third objective was to determine whether OIRA had made available to the public all documents exchanged between OIRA and the agency during the review process. To describe differences in the extent of documentation available to the public in the agencies’ files, we coded each regulatory action into one of the following three categories: (1) complete documentation, which could be a “redline/strikeout” version of the rule showing all changes made during the review, a memorandum to the file listing all of the changes, or a memorandum indicating that there were no such changes; (2) some documentation, which means we found indications of changes that had been made during OIRA’s review (e.g., memorandums or redline/strikeout versions), but the files did not indicate whether all such changes had been documented; and (3) no documentation, which means that there were no changes made during the review or that changes were made, but were not documented. We followed the same general procedure to describe the extent to which the agencies had documented for the public the changes made to the regulatory actions at the suggestion or recommendation of OIRA. Agencies Often Did Not Document Whether Changes Were Made to Rules While at OIRA Executive Order 12866 directs agencies to “identify for the public, in a complete, clear, and simple manner, the substantive changes between the draft submitted to OIRA for review and the action subsequently announced.” The 4 agencies had complete documentation of the changes for about 26 percent of the 122 regulatory actions that we reviewed. The remaining 44 percent of the actions had no documentation available to the public indicating whether changes were made to the draft rule submitted to OIRA. The remaining agencies (HUD and OSHA) had no documentation for about one-third of their regulatory actions. Another 17 percent of the actions had some documentation of changes that had been made to the rules, but the files did not indicate whether all such changes had been made at OIRA’s suggestion or whether all OIRA-suggested changes had been documented. Other documents indicated that OIRA had suggested certain changes to the rule, but it was unclear whether those changes had been made. OSHA officials said that they would make the documentation available to the public upon request. Because we could not be sure that we had identified all of the documents that had been exchanged between the agencies and OIRA during the regulatory review process, we could not conclusively determine the extent to which OIRA had made such documents available to the public. It was unclear whether this absence of documentation meant that no changes had been made to the rules or that the changes were made, but they had not been documented. On the other hand, about 26 percent of the 122 regulatory actions that we reviewed in the 4 agencies had complete documentation available to the public of the changes made to rules while at OIRA, and about 24 percent had documentation of changes made at OIRA’s suggestion.

Why GAO Did This Study Pursuant to a congressional request, GAO reviewed the regulatory review process, focusing on the Office of Information and Regulatory Affairs (OIRA) and four regulatory agencies, the Department of Housing and Urban Development (HUD) and Department of Transportation (DOT), the Department of Labor's Occupational Safety and Health Administration (OSHA), and the Environmental Protection Agency (EPA), and on whether: (1) the regulatory agencies had identified for the public the substantive changes made to their regulations between the draft they submitted to OIRA and the regulatory actions they subsequently announced; (2) the regulatory agencies identified for the public the changes made to their regulations at the suggestion or recommendation of OIRA; and (3) OIRA had made available to the public all documents exchanged between OIRA and the selected agencies during OIRA's review. What GAO Found GAO noted that: (1) EPA, DOT, HUD, and OSHA had complete documentation available to the public of all of the substantive changes made to their rules between the draft submitted to OIRA and the actions subsequently announced for about 26 percent of the 122 regulatory actions that GAO reviewed; (2) for about 30 percent of the regulatory actions, the agencies had some documentation available to the public indicating that changes had been made to the rules while at OIRA, but the information did not indicate whether all such changes had been documented; (3) for the remaining 44 percent of the regulatory actions, the agencies had no documentation available to the public of changes made during OIRA's review; (4) because Executive Order 12866 does not specifically require agencies to document that no changes were made to rules while they were under review at OIRA, the absence of documentation does not necessarily mean that the agencies were not complying with the order; (5) however, it was unclear whether the absence of documentation meant that no changes had been made to the rules or whether changes had been made but they had not been recorded; (6) the agencies had complete documentation available to the public of all of the changes that OIRA had suggested or recommended for about 24 percent of the 122 regulatory actions; (7) for about 17 percent of the regulatory actions, the agencies had some documentation available to the public indicating that OIRA had suggested changes to the rules, but the information did not indicate whether all such changes had been documented; (8) for the remaining 59 percent of the actions, the agencies had no documentation available to the public indicating whether changes had been made at the suggestion or recommendation of OIRA; (9) for some of these actions, the agencies had documentation available indicating that changes had been made to the rules during the rulemaking process, but it was unclear whether any of the changes were at OIRA's suggestion; (10) even those rules for which the agencies had complete documentation of all changes made while they were at OIRA and at the suggestion of OIRA, the documents were not always available to the public or easy to locate; and (11) GAO could not identify all of the documents that had been exchanged between the agencies and OIRA during the regulatory review process, so it could not be determined whether OIRA had made all such documents available to the public.

gao_GAO-10-423

gao_GAO-10-423_0

Copyright. Trademark. Patent. Counterfeiting and Piracy Have a Wide Range of Effects on U.S. Consumers, Industry, Government, and the Economy According to experts we spoke with and literature we reviewed, counterfeiting and piracy have produced a wide range of effects on consumers, industry, government, and the economy as a whole, depending on the type of infringements involved and other factors. These sources further noted that the economic effects vary widely among industries and among companies within an industry. U.S. Government Loses Tax Revenue, Incurs Enforcement Expenses, and Faces Risks to Supply Chains Many of the experts we interviewed identified lost tax revenue as an effect of counterfeiting and piracy on governments. The U.S. government also incurs costs due to IP protection and enforcement efforts. Seized goods have to be secured, as they have potential value but cannot be allowed to enter U.S. commerce. Some consumers may knowingly purchase a counterfeit or pirated product because it is less expensive than the genuine good or because the genuine good is unavailable, and they may experience positive effects from such purchases. Lack of Data Hinders Efforts to Quantify Impacts of Counterfeiting and Piracy According to experts we spoke with and literature we reviewed, estimating the economic impact of IP infringements is extremely difficult, and assumptions must be used due to the absence of data. Assumptions, such as the rate at which consumers would substitute counterfeit goods for legitimate products, can have enormous impacts on the resulting estimates and heighten the importance of transparency. Because of the significant differences in types of counterfeit and pirated goods and industries involved, no single method can be used to develop estimates, and each method has limitations. Nonetheless, research in specific industries suggest that the problem is sizeable. Three Widely Cited Estimates Sourced to U.S. Economy-Wide Impact of Counterfeiting and Piracy Is Unknown While experts and literature we reviewed provided different examples of effects on the U.S. economy, most observed that despite significant efforts, it is difficult, if not impossible, to quantify the net effect of counterfeiting and piracy on the economy as a whole. Appendix I: Objectives, Scope, and Methodology The Prioritizing Resources and Organization for Intellectual Property Act of 2008 (PRO-IP Act) directed GAO to conduct a study on the quantification of the impacts of imported and domestic counterfeits on the stry and the overall economy of the United States. Based on discussions with staff from the House and Senate Judiciary Committees, we agreed that we would (1) examine existing research on the effects of counterfeiting and piracy on consumers, industries, government, and the U.S. economy; and (2) identify insights gained from efforts to quantify the effects of counterfeiting and piracy on the U.S. economy. To address both of these objectives, we interviewed officials and representatives from industry associations, nongovernmental organizations, academic institutions, and U.S. government agencies and the multilateral Organization for Economic Cooperation and Development (OECD). We also reviewed documents and studies quantifying or discussing the impacts of counterfeiting and piracy on the U.S. economy, industry, government, and consumers. No.

Why GAO Did This Study In October 2008, Congress passed the Prioritizing Resources and Organization for Intellectual Property Act of 2008 (PRO-IP Act), to improve the effectiveness of U.S. government efforts to protect intellectual property (IP) rights such as copyrights, patents, and trademarks. The act also directed GAO to provide information on the quantification of the impacts of counterfeit and pirated goods. GAO (1) examined existing research on the effects of counterfeiting and piracy on consumers, industries, government, and the U.S. economy; and (2) identified insights gained from efforts to quantify the effects of counterfeiting and piracy on the U.S. economy. GAO interviewed officials and subject matter experts from U.S. government agencies, industry associations, nongovernmental organizations, and academic institutions, and reviewed literature and studies quantifying or discussing the economic impacts of counterfeiting and piracy on the U.S. economy, industry, government, and consumers. GAO is making no recommendations in this report. What GAO Found According to experts and literature GAO reviewed, counterfeiting and piracy have produced a wide range of effects on consumers, industry, government, and the economy as a whole, depending on the type of infringements involved and other factors. Consumers are particularly likely to experience negative effects when they purchase counterfeit products they believe are genuine, such as pharmaceuticals. Negative effects on U.S. industry may include lost sales, lost brand value, and reduced incentives to innovate; however, industry effects vary widely among sectors and companies. The U.S. government may lose tax revenue, incur IP enforcement expenses, and face risks of counterfeits entering supply chains with national security or civilian safety implications. The U.S. economy as a whole may grow more slowly because of reduced innovation and loss of trade revenue. Some experts and literature also identified some potential positive effects of counterfeiting and piracy. Some consumers may knowingly purchase counterfeits that are less expensive than the genuine goods and experience positive effects (consumer surplus), although the longer-term impact is unclear due to reduced incentives for research and development, among other factors. Three widely cited U.S. government estimates of economic losses resulting from counterfeiting cannot be substantiated due to the absence of underlying studies. Generally, the illicit nature of counterfeiting and piracy makes estimating the economic impact of IP infringements extremely difficult, so assumptions must be used to offset the lack of data. Efforts to estimate losses involve assumptions such as the rate at which consumers would substitute counterfeit for legitimate products, which can have enormous impacts on the resulting estimates. Because of the significant differences in types of counterfeited and pirated goods and industries involved, no single method can be used to develop estimates. Each method has limitations, and most experts observed that it is difficult, if not impossible, to quantify the economy-wide impacts. Nonetheless, research in specific industries suggest that the problem is sizeable, which is of particular concern as many U.S. industries are leaders in the creation of intellectual property.

gao_GAO-07-112

gao_GAO-07-112_0

In fiscal year 2005, CDP cases accounted for more than one-quarter of Appeals’ annual caseload. CDP Appeals Identified Few Errors by Collection, but Some Taxpayers Received a Different Outcome Our case file review indicates that during the CDP review process Appeals found evidence that Collection had not followed proper procedures in an estimated 2 percent of the cases closed in fiscal year 2004. Finally, in about 60 percent of cases, Appeals upheld the lien filing or levy for a variety of reasons, including because taxpayers did not file required returns, had not paid their taxes for certain periods, or both. Of approximately 27 percent of CDP cases that resulted in a different outcome after taxpayers appealed, Appeals negotiated a collection alternative with taxpayers in about 16 percent of the cases. The Majority of Taxpayers Raised the Same Arguments with Both Collection and Appeals, Received the Same Determination, and Had Multiple Contacts with IRS During fiscal year 2004, most taxpayers raised arguments permitted by statute to Appeals, while we estimated that 5 percent of taxpayers raised arguments considered frivolous under IRS guidance with either Collection or Appeals. As shown in table 3, in general the median number of IRS-initiated contacts with taxpayers—letters, telephone conversations, and formal meetings—was twice as high as the median number of taxpayer-initiated contacts with IRS. The highest median tax liability was associated with trust fund recovery penalty cases, followed by employment tax liabilities, as shown in table 6. IRS has taken some steps that may improve CDP program operations. However, IRS has not established responsibility for analyzing future program outcome data to determine if these changes will be effective. Specifically, we recommend that the Commissioner determine—for taxpayers seeking only a collection alternative—a reasonable amount of additional time beyond the current 30-day period for requesting a CDP hearing for these taxpayers to submit the required supporting financial information necessary for Appeals to consider the alternative of choice, and if seeking an OIC, to submit the OIC application form; instruct Appeals to transfer CDP cases where taxpayers seek an OIC as a collection alternative and raise no liability issues to IRS’s specialized processing units for investigation and evaluation of OICs before consideration by Appeals; and establish responsibility for analyzing future CDP appeal case outcome data in order to determine whether revisions to the hearing request form and program regulations will result in meeting their objectives. Appendix I: Objectives, Scope, and Methodology Our objectives were to provide information on (1) the extent to which the Internal Revenue Service’s (IRS) Office of Appeals (Appeals) found the IRS Collection function (Collection) had made errors in processing liens and levies and how often Collection Due Process (CDP) case results changed after a taxpayer requested a CDP appeal hearing; (2) the nature of the arguments presented by taxpayers seeking relief from a lien filing or levy and the amount of communication between IRS and taxpayers; (3) the characteristics of the taxpayers that availed themselves of the CDP appeal process, such as the amount of their total liability; and (4) whether opportunities exist to improve the operations of the CDP program while protecting taxpayer rights.

Why GAO Did This Study As a result of the Internal Revenue Service (IRS) Restructuring and Reform Act of 1998, taxpayers facing liens or levies can request a Collection Due Process (CDP) appeal hearing with IRS's Office of Appeals (Appeals). By 2005, CDP cases represented about one-quarter of Appeals' workload. GAO was asked to provide information on (1) whether the IRS Collection function (Collection) erred in processing liens and levies and how often CDP case results changed after the appeal, (2) the arguments raised and the communication between IRS and taxpayers, (3) the characteristics of CDP taxpayers, and (4) potential improvements to the CDP program. To develop this information, GAO analyzed a random sample of 208 CDP cases closed by Appeals during fiscal year 2004. What GAO Found GAO estimates that Appeals found Collection did not follow proper procedures in 2 percent of CDP cases closed during fiscal year 2004. About 27 percent of taxpayers received a different outcome than the lien filing or levy after appealing, including those that negotiated collection alternatives or ended up with no balance due to IRS. For about 60 percent of taxpayers, Appeals upheld the collection action often because taxpayers did not file all the required tax returns necessary to qualify for a collection alternative. GAO's estimates show that nearly 90 percent of CDP taxpayers raised arguments permitted by statute with both Collection and Appeals, such as requesting a collection alternative. An estimated 5 percent of taxpayers raised frivolous arguments--arguments without legal basis per IRS guidance--with either Collection or Appeals. When taxpayers raised the same argument with Collection and Appeals, Appeals reached the same conclusion as Collection in more than 80 percent of cases. In general, the median number of IRS-initiated contacts with taxpayers was twice as high as the median number of taxpayer-initiated contacts with IRS. CDP taxpayer characteristics varied among individual and business filers. Both did not pay taxes for multiple return filing periods. Total tax liability varied considerably, with trust fund recovery penalty and employment tax cases having the highest liabilities. Allowing certain taxpayers like those that offer arguments without a legal basis to use the CDP program may not be consistent with the program's goal of ensuring due process. Also, Appeals resources are not used efficiently when taxpayers request collection alternatives yet have not (1) submitted financial documentation with their CDP requests, (2) worked with specialized Collection units, or (3) filed all required tax returns needed to qualify for a collection alternative. IRS has taken steps to revise the CDP regulations and hearing request form, but has not established responsibility for analyzing program outcome data to determine if these changes will be effective.

gao_GAO-04-803

gao_GAO-04-803_0

Throughout the nation’s history, the post office has been a key component in the provision of postal services. Differences Exist in How USPS Provides Delivery and Retail Services Providing mail delivery and access to retail postal services is central to USPS’s mission and role. Differences exist, however, in how USPS provides these services, particularly in where, when, and how customers receive the mail and have access to the postal network. These differences have always existed and have evolved with changes in technology, transportation, and communications. Delivery and retail decisions are made primarily by local staff (i.e., district employees and local postmasters), with overarching guidance provided by national USPS policies and procedures. These differences (1) exist in terms of what types of retail options customers have access to and where these retail options are located and (2) are based on cost and customer service determinations made by local USPS officials. USPS has taken actions, and is planning future actions, to deal with these challenges and improve the efficiency and effectiveness of its delivery and retail networks. (2) Move stamp-only transactions away from the post office window. It is unclear how post offices in rural areas may be affected by this initiative, because, as USPS stated in its Infrastructure and Workforce Rationalization Plan to Congress, “the savings from closing small post offices are minimal, since the potential savings in personnel and office rent are often more than offset by the additional cost of rural delivery service needed in lieu of post office box delivery.” Another approach, recommended by the President’s Commission, would be for USPS to optimize its retail network by assessing its “low-activity” post offices to determine if they are needed to ensure the fulfillment of universal service. Customer Satisfaction and Issues Data reflect that customers are generally satisfied with the services provided by USPS. Although it is reported that overall customer satisfaction is high, when customers do raise concerns, many relate to inconsistencies in delivery services and changes in access to retail services. On the retail side, the issues raised most frequently were concerns about potential post office closings or relocations. In regards to its delivery network, USPS appropriations acts have included provisions on 6-day-a-week delivery and rural mail service, and there is strong stakeholder opposition to cuts in the frequency or quality of postal services. We previously discussed these principles, and they included targeting underserved areas, particularly in high-growth areas, and replacing redundant, low-value access points with alternative access methods. Conclusions USPS’s retail optimization strategy could be an opportunity for a “win-win” outcome for both USPS and its customers, including those in rural areas, in that USPS could reduce its costs while at the same time improving access for its customers. Improved transparency and accountability mechanisms are also needed to raise stakeholder confidence that decisions will be made in a fair, rational, and fact-based manner. Recommendation for Executive Action To facilitate USPS’s progress in implementing its planned actions aimed at improving efficiency in its postal network while increasing customer service, we recommend that the Postmaster General provide improved transparency and communication to inform Congress and other stakeholders of the actions it plans to take regarding its retail optimization strategy, including (1) the criteria USPS will use to make decisions related to changing its retail network; (2) the process it will use to communicate with postal stakeholders throughout the decision-making process; (3) the impact on customers, including those in rural areas; and (4) the time frames for implementing all phases of its retail optimization initiative. Postal Service’s (USPS) policies, procedures, and practices for providing rural delivery services, and how they compare with those in urban areas, we discussed USPS’s basis for providing delivery and retail services, the legal framework under which these decisions are made, and the process used to carry out these decisions with USPS officials.

Why GAO Did This Study A key element of the ongoing postal reform deliberations before Congress is the U.S. Postal Service's (USPS) ability to carry out its mission of providing universal mail delivery and retail services at reasonable rates. Many are concerned that USPS's mission is at risk in the current operating environment of increasing competition and decreasing mail volumes. Preserving universal service, particularly in rural areas, is a goal of postal reform. GAO was asked to discuss (1) how USPS provides universal mail delivery services and access to postal services in both rural and urban areas; (2) what changes USPS is making or plans to make related to providing postal services, including changes that may affect rural areas; and (3) what are the major issues that have been raised related to how USPS provides postal services. What GAO Found USPS provides its customers, regardless of where they live, with services that include mail delivery at no charge and access to retail services. However, differences exist in how, when, and where USPS provides these services. These differences have always existed due to the nation's geographic diversity and changes in technology, transportation, and communications. Universal postal service is not defined by law, but appropriations legislation requires 6-day mail delivery and prohibits USPS from closing small, rural post offices. Delivery and retail decisions are made primarily by local USPS officials with overarching guidance provided by national policies and procedures. Local decisions are based on cost and service factors, including the number and location of deliveries, quality of roads, employee safety, and mail volume. USPS has taken actions, and is planning future actions, to improve the efficiency of its delivery and retail networks. Overall, customers in urban and rural areas will probably not see significant changes in delivery services since most changes are focused on operational improvements. On the retail side, USPS plans to provide more cost-effective and convenient service by developing new, low-cost alternatives; moving stamp-only transactions away from post office counters; and optimizing its retail network. USPS's retail optimization involves tailoring services to communities' needs and replacing "redundant, low-value access points with alternative access methods." It remains unclear how customers in rural areas will be affected by these retail initiatives since most are planned for high-growth, high-density areas. Generally, postal customers are satisfied with the services provided to them. The issues that have raised the greatest concerns from customers include inconsistent mail delivery and the threat of post office closings or reductions in post office hours. Also, concerns have been raised about USPS's limited communication regarding its planned changes to its networks. USPS's retail optimization could be an opportunity for USPS to reduce its costs while improving customer service. However, USPS needs to provide additional transparency and accountability mechanisms to better communicate its retail optimization plans and raise stakeholders' confidence that decisions will be made in a fair, rational, and fact-based manner.

gao_GAO-02-763

gao_GAO-02-763_0

Spouses and children are also eligible for Social Security survivor benefits. Portion of JSAS Costs Covered by Judges’ Contributions Varied For JSAS plan years 1999 through 2001 under the Federal Courts Administration Act of 1992, the participating judges paid more than 50 percent of the JSAS normal costs in the first year and less than 50 percent in the remaining 2 years. Adjustment That Would Be Needed in Judges’ Contribution Rates On the basis of the information contained in the JSAS actuarial report as of September 30, 2001, we determined that the participating judges’ future contributions would have to increase a total of 0.1 percentage point above the current 2.2 percent of salaries for active and senior judges and 3.5 percent of retirement salaries for retired judges in order to cover 50 percent of JSAS costs. However, increasing the contribution rates now could affect the judges’ decision to participate in JSAS.

What GAO Found The Federal Courts Administration Act of 1992 requires GAO to review certain aspects of the Judicial Survivors' Annuities System (JSAS), one of several survivor benefit plans applicable to federal employees. JSAS provides annuities to surviving spouses and dependent children of deceased Supreme Court Justices, judges of the United States, and other participating judicial officials. For the 3 years covered by GAO's review, the judges' contributions represented more than 50 percent of the JSAS normal costs for fiscal year 1999, but less than 50 percent for fiscal years 2000 and 2001. To cover 50 percent of JSAS estimated future normal costs, the judges' contributions would need to increase by 0.1 percentage point above the 2.2 percent of salaries paid by retired judges. However, increasing required contributions could reduce the judges' rate of participation even though increasing participation was one of the main reasons for enhancing JSAS benefits and reducing judges' contributions in 1992.

gao_GAO-04-109

gao_GAO-04-109_0

Largest Percentage of Original Residents Were Relocated to Other Public Housing, and About Half Are Expected to Return to HOPE VI Sites According to HUD data, the largest percentage of residents living at HOPE VI sites were relocated to other public housing. Overall, grantees estimated that 46 percent of the original residents would return to the revitalized sites. However, as shown in figure 2, the percentage of original residents that were expected to return varied greatly from site to site. Resident Involvement in the HOPE VI Process Has Varied The extent to which grantees involved residents in the HOPE VI process has varied at the 1996 sites. All of the 1996 grantees held meetings to inform residents about revitalization plans and solicit their input. As the following examples illustrate, some of the grantees we visited took additional steps to seek a greater level of resident involvement in the HOPE VI process: In Tucson, the housing authority first asked residents to vote on the revitalization plan for the Connie Chambers site. However, for a number of reasons, we could not determine the extent to which the HOPE VI program was responsible for these changes. By Some Measures, HOPE VI Neighborhoods Have Experienced More Positive Change Than Neighborhoods with Comparable Public Housing Comparison of four HOPE VI neighborhoods with neighborhoods in which comparable public housing sites are located (comparable neighborhoods) showed that HOPE VI neighborhoods experienced greater positive changes in some, but not all, of the variables that we evaluated. Key contributors to this report are listed in Appendix V. Objectives, Scope, and Methodology Our objectives were to examine (1) the types of housing to which the original residents of HOPE VI sites were relocated and the number of original residents that grantees expect to return to the revitalized sites, (2) how the fiscal year 1996 grantees have involved residents in the HOPE VI process, (3) the types of community and supportive services that have been provided to residents and the results achieved, and (4) how the neighborhoods surrounding the sites that received HOPE VI grants in fiscal year 1996 have changed. In addition, as of June 30, 2003, the majority of sites had not completed construction.

Why GAO Did This Study Congress established the HOPE VI program in 1992 to revitalize severely distressed public housing by demolition, rehabilitation, or replacement of sites. In fiscal years 1993-2001, the Department of Housing and Urban Development (HUD) awarded approximately $4.5 billion for 165 HOPE VI revitalization grants to public housing authorities (grantees). GAO was asked to examine (1) the types of housing to which the original residents of HOPE VI sites were relocated and the number of original residents that grantees expect to return to the revitalized sites, (2) how the fiscal year 1996 grantees have involved residents in the HOPE VI process, and (3) how the neighborhoods surrounding the 20 sites that received HOPE VI grants in fiscal year 1996 have changed. What GAO Found The largest percentage of the approximately 49,000 residents that had been relocated from HOPE VI sites, as of June 30, 2003, were relocated to other public housing, and about half were expected to return to the revitalized sites. Although grantees, overall, expected 46 percent of relocated residents to return, the percentage of original residents that were expected to return (or the reoccupancy rate) varied greatly from site to site. The level of resident involvement in the HOPE VI process varied at the 1996 sites. While all of the 1996 grantees held meetings to inform residents about revitalization plans and solicit their input, some took additional steps to involve residents. For example, in Tucson, the housing authority submitted the revitalization plan for the Connie Chambers site to the city council for approval only after the residents had voted to approve it. The neighborhoods in which 1996 HOPE VI sites are located generally have experienced improvements in indicators such as education, income, and housing, although GAO could not determine the extent to which the HOPE VI program contributed to these changes. In a comparison of four 1996 HOPE VI neighborhoods to four comparable neighborhoods, mortgage lending activity increased to a greater extent in three of the HOPE VI neighborhoods. But, a comparison of other variables (such as education and new construction) produced inconsistent results, with HOPE VI neighborhoods experiencing both greater positive and negative changes than comparable neighborhoods.

gao_GAO-03-38

gao_GAO-03-38_0

Background According to the program’s legislative history, the Visa Waiver Pilot Program was created, in part, to improve U.S. foreign relations and to promote effective use of State Department‘s resources. Persons traveling to the United States under the Visa Waiver Program must have a valid passport issued by the participating country and be a national of that country; be seeking entry for 90 days or less as a temporary visitor; have their identity checked at the U.S. port of entry against an automated electronic database containing information about the inadmissibility of aliens, to uncover any grounds on which the alien may be inadmissible to the United States, with no such ground found; have been determined by the Immigration and Naturalization Service (INS) at the U.S. port of entry to represent no threat to the welfare, health, safety, or security of the United States; have complied with conditions of any previous admission under the program (e.g., stayed in the United States for 90 days or less); if entering by air or sea, possess a round-trip transportation ticket issued by a carrier that has signed an agreement with the U.S. government to participate in the program and must have arrived in the United States aboard such a carrier; and if entering by land, have proof of financial solvency and a domicile abroad to which he or she intends to return. Nomination Process Assesses Countries’ Eligibility to Join the Program To comply with laws intended to ensure that countries’ participation in the Visa Waiver Program does not threaten U.S. security and interests, the Departments of State and Justice have established a draft protocol that spells out procedures to assess countries’ eligibility to be admitted to the program. INS accelerated the scheduling of the evaluations after the terrorist attacks on September 11, 2001. Recent Laws Affect Process for Assessing Eligibility, but Full, Timely Implementation Uncertain Laws passed since the terrorist attacks of September 11, 2001, affect the process for determining countries’ eligibility to participate in the Visa Waiver Program. These laws cover passport requirements for visa waiver countries and reemphasize the requirement for the Attorney General to establish a system to monitor peoples’ entry into and exit from the United States. However, it is unclear whether Justice and State will fully implement these requirements by the deadlines called for under U.S. law. Implications of Eliminating the Visa Waiver Program Are Uncertain The implications for U.S. national security of eliminating the program are uncertain; however, eliminating the program could negatively affect U.S. relations with participating country governments, impede tourism to the United States, and increase the need for State personnel and facilities overseas. State Department and U.S. law enforcement officials’ opinions varied on the effect of the Visa Waiver Program on U.S. national security. Eliminating the Program Could Affect U.S. Tourism As previously mentioned, Congress created the Visa Waiver Program, in part, to facilitate international travel and thereby increase the number of foreign travelers to the United States. We also interviewed officials from the Departments of State, including the Bureaus of Consular Affairs and Diplomatic Security, and Justice, including the INS, FBI, and DEA in the United States and in Argentina, Belgium, Italy, Slovenia, Spain, and Uruguay. State commented that the draft report did not provide detailed information on the border inspection process.

Why GAO Did This Study Since the terrorist attacks of September 11, 2001, the U.S. Congress, the administration, law enforcement officials, and the public have questioned the effectiveness of U.S. visa programs in protecting national security. Some have voiced concern that terrorists or other criminals may exploit one of these programs--the Visa Waiver Program--to enter the United States. The program enables citizens of 28 participating countries to travel to the United States for tourism or business for 90 days or less without first obtaining a visa. It was created, in part, to promote the effective use of government resources and to facilitate international travel without threatening U.S. security. GAO was asked to review the Visa Waiver Program, including the process for assessing countries' eligibility to participate in the program. GAO was also asked to determine the implications--specifically those affecting national security, foreign relations, tourism, and State Department resources--of eliminating the program. GAO analysts traveled to several visa waiver countries, including Belgium, Italy, Slovenia, Spain, and Uruguay, as well as to Argentina, whose participation in the program was recently revoked. What GAO Found To ensure that countries participating in the Visa Waiver Program pose a low risk to U.S. national interests, the Departments of Justice and State verify each country's political and economic stability and the security of its passport issuance process. However, laws passed since the terrorist attacks of September 11, 2001, affect the processes for determining eligibility for the program. The new laws expand passport requirements for visa waiver countries and call for a system to monitor visitors' movement into and out of the United States. Whether these requirements will be implemented by the specified deadlines remains uncertain. The implications for U.S. national security of eliminating the Visa Waiver Program are difficult to determine. It is clear, however, that eliminating the program could affect U.S. relations with other countries, U.S. tourism, and State Department resources abroad. Although the Departments of Justice and State generally agreed with our report, Justice was concerned that GAO did not fully take into account its progress in meeting certain requirements. State questioned whether GAO considered the border inspection process when discussing the national security implications of eliminating the Visa Waiver Program.

gao_GAO-08-225T

gao_GAO-08-225T_0

DOT protocols have specific requirements that collection sites must meet, including procedures to (1) prevent unauthorized access to the urine collection site; (2) prevent the tested employee or anyone else from gaining unauthorized access to the collection materials/supplies; (3) ensure that the tested employee does not have access to items that could be used to adulterate or dilute the specimen such as soap, disinfectants, cleaning supplies, and water; and (4) ensure that the tested employee is under the supervision of a collector or appropriate site personnel at all times when permitted into the site. The collection sites must follow DOT protocols and their role is to collect the urine specimen, while the laboratories must be certified by HHS and their role is to perform the drug testing of the specimen. An invalid test results when a drug screening lab identifies an unidentified adulterant, substitute, or abnormal physical characteristic in the specimen that prevents the lab from obtaining a valid test result. Most Collection Sites Failed to Comply with All DOT Protocols In our tests of the selected 24 urine collection sites in four major geographic areas throughout the United States, we determined that 22 of the 24 sites showed varying degrees of failure in complying with the protocols that we tested. While all urine collection sites followed DOT protocols by asking our undercover investigators to provide identification, we successfully used bogus driver’s licenses to gain access to all 24 sites— demonstrating that a drug user could send someone else to take a drug test in their place. Twenty-two of the 24 tested collection sites failed to comply with many of the remaining DOT protocols we tested. A tested employee could have used this spray to dilute or adulterate his or her specimen. Commercially Available Products Can Defeat Drug Tests at Selected Sites We determined that drug-masking products were widely available for purchase over the Internet and used this method to purchase adulterants and synthetic urine for our tests. As discussed above, we submitted specimens containing adulterants at four of the collection sites and at another four sites we used synthetic urine without being caught by site collectors, demonstrating that these products could easily be brought in and used during a test. In every case that investigators used adulterants or substitutes during the drug test, the drug-masking products went undetected during lab testing, lab validation, and MRO review of the labs’ results. Companies that sell drug-masking products can access this information and update their products to prevent them from being detected by the laboratory. Products to Defeat Drug Tests Are Widely Available In performing Internet searches, we found drug-masking products that the public can easily obtain and that are marketed as products that can be used to pass urine drug tests. We used these types of Web sites to purchase drug-masking products for our testing of selected urine collection sites. DOT did not adopt this update in their regulations------so currently drug testing laboratories are only authorized, not required, to perform validity testing for all DOT required commercial motor carrier drug tests. According to SAMHSA, approximately 400 different products are available to defeat urine drug tests. SAMHSA is required to provide information to laboratories on how to test the validity of the urine specimen and publicly provide detailed information on lab testing procedures. These posters are intended to help collectors follow the appropriate protocols while conducting drug tests under the DOT drug screening program.

Why GAO Did This Study To help prevent accidents resulting from drug use by individuals in safety-sensitive positions, the Department of Transportation (DOT) requires motor carriers to conduct drug testing of their employees. These drug tests involve collecting a urine specimen from employees. To ensure the integrity of the urine specimen and the collection process, DOT regulations provide numerous protocols that outline collection procedures and identify controls to prevent employees from defeating a drug test. Recent media accounts indicate that some sites performing DOT drug test collections may not be adhering to the collection protocols. Moreover, given the different techniques a drug user may employ in an attempt to defeat a drug test, it is possible that a commercial truck driver could defeat a drug test by diluting, substituting, or adulterating a urine specimen in order to obtain a passing result. GAO was asked to perform an undercover operation to determine whether (1) urine collectors followed DOT protocols at selected collection sites and (2) commercially available products could be used to defeat drug tests. To perform this undercover operation, GAO created two fictitious trucking companies and produced bogus driver's licenses. GAO investigators then posed as truck drivers to test 24 collection sites throughout the United States. GAO briefed DOT officials on its results and they agreed with the findings. What GAO Found DOT's drug testing program is vulnerable to manipulation by drug users, especially given the wide availability of products designed to defeat drug tests. While all urine collection sites followed DOT protocols by asking GAO undercover investigators to provide identification, investigators successfully used bogus driver's licenses to gain access to all 24 sites--demonstrating that a drug user could send someone to take a drug test in their place using fake identification. In addition, 22 of the 24 selected urine collection sites did not adequately follow the remaining protocols GAO tested. For example, 75 percent of the urine collection sites GAO tested failed to restrict access to items that could be used to adulterate or dilute the specimen, meaning that running water, soap, or air freshener was available in the bathroom during the test. The table below provides information about the high failure of selected protocols for the 24 collection sites tested. GAO also found that drug masking products such as adulterants, dilutants, and substitutes were widely available on the Internet. After purchasing drug masking products from Web sites, GAO investigators used adulterants at four of the collection sites and substitute synthetic urine at another four sites without being caught by site collectors--demonstrating that these products could easily be brought into a collection site and used during a test. Even in one case where a collection site followed all DOT collection protocols regarding administration of the test, investigators were still able to substitute synthetic urine for their sample. Every drug masking product went undetected by the drug screening labs. Provided the adulterant GAO used would be able to mask drug use as advertised, a drug user would likely be able to use the substances GAO tested to obtain a passing result on his or her test. According to officials GAO interviewed at the Substance Abuse and Mental Health Services Administration (SAMHSA), companies that make drug-masking products are aware of government test standards and devise products that prevent laboratories from detecting them. SAMHSA is required to provide information to laboratories on how to test the validity of the urine specimens, publicly providing detailed information on lab testing procedures on its Web site.

gao_GAO-06-467T

gao_GAO-06-467T_0

At the same time the federal government has been developing guidance and standards for state and local first responders in the areas of incident management and capabilities and tying certain requirements to the award of grants. DHS has undertaken three major policy initiatives to promote the further development of the all-hazards emergency preparedness capabilities of first responders. Major emergency incidents, particularly catastrophic incidents, by definition require the coordinated actions of personnel from many first responder disciplines and all levels of government, plus nonprofit organizations and the private sector. Following are some illustrative tasks needed to prepare for and respond to a major emergency incident that could be tested with realistic exercises: assessing potential needs, marshalling key resources, and moving property and people out of harm’s way prior to the actual event (where predictable or where there is forewarning), obtaining and communicating accurate situational data for evaluating and coordinating appropriate response during and after the event; leadership: effectively blending (1) active involvement of top leadership in unified incident command and control with (2) decentralized decision making authority that encourages innovative approaches to effective response; clearly understood roles and responsibilities prior to and in response to effective communication and coordination; and the ability to identify, draw on, and effectively deploy resources from other governmental, nonprofit, and private entities for effective response For exercises to be effective in identifying both strengths and areas needing attention, it is important that they be realistic, designed to test and stress the system, involve all key persons who would be involved in responding to an actual event, and be followed by honest and realistic assessments that result in action plans that are implemented. What is remarkable about the whole area of emergency preparedness and homeland security is how little we know about how states and localities (1) finance their efforts in this area, (2) have used their federal funds, and (3) are assessing the effectiveness with which they spend those funds. Katrina raised a number of questions about the nation’s ability to respond effectively to catastrophic events—even one with several days warning. It is also a task that is never done, but requires continuing commitment and leadership and trade-offs because circumstances change and we will never have the funds to do everything we might like to do. As the nation assesses the lessons of Katrina, we must incorporate those lessons in assessing state and local emergency management plans, amend those plans as appropriate, and reflect those changes in planned expenditures and exercises.

Why GAO Did This Study This testimony discusses the challenges of effective emergency preparedness for, response to, and recovery from major emergencies, including catastrophic incidents. What GAO Found Effective emergency preparedness and response for major events requires the coordinated planning and actions of multiple players from multiple first responder disciplines, jurisdictions, and levels of government as well as nongovernmental entities. Effective emergency preparedness and response requires putting aside parochialism and working together prior to and after an emergency incident. September 11, 2001 fundamentally changed the context of emergency management preparedness in the United States, including federal involvement in preparedness and response. The biggest challenge in emergency preparedness is getting effective cooperation in planning, exercises, and capability assessment and building across first responder disciplines and intergovernmental lines. DHS has developed several policy documents designed to define the federal government's role in supporting state and local first responders in emergencies, implement a uniform incident command structure across the nation, and identify performance standards that can be used in assessing state and local first responder capabilities. Realistic exercises are a key component of testing and assessing emergency plans and first responder capabilities, and the Hurricane PAM planning exercise demonstrated their value. With regard to the status of emergency preparedness across the nation, we know relatively little about how states and localities (1) finance their efforts in this area, (2) have used their federal funds, and (3) are assessing the effectiveness with which they spend those funds. Katrina has raised a host of questions about the nation's readiness to respond effectively to catastrophic emergencies. Effective emergency preparedness is a task that is never done, but requires continuing commitment and leadership because circumstances change and continuing trade-offs because we will never have the funds to do everything we might like to do.

gao_T-RCED-96-205

gao_T-RCED-96-205_0

HUD’s fiscal year 1997 budget proposal requests about $22 billion in discretionary budget authority and plans about $33 billion in discretionary outlays. Updated Data May Assist in Evaluating HUD’s Multifamily Reengineering Cost Estimates HUD’s fiscal year 1997 budget request discusses how a planned, major restructuring of the multifamily housing program is likely to affect its budget over the next 6 years and beyond. However, HUD’s assumptions about its ability to quickly restructure properties with high subsidy costs appear overly optimistic and could be responsible for HUD underestimating its request for rental assistance for low-income families. HUD Needs More Time to Establish a Program of Performance Bonuses In its fiscal year 1997 budget, HUD requested $845 million in bonus funding for high-performing grantees in four of its six new block grants. III summarizes the details of the proposed bonus pools.) Implementing Performance Funds Will Be Complicated and Time-Consuming Some features inherent to block grants will complicate the implementation of a performance measurement system in fiscal year 1997. High-Risk Series: Department of Housing and Urban Development (GAO/HR-95-11, Feb. 1995).

Why GAO Did This Study GAO discussed the Department of Housing and Urban Development's (HUD) fiscal year 1997 budget request, focusing on: (1) HUD multifamily reengineering cost estimates; (2) proposed bonus pools for high-performing grantees who exceed established performance measures; and (3) HUD progress in addressing management deficiencies. What GAO Found GAO noted that: (1) HUD has requested about $22 billion in discretionary budget authority and plans about $33 billion in discretionary outlays; (2) overly optimistic cost control assumptions about the major restructuring of the multifamily housing program could affect the HUD budget request for rental assistance for low-income families; (3) HUD has requested $845 million in bonus funding for high-performing grantees in some of its new block grants; (4) implementing HUD performance funds will be complicated and time-consuming; and (5) HUD has proposed various internal controls to address management deficiencies.

gao_GAO-13-798

gao_GAO-13-798_0

Our second objective was to describe how answering these key questions provides information about why carryover balances were reported in selected accounts during fiscal years 2007 through 2012, and how agencies estimated and managed these balances. We identified the 100 accounts with the largest average unobligated balance during fiscal years 2007 through 2012.eight accounts representing a variety of characteristics, including the size of the average unobligated balance, budget function, type of account, agency, and whether the account was composed of mandatory funds, discretionary funds, or a combination of both. Four Key Questions to Consider When Evaluating Carryover Balances To assist congressional and agency-level decision makers as well as other reviewers in their evaluation of agencies’ carryover balances, we identified four overarching key questions to consider: What mission and goals is the account or program supporting? Answering each of the four overarching questions and their second-tier questions provides insight into why a carryover balance exists, what size balance is appropriate, and what opportunities, if any, for savings exist. These questions can be applied when evaluating carryover balances at either the account or program level. A single account may support a single program or multiple programs. Understanding the mission activities, goals, and programs the account supports provides information about whether a program needs to maintain a balance to operate smoothly, what size balance is appropriate, and whether opportunities for savings exist. The sources and fiscal characteristics of the funding influence what opportunities may exist for budgetary savings. Discretionary and mandatory funds present different issues in changing the size of any balance. Moreover, since mandatory funds are often provided in “such sums as may be necessary” to make payments to those eligible, reducing the balance in such an account may have no practical or economic benefit and instead could impose unnecessary administrative costs. Some factors are within an agency’s control and some are not. Understanding what drives this “spendout rate” provides information on the size of the unobligated portion of the balance versus the obligated portion; this in turn provides insight into the composition of the carryover balance as a whole. The sources and fiscal characteristics of funding for an account or program affect the timing of when funds are obligated and disbursed, and provide insight into why amounts may be carried forward from one fiscal year to the next. In the case of mandatory accounts, agencies focused on future needs of the account and relied on economic indicators as well as historical trends to estimate future balances of the account, including carryover balances. Among the eight accounts we reviewed, the discretionary accounts used historical data combined with current variables to estimate carryover balances. Concluding Observations Given the fiscal pressures facing the nation, examination of carryover balances provides an opportunity for enhanced oversight of agencies’ management of federal funds. It also may help identify areas where the federal government can improve and maximize the use of resources. All four departments generally agreed with our findings and provided technical comments that were incorporated as appropriate. Furthermore, HHS said that any conclusions drawn from the report may not apply across the board to all accounts with multi-year or no-year funds. A single account may support a single program or multiple programs. If funds are discretionary, balances can be controlled by the annual appropriations process. How does the agency estimate and manage carryover balances? Understanding an agency’s processes for estimating and managing carryover balances provides information to assess how effective agencies are in anticipating program needs and ensuring the most efficient use of resources. What is the spendout rate after funds have been obligated? The eight accounts we reviewed as case illustrations were: Department of Defense: Army Aircraft Procurement Department of Defense: U.S. Army Corps of Engineers-Civil Works, Department of Health and Human Services: Public Health and Social Department of Housing and Urban Development: Community Department of Housing and Urban Development: Federal Housing Administration-Mutual Mortgage Insurance Capital Reserve Department of Housing and Urban Development: Homeless Department of the Treasury: Exchange Stabilization Fund Department of the Treasury: Government Sponsored Enterprise (GSE) Preferred Stock Purchase Agreements Account Name: Agency: National Priority: Department of Defense-Military Aircraft Procurement, Army (APA) Department of Defense (Budget Subfunction 051) What Mission and Goals Is the Account or Program Supporting? What Factors Affect the Size or Composition of Carryover Balances?

Why GAO Did This Study Given the fiscal pressures facing the nation, examination of balances carried forward into future fiscal years (carryover balances) provides an opportunity to identify areas where the federal government can improve and maximize the use of resources. GAO was asked to review issues related to federal carryover balances. GAO's objectives were to (1) identify key questions for congressional committees, managers, and other reviewers to consider when evaluating carryover balances, including whether to reduce them, and (2) describe how answering these key questions provides insight into why carryover balances may exist in selected accounts. GAO reviewed carryover balances from fiscal years 2007 through 2012 in eight selected accounts from the Departments of Defense (DOD), Health and Human Services (HHS), Housing and Urban Development (HUD), and Treasury. Account selection was based on several characteristics, including the average size of the balance, budget function, type of account, agency, and whether the account was composed of mandatory or discretionary funds. GAO is not making any recommendations. DOD, HHS, HUD, and Treasury generally agreed with our findings and provided technical comments that were incorporated as appropriate. HHS provided comments stating that conclusions drawn from the report may not apply across the board to all accounts. What GAO Found Carryover balances in fiscal year 2012 were $2.2 trillion, of which about $800 billion had not yet been obligated. Answering key questions during review of carryover balances provides insights into why a balance exists, what size balance is appropriate, and what opportunities (if any) for savings exist. Given that a single account may support a single program or multiple programs--or that multiple accounts may support a single program--these questions can be applied when evaluating balances at either the account or program level. Examination of balances may assist decision makers in identifying opportunities to achieve budgetary savings or redirecting resources to other priorities. However, the complexity of the federal budget is such that a case-by-case analysis is needed to understand how best to achieve these financial benefits. What mission and goals is the account or program supporting? Understanding the mission activities, goals, and programs the account supports provides information about whether a program needs to maintain a balance to operate smoothly, what size balance is appropriate, and whether opportunities for savings exist. Accounts GAO reviewed maintained balances to support activities such as long-term acquisition of military aircraft and public health emergency preparedness. What are the sources and fiscal characteristics of the funding? The sources and fiscal characteristics of the funding present different issues in changing the size of carryover balances. Accounts such as Treasury's Exchange Stabilization Fund, receive "such sums as may be necessary" and may require programmatic changes to effectively reduce balances. In such cases, simply reducing balances may have no economic benefit and could impose unnecessary administrative costs. If funds are discretionary, such as with HUD's Homeless Assistance Grants, balances can be controlled through appropriations acts. What factors affect the size or composition of the carryover balances? Understanding factors within and outside an agency's control that affect its "spendout rate" provides insight to the composition of the carryover balance as a whole. Funds in accounts that support activities such as certain procurement or disaster relief may be obligated fairly quickly, but are expended over a longer period as milestones are met or as grantees draw down funds. Accounts with quick spendout rates, such as those that provide cash payments to government-sponsored enterprises, disburse funds soon after obligation. How does the agency estimate and manage carryover balances? Understanding an agency's processes for estimating and managing balances provides information to assess how effectively agencies anticipate program needs and ensure the most efficient use of resources. For the mandatory accounts GAO reviewed, such as the Federal Housing Administration's Mutual Mortgage Insurance Capital Reserve account, agencies focused on future needs of the account and relied on economic indicators and historical trends to estimate future balances. For discretionary accounts GAO reviewed, such as the U.S. Army Corps of Engineers' Construction account, agencies used historical data combined with current variables to estimate carryover balances.

gao_GAO-10-852T

gao_GAO-10-852T_0

Technical Expertise Agencies should have sufficient staff with the technical expertise to oversee the activities under their authority. Oil and gas production methods on federal lands and waters have become increasingly sophisticated over the past decade. In a March 2010 review, we found that Interior had challenges in hiring, training, and retaining staff in critical oil and gas oversight roles, leading to questions about the technical capacity of Interior staff overseeing oil and gas activities. Interior’s challenges in hiring and retaining staff stem, in part, from competition with the oil and gas industry, which generally pays significantly more than the federal government. Moreover, key technical positions responsible for oversight of oil and gas activities have experienced high turnover rates, which, according to Interior officials, impede these employees’ capacity to oversee oil and gas activities. Ability to Perform Reviews and Require that Findings Be Addressed An effective oversight program should include a component for systematic inspections and reviews, whose findings should be documented and subsequently addressed. In several recent reviews, we found that Interior had been unable to complete its necessary reviews, including both environmental and oil and gas production verification inspections and certain offshore environmental analyses. More recently, in March 2010, we reported that Interior had only been able to complete approximately one-third of the required onshore oil and gas production verification inspections, raising concerns about the accuracy of the oil and gas volumes reported to MRM. In another March 2010 report, we found that MMS faces challenges in the Alaska Outer Continental Shelf (OCS) Region in conducting reviews of oil and gas development under the National Environmental Protection Act (NEPA), which requires MMS to evaluate the likely environmental effects of proposed actions, including oil and gas development. Although Interior policy directed its agencies to prepare handbooks providing guidance on how to implement NEPA, we found that MMS lacked such a handbook. It also left unclear MMS’s policy on what constitutes a significant environmental impact as well as its procedures for conducting and documenting NEPA-required analyses to address environmental and cultural sensitivities, which have often been the topic of litigation over Alaskan offshore oil and gas development. Just this year, Secretary Salazar directed Interior to conduct studies examining these issues. In our March 2010 report, we determined that in some instances Interior is uncertain about its legal authority for undertaking necessary enforcement actions and may be using its enforcement authority inconsistently. Specifically, we found that some Interior staff were not issuing incidents of non-compliance—a type of enforcement action—when they identified certain measurement devices during the course of their inspections, as they believe the current measurement regulations were out of date. In preliminary results from our ongoing work on public challenges to BLM’s federal oil and gas lease sale decisions in the four Mountain West states responsible for most onshore federal oil and gas development, we found the extent to which BLM made publicly available information related to public protests filed during the leasing process varied by state and was generally limited in scope. We also found that stakeholders— nongovernmental organizations representing environmental, recreational, and hunting interests that filed protests to BLM lease offerings—wanted additional time to participate in the leasing process and more information from BLM about its leasing decisions. Our past work, as well as that of Interior’s OIG, has identified several instances where Interior staff had inappropriate relationships with oil and gas industry personnel, raising questions about whether Interior’s oversight efforts were sufficient. In August 2008, Interior’s OIG reported on inappropriate relationships between staff working in Interior’s RIK program and the oil and gas industry. Most recently, in May 2010, the OIG reported on inappropriate relationships between Interior’s offshore inspection staff and certain oil and gas companies operating in the Gulf of Mexico. As the Secretary and Congress consider what fundamental changes are needed in how Interior structures its oversight of oil and gas programs, we believe that our and others’ past work provides a strong rationale for broad reform of the agency’s oil and gas oversight functions—at MMS to be sure, but also across other parts of Interior, including those responsible for oversight of onshore areas. 2, 2009).

Why GAO Did This Study The catastrophic oil spill in the Gulf of Mexico has drawn national attention to the exploration and production of oil and gas from leases on federal lands and waters. The Department of the Interior's Bureau of Land Management (BLM) oversees onshore oil and gas activities, the Minerals Management Service's (MMS) Offshore Energy and Minerals Management oversees offshore oil and gas activities, and MMS's Minerals Revenue Management collects revenues from oil and gas produced. Interior's oil and gas oversight has long been the subject of audits and investigations by GAO, Interior's Office of Inspector General (OIG), and others. In response to the recent oil spill, the Secretary of the Interior has proposed reorganizing MMS. Over the past 5 years, GAO has issued numerous recommendations to the Secretary of the Interior to improve the agency's management of oil and gas resources--most recently resulting in two reports in March 2010. Overall, GAO's work in this area can be useful in evaluating key aspects of the Secretary's plans to reorganize MMS. In particular, GAO's findings and recommendations can provide guidance on how to achieve effective oversight of federal oil and gas management by improving (1) technical expertise in the agency, (2) performance of analyses and reviews, (3) enforcement of laws and regulations, (4) public access to information, and (5) the degree of independence in the agency. What GAO Found Technical Expertise. Oil and gas production methods on federal lands and waters have become increasingly sophisticated over the past decade. GAO found in a March 2010 report that Interior had challenges in hiring, training, and retaining key staff, leading to questions about the technical capacity of Interior staff overseeing oil and gas activities. Interior's challenges partly stem from competition with the oil and gas industry, which can pay staff higher salaries. Moreover, key technical positions responsible for oversight of oil and gas activities have experienced high turnover rates, which, according to Interior officials, impede their capacity to oversee oil and gas activities. Ability to perform reviews and require that findings be addressed. In several recent reports, GAO found that Interior was unable to complete necessary reviews, including environmental and oil and gas production verification inspections, and had an ill-defined process for conducting certain offshore environmental analyses. For example, GAO reported in March 2010 that MMS faced challenges in Alaska conducting required environmental reviews, because although Interior policy directed MMS to prepare a handbook providing guidance on how to conduct these reviews, MMS lacked such a handbook. This lack of guidance also left unclear MMS's policy on what constitutes a significant environmental impact. Enforcement Authority. In a March 2010 review, GAO determined that in some instances, Interior was uncertain about its legal authority for undertaking potential necessary enforcement actions, and that Interior may be inconsistently using its enforcement authority. For example, staff from one BLM office told us that they were not issuing enforcement actions for unauthorized devices intended to modify gas flow upstream of the measurement meter--which may result in inaccurate measurement of gas production volumes. These staff explained that this was due to measurement regulations that were out of date. Public Access. In its preliminary results from ongoing work on public challenges to BLM's federal onshore oil and gas lease sale decisions in the four Mountain West states responsible for most federal oil and gas development, GAO found state-by-state variation in what protest-related information was made publicly available across BLM state offices. GAO also found that stakeholders, including industry groups and nongovernmental organizations representing environmental, recreational, and hunting interests, expressed frustration with the transparency and timeliness of the information. Independence. During GAO's work in 2009 and in Interior OIG reports in 2008 and 2010, several instances were identified where Interior staff had inappropriate relationships with oil and gas industry personnel, raising questions about whether Interior's oversight efforts were sufficient. The OIG found numerous instances of inappropriate contact between industry and Interior staff, including staff receipt of gifts.

gao_GAO-01-368

gao_GAO-01-368_0

As a result, some states have begun to implement, or are considering adopting, strategies specifically designed to help hard-to- employ recipients join the workforce. To be successful in moving hard-to-employ TANF recipients into the workforce within their 60-month time limit for federal benefits, states must develop programs and provide work and work-preparation activities tailored to the needs of their hard-to-employ recipients and they must ensure that recipients with characteristics that impede employment have access to programs and activities that meet their needs. Some states believe they would be better able to accomplish this if they (1) had caseload data on the number and characteristics of hard-to-employ TANF recipients, particularly those who will reach their 60-month limit before they are able to work; and (2) used a range of work and work- preparation activities that meet the needs of hard-to-employ recipients, including activities that extend beyond those that meet federal work participation requirements. Temporary Assistance for Needy Families (TANF) Program: Third Annual Report to Congress.

What GAO Found Although some welfare recipients who might seem hard to employ are able to successfully enter the workforce, others have needed considerable time and support to become work-ready. As a result, some states have begun to implement or are considering strategies to help hard-to-employ recipients join the workforce. To be successful in moving hard-to-employ Temporary Assistance for Needy Families (TANF) recipients into the workforce within their 60-month time limit for federal benefits, states must develop programs and provide work and work-preparation activities tailored to the needs of their hard-to-employ recipients and they must ensure that recipients with characteristics that impede employment have access to programs and activities that meet their needs. Some states believe that they would be better able to accomplish this if they (1) had caseload data on the number and characteristics of hard-to-employ TANF recipients, particularly those who will reach their 60-month limit before they are able to work and (2) used a range of work and work-preparation activities that meet the needs of hard-to-employ recipients, including activities that extend beyond those that meet federal work participation requirements.

gao_GAO-17-247

gao_GAO-17-247_0

History of Telework at Four Case Study Agencies The act requires OPM to report agencies’ progress towards meeting telework goals, such as telework participation rates; however, telework had existed at federal agencies before the act’s passage. All four case study agencies require managers and supervisors to complete telework training, but not all require it before signing telework agreements. By not requiring telework agreements to be regularly reviewed, GSA, Labor, and SEC cannot be assured that the agreements reflect and support their current business needs. Of these agencies, Labor is most vulnerable to the risk of having inaccurate data on current telework agreements because it uses a largely paper-based manual system to manage its telework agreements. Managerial Resistance and Technology Challenges Continue to Be Barriers to Telework Participation Case study agency officials and some focus groups with supervisors and teleworkers report that while managerial resistance to telework has gone down, and telework technology has improved in the 6 years since the act’s passage, they remain the key challenges to increasing telework participation. For example, one focus group reported that some newly issued laptops at GSA did not have webcams. Selected Agency Telework Policies and Supervisors’ Strategies Enable Agencies to Manage for Results Policies Include Internal Controls Designed to Maintain Performance and Consistent Performance Expectations Consistent with the act, all four case study agencies have developed internal controls designed to help ensure employee and organizational performance is maintained with telework. The act requires that teleworkers and nonteleworkers be treated the same for the purposes of work requirements, performance appraisals, and promotions, among other managerial decisions. Supervisors Cited Several Strategies and Resources for Managing Teleworkers Supervisors in our focus groups described numerous strategies and resources they use to supervise and stay connected with their employees, including teleworking employees. OPM and Case Study Agencies Face Challenges in Collecting and Reporting Accurate and Consistent Telework Data Agencies Faced Some Challenges in Collecting and Reporting Telework Data Having robust telework data is important for managing and improving telework programs. GSA and SEC use electronic systems for storing and tracking telework agreements. Thus it may not be included in the telework data used by senior department leadership for decision-making and reporting purposes. OPM did not issue a fiscal year 2015 report. The overall participation goal for fiscal year 2016 should have been 90 percent. For example, OPM did not contact Education to clarify why its overall telework participation goal dropped from 85 percent to 5 percent. We have previously found that OPM may be missing opportunities to improve upon data it reports by not following up with agencies on data differences. Reporting and using data that either do not comply with the act or are known to be of questionable quality compromises these agencies’ abilities to effectively manage their telework programs, and limits the usefulness of OPM’s annual reports to Congress. Recommendations for Executive Action To support the consistent application of agency telework policy throughout the agency, the Secretaries of the Departments of Education and Labor and the Chair of the Securities and Exchange Commission should implement controls to verify that supervisors have completed telework training prior to entering into telework agreements with their employees and that completion of this training is documented. To help ensure that telework agreements accurately reflect telework participation, and to further ensure the accuracy of telework data reported internally and externally, the Secretary of the Department of Labor, the Administrator of the General Services Administration, and the Chair of the Securities and Exchange Commission should require documentation of regular or periodic reviews of all telework agreements in agency telework policies. To provide additional guidance to agencies and encourage the elimination of barriers to increased telework opportunities consistent with the act, and to ensure the accuracy of telework information OPM annually reports to Congress, the Director of OPM should: develop tools to help agencies assess and analyze persistent barriers to telework, including managerial resistance, such as a survey or other feedback mechanism; and strengthen controls for reviewing, validating, and reporting telework data in annual Status of Telework in the Federal Government reports. Labor neither agreed nor disagreed with our recommendations but provided comments on the report’s recommendations. OPM did not concur with the two recommendations directed to it. OPM further states that the act does not obligate OPM to spend significant resources to independently validate agency telework data. Appendix I: Objectives, Scope, and Methodology This report identifies and examines (1) how selected agencies establish and monitor telework eligibility and participation, and comply with the requirements of and expectations included in telework agreements; (2) the internal controls and practices at selected agencies that affect supervisors’ abilities to manage for results in the telework environment, and hold employees who routinely telework accountable for achieving results; and (3) the challenges selected agencies and the Office of Personnel Management (OPM) face in collecting and reporting telework data. We selected these agencies using size and telework participation rates as criteria. We also interviewed OPM officials about OPM’s role in providing telework guidance to federal agencies. To determine how supervisors at case study agencies manage for results in a telework environment and hold employees who routinely telework accountable for achieving results, we reviewed requirements of the act and agency policies, reviewed OPM and agency specific training materials on telework and performance management, and discussed agency performance management policy with case study agency officials.

Why GAO Did This Study The Telework Enhancement Act of 2010 required agencies to develop telework policies and OPM to provide guidance and report on telework use, among other things. GAO was asked to review agency telework programs. This report examines (1) how selected agencies comply with the act's requirements, (2) the internal controls affecting federal supervisors' ability to hold teleworkers accountable for achieving results, and (3) the challenges selected agencies and OPM face in collecting and reporting telework data. GAO selected four case study agencies for review—Education, General Services Administration, Labor, and Securities and Exchange Commission—based on agency size and telework participation rates. GAO reviewed OPM guidance and reports, and policies and data at case study agencies. GAO also interviewed OPM and case study agency officials and held focus groups with case study agency supervisors and teleworkers. What GAO Found The telework policies at four selected case study agencies GAO reviewed met select requirements of the Telework Enhancement Act of 2010 (the act) for telework eligibility and agreements. These agencies followed similar processes for approving telework agreements. Office of Personnel Management (OPM) guidance recommends managers complete telework training prior to approving telework agreements, but three of the four agencies did not have a mechanism to help ensure managers have completed this training before approving employee telework agreements. Because managers in these agencies may not have completed the training before entering into agreements, they may not be familiar with telework policies. Further, three of the four agencies did not require a periodic documented review of telework agreements. By not requiring regular review of telework agreements, these agencies cannot be assured that the agreements reflect and support their current business needs. Consistent with the act, all four agencies described efforts to encourage telework participation and provide for the technology to enable it. However, GAO's focus groups with teleworkers provided some examples of how supervisors may discourage telework participation and reported that some level of managerial resistance to telework remains. Managerial resistance to telework can undermine reviewed agencies' ability to meet telework participation goals. In its leadership role for telework matters, OPM can assist agencies with tools to assess and resolve these types of concerns. Consistent with the act, all four case study agencies have controls to help ensure that telework does not diminish employee and organizational performance. These four agencies' policies followed the act's requirement that teleworkers be treated the same as nonteleworkers for the purposes of work requirements, performance appraisals, and other managerial decisions. Agency officials and focus groups reported that telework status did not impact performance expectations. Focus groups with supervisors described numerous strategies and resources they use to supervise and stay connected with teleworking employees. The four agencies used varied methods to collect and report telework data to be included in OPM's annual telework reports, but all cited challenges to ensuring that employee-reported telework data were accurate because employees may not know or follow policies for recording telework. While three of these agencies use electronic systems to track telework agreements, the Department of Labor (Labor) uses a manual system which limits its ability to access accurate, real-time telework agreement data that management uses to assess compliance and for resource allocation decisions. Further, GAO found that the Department of Education (Education) had not been reporting telework eligibility data compliant with the act. OPM also faced challenges in reporting accurate agency telework data and GAO identified errors in OPM's annual reports to Congress. For example, OPM's report cited Education's fiscal year 2016 telework participation goal as 5 percent, reflecting Education's goal for increasing its participation rate, instead of its overall participation goal of 90 percent. OPM may be missing opportunities to improve its data because it does not always follow up with agencies on significant data differences or outliers. The errors and invalid data in OPM's annual reports to Congress reduce the usefulness of these reports. What GAO Recommends GAO makes recommendations to each of the case study agencies, including ensuring supervisors complete telework training in a timely manner and improving telework data. GAO also recommends that OPM develop tools to help agencies assess telework barriers, and to improve telework data reported to Congress. Three agencies agreed with the recommendations. One did not comment. OPM disagreed with GAO's recommendations citing limited resources to expend on efforts not specifically required under the act. GAO maintains that OPM should implement these actions as discussed in the report.

gao_GAO-12-727

gao_GAO-12-727_0

Air Force Major Commands Determine Their Mix of Live and Virtual Training Based on Various Factors Currently, the three lead Air Force major commands—Air Mobility Command, Air Force Special Operations Command, and Air Combat Command—have similar processes to determine the mix of live and virtual training, but the mix of training differs across the major commands, and among aircraft within the commands. At each command, training-requirement review boards composed of subject-matter experts meet to consider broad sets of training issues and evaluate training requirements for specific aircraft. The boards consider factors such as specific combatant command mission requirements and the capabilities of simulators and networks that have already been fielded, and determine which training requirements can be completed in a virtual environment and which need to be completed in a live environment. The Air Force Has Not Established an Overarching Organizational Framework to Guide, Oversee, and Integrate Virtual Training Efforts The Air Force has recently taken steps to increase management attention over its virtual training efforts, but its approach to virtual training currently lacks (1) a designated organization with accountability and authority for achieving results and (2) an overarching strategy—key elements of an organizational framework that we have found to be critical for successful transformations in both public and private organizations. In the absence of an organization to guide virtual training efforts, the lead major commands have developed their own standards and acquired and fielded systems that are not interoperable and often require costly, time- consuming work-arounds to be able to train together in large, complex virtual training exercises. Our prior work has found that strategic planning is a key element of an overarching organizational framework. In the absence of a strategy, the Air Force cannot be certain that its individual initiatives are synchronized and will address its highest priority needs. Air Force Lacks Cost Data for Virtual Training and Did Not Account for Virtual Training Costs When Determining Savings from Its Flying-Hour Efficiency Initiative In outlining its efficiency initiative related to training, the Air Force estimated potential cost savings of $268 million for fiscal year 2012, and a total of $1.7 billion for fiscal years 2012 to 2016 by among other things, reducing legacy combat Air Force flying hours across the board by 5 percent. Additionally, federal internal control standards state that decision makers need visibility over a program’s financial data to determine whether the program is meeting the agencies’ goals and effectively using resources. The Air Force did not consider any potential costs associated with the increase in virtual training in its estimate of cost savings because it has not developed a methodology to collect and track information on the cost of its virtual training program. These costs could include expenses for aircrew to travel to simulator locations, additional contractor personnel to schedule and operate simulators, and the purchase of additional simulators to meet increased demand. Without a means to collect or calculate its virtual training costs, the Air Force lacks the information it needs to make informed investment decisions in the future regarding the mix of live and virtual training. Among other things, the Air Force has implemented various initiatives and established organizations intended to enhance its virtual training capabilities. Recommendations for Executive Action To develop a fully integrated management approach to guide virtual training efforts and investments, we recommend the Secretary of Defense direct the Secretary of the Air Force to designate an entity that is responsible and accountable for integrating all of the Air Force’s virtual training efforts, including the development and enforcement of interoperability standards across virtual training systems, and investment planning; and develop an overarching strategy to align goals and funding for virtual training efforts across all Air Force major commands. To improve decision makers’ visibility over the costs related to virtual training, we recommend that the Secretary of Defense direct the Secretary of the Air Force to develop a methodology for collecting and tracking cost data for virtual training and use this cost data to help inform future decisions regarding the mix of live and virtual training. In response to our recommendation to designate an entity that is responsible and accountable for integrating all of the Air Force’s virtual training efforts, including the development and enforcement of interoperability standards across virtual training systems, and investment planning, DOD stated that the Air Force has taken initial steps to designate its Headquarters, Air Force office, AF/A3/5 (Operations, Plans, and Requirements) as the single entity responsible for integrating the Air Force’s virtual training efforts. To determine the extent to which the Air Force considered costs related to virtual training in estimating potential savings from its training efficiency initiative, we obtained and analyzed the Air Force efficiency calculation and compared it with cost saving estimating best practices.

Why GAO Did This Study Over the last 20 years, the Air Force has sought ways to expand its approaches to meeting aircrew training requirements, including the increased use of virtual training. In 2012, the Air Force reduced live flying hours, which it estimates will save $1.7 billion in fiscal years 2012 through 2016, as part of its response to the Secretary of Defense’s efficiency initiatives. GAO conducted this study in response to House Report 112-78, accompanying a bill for the Fiscal Year 2012 National Defense Authorization Act, which directed GAO to review the status of the military services’ virtual training programs. Specifically, GAO assessed (1) how the Air Force determines the mix of live and virtual training to meet training requirements; (2) the extent to which the Air Force has an overarching organizational framework to guide, oversee, and integrate its virtual training efforts; and (3) the extent to which the Air Force considered costs related to virtual training in estimating potential savings from its training efficiency initiative. To do so, GAO analyzed guidance and other documents, visited virtual training facilities, and interviewed officials from the Office of the Secretary of Defense, the Joint Staff, and the Air Force. What GAO Found The three lead Air Force major commands—Air Mobility Command, Air Force Special Operations Command, and Air Combat Command—all utilize training requirements review boards composed of subject-matter experts to determine training requirements for specific aircraft. These boards determine which training requirements can be completed in live or virtual environments based upon factors such as specific combatant command mission requirements and the capabilities of fielded simulators and networks. All three commands use a combination of live and virtual approaches, but the mix varies by aircraft. For example, Air Combat Command specifies that approximately 25 percent of its training requirements could be met virtually. The other two commands conduct approximately 50 percent of their training virtually. The Air Force has taken steps to manage its virtual training efforts, but its approach lacks some key elements of an overarching organizational framework needed to fully integrate efforts and address challenges. It has reorganized offices and undertaken various initiatives intended to enhance existing virtual training capabilities, but has not designated an entity to integrate these efforts or developed an overarching strategy to define goals, align efforts, and establish investment priorities. As a result, major commands have developed their own investment plans and standards for acquiring and fielding virtual training systems, which are often not interoperable and require costly, time-consuming work-arounds to allow personnel to train together and with joint and coalition partners. GAO’s prior work has found that a designated entity with the necessary authority and resources and an overarching strategy are critical elements of managing organizational transformations and meeting long-term goals and agency missions. In the absence of an approach that establishes clear accountability and a strategy to guide its planning and investment decisions, the Air Force will continue to be challenged to guide the efforts of its commands in planning for and investing in virtual training, ensure these efforts meet the highest priority needs and are synchronized to avoid gaps or future interoperability issues, and maximize available resources. The Air Force estimated it could save about $1.7 billion in its training program by reducing live flying hours and taking other steps, such as increasing the use of virtual training, but it lacks a methodology for determining the costs of virtual training and therefore did not consider these costs in its estimate. The Air Force estimated savings based solely on reductions in live flying hours without considering expenses such as those incurred for aircrew to travel to simulators, contractor personnel to schedule and operate simulators, and purchase of additional simulators. GAO has found that decision makers need visibility over financial data to meet agency goals and effectively use resources. Identifying virtual training costs is challenging because data is spread across multiple program elements in the Air Force’s accounting structure. The Air Force completed an initial study in September 2011 that identified some costs related to virtual training, but it concluded these data might not be complete. In the absence of taking further steps to determine the universe of costs and a means to collect and track data, the Air Force will be limited in its ability to make fully informed investment decisions about the mix of live and virtual training in the future. What GAO Recommends GAO recommends that the Air Force designate an entity to integrate its virtual training efforts, develop a strategy to align virtual training initiatives and goals, and develop a methodology to collect virtual training cost data. DOD concurred with GAO’s recommendations and identified planned actions.

gao_GAO-04-982T

gao_GAO-04-982T_0

However, the structure of the world crude oil market has dramatically changed as a result of such factors as the nationalization of oil fields by oil-producing countries, the emergence of independent oil companies, and the evolution of futures and spot markets in the 1970s and 1980s. Companies that supply gasoline to U.S. markets also post the domestic gasoline prices. To determine the potential effect of a merger on market competition, FTC evaluates how the merger would change the level of market concentration, among other things. Mergers Occurred in All Segments of the U.S. Petroleum Industry in the 1990s for Several Reasons Over 2,600 merger transactions occurred from 1991 through 2000 involving all three segments of the U.S. petroleum industry. Economic literature indicates that enhancing market power is also sometimes a motive for mergers. Mergers Contributed to Increases in Market Concentration and to Other Changes That Affect Competition Mergers in the 1990s contributed to increases in market concentration in the downstream (refining and marketing) segment of the U.S. petroleum industry, while the upstream segment experienced little change. 2). Consequently, this market went from moderately concentrated to highly concentrated. In wholesale gasoline markets, market concentration increased broadly throughout the United States between 1994 and 2002. Evidence from various sources indicates that, in addition to increasing market concentration, mergers also contributed to changes in other aspects of market structure in the U.S. petroleum industry that affect competition—specifically, vertical integration and barriers to entry. Based on anecdotal evidence and economic analyses by some industry experts, we determined that a number of mergers that have occurred since the 1990s have led to greater vertical integration in the U.S. petroleum industry, especially in the refining and marketing segment. U.S. Gasoline Marketing Has Changed in Two Major Ways According to some petroleum industry officials that we interviewed, gasoline marketing in the United States has changed in two major ways since the 1990s. First, the availability of unbranded gasoline has decreased, partly due to mergers. Officials noted that unbranded gasoline is generally priced lower than branded. The second change identified by these officials is that refiners now prefer dealing with large distributors and retailers because they present a lower credit risk and because it is more efficient to sell a larger volume through fewer entities. These requirements have motivated further consolidation in the distributor and retail sectors, including the rise of hypermarkets. Mergers and Increased Market Concentration Generally Led to Higher U.S. Wholesale Gasoline Prices Our econometric modeling shows that the mergers we examined mostly led to higher wholesale gasoline prices in the second half of the 1990s. For market concentration, which captures the cumulative effects of mergers as well as other competitive factors, our econometric analysis shows that increased market concentration resulted in higher wholesale gasoline prices. The increases were larger in the West than in the East—the increases were between one-half cent and one cent per gallon in the West, and about one- quarter cent in the East (for branded gasoline only), on average. Price increases for boutique fuels sold in some parts of the East Coast and Gulf Coast regions and in California were larger compared to the increases for conventional gasoline. The wholesale prices increased by an average of about 1 cent per gallon for boutique fuel sold in the East Coast and Gulf Coast regions between 1995 and 2000, and by an average of over 7 cents per gallon in California between 1996 and 2000. Our analysis shows that wholesale gasoline prices were also affected by other factors included in the econometric models, including gasoline inventories relative to demand, supply disruptions in some parts of the Midwest and the West Coast, and refinery capacity utilization rates. For refinery capacity utilization rates, we found that prices were higher by about an average of one-tenth to two-tenths of 1 cent per gallon when utilization rates increased by 1 percent.

Why GAO Did This Study Gasoline is subject to dramatic price swings. A multitude of factors affect U.S. gasoline markets, including world crude oil costs and limited refining capacity. Since the 1990s, another factor affecting U.S. gasoline markets has been a wave of mergers in the petroleum industry, several between large oil companies that had previously competed with each other. For example, in 1999, Exxon, the largest U.S. oil company, merged with Mobil, the second largest. This testimony is based primarily on Energy Markets: Effects of Mergers and Market Concentration in the U.S. Petroleum Industry ( GAO-04-96 , May 17, 2004). This report examined mergers in the industry from the 1990s through 2000, the changes in market concentration (the distribution of market shares among competing firms) and other factors affecting competition in the industry, how U.S. gasoline marketing has changed since the 1990s, and how mergers and market concentration in the industry have affected U.S. gasoline prices at the wholesale level. To address these issues, GAO purchased and analyzed a large body of data and developed state-of-the art econometric models for isolating the effects of eight specific mergers and increased market concentration on wholesale gasoline prices. Experts peer-reviewed GAO's analysis. What GAO Found Mergers have altered the structure of the U.S. petroleum industry, including the refining market. Over 2,600 mergers have occurred in the U.S. petroleum industry since the 1990s, mostly later in the period. Industry officials cited various reasons for the mergers, particularly the need for increased efficiency and cost savings. Economic literature also suggests that firms sometimes merge to enhance their ability to control prices. Partly because of the mergers, market concentration has increased in the industry, mostly in the downstream (refining and marketing) segment. For example, market concentration in refining increased from moderately to highly concentrated in the East Coast and from unconcentrated to moderately concentrated in the West Coast. Concentration in the wholesale gasoline market increased substantially from the mid-1990s so that by 2002, most states had either moderately or highly concentrated wholesale gasoline markets. Anecdotal evidence suggests that mergers also have changed other factors affecting competition, such as the ability of new firms to enter the market. Two major changes have occurred in U.S. gasoline marketing related to mergers, according to industry officials. First, the availability of generic gasoline, which is generally priced lower than branded gasoline, has decreased substantially. Second, refiners now prefer to deal with large distributors and retailers, which has motivated further consolidation in distributor and retail markets. Based on data from the mid-1990s through 2000, GAO's econometric analyses indicate that mergers and increased market concentration generally led to higher wholesale gasoline prices in the United States. Six of the eight mergers GAO modeled led to price increases, averaging about 1 cent to 2 cents per gallon. Increased market concentration, which reflects the cumulative effects of mergers and other competitive factors, also led to increased prices in most cases. For example, wholesale prices for boutique fuels sold in the East and Gulf Coasts--fuels supplied by fewer refiners than conventional gasoline--increased by about 1 cent per gallon, while prices for boutique fuels sold in California increased by over 7 cents per gallon. GAO also identified price increases of one-tenth of a cent to 7 cents that were caused by other factors included in the models, particularly low gasoline inventories relative to demand, supply disruptions in some regions, and high refinery capacity utilization rates. For example, we found that a 1 percent increase in refinery capacity utilization rates resulted in price increases of one-tenth to two-tenths of a cent per gallon. FTC disagreed with GAO's methodology and findings. However, GAO believes its analyses are sound.

gao_GAO-03-818

gao_GAO-03-818_0

Progress in Assessing Core Functions Has Varied Across the Defense Components and Has Been Affected Somewhat by Definitions of “Core” Progress in assessing core functions has been varied and limited across the major Defense components, and affected by somewhat ambiguous and subjective definitions of what constitutes a “core function.” These multiple and somewhat ambiguous definitions of what is a “core function” have made it difficult for the components to easily employ the core competency approach to decision-making, and some DOD components have sought additional guidance and/or applied their own criteria to identify core functions. That notwithstanding, the definition of core remains somewhat broad in nature and subjective, and will likely remain so in the future. In making its decisions, Army officials determined that medical activities could be considered core in some circumstances and non-core in others. Additional factors must also be considered. Air Force officials told us that moving the military personnel out of non-core functions is a high priority, but because of the high cost involved in adding funds to the operations and maintenance appropriation account to pay for replacement civilian or contractor positions, it is currently an unfunded priority. Some Progress Made in Identifying Alternative Sourcing Arrangements, but the Extent to Which Alternatives Are Likely to Be Used Is Unclear The range of alternatives to A-76 likely to be pursued under the core competency-based approach is not yet clear given limitations in the core analyses, but DOD has made some progress toward identifying and/or using some sourcing arrangements that are alternatives to A-76. At the same time, some DOD officials indicated that the use of some alternatives could be limited without special legislative authorities and/or repeal of various existing prohibitions. The use of alternative sourcing could also be affected by the emphasis on A-76 competitions and OMB’s goals for the department. Alternate Sourcing Approaches Identified through Pilot Projects and Other Initiatives DOD has made some progress in identifying and using sourcing arrangements that are alternatives to A-76, including some as part of an initiative to identify alternatives through use of pilot projects, and a few others that have been identified by the services as they have focused on the core initiative. For example, the department plans to transfer its personnel security investigations function, now performed by the Defense Security Service to the Office of Personnel Management. For DOD, this represents approximately 226,000 positions. Recently, DOD’s study goals have increased because of OMB’s competitive sourcing goals. To meet OMB’s goal of directly converting or studying 15 percent of the 453,000 commercial activity positions identified in the 2000 FAIR Act inventories by the end of fiscal year 2003, DOD would need to complete A-76 studies on about 68,000 positions between fiscal year 2000 and the end of fiscal year 2003. Specifically, the objectives of this report were to assess (1) the department’s progress in assessing its core functions as a basis for sourcing decisions, (2) the plans and progress DOD has made in identifying and implementing alternatives to A-76, and (3) the current status of DOD’s A-76 program.

Why GAO Did This Study The Department of Defense (DOD) is pursuing a new initiative involving a core competency approach for making sourcing decisions--that is, sourcing decisions based on whether the function is core to the agency's warfighting mission. In determining how to best perform non-core functions, DOD's position is that its components should look beyond just the use of public-private competitions under Office of Management and Budget (OMB) Circular A-76 in making sourcing decisions, and consider other alternatives such as partnering or employee stock ownership. GAO was asked to assess (1) the department's progress in assessing its core functions as a basis for sourcing decisions, (2) the plans and progress DOD has made in identifying and implementing alternatives to A-76, and (3) the current status of DOD's A-76 program. What GAO Found Progress in assessing core functions has been varied and limited across major Defense components, affected somewhat by ambiguous definitions of the term "core function." In some instances additional guidance was obtained, but definitions of core remain somewhat broad and subjective, and will likely remain so in the future. Army and Air Force have led within DOD in assessing core functions, but the Army has done the most, and found, contrary to its expectations, that distinguishing between core and non-core functions does not, by itself, prescribe a sourcing decision. Other factors must also be considered such as risk and operational considerations. The range of alternatives to A-76 likely to be pursued under the core competency-based approach is not yet clear, but DOD has made some progress toward identifying and/or using some alternatives through pilot projects and other efforts by the services as they have focused on the core initiative. However, the use of alternatives could be limited without special legislative authorities and/or repeal of various existing prohibitions, and some could be tempered by the department's efforts to meet the A-76 competitive sourcing goals set by OMB. DOD reported that as of June 1, 2003, it has met OMB's short-term goal to use the A-76 process to study 15 percent of the positions identified in DOD's commercial activities inventory by the end of fiscal year 2003. However, meeting the longer-term goal to study at least 50 percent (226,000) of its nearly 453,000 commercial activity positions through fiscal year 2008 will present a challenge. This is nearly double the number of positions that DOD has previously studied during a comparable time period, and providing sufficient resources (financial and technical) to complete the studies may prove challenging. Also, the defense components, particularly the Air Force, plan to transfer certain military personnel into warfighting functions and replace them with government civilian and/or contractor personnel. This will require the components to reprioritize their funding for operation and maintenance accounts, because it is from those accounts the services must fund replacement civilian or contractor personnel.

gao_GAO-03-820T

gao_GAO-03-820T_0

Background The United States has provided assistance to help reduce illegal drug production and trafficking activities in Colombia since the 1970s. Yet, Colombia is still the world’s leading cocaine producer and distributor and a major source of the heroin used in the United States. In fiscal years 2000 through 2003, the United States provided more than $2.5 billion to Colombia for counternarcotics assistance. Assistance to the Colombian Army Has Been Delivered, but Problems Were Encountered U.S. assistance to the Colombian Army during fiscal years 2000- 03$640 million for the counternarcotics brigade, 72 helicopters, and related supporthas, for the most part, been delivered and is being used for counternarcotics operations. Colombia’s Aerial Eradication Program Has Had Mixed Results Since the early 1990s, State’s Bureau for International Narcotics and Law Enforcement Affairs (through the U.S. Embassy’s Narcotics Affairs Section (NAS) and the Office of Aviation) has supported the Colombian National Police’s efforts to significantly reduce, if not eliminate, the cultivation of coca and opium poppy. However, for the most part, the net hectares of coca under cultivation in Colombia continued to rise until 2002, and the net hectares of opium poppy under cultivation remained relatively steady until 2001-02. Financial and Management Challenges Continue to Complicate Efforts to Reduce Illicit Drug Activities The U.S.-supported counternarcotics program in Colombia has recently begun to achieve some of the results envisioned in 1999-2000. However, Colombia and the United States must continue to deal with financial and management challenges. But because of overall poor economic conditions, the government of Colombia’s ability to contribute more is limited. The continuing violence limits the government’s ability to institute economic, social, and political improvements. For U.S. assistance to continue, Colombia faces continuing challenges associated with the need to ensure that the army and police comply with human rights standards, that the aerial eradication program meets certain environmental conditions, and that alternative development is provided in areas subject to aerial eradication. Overall, neither the Colombian Army nor the Colombian National Police can sustain ongoing counternarcotics programs without continued U.S. funding and contractor support for the foreseeable future. According to U.S. embassy officials, these programs alone may cost up to $230 million per year, and future costs for some recently initiated programs have not been determined. As we noted in 2000, the total costs of the counternarcotics programs in Colombia were unknown. Nearly 3 years later, the Departments of State and Defense have still not developed estimates of future program costs, defined their future roles in Colombia, identified a proposed end state, or determined how they plan to achieve it.

Why GAO Did This Study The United States has been providing assistance to Colombia since the early 1970s to help reduce illicit drugs. In 1999, the Colombian government introduced Plan Colombia--program that, among other things, proposed reducing illicit drug activities by 50 percent over 6 years. In fiscal years 2000-03 alone, the United States provided more than $2.5 billion in counternarcotics assistance. Despite this aid, Colombia remains the world's leading producer and distributor of cocaine and a major source of the heroin used in the United States. This testimony discusses the status of U.S. counternarcotics assistance to the Colombian Army and for a U.S.-supported Colombian police aerial eradication program. It also addresses challenges Colombia and the United States face in sustaining these programs. What GAO Found In fiscal years 2000-03, the United States provided about $640 million in assistance to train and equip a Colombian Army counternarcotics brigade and supply the army with 72 helicopters and related support. Most of this assistance has been delivered and is being used for counternarcotics operations. In recent years, the Colombian National Police aerial eradication program has had mixed results. Since 1995, coca cultivation rose in every year until 2002 and opium poppy cultivation remained relatively steady until 2001. But, for 2002, the U.S. Office of National Drug Control Policy reported that net coca cultivation in Colombia decreased 15 percent and net opium poppy cultivation decreased 25 percent--the second yearly decline in a row. U.S. officials attributed this success primarily to the Colombian government's willingness to eradicate coca and poppy plants without restriction. Although the U.S.-supported counternarcotics program in Colombia has recently begun to achieve some of the results envisioned in Plan Colombia, Colombia and the United States must continue to deal with financial and management challenges. Neither the Colombian Army nor the Colombian National Police can sustain ongoing counternarcotics programs without continued U.S. funding and contractor support for the foreseeable future. According to U.S. embassy officials, these programs alone may cost up to $230 million per year, and future costs for some other programs have not been determined. Because of overall poor economic conditions, the government of Colombia's ability to contribute more is limited, but the continuing violence from Colombia's long-standing insurgency limits the government's ability to institute economic, social, and political improvements. Moreover, Colombia faces continuing challenges associated with the need to ensure it complies with human rights standards and other requirements in order for U.S. assistance to continue. As GAO noted in 2000, the total costs of the counternarcotics programs in Colombia were unknown. Nearly 3 years later, the Departments of State and Defense have still not developed estimates of future program costs, defined their future roles in Colombia, identified a proposed end state, or determined how they plan to achieve it.

gao_GGD-95-88

gao_GGD-95-88_0

Of the approximately 2.1 million corporations that were subject to AMT in 1992, about 2,000 corporations with assets of $100 million or more paid 85 percent of the total corporate AMT liability. However, most corporations that paid AMT from 1987 through 1992 were relatively small. By far the most important elements that caused corporations to pay AMT were the depreciation adjustment for property placed in service after 1986 and the book income and adjusted current earnings adjustments. AMT has partially achieved the congressional objectives of ensuring that taxpayers with substantial economic income in a given year, and taxpayers with positive book income in a given year, pay some tax in that year. The effects of AMT on corporate investment are not clear. Objectives, Scope, and Methodology Our objectives for this report were to (1) determine which corporations paid AMT and why they were liable for it, (2) examine whether AMT has achieved its purpose, and (3) discuss how AMT might affect corporate investment. Cannot be used to reduce AMT. This appendix contains information on the amount of corporate AMT payments, the size of the firms paying AMT, the industry breakdown of these firms, the frequency of AMT payments and AMT credits claimed, the significant elements of AMT, and the relationship of AMT to net operating losses (NOL) and to the foreign tax credit (FTC). AMT revenues were between $2.7 and $8.6 billion, or between 3 and 9 percent of the regular tax revenues collected during the period. Large corporations represented a small percentage of AMT payers. The data show that the manufacturing, transportation, and finance industries paid the most AMT. Fewer AMT payers had positive taxable income and owed no regular tax. In addition, as AMT credits are reclaimed in the future, cash flow would increase at that time, possibly increasing investment.

Why GAO Did This Study Pursuant to a congressional request, GAO provided information on the corporate alternative minimum tax (AMT), focusing on: (1) the corporations that paid AMT between 1987 and 1992; (2) whether AMT achieved its purpose; and (3) how AMT might affect corporate investment. What GAO Found GAO found that: (1) AMT accelerated tax payments of $27.4 billion and corporations used credits totalling $5.8 billion from 1987 to 1992; (2) at the end of 1992, corporations had accumulated $21.6 billion in credits that would result in lower tax revenues in the future; (3) of the 2.1 million corporations subject to AMT, 2,000 large corporations paid 85 percent of all AMT in 1992; (4) the two AMT provisions that produced the largest increases in taxable income were the depreciation adjustment, used by 87 percent of all AMT payers, and the adjusted current earnings adjustment, used by 67 percent of all AMT payers; (5) manufacturing, transportation, and finance industries paid the most AMT; (6) AMT has achieved its objectives of making profitable corporations pay tax and causing corporations that report positive amounts of income in a particular year to pay some tax in that year; (7) the effects of AMT on corporate investment are unclear due to insufficient data; and (8) while AMT might reduce present cash flows, future cash flows may be enhanced as taxpayers recover AMT credits.

gao_GAO-07-707

gao_GAO-07-707_0

USDA has continued to use the NASS survey of cheese prices in certain milk pricing formulas as trading in the spot cheese market occurred at the CME. Certain Structure and Operations of CME Spot Cheese Market Are Similar to Those of NCE, and Certain Characteristics Result in Ongoing Concerns about the Potential for Price Manipulation The CME spot cheese market shares a number of operational and structural similarities with NCE and has certain characteristics that could make the CME spot cheese market susceptible to price manipulation. Some Operational Aspects of the CME Spot Cheese Market Resemble Those at NCE NCE and CME share many similarities, including certain trading rules, products traded, the volume of cheese traded, and market participants, but there are differences. Thinness of the CME Spot Cheese Market, Combined with Other Factors, Contributes to Questions about Possible Price Manipulation Despite the move to CME, the spot cheese market remains a thin market, which in combination with the presence of a small number of traders that make a majority of trades and the spot cheese market’s pricing structure contributes to questions about the potential for price manipulation. Relatively few market participants account for the majority of trading at the CME spot cheese market, as shown in figure 1. Additionally, the change from once-a-week trading on the NCE market to daily trading on the CME spot cheese market may make sustaining attempted price manipulation more difficult because a trader may have to be active in the market on a daily basis in order to influence prices. Despite allegations of price manipulation, industry participants we interviewed stated that they generally did not believe manipulation was occurring. CFTC and CME Provide Increased Oversight of the CME Spot Cheese Market Both CFTC and CME engage in activities that may detect or deter potential price manipulation at the CME spot cheese market. CFTC, as part of its responsibility for the regulation of commodity futures markets, monitors cash markets that affect futures markets, such as the CME spot cheese market. CFTC did review trading activities on NCE in 1997 prior to approving a market for trading in certain milk futures. None of these reviews resulted in any legal action taken by CFTC against a market participant. According to CFTC officials, they have not approved CME spot cheese market rules. The USDA Survey of Cheddar Cheese Prices Largely Duplicates CME Cheese Prices and Introduces a Time Lag into Some Milk Prices The NASS survey of cheese prices, which is a major determinant of some FMMO minimum milk prices, is not currently audited by USDA, largely duplicates reported CME cheese market prices, and introduces a 1- to 2- week time lag between when data are reported by NASS and when transactions captured in the survey occur. Auditing the transactions could help to ensure the accuracy of the information used to establish minimum milk prices under the FMMOs. The NASS survey of cheese prices largely captures CME price data by surveying producers versus capturing current data directly from CME. We compared this information to the National Cheese Exchange’s (NCE) rules and procedures, as well as to federal and academic analyses of the structure and operations of NCE.

Why GAO Did This Study The Chicago Mercantile Exchange (CME) is home to the spot cheddar cheese market, which impacts the prices of virtually all cheese traded in the United States, producer milk prices, and milk futures contracts. The spot cheese market, formerly the National Cheese Exchange (NCE) in Wisconsin, has been and continues to be the subject of concerns about price manipulation. GAO was asked to examine (1) the market's structure and ongoing concerns about price manipulation; (2) market oversight and efforts to address potential manipulation; and (3) how the market impacts federal milk pricing. In response, GAO compared the markets at NCE and CME, analyzed trading data, collected information about the Commodity Futures Trading Commission's (CFTC) oversight, and met with industry participants, academics, and agency officials. What GAO Found Because the CMEspot cheese market remains a market in which few daily trades occur and a small number of traders account for the majority of trades, questions exist about this market's susceptibility to potential price manipulation. The structure and operations of the CME spot cheese market are comparable to NCE's, including trading rules, products traded, and market participants. However, there are differences, including daily trading at CME versus once-a-week trading at NCE. CFTC and CME provide oversight of the CME spot cheese market that did not occur on NCE. Both engage in activities that may detect and deter potential price manipulation at this market. CFTC, as part of its responsibility for regulation of commodity futures markets, monitors cash markets, including the spot cheese market, and can act on indications of manipulative activity. In addition, CME conducts daily surveillance and regularly reviews trading data and market trends. According to CFTC and CME officials, they have both made efforts to address allegations of the potential for price manipulation by examining the activities of participants in the spot cheese market. As of June 2007, none of these reviews have led to an instance of CFTC taking legal action against a market participant. CME's spot cheese market impacts federal minimum milk pricing through the NASS survey of cheddar cheese prices, which as shown below are highly correlated to the CME cheese prices. CME spot cheese prices are used to set long-term contracts, which are then captured by the NASS survey of cheese prices--a significant commodity component in USDA's minimum milk pricing formulas. According to USDA, the agency uses the survey, in part, because it captures more transactions than occur at the CME spot cheese market. However, in addition to largely capturing CME price data, it introduces a 1- to 2-week time lag between when data are reported by NASS and when certain transactions captured in the survey occur. Moreover the survey is not currently audited to ensure the accuracy of the information. These factors may contribute to milk prices paid by dairy market participants that are either not completely accurate or not current.

gao_AIMD-98-113

gao_AIMD-98-113_0

Planning and Budgeting Becoming More Outcome-Oriented Under Results Act Under the Results Act, the Park Service for the first time has introduced servicewide goals to be achieved by park managers. Both the Park Service and individual parks have prepared 5-year strategic plans and annual performance plans. Although the Park Service has made some progress in aligning its budget structure and processes with its strategic plan, its efforts to link its plans and budgets have been hampered by the incompatibility between its activity-oriented budget and accounting systems and its goal-orientated strategic plan. Changes to the Budget Process in Early Stages of Implementation The Results Act is based on the premise that budget decisions should be more clearly informed by expectations about program performance. As a first step toward bringing the agency’s budget presentations in line with its performance goals, the Park Service has developed an information system, called the Performance Management Data System (PMDS), which enables parks to enter their annual performance goals, along with the estimated funds and FTEs needed to achieve the goals, into a servicewide information system. Currently, park managers have no way to track or report how actual spending compared to planned spending by goal at the end of the fiscal year. These officials also identified challenges, such as the difficulty of holding managers accountable for achieving park goals, developing appropriate measures for achieving goals, and linking planning systems to budget and accounting systems. The officials told us that, despite these challenges, the strategic planning process produced benefits, such as increased communication and resource sharing within parks and information about how resources were being allocated among goals. Field-Oriented Approach to Training and Development of Strategic Plans Was Essential The Park Service’s field-oriented approach, in which park managers participated in the development of the planning process, the servicewide plan, and, ultimately, the development of park-level plans, was essential to make these plans and processes meaningful to park staff and obtain their support. Finally, park officials suggested that a team approach to developing strategic and annual performance plans resulted in better plans with more buy-in from participants. Observations We concluded in a previous report that by implementing the Results Act the Park Service can promote a better understanding by Congress and other stakeholders of (1) the agency’s and each park’s priorities, (2) the links between the agency’s and each park’s priorities, (3) the results achieved with the funds provided, and (4) the shortfalls in performance.As it sought to implement the Results Act, the Park Service has faced difficult circumstances, including multiple missions that are often competing and resistant to direct measurement, and extraordinarily decentralized operations, for which many parks possess distinct legislative mandates. Copies will also be made available to others upon request. GAO Comments 1. 2. 3. Implementation of the Government Performance and Results Act by the Park Service The Park Service’s approach to implementing the Results Act was phased and iterative and involved both top management and field staff.

Why GAO Did This Study Pursuant to a congressional request, GAO reviewed: (1) how the Government Performance and Results Act has influenced planning and budgeting at the National Park Service (NPS); (2) the extent to which strategic and annual planning and budgeting processes have become linked and the challenges in achieving such a linkage; and (3) any insight that NPS's experiences with results-oriented management and budgeting suggest for other agencies implementing the Results Act. What GAO Found GAO noted that: (1) NPS implemented the Results Act by instituting a results-oriented planning process that has introduced for the first time servicewide goals to be achieved by park managers; (2) at the same time, NPS addressed the diversity and decentralized nature of the park system by requiring parks to develop strategic plans to address both applicable servicewide goals as well as goals specific to their unique legislative and operating environments; (3) both NPS and individual parks and programs have prepared strategic and annual performance plans with measurable outcome-oriented goals; (4) to link these plans to their budget, NPS designed an information system to report park estimates of spending according to goals; (5) although NPS has made some progress in connecting performance plans with budgets, significant issues remain to be resolved; (6) NPS's efforts to track actual spending according to performance goals have been hampered by the incompatibility between its activity-oriented budget and accounting systems and its goal-oriented strategic plan; (7) the most frequently cited challenges involved performance measurement and information systems; (8) performance measurement is complicated by the difficulty of defining outcome-oriented performance measures; (9) park staff also identified as a challenge the absence of information systems that link spending information to goals; (10) despite limited experience with managing for results, parks reported some benefits from their initial efforts; (11) benefits included better information about how park resources were being spent on desired park outcomes and increased communication and resource sharing across division lines; (12) although NPS is still in the early stages of implementing the Results Act, the progress it has made and the challenges that remain provide valuable insights that could prove useful to other agencies as they implement the act; (13) NPS has demonstrated how to develop an agencywide strategic planning process in a decentralized operating environment; (14) NPS officials recognized that strong field-level involvement in developing the servicewide plan and the field-oriented approach to implementing the Results Act resulted in greater ownership by the field staff charged with achieving the results; and (15) however, changes to these systems will require extensive consultations and consensus among the agency, the Office of Management and Budget, and Congress.

gao_GAO-07-1025T

gao_GAO-07-1025T_0

The program awards grants to public housing authorities (PHA). Public funding can come from federal, state, and local sources. They approve changes to the revitalization plan and coordinate the review of the community and supportive services plan that each grantee submits. In 2003, Congress reauthorized the HOPE VI program and required us to report on the extent to which public housing for the elderly and non- elderly persons with disabilities was severely distressed. Grantees Had Projected A General Increase in Leveraged Funds, Primarily From Federal Sources According to our analysis of HUD data for our November 2002 report, housing authorities expected to leverage an additional $1.85 in funds from other sources for every dollar received in HOPE VI revitalization grants awarded since the program’s inception through fiscal year 2001. Finally, our analysis showed that although the majority of funds budgeted overall for supportive services were HOPE VI funds, the amount of non-HOPE VI funds budgeted for supportive services increased dramatically since the program’s inception. We recommended that the Secretary of Housing and Urban Development provide these annual reports to Congress and include in these annual reports, among other things, information on the amounts and sources of funding used at HOPE VI sites, including equity raised from low-income housing tax credits, and the total cost of developing public housing units at HOPE VI sites, including the costs of items subject to HUD’s development cost limits and those not subject. In response to this recommendation, HUD issued annual reports to Congress for fiscal years 2002 through 2006 that include information on the amounts and sources of funding used at HOPE VI sites. Based on data reported in the 2006 annual report, since the program’s inception HOPE VI grantees have cumulatively leveraged $1.28 per HOPE VI grant dollar expended. HUD’s Oversight of Projects and Enforcement of Program Requirements Had Been Inconsistent Our May 2003 report found that a variety of factors diminished HUD’s ability to oversee HOPE VI grants. In particular, the limited numbers of grant managers, a shortage of field office staff, and confusion about the role of field offices had diminished the agency’s ability to oversee HOPE VI grants. HUD agreed with this recommendation, and in December, 2003 notified several grantees that they were nearing deadlines and that failure to meet these deadlines could result in HUD placing the grant in default. About Half of Public Housing Residents Were Expected to Return to Revitalized Sites, while Evidence Suggested That Communities Surrounding Some HOPE VI Sites Had Improved In our November 2003 report, we found that most residents at HOPE VI sites had been relocated to other public housing, or other subsidized housing, and that grantees expected that about half of the original residents would return to the revitalized sites. Further, HUD data and information obtained during our site visits suggested that the supportive services provided public housing residents yielded at least some positive outcomes. Most Original Residents Were Relocated to Other Public Housing, and About Half Were Expected to Return to Revitalized HOPE VI Sites According to HUD data, approximately 50 percent of the almost 49,000 residents that had been relocated as of June 30, 2003, had been relocated to other public housing; about 31 percent had used vouchers to rent housing in the private market; approximately 6 percent had been evicted; and about 14 percent had moved without giving notice or vacated for other reasons. 1996 HOPE VI Communities Experienced Positive Changes According to our analysis of census and other data, the neighborhoods in which 1996 HOPE VI sites are located generally have experienced improvements in a number of indicators used to measure neighborhood change, such as educational attainment levels, average housing values, and percentage of people in poverty.

Why GAO Did This Study Since fiscal year 1992, the Department of Housing and Urban Development (HUD) has awarded more than $6 billion in HOPE VI program grants to public housing authorities to revitalize severely distressed public housing and provide supportive services to residents. HUD has encouraged housing authorities to use their HOPE VI grants to attract, or leverage, funding from other sources, including other federal, state, local, and private-sector sources. Projects funded with public and private funds are known as mixed-finance projects. This testimony is based primarily on three reports that GAO issued between November 2002 and November 2003, focusing on (1) the financing of HOPE VI projects, including the amounts of funds leveraged from non-HOPE VI sources; (2) HUD's oversight and administration of the program; and (3) the program's effects on public housing residents and neighborhoods surrounding HOPE VI sites. As requested, the statement summarizes the key findings from these reports, the recommendations GAO made to HUD for improving HOPE VI program management, and HUD's actions in response to the recommendations. What GAO Found In its November 2002 report, GAO found that housing authorities expected to leverage--for each HOPE VI dollar received--$1.85 in funds from other sources, and that the authorities projected generally increasing amounts of leveraged funds. GAO also found that even with the general increase in projected leveraging, 79 percent of the budgeted funds in mixed-finance projects that HUD had approved through fiscal year 2001 came from federal sources. GAO recommended that HUD provide the Congress with annual reports on the HOPE VI program, as required by statute, and provide data on the amounts and sources of funding used at HOPE VI sites. HUD has submitted these reports to Congress since fiscal year 2002. According to the 2006 report, HOPE VI grantees have cumulatively leveraged, from the program's inception through the second quarter of fiscal year 2006, $1.28 for every HOPE VI grant dollar expended. In its May 2003 report, GAO found that HUD's oversight of the HOPE VI program had been inconsistent for several reasons, including a shortage of grant managers and field office staff and confusion about the role of field offices. A lack of enforcement policies also hampered oversight; for example, HUD had no policy regarding when to declare a grantee in default of the grant agreement or apply sanctions. GAO made several recommendations designed to improve HUD's management of the program. HUD concurred with these recommendations and has taken actions in response, including publishing guidance outlining the oversight responsibility of field offices and notifying grantees that they would be in default of their grant agreement if they fail to meet key deadlines. In its November 2003 report, GAO found that most of the almost 49,000 residents that had been relocated as of June 2003 had moved to other public or subsidized housing; small percentages had been evicted, moved without giving notice, or vacated for other reasons. Grantees expected that about half of the original residents would return to the revitalized sites. Limited HUD data and information obtained during GAO's site visits suggested that the grantee-provided community and supportive services had yielded some positive outcomes, such as job training and homeownership. Finally, GAO's analysis of Census and other data showed that neighborhoods surrounding 20 HOPE VI sites (awarded grants in 1996) experienced improvements in several indicators used by researchers to measure neighborhood change, such as educational attainment levels, average household income, and percentage of people in poverty. However, for a number of reasons, GAO could not determine the extent to which the HOPE VI program was responsible for the changes.

gao_GAO-17-109

gao_GAO-17-109_0

Each autism characteristic may vary in type and degree from person to person and can fluctuate over time. Panel Theme: Needs for Services and Supports Depend on Transitioning Youths’ Goals for Adulthood The panel told us that youth with ASD may need services addressing individual autism characteristics—or a combination of autism characteristics and other health conditions—that affect their ability to attain their goals for adulthood. The panel discussed the importance of valuing the characteristics that may facilitate goals and warned against assuming that autism characteristics need to be “fixed.” The panel discussion, however, focused primarily on services and supports needed to address autism characteristics that can hinder progress toward goal attainment. The panel said that in order for youth with ASD to achieve health and safety, there need to be enough medical and mental health caregivers who are trained in the unique needs of patients with ASD and prepared to accommodate them. Panel Theme: The Need for Access to Evidence-Based Services that Are Individualized, Flexible, Timely, and Provided in the Community Individualized and Flexible Supports The panel said that, like other transitioning youth with disabilities, autistic youth need a personalized mix of services that address their unique support needs. A comprehensive approach which provides individualized, consumer- directed supports in all of these areas can enable all autistic people to participate in their communities, self-advocate, and live meaningful and productive lives with a high quality of life, regardless of level of disability.” The panel said that individuals with ASD need flexible services and supports that can adapt to changes in their needs. The panel also noted that girls and minority students are diagnosed with ASD at a later age than other youth, on average—sometimes after they have left high school. As a result, the panel said, they may have received fewer services and may need more help as they transition to adulthood. On Access to Services “Without transportation, it can be difficult or impossible for autistic youth to hold jobs, pursue higher education, go to community events, meet with peers, access healthcare, or develop relationships, hobbies, or interests outside of the home.” Well-Coordinated, Holistic Supports According to the panel, services for transitioning youth with ASD should be well-coordinated, with service providers, youth, and their families agreeing on common goals and communicating regularly. Local services may help youth better integrate into their community. The really shocking thing in all this is that we spend roughly $130 billion per year on services for autism across the lifespan but we have so little insight into who gets what and with what effect.” Panel Theme: A New Approach to Supporting Youth with Autism to Enhance Their Integration into Society To improve the ability of youth with ASD to fully participate in society, the panel cited the need for a paradigm shift, including a new approach to supports. In this new paradigm, society and autistic youth alike would share the responsibility for inclusion, and the public and service providers would have better understanding of autistic youths’ potential. Appendix I: Objectives, Scope, and Methodology This is the first in a series of reports on youth with autism transitioning to adulthood. A second engagement will examine the services provided to transitioning youth with ASD and any challenges they may face obtaining them. 2. How can youth with autism be fully integrated into society? Choosing Panelists To answer our research questions, we convened a roundtable discussion on March 3 and 4, 2016. Panel Topics of Discussion We asked the panel about the services that transitioning youth across the autism spectrum need to help them achieve five goals for adulthood: 1. Postsecondary education. Employment. 3. Maximizing community integration. Appendix II: Agenda and List of Invited Panelists Appendix III: Services and Supports for Transitioning Youth with Autism Identified By the Panel The panel identified 14 broad categories of services and supports that may help youth with Autism Spectrum Disorders (ASD) attain the goals of education, employment, health/safety, independent living, and community integration as they transition to adulthood.

Why GAO Did This Study About a half a million youth with ASD will enter adulthood over the next decade. As they exit high school, they must obtain services as adults. Previous GAO work has shown that students with disabilities who are transitioning to adulthood face challenges identifying and obtaining adult services. GAO was asked to study the services and supports youth with ASD need during the transition to adulthood. This is the first in a series of reports. GAO studied (1) the services and supports transitioning youth with ASD need to attain their goals for adulthood, (2) the characteristics of these services and supports, and (3) how youth with ASD can be fully integrated into society. To address these objectives, GAO convened a roundtable discussion on March 3 and 4, 2016. GAO selected 24 panelists, including adults with ASD, service providers, researchers, and parents of youth with ASD. GAO interviewed prospective panelists in advance of the discussion and selected a panel with a broad base of expertise reflecting the diversity of the autism community. The panel described the services and supports that youth with ASD may need to help them achieve five goals for adulthood: postsecondary education; employment; maximizing independent living; health and safety; and maximizing community integration. GAO analyzed the transcripts of the panel as well as documents provided by panelists. GAO is not making recommendations in this report. What GAO Found Youth with Autism Spectrum Disorder (ASD) transitioning to adulthood may need a wide range of services and supports to help them achieve their goals, according to a panel GAO convened in March 2016. ASD is a highly individualized condition with characteristics that vary in degree and type from person to person. Autism characteristics may hinder or help youth achieve their goals—such as postsecondary education and community integration. For each goal, the panel described services and supports that youth (ages 14-24) with ASD transitioning to adulthood may need to address autism characteristics and other health conditions that affect their ability to attain the goal. GAO grouped these services into 14 broad categories. To support a successful transition into adulthood, the panel said youth need to be able to access services that are individualized, timely, equitable, and community- and evidence-based, among other things. The panel discussed the need for timely, individualized services that address the variation in autism characteristics and any changes over a person's lifetime. For example, a person's verbal abilities may change over time, and their needs for communication services would also change. The panel said transitioning youth with ASD need equitable access to services regardless of their race, gender, family income, or location. For instance, the panel said that female and minority youth may be diagnosed at a later age and thus receive fewer services during school and may need additional transition planning services. The panel also emphasized the need for services within youths' local communities in order to foster access and community involvement. In addition, the panel said that while services should be evidence-based, more research into program efficacy is needed. To improve the ability of autistic youth to fully integrate into society, the panel cited the need for a new approach to providing supports and better public understanding of autism. Such an approach would place a shared responsibility for inclusion on both society and youth with ASD. For example, according to the panel, youth with ASD should learn workplace social expectations and meet them to the extent they can, but employers should also recognize that some social rules, such as expecting individuals to smile, can be difficult for some individuals with autism. The panel also said that widespread knowledge of autism could lead to better understanding of autistic youths' potential and enhance their chances of attaining it.

gao_T-RCED-98-229

gao_T-RCED-98-229_0

In addition, the Fund’s overall performance is subject to the Results Act and the Office of Management and Budget’s (OMB) implementing guidance. Stronger Performance Measures Would Provide a Better Basis for Monitoring and Evaluating the CDFI Program’s Accomplishments While the assistance agreements that the Fund negotiated with awardees in the CDFI program satisfy the CDFI Act’s requirements for performance measurement, they include more measures of activity (what the awardees will do) than of accomplishment (how the awardees’ activities will affect distressed communities) and do not always include measures for key aspects of goals. As the CDFI Act requires, these assistance agreements include performance measures that (1) the Fund negotiated with the awardees and (2) are generally based on the awardees’ business plans. As of January 1998, the Fund had entered into assistance agreements with 26 of the 31 awardees for 1996. While the measures in the agreements included most of these elements, they generally lacked baseline values and dates. Refining the awardees’ goals and measures to meet Results Act guidance will facilitate the Fund’s assessment of the awardees’ progress over time. Mandated Monitoring and Evaluation Systems Are Not Yet in Place Although the Fund has developed reporting requirements for awardees to collect information for monitoring their performance, it lacks documented postaward monitoring procedures for assessing their compliance with their assistance agreements, determining the need for corrective actions, and verifying the accuracy of the information collected. Impact of BEA Awards on Banks’ Investment Activities Is Difficult to Assess In the BEA program, as of January 1998, about 58 percent of the banks had completed the activities for which they received the awards and the Fund had disbursed almost 80 percent of the $13.1 million awarded in fiscal year 1996. In addition, more complete data on some banks’ investments are needed to guarantee that the increases in investments in distressed areas rewarded by the BEA program are not being offset by decreases in other investments in these distressed areas. Furthermore, the Fund cannot be assured that the banks’ increased investments remain in place because it does not require banks to report any material changes in these investments. Banks have multiple incentives for investing in CDFIs and distressed areas. Reinvestment in community development is consistent with the goals of the BEA program. The Fund’s strategic plan does not explicitly address the relationship of the Fund’s activities to similar activities in other agencies or indicate whether or how the Fund coordinated with other agencies in developing its strategic plan. According to this official, the revised strategic plan, which the Fund expects to complete by August 1998, proposes to incorporate changes to the plan’s strategic goals, including the elimination of the two that are organizational rather than strategic; a new format for presenting goals and objectives that links benchmarks and planned evaluations to each goal, along with key external factors that could affect the Fund’s progress toward that goal; a budget structure that aligns the program’s activities with sources and uses of funds to better track the resources required to implement the program’s goals and objectives; a performance goal that measures the ability of the Fund to leverage its resources with those of the private sector; and an identification and description of crosscutting organizations and programs that duplicate or compliment the CDFI Fund’s programs.

Why GAO Did This Study GAO discussed the preliminary results of its ongoing review of the administration of the Community Development Financial Institutions (CDFI) Fund, focusing on: (1) the first year's performance of the CDFI and Bank Enterprise Award (BEA) programs and opportunities for improving their effectiveness; (2) the Fund's progress in developing performance measures for awardees and systems to monitor and evaluate their progress; (3) the impact of the BEA program on banks' investments in CDFIs and distressed communities; and (4) CDFI's progress in meeting the strategic planning requirements of the Government Performance and Results Act of 1993. What GAO Found GAO noted that: (1) as of January 1998, the Fund had entered into assistance agreements with 26 of the 31 CDFIs that received awards in 1996; (2) these agreements include performance goals and measures that were based on the business plans submitted by awardees in their application packages and negotiated between the Fund and the awardees, as the CDFI Act requires; (3) these agreements are consistent with the program's objectives; (4) using the Results Act for guidance, GAO found that the performance measures in the assistance agreements generally assess activities rather than accomplishments reflecting the results of activities; (5) GAO further found that although the performance measures in the assistance agreements are generally related to specific goals, they do not always address all key aspects of the goals, and most assistance agreements lack baseline data that would facilitate tracking progress over time; (6) the Fund has developed reporting requirements for awardees to collect information for monitoring their performance and is developing post-award monitoring procedures for assessing their compliance with their assistance agreements; (7) the Fund currently does not have a system for evaluating the impact of awardees' activities; (8) although the Fund has disbursed about 80 percent of the fiscal year 1996 BEA awards funds, it is difficult to determine the extent to which the program has encouraged the 38 awardees to increase their investments in distressed communities; (9) in addition, some banks do not collect all of the data on their activities needed to guarantee that increases in investments under the BEA program are not being offset by decreases in other investments in these distressed areas; (10) furthermore, the Fund cannot be assured that banks' increased investments remain in place because it does not require banks to report any material changes in the status of these investments; (11) the CDFI Fund's strategic plan contains all of the elements required by the Results Act and the Office of Management and Budget's associated guidance, but these elements generally lack the clarity, specificity, and linkage with one another that the act envisioned; (12) although the plan identifies key external factors that could affect the Fund's mission, it does not relate these factors to the Fund's strategic goals and objectives and does not indicate how the Fund will take the factors into account when assessing awardees' progress toward goals; and (13) in addition, the plan does not describe the relationship of its activities to similar activities in other government agencies.

gao_GAO-15-358

gao_GAO-15-358_0

The spending requirements for SBIR and STTR are to be calculated as a percentage of each agency’s extramural R&D obligations, provided their extramural R&D obligations exceed the participation thresholds of $100 million for SBIR and $1 billion for STTR. SBA Cannot Fully Determine Compliance with Spending Requirements, but Data Submitted to SBA Indicate Most Agencies Met the Requirements SBA cannot fully determine if all 11 agencies met their spending requirements for fiscal year 2013, as 9 of the 11 participating agencies did not follow SBA’s guidance in submitting data on their total extramural R&D obligations. The Small Business Act requires agencies to calculate their spending requirements based on their extramural R&D budget, but it defines the extramural R&D budget as the actual obligations over the course of the year—which are not fully known until the end of the year— rather than the amount that agencies propose to spend on the program early in the fiscal year. SBA’s ability to conduct an accurate assessment of whether agencies are complying with spending requirements is dependent on agencies submitting the correct data. Agencies Did Not Comply with All Methodology Reporting Requirements Each of the agencies participating in the SBIR and STTR programs submitted the required reports describing the methodology used for calculating the amount of their extramural R&D budgets to SBA for fiscal year 2013, but agencies did not comply with all methodology reporting requirements. Specifically, DOD, EPA, and NSF either did not itemize the specific programs that they excluded, did not explain the reasons why they excluded the programs, or both. SBA Has Not Submitted Its Required Report to Congress for Fiscal Year 2013 SBA has not issued its report to Congress on the programs for fiscal year 2013. Without assessing whether the information it collects is adequate to analyze agencies’ methodology reports, SBA cannot provide Congress with an accurate analysis of how agencies calculate their extramural R&D. Changing the Calculation Methodology for Determining Spending Requirements Could Increase Spending Requirements and Participation with Potential Benefits and Drawbacks Potential effects of changing the methodology to calculate the SBIR and STTR spending requirements based on each agency’s total R&D budget instead of its extramural R&D obligations include an increase in the amount of each agency’s spending requirement—for some agencies more than others—and an increase in the number of agencies required to participate. However, such a scenario would lower spending requirements at some agencies and raise them at others. Total Administrative Spending in Fiscal Year 2013 Is Unknown, but Six Agencies Spent $12.3 Million on the Administrative Pilot Program Little is known about total administrative spending for fiscal year 2013 because the agencies that participate in the SBIR and STTR programs are not required to and do not fully track these costs. Agencies participating in the administrative pilot program reported spending $12.3 million on various new administrative and oversight activities in fiscal year 2013, but this amount does not represent total administrative spending. The 2011 reauthorization of the programs requires SBA to provide Congress with a report on the use of administrative pilot program funds.was the first year of the pilot program, and SBA officials said they were still determining the information they needed to report to Congress. Conclusions Federal agencies have awarded billions of dollars to small businesses under the SBIR and STTR programs to develop and commercialize innovative technologies. Recommendations for Executive Action To ensure full compliance with SBIR and STTR spending and reporting requirements, we recommend that the SBA Administrator take the following three actions: Notify Congress in SBA’s annual report if it cannot determine agency compliance with program spending requirements when agencies that participate in the SBIR and/or STTR programs do not report extramural R&D obligations data, or develop a proposal to Congress that would change the requirement. GAO staff who made key contributions to this report are listed in appendix V. Appendix I: Agencies’ Compliance with Spending Requirements for the Small Business Innovation Research Program for Fiscal Year 2013, according to Agency Data The data that the agencies submitted to the Small Business Administration (SBA) indicate that 9 of the 11 participating agencies spent amounts for the Small Business Innovation Research (SBIR) program that met or exceeded their fiscal year 2013 spending requirements, while spending for the remaining 2 agencies did not meet the requirements.

Why GAO Did This Study Federal agencies have awarded more than 156,000 contracts and grants, totaling nearly $40 billion through the SBIR and STTR programs to small businesses to develop and commercialize innovative technologies. The Small Business Act requires agencies with extramural R&D obligations that meet certain thresholds for participation—$100 million for SBIR and $1 billion for STTR—to spend a percentage of these funds on the programs. The agencies are to report on their activities to SBA and, in turn, SBA is to report to Congress. The 2011 reauthorization of the programs mandated GAO to review compliance with spending and reporting requirements, as well as other program aspects. This report examines, for fiscal year 2013, (1) the extent to which agencies complied with spending requirements, (2) the extent to which agencies and SBA complied with certain reporting requirements, (3) the potential effects of basing spending requirements on total R&D budgets, and (4) what is known about the amounts spent on administering the programs. GAO reviewed agency spending data and required reports for fiscal year 2013 and interviewed program officials from SBA and the participating agencies. What GAO Found The Small Business Administration's (SBA) ability to fully determine compliance with spending requirements for the Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs for fiscal year 2013 is limited because most agencies submitted incorrect data. Nevertheless, analyzing agency data submitted to SBA suggests that 9 of the 11 agencies participating in the SBIR program and 4 of the 5 agencies participating in the STTR program complied with spending requirements for fiscal year 2013. Specifically, agencies are required to submit the actual amount obligated for extramural research or research and development (R&D)—which is generally conducted by nonfederal employees outside of federal facilities—and these obligations are the basis for calculating the agencies' spending requirements. However, most agencies submitted budget data instead. Program managers raised concerns about the difficulties in determining the amount of extramural R&D obligations and the challenges in using this amount to calculate spending requirements, as extramural R&D obligations are not known until after the end of the fiscal year. However, without the required data, SBA cannot accurately report on agencies' compliance with spending requirements—as defined in the law—to Congress. Some agencies did not comply with certain methodology reporting requirements for the programs. For example, 3 of the 11 participating agencies did not itemize the specific programs they excluded from their extramural R&D in their required methodology reports, or did not explain the reasons why they excluded the programs, or both. GAO also found that SBA did not assess whether the information it collected was adequate to appropriately analyze agencies' methodology reports. Without such an assessment, SBA cannot provide Congress with an accurate analysis of how agencies calculate their extramural R&D. Furthermore, SBA has not issued its required report to Congress on the programs for fiscal year 2013. Basing the programs' spending requirements on total R&D instead of extramural R&D could increase the amount of each agency's spending requirement and increase the number of agencies required to participate. Some agency officials said that basing the calculation methodology on their total R&D budget would make administering their programs easier, but officials at other agencies said that the change could result in reduced funding for intramural research and extramural research outside of the SBIR and STTR programs. Little is known about total administrative spending on the programs for fiscal year 2013 because the agencies that participate are not required to and do not fully track these costs. Six agencies participated in an administrative pilot program that allowed them to spend program funds on new administrative and oversight activities in fiscal year 2013. These agencies reported spending $12.3 million on these activities, but this amount does not represent total administrative spending. Additionally, this is about 20 percent of what the agencies had planned to spend on the administrative pilot program at the beginning of the fiscal year. Program managers at seven agencies told GAO that they would prefer that the administrative pilot program were either extended or made permanent. What GAO Recommends GAO recommends, among other things, that SBA notify Congress if it cannot determine agency compliance with spending requirements and assess the adequacy of the methodology reporting requirement. SBA generally agreed with GAO's findings and recommendations.

gao_T-RCED-98-127

gao_T-RCED-98-127_0

The successor to ICC, STB is responsible for the economic regulation of railroads and certain pipelines, as well as some motor carrier and water carrier activities. Rail issues constitute the majority of STB’s workload. In fiscal year 1997, STB dedicated 116 of its 131 full-time equivalent staff (89 percent) to rail issues. Pipelines Have Historically Been Regulated to Ensure That Their Rates Are Reasonable Historically, the federal government has regulated industries engaged in interstate commerce—including common carrier pipelines—with inherent cost advantages that may limit competition from other pipelines as well as other modes of transportation. The regulation of pipelines has been imposed to enforce the common carrier obligation, including ensuring that, in the absence of competition, pipeline carriers do not charge unreasonably high rates relative to their costs The federal economic regulation of interstate pipelines is provided by two agencies: the Federal Energy Regulatory Commission, which regulates oil and gas pipelines, and STB, which regulates the remaining pipelines. Ability of Pipeline Alternatives to Compete Varies Throughout the Midwest The ability of alternatives to pipelines—local production within the Midwest, as well as barge and rail transport from other areas of the United States—to compete with pipelines within local market areas in the Midwest depends on two factors. We found that, while some local market areas currently served by pipelines also have access to alternatives, other market areas may not. Second, alternatives to pipelines must have the ability to increase their supply of anhydrous ammonia to serve these markets. We found that alternatives may not offer effective competition to pipelines because they have limited ability to increase their supply of anhydrous ammonia without additional investments in capital. Because of the large number of local markets that exist along the two midwestern anhydrous ammonia pipelines, we were not able to definitively determine the number of markets that do or do not have competitive alternatives to pipelines. 1.) 1.) Issues Before the Congress in Deciding the Future of STB’s Regulation of Pipelines No clear conclusions can be reached on whether the continued economic regulation of pipelines under STB’s jurisdiction is needed because such a determination requires the examination of competition in numerous local markets along 21 pipelines. There will be several issues before the Congress as it decides whether to extend, modify, or rescind STB’s authority to regulate pipelines. First, do pipelines under STB’s jurisdiction lack effective competition in a significant number of market areas and have the potential to charge unreasonably high rates? Third, does the limited number of pipeline rate cases indicate there is no need for continued regulation? Finally, would shippers have recourse if STB’s economic regulation of pipelines was eliminated?

Why GAO Did This Study GAO discussed the regulatory role of the Surface Transportation Board (STB), focusing on: (1) STB's responsibilities in regulating surface transportation; (2) the historical reasons for the economic regulation of pipelines; (3) the ability of alternatives to anhydrous ammonia pipelines to compete in the Midwest; and (4) issues before Congress as it decides to extend, modify or rescind STB's authority to regulate pipelines. What GAO Found GAO noted that: (1) STB is responsible for the economic regulation of railroads and certain pipelines, as well as some aspects of motor carrier and water carrier transportation; (2) the majority of STB's resources and workload are devoted to examining rail issues; (3) in fiscal year 1997, STB dedicated 89 percent of its staff years to rail issues and less than 1 percent to pipeline issues; (4) historically, the federal government has regulated the rates charged by interstate pipelines because pipelines have inherent cost advantages that may limit competition from other pipelines as well as from other modes of transportation; (5) two federal agencies--STB and the Federal Energy Regulatory Commission--regulate pipelines; (6) this regulation includes ensuring that all shippers have access to pipeline transportation services and that the rates charged by pipeline carriers for these services are reasonable and nondiscriminatory; (7) the ability of alternatives to anhydrous ammonia pipelines to compete with pipelines in the Midwest varies, depending on these alternatives' access to the market areas served by pipelines and their ability to increase their supply of anhydrous ammonia to compete within those market areas; (8) GAO's work showed that some market areas currently served by pipelines also have access to alternatives, while other market areas may not; (9) however, even where alternatives to pipelines are available, they may not offer effective competition because they have limited ability to increase their supply of anhydrous ammonia without additional investments in capital; (10) because of the large number of local markets that exist along the two midwestern anhydrous ammonia pipelines, GAO was not able to definitively determine the number of markets that do or do not have competitive alternatives to pipelines; (11) no clear conclusions can be reached on whether continued economic regulation of pipelines under STB's jurisdiction is needed because such a determination requires the examination of competition in numerous local markets along 21 pipelines; and (12) however, as Congress considers reauthorizing STB, pipeline regulation issues to consider include: (a) whether pipelines do not face effective competition in a significant number of market areas and subsequently have the potential to charge unreasonably high rates; (b) what the costs of regulating pipelines are; (c) whether the limited number of pipeline cases before STB and its predecessor indicates there is no need for regulation; and (d) whether shippers would have any recourse if STB's economic regulation of pipelines was eliminated.

gao_GAO-08-359

gao_GAO-08-359_0

MA Plans Projected That They Would Allocate Relatively Little of Their Rebates to Additional Benefits and the Majority to Reduced Cost Sharing MA plans that received rebates projected, on average, that their rebates would be $87 PMPM. MA Plans Used Rebates and Additional Premiums to Cover Additional Benefits Such as Dental, Hearing, and Vision MA plans covered several common additional benefits with the rebates, additional premiums, or both. On the basis of plan projections, we estimated that rebates would pay for most of the additional benefits plans provided (77 percent), while additional premiums would pay for the remainder (23 percent). MA Plans Projected That MA Beneficiaries, on Average, Would Have Lower Cost Sharing Than if They Were in Medicare FFS, but Some MA Beneficiaries Could Pay More For 2007, MA plans projected that MA beneficiary cost sharing would be 42 percent of estimated cost sharing in Medicare FFS. For example, 19 percent of MA beneficiaries were enrolled in plans that projected higher cost sharing for home health services, on average, than Medicare FFS, which has no cost sharing for this service at all, and 16 percent of beneficiaries were enrolled in plans that projected higher cost sharing for inpatient services compared to Medicare FFS estimates. Because cost sharing is higher for some categories of services, some beneficiaries who frequently use these services can have overall cost sharing that is higher than what they would pay under Medicare FFS. MA plans projected that they would allocate approximately 9 percent of total revenue ($71 PMPM) to non-medical expenses, and approximately 4 percent ($30 PMPM) to the plans’ margin, on average. Plans projected that they would use a relatively small portion of their rebates—approximately 11 percent—to provide benefits that are not covered under Medicare FFS. Whether the value that MA beneficiaries receive in the form of reduced cost sharing, lower premiums, and extra benefits is worth the increased cost borne by beneficiaries in Medicare FFS and other taxpayers is a decision for policymakers. However, if the policy objective is to subsidize health care costs of low- income Medicare beneficiaries, it may be more efficient to directly target subsidies to a defined low-income population than to subsidize premiums and cost sharing for all MA beneficiaries, including those who are well off. As Congress considers the design and cost of the MA program, it will be important for policymakers to balance the needs of beneficiaries— including those in MA plans and those in Medicare FFS—with the necessity of addressing Medicare’s long-term financial health. CMS also expressed concern that the report was not balanced because it did not sufficiently focus on the advantages of MA plans. This modification did not change our message that some beneficiaries in MA plans could have higher out-of-pocket costs. Plan A submits a bid of $700 per member per month (PMPM). As a result, the plan receives no rebate. Appendix II: Scope and Methodology This section describes the scope and methodology used to analyze our four objectives: (1) how MA plans projected they would allocate the rebates they receive, (2) what additional benefits MA plans commonly covered with the rebates and additional premiums, and the projected costs of these additional benefits, (3) how MA plans’ projected beneficiary cost sharing, overall and by type of service, compared to Medicare fee-for- service (FFS), and (4) how MA plans projected they would allocate their revenue to medical and other expenses. However, since MA plans use both rebates and additional premiums as a funding source for these additional benefits, reduced premiums, and reduced cost sharing, we calculated the proportion of total funding plans projected they would spend on additional benefits, reduced premiums, and reduced cost sharing and applied these projections to the projected rebate. We reported the percentages of beneficiaries in plans that projected medical expenses less than 85 percent.

Why GAO Did This Study In 2006, the federal government spent about $59 billion on Medicare Advantage (MA) plans, an alternative to the original Medicare fee-for-service (FFS) program. Although health plans were originally envisioned in the 1980s as a potential source of Medicare savings, such plans have generally increased program spending. Payments to MA plans have been estimated to be 12 percent greater than what Medicare would have spent in 2006 had MA beneficiaries been enrolled in Medicare FFS. Some policymakers are concerned about the cost of the MA program and its contribution to overall spending on the Medicare program, which already faces serious long-term financial challenges. MA plans receive a per member per month (PMPM) payment to provide services covered under Medicare FFS. Almost all MA plans receive an additional Medicare payment, known as a rebate. Plans use rebates and sometimes additional beneficiary premiums to fund benefits not covered under Medicare FFS, reduce premiums, or reduce beneficiary cost sharing. This report examines for 2007 (1) MA plans' projected rebate allocations; (2) additional benefits MA plans commonly covered and their costs; (3) MA plans' projected cost sharing; and (4) MA plans' allocation of projected revenues and expenses. GAO analyzed data on MA plans' projected revenues and covered benefits for the most common types of MA plans, accounting for 71 percent of all beneficiaries in MA plans. What GAO Found In 2007, plans projected that relatively little of their rebates would be spent on additional benefits compared to cost-sharing and premium reductions. Of the average projected rebate amount of $87 PMPM, plans projected they would allocate about $10 PMPM (11 percent) to additional benefits, about $61 PMPM (69 percent) to reduced cost sharing, and about $17 PMPM (20 percent) to reduced premiums. Using funding from both rebates and additional premiums, plans covered a variety of additional benefits not covered by Medicare FFS in 2007, including dental and vision benefits. On the basis of plans' projections, GAO estimated that rebates would pay for approximately 77 percent of additional benefits and additional beneficiary premiums would pay for the remaining 23 percent. MA plans projected that, on average, beneficiaries in their plans would have lower cost sharing than Medicare FFS cost-sharing estimates, although some MA plans projected that their beneficiaries would have higher cost sharing for certain service categories, such as home health care and inpatient services. Because cost sharing was projected to be higher for some categories of services, beneficiaries who frequently used these services could have had overall cost sharing that would be higher than under Medicare FFS. On average, MA plans projected that they would allocate about 87 percent of total revenue ($683 of $783 PMPM) to medical expenses; approximately 9 percent ($71 PMPM) to non-medical expenses, including administration, marketing, and sales; and approximately 4 percent ($30 PMPM) to the plans' margin, sometimes called the plans' profit. About 30 percent of beneficiaries were enrolled in plans that projected they would allocate less than 85 percent of their revenues to medical expenses. Whether the value that MA beneficiaries receive in the form of reduced cost sharing, lower premiums, and additional benefits is worth the additional cost is a decision for policymakers. However, if the policy objective is to subsidize health care costs of low-income Medicare beneficiaries, it may be more efficient to directly target subsidies to a defined low-income population than to subsidize premiums and cost sharing for all MA beneficiaries, including those who are well off. As Congress considers the design and cost of MA, it will be important for policymakers to balance the needs of beneficiaries and the necessity of addressing Medicare's long-term financial health. In commenting on a draft of this report, the Centers for Medicare & Medicaid Services expressed concern that the report was not balanced because it did not sufficiently focus on the advantages of MA plans. GAO disagrees. This report provides information on how plans projected they would use rebates and identified instances in which MA beneficiaries could have out-of-pocket costs higher than they would have experienced under Medicare FFS.

gao_AIMD-99-11

gao_AIMD-99-11_0

These advance payments are held in an FMS trust fund by the Department of the Treasury. As a result, FMS customers’ trust fund accounts were not being charged for millions of dollars of these costs for major defense equipment items they had received. Millions of Dollars Not Recovered DOD’s reports on nonrecurring costs for current sales cases show that as of March 1998, the Air Force and Navy had over $655 million of nonrecurring research, development, and production costs for major defense equipment sales that had not been recovered from FMS customers. From July 1993 through November 1995, 48 F-16 aircraft were delivered to South Korea. While DOD’s accounting records showed that the FMS customer’s account had been charged for over $1.3 billion to pay the contractor and DOD activities for their costs, the Air Force program office had not completed the necessary delivery and cost reports in order to recover the U.S. government’s nonrecurring costs of $1,018,050 per aircraft. Recommendations We recommend the Secretary of Defense direct the Under Secretary of Defense (Comptroller) to require the Air Force and Navy to recover the over $183 million identified in this report as nonrecurring research, development, and production costs that have not been charged to FMS customers’ trust fund accounts for major defense equipment that has already been delivered, review all the other open FMS cases that require FMS customers to pay a proportionate amount of nonrecurring research, development, and production costs for major defense equipment and recoup nonrecurring costs that have not yet been recovered for items that have already been delivered to FMS customers, and follow DOD policies and procedures for reporting the delivery of major defense equipment so that the FMS customers’ accounts can be charged with nonrecurring research, development, and production costs and amounts transferred to the general fund of the Treasury within the 30 days required by DOD policy.

Why GAO Did This Study Pursuant to a congressional request, GAO reviewed the Department of Defense's (DOD) ability to account for and report on the full costs of the foreign military sales (FMS) program, focusing on DOD's: (1) recoupment of monies owed by FMS customers for the U.S. government's research, development, and production costs of major defense equipment; and (2) accountability over expenditures of FMS customers' funds. GAO focused on Air Force and Navy activities. What GAO Found GAO noted that: (1) the Air Force and Navy were not always recovering nonrecurring research, development, and production costs from the FMS trust fund as major defense equipment items were delivered to the FMS customer; (2) specifically, GAO identified over $183 million of nonrecurring costs related to items that were delivered--some as long ago as 1989--that had not been charged to the FMS customers' trust fund account; (3) for example, between July 1993 and November 1995, South Korea received 48 F-16 aircraft on a FMS case managed by the Air Force; (4) GAO's review of the case disclosed that no deliveries had been reported for the purpose of recovering nonrecurring research, development, and production costs; (5) had the Air Force followed DOD's procedures and reported the deliveries and recouped the nonrecurring costs within 30 days of physical delivery of the aircraft, it would have already charged South Korea's trust fund account for over $49 million of nonrecurring research, development, and production costs; and (6) Air Force and Navy officials agreed that FMS customers were not being properly charged for millions of dollars of nonrecurring costs for major defense equipment items they had received and have begun to take actions to recover the outstanding amounts.

gao_GAO-08-535

gao_GAO-08-535_0

Culturally appropriate health care is care that is respectful of and responsive to the cultural needs of patients. VA Medical Centers Are Implementing VA’s LEP Directive; However, Utilization of Language Access Services Is Low VA medical centers are implementing VA’s LEP Directive in terms of assessing the language needs of its veteran service population, and, if necessary, developing language assistance policies. VA medical centers and facilities have offered language access services that include providing translated materials and interpretation services to meet the needs of veterans with LEP. However, VA and medical center officials told us that they expect the demand for language access services to grow as the increasingly diverse servicemember population transitions to veteran status. VA Medical Centers Have Implemented the LEP Directive VA stated that by June 2007 all of its medical centers had taken actions to implement the guidance in VA’s LEP Directive. In July 2007, VA reported that as a result of its follow- up efforts, all of VA’s medical centers, in accordance with the LEP Directive, had assessed the language needs of their veteran service population and developed language assistance policies as needed. The VA medical centers and facilities included in our in-depth review also provide translated materials to meet the various language needs of their veteran service populations. For example, staff members at all six of these medical centers maintained a list of bilingual medical center staff who volunteered to provide interpretation services during a clinical encounter between a provider and a veteran with LEP. In addition, staff at five of the six VA medical centers had contract telephone interpretation services available as a means to help effectively communicate with veterans and their families with LEP. In addition to efforts made by VA’s medical centers to provide language access services, some of VA’s Vet Centers have also made efforts to provide language access services to ensure that veterans with LEP have meaningful access to counseling and other services. VA Medical Centers Are Addressing the Need for Culturally Appropriate Health Care Services through Staff Training and Tailoring Health Care Services In an effort to address the cultural differences represented in its veteran service population, VA medical centers have conducted training programs to increase staff awareness about cultural diversity and the need for culturally appropriate health care services. VA Medical Centers and Facilities Have Provided Health Care Services Tailored to Meet the Needs of a Culturally Diverse Veteran Population VA medical centers and facilities have provided numerous health care services designed to meet the needs of the culturally diverse veteran population that differs in terms of race, ethnicity, sex, as well as age. During our in-depth review of 16 VA medical centers and facilities, officials identified a number of health care services that are provided in a culturally appropriate manner: Two medical centers and one Vet Center offer spiritual services, which include the use of medicine men and traditional healing rituals, in order to meet the needs of Native American veterans. To facilitate the delivery of culturally appropriate health care services, all VA medical centers have a minority veterans program coordinator. The role of the minority veterans program coordinator is to identify barriers to health care and advise medical center officials in developing services to make health care more accessible and culturally appropriate for minority veteran populations. To promote the availability of culturally appropriate care, the six VA medical centers included in our in-depth review have implemented a variety of targeted outreach efforts to different veteran populations. VA agreed with the information presented as it pertained to VA.

Why GAO Did This Study The Department of Veterans Affairs (VA) faces challenges in bridging language and cultural barriers as it seeks to provide quality health care services to an increasingly diverse veteran population in terms of race, ethnicity, sex, and age. To meet the needs of veterans with limited English proficiency (LEP), VA issued an LEP Directive that provides guidance for medical centers in assessing language needs and, if needed, developing language access services designed to ensure effective communication between English-speaking providers and those with LEP. In addition, VA is also challenged to deliver health care services in ways that are culturally appropriate--that is, respectful of and responsive to the cultural values of a diverse veteran population. In light of these challenges, GAO was asked to discuss the (1) actions VA has taken to implement its LEP Directive and the status of veterans' utilization of language access services, and (2) efforts VA has made to provide culturally appropriate health care services. GAO reviewed VA's policies and the LEP Directive, interviewed VA officials and reviewed efforts by 6 VA medical centers and 10 other VA facilities to implement VA's LEP Directive and to provide culturally appropriate health care services. GAO also reviewed documents from 17 other VA medical centers related to implementation of the LEP Directive. What GAO Found VA reported that as of June 2007, all of its medical centers had taken action to implement the guidance in VA's LEP Directive. Specifically, medical center officials told VA that they had assessed the language needs of their veteran service populations, and, if necessary, developed language assistance policies and offered language access services, including providing translated materials and interpretation services. The VA medical centers GAO reviewed provided translated materials to meet the various language needs of their veteran service populations and offered interpretation services as well. For example, VA medical centers maintained a list of bilingual medical center staff who can provide interpretation services during a clinical encounter between a provider and a veteran with LEP. In addition, five of the six VA medical centers GAO reviewed can access telephone interpretation services that are provided through a contract to help ensure that medical staff can communicate with veterans and their families with LEP. According to officials at medical centers GAO reviewed, utilization of language access services is low. However, VA officials told GAO that they expect the demand for language access services to grow as the increasingly diverse military servicemember population transitions to veteran status. VA medical centers are addressing the need for culturally appropriate health care services through staff training and tailoring health care services. Medical centers provide training for medical center staff to facilitate the delivery of culturally appropriate health care services including an annual mandatory training on the health care needs of veterans in various age groups. VA medical centers and other VA facilities GAO reviewed have implemented a variety of measures to meet the needs of their culturally diverse veteran populations. For example, three VA facilities GAO reviewed offer spiritual services, such as the use of medicine men and traditional healing rituals, in order to meet the needs of Native American veterans. Also, VA has minority veterans program coordinators at each medical center to identify barriers to health care for minorities and advise medical center officials in developing services to make health care more accessible and culturally appropriate for minority veteran populations. VA medical centers GAO reviewed have also initiated outreach efforts to promote the availability of culturally appropriate care. In commenting on a draft of this report, VA stated that it agreed with the information presented as it pertained to VA.

gao_NSIAD-96-65

gao_NSIAD-96-65_0

Demand for Offsets in Selected Countries Has Increased Over the last 10 years, the countries in our study have increased their demands for offsets, begun to emphasize longer term offset projects and commitments, or initiated offset requirements. More recently, buying countries have changed their offset strategies in an attempt to achieve lasting economic benefits. Types of Offsets Required by Countries Depend on Offset Goals and Economic Development The types of offsets required by the countries in our review depend on their offset program goals and the country’s economy—whether it is developed, newly industrialized, or less industrialized. Companies undertake a broad array of activities to meet these offset obligations. These countries have well-established defense industries and are using offsets to channel work to their defense companies, thus supporting their defense industrial base. 12.) Some of the U.S. companies in our review expressed concern about the impact of defense-related offsets on the U.S. defense industry, particularly the loss of production to U.S. defense subcontractors and suppliers. Newly Industrialized Economies Countries in our study with developing defense and commercial industries, such as South Korea, Singapore, and Taiwan, have pursued both defense-related and nondefense-related offsets. The agreements with Saudi Arabia were informal and did not require a specified offset percentage. 2-3.) 1.) It is difficult to accurately measure the impact of offsets on the overall U.S. economy and on specific industry sectors that are critical to defense. Similarly, the impact of offsets on specific sectors of the U.S. economy cannot be accurately measured because reliable data on the number and size of offset agreements and the transactions used to fulfill these offsets are not readily available. Commerce plans to issue its first report in 1996. Actions Taken to Address Offsets In response to concerns raised about the impact of offsets, the President issued a policy statement in 1990 that reaffirmed DOD’s standing policy of not encouraging or participating directly in offset arrangements. This policy statement also recognized that certain offsets are economically inefficient and directed that an interagency team, led by DOD in coordination with the Department of State, consult with foreign nations on limiting the adverse effects of offsets in defense procurement. According to the Commerce Department, industry is not opposed to the initiation of consultations on offsets, but is concerned that the U.S. government might unilaterally limit the use of offsets. Military procurements exceeding $5 million are subject to offset. Range from 2 for local purchases to 10 for technology transfer. Indirect offsets.

Why GAO Did This Study Pursuant to a congressional request, GAO reviewed offset requirements associated with military exports, focusing on: (1) how the offset goals and strategies of major buying countries have changed; (2) the offset requirements of these countries and how they are being satisfied; and (3) the impact of offsets and any action taken by the U.S. government. What GAO Found GAO found that: (1) demands for offsets in foreign military procurement have increased in selected countries; (2) countries that previously pursued offsets are now demanding more; (3) countries are requiring more technology transfer, higher offset percentages, and higher local content requirements to offset their foreign military purchases; (4) further, countries that previously did not require offsets now require them as a matter of policy; (5) the offset strategies of many countries in GAO's study now focus on longer term offset deals and commitments; (6) this shift highlights these countries' use of offsets as a tool in pursuing their industrial policy goals; (7) the types of offset projects sought or required by buyer countries in GAO's review depend on their offset program goals, which in turn are driven by their industrial and economic development needs; (8) companies are undertaking a broad array of activities to satisfy offset requirements; (9) countries with established defense industries are using offsets to help channel work to their defense companies; (10) countries with developing defense and commercial industries pursue both defense- and nondefense-related offsets that emphasize the transfer of high technology; (11) countries with less industrialized economies often pursue indirect offsets as a way to encourage investment and create viable commercial businesses; (12) views on the impact of offsets on the U.S. economy and specific industries are divided; (13) measuring the impact of offsets on the economy as well as specific defense industries is difficult without reliable data; (14) the Department of Commerce is currently gathering additional information on the impact of offsets and is expected to issue a report in 1996; (15) to date, the executive branch agencies have consulted with other countries about certain offsets associated with individual defense procurements, but have not had an interagency team hold the broad-ranging discussions on the ways to limit the adverse impacts of offsets as called for in a 1990 presidential policy statement; (16) according to the Commerce Department, industry is not opposed to the initiation of consultations, but is concerned about unilateral U.S. government actions to limit the use of offsets; and (17) moreover, representatives from several defense companies expressed doubt about the government being able to enforce restrictions on offsets.

gao_GAO-16-60

gao_GAO-16-60_0

Potential Effect of a Fine on Remitters without Legal Status Is Uncertain and Depends on a Variety of Factors A proposed fine on immigrants unable to show proof of legal status who send money through remittance transfer providers covered under EFTA could raise money for border protection, but the potential amount of revenue to be generated is unknown. Net revenue from the fine—the total of all fines collected less CFPB’s administrative and enforcement costs— would depend on several key factors, namely the dollar amount of remittances sent by those without legal immigration status, changes in remitter behavior because of the fine, including a potential reduction in remittances through regulated providers, and the cost of enforcement. The revenue raised by the proposed fine would first be used to pay CFPB for enforcement costs. Lastly, providers told us the fine could have consequences for them, and one provider said that smaller providers would likely be affected the most. Given the uncertainty related to these important factors, we constructed a scenario analysis to illustrate how the revenue generated for border protection could vary based on the values we assume for the following, given our starting assumptions about the total volume of remittances and proportion of those in the formal sector: 1. the dollar amount of remittances sent by immigrants without legal 2. the reduction in remittances through regulated providers in response to the request to show proof of legal status or pay a fine, and 3. the magnitude of administrative and enforcement costs to CFPB. However, BEA’s methodology for estimating remittances is not consistent with government-wide policies and guidance on statistical practices or with BEA’s own best practices and thus produces unreliable estimates. However, BEA’s estimate is cited by national and international organizations and in some cases is incorporated into the estimates of these organizations, including the World Bank. BEA’s Estimates of Remittances from the United States BEA’s estimate of remittances from the United States (which it reports as personal transfers) totaled approximately $40 billion in 2014. BEA’s Methodology Resulted in Unreliable Estimates, Partly Due to its Failure to Follow Best Practices and Guidelines for Federal Statistical Agencies We found several issues with BEA’s methodology that resulted in unreliable remittance estimates. BEA Did Not Follow Its Own Best Practices for Documenting Its Procedures Despite OMB and agency guidance and best practices that would provide that BEA should document its procedures for developing its new model for estimating remittances, BEA did not prepare adequate, transparent documentation of its efforts to develop its new model. Such events would include supervisory review of methodological changes to BEA’s estimation model. Conclusions BEA’s updated model for estimating remittances produces unreliable results due to underlying issues with the data, such as missing information and measurement problems. Although BEA officials discount the importance of remittances as a component of international transactions statistics, the inability of BEA’s new model to produce more accurate remittances estimates is consequential, as BEA’s estimate is the official remittance estimate of the United States and is cited by both national and international organizations, and in some cases incorporated into the estimates of these organizations. Recommendations for Executive Action We recommend that the Secretary of Commerce direct the BEA Director to take the following actions: To improve the reliability of the annual official U.S. estimate of remittances, conduct additional analyses of BEA’s estimates using estimation techniques appropriate for dealing with the shortcomings of the data. However, we maintain that our findings related to the reliability of BEA’s remittance estimates and documentation of the methodology to produce such estimates are valid and support the recommendations we made in the report. Regarding our conclusion that BEA did not follow the best practices, policies, and guidance to which it is subject for documenting its methods and analyses, BEA stated that the documentation provided to GAO was fully adequate. BEA also rejected the statement that it did not follow best practices because it did not consider remittances to be influential. Appendix I: Objectives, Scope, and Methodology This report (1) discusses the potential effects of collecting information from and imposing a fine on remitters unable to provide proof of legal U.S. immigration status, and (2) examines the Bureau of Economic Analysis’ (BEA) remittance estimate and the extent to which the revised estimation methodology met government-wide policies and agency best practices. We also reviewed laws and regulations relevant to remittance transfer providers.

Why GAO Did This Study For many countries, remittances represent a large and stable source of foreign currency. Remittances have received increasing attention from policymakers as the volume of funds transferred has increased over the years. Despite the global significance of remittances, much remains unknown about the actual volume of remittances and the methods used to remit them. GAO was asked to study the potential effects of a fine on certain remitters and estimates of U.S. remittances. GAO examined (1) the potential effects of a fine on remitters unable to provide proof of legal immigration status, and (2) BEA's remittance estimate and the extent to which its revised estimation methodology met government-wide policies and best practices. GAO constructed a hypothetical scenario analysis to show the uncertainty associated with the effects of a fine. GAO interviewed, among others, BEA, International Monetary Fund and World Bank officials, and researchers. GAO also analyzed BEA's estimate of U.S. remittances and documentation of its methodologies. What GAO Found The Remittance Status Verification Act of 2015, S. 79, would require remittance transfer providers to request that all senders of remittances to recipients outside the United States provide proof of their legal status under U.S. immigration laws and impose a fine on those unable to provide such proof. The funds collected would be submitted to the Consumer Financial Protection Bureau (CFPB) to pay for its administrative and enforcement costs in carrying out the act, and any remaining funds would be used to pay expenses related to border protection. The fine may raise money for border protection, but the exact amount is unknown and would depend on several factors, including the dollar amount of remittances sent by those without legal status, changes in remitter behavior due to the fine, such as using unregulated transfer methods, and CFPB's administrative and enforcement costs to carry out the act. The first two factors above affect the volume of remittances that would be subject to a fine. The third factor affects the amount of net revenue from the fine remaining for border protection. Finally, remittance transfer providers told GAO that the fine could have consequences for them, including potentially disproportionate costs for small providers. The Bureau of Economic Analysis (BEA) estimated that remittances from the United States were approximately $40 billion in 2014. However, BEA's methodology for estimating remittances is not consistent with government-wide policies and guidance on statistical practices or with BEA's own best practices and thus produces unreliable estimates. GAO identified several weaknesses in BEA's estimation methodology, illustrated by the following examples. BEA failed to use appropriate methodology that addressed questionable aspects of the data, such as missing information and measurement problems. This is inconsistent with National Research Council of the National Academies of Science guidelines for federal statistical agencies and government-wide policies. BEA also calibrated the output of the new model to match the estimate produced by BEA's previous model. BEA did this because according to officials the new model produced substantially lower results than BEA had previously estimated. In a 2006 report GAO had questioned the reliability of BEA's previous model; as a result BEA's actions raise further concerns about the reliability of the new model's results. Moreover, BEA could not provide adequate, transparent documentation underlying its methodology or reviews of its methods and data. According to BEA officials, BEA did not adhere to its own best practices for changing its methodology because they did not consider the remittance estimate to be influential information. However, BEA's estimate is influential, as it is cited by national and international organizations and in some cases is incorporated into the estimates of these organizations, including the World Bank. What GAO Recommends GAO recommends that BEA conduct analyses to improve the reliability of its estimate and follow established policies for documenting its methods and analyses. BEA agreed to implement the recommendations but disagreed that its estimates are unreliable and not adequately documented. GAO disagrees and maintains that BEA's revised estimation model produces unreliable estimates and BEA could not provide adequate documentation of its methodology.

gao_GAO-09-8

gao_GAO-09-8_0

Check Truncation Has Not Resulted Yet in Overall Gains in Economic Efficiency for the Federal Reserve or for Banks, but Is Expected to Produce Efficiencies in the Future Check truncation has not resulted yet in overall gains in economic efficiency for the Federal Reserve or for the banks we surveyed, but Federal Reserve and bank officials expect efficiencies in the future. Our analysis of Federal Reserve cost accounting data suggests that its costs may have increased since the passage of Check 21, which may reflect concurrent maintenance of its paper processing infrastructure, investments in equipment and software for electronic check processing, and incurred costs associated with closing check processing sites. For example, several of the 10 largest banks noted that maintaining a dual paper-electronic infrastructure to date had prevented them from achieving overall lower costs, although they had seen reduced transportation and labor costs. With reduced paper volumes accompanying check truncation, the Federal Reserve’s transportation costs for check services decreased approximately 11 percent from the fourth quarter of 2001 through the fourth quarter of 2007 (see fig. Use of Substitute Checks and Check Imaging Appears to Have Had a Neutral Effect on Fraud Losses Based on a recent American Bankers Association’s (ABA) survey of their members about fraud in deposit accounts, the analysis of responses to our data collection instrument, and our interviews with banks, we found that the use of substitute checks and check imaging has had a neutral effect on fraud losses. Most Bank Consumers Appeared to Have Accepted Changes to Their Checking Accounts from the Check Truncation Process Resulting from Check 21 On the basis of our structured bank consumer interviews, we found only a small percentage of consumers who preferred to receive canceled checks with their checking account statement. Also, most of the consumers were not concerned significantly about being able to demonstrate proof of payment using a substitute check or check image rather than a canceled check. Few of the consumers reported that they suffered errors from the check truncation process. Several consumers stated that they did not need the “extra paper” from canceled checks and image statements and that online reviewing was more secure than receiving canceled checks. Bank Consumers Have Realized Benefits and Costs Relating to Faster Check Processing and Access to Information about Their Checking Accounts To the extent that banks have implemented electronic check processing, bank consumers have realized both benefits and costs relating to faster processing and access to information about their checking accounts. We also found that some consumers may incur fees related to receiving canceled checks and check images with their checking account statements. Based on our review of available data from 2001 through 2006, it appears that fees for canceled checks have increased and fees for check images have remained relatively flat. Check 21’s Expedited Recredit Is Considered a Consumer Benefit, but It Appears That a Limited Number of Consumers Filed for the Benefit One of the expected consumer benefits of Check 21 is the right to expedited recredit, but the extent to which consumers have benefited is unclear. On the basis of our consumer and bank interviews, it appears that a small number of bank consumers have filed expedited recredit claims. The report objectives are to: (1) determine the gains in economic efficiency from check truncation and evaluate the costs and benefits to banks and the Federal Reserve System (Federal Reserve) from check truncation, (2) assess consumer acceptance of the check truncation process resulting from Check 21, and (3) evaluate the costs and benefits to consumers from check truncation. More specifically, the structured interview of the 108 consumers included questions on the following issues: (1) bank fees charged to them to receive canceled checks, substitute checks or image statements; (2) instances and subsequent resolution of errors involving their checking accounts; (3) their preferred method of receiving information from their bank about check payments activity (such as receiving their canceled checks, reviewing information online, or reviewing an image statement); (4) instances in which they had to demonstrate proof of payment using a canceled check or a check image and their resolutions; (5) their level of concern about using a check image as a proof of payment; and (6) whether their bank had extended its cut-off time for accepting deposits and the consumer’s opinion about the merits of such an action. Appendix II: Econometric Analysis of Check 21 for Economic Efficiency in the Federal Reserve’s Check Services The Check Clearing for the 21st Century Act of 2003 (Check 21) was intended to make the check payment system more efficient and less costly by facilitating wider use of electronic check processing without demanding that any bank change its current check collection practices. Check 21 facilitates electronic check processing by allowing banks to use imaging technology for collection and create substitute checks from those images for delivery to banks that do not accept checks electronically.

Why GAO Did This Study Although check volume has declined, checks still represent a significant volume of payments that need to be processed, cleared, and settled. The Check Clearing for the 21st Century Act of 2003 (Check 21) was intended to make check collection more efficient and less costly by facilitating wider use of electronic check processing. It authorized a new legal instrument--the substitute check--a paper copy of an image of the front and back of the original check. Check 21 facilitated electronic check processing by allowing banks to use electronic imaging technology for collection and create substitute checks from those images for delivery to banks that do not accept checks electronically. Check 21 mandated that GAO evaluate the implementation and administration of the act. The report objectives are to (1) determine the gains in economic efficiency from check truncation and evaluate the benefits and costs to the Federal Reserve System (Federal Reserve) and financial institutions; (2) assess consumer acceptance of the check truncation process resulting from Check 21; and (3) evaluate the benefits and costs to bank consumers from check truncation. GAO analyzed costs for the check operations of the Federal Reserve and a group of banks, interviewed consumers about their acceptance of and costs and benefits of electronic check processing, and analyzed survey data on bank fees. The Federal Reserve agreed with the overall findings of the report. What GAO Found Check truncation has not yet resulted in overall gains in economic efficiency for the Federal Reserve or for a sample of banks while Federal Reserve and bank officials expect efficiencies in the future. GAO's analysis of the Federal Reserve's cost accounting data suggests that its costs for check clearing may have increased since Check 21, which may reflect that the Federal Reserve must still process paper checks while it invests in equipment and software for electronic processing and incurs costs associated with closing a number of check offices. However, GAO found that the Federal Reserve's work hours and transportation costs associated with check services declined from the fourth quarter of 2001 through the fourth quarter of 2007. Several of the 10 largest U.S. banks reported to GAO that maintenance of both paper and image-based check processing systems prevented them from achieving overall lower costs, although they had reduced transportation and labor costs since Check 21 was enacted. Check imaging and the use of substitute checks appear to have had a neutral or minimal effect on bank fraud losses. Most bank consumers seem to have accepted changes to their checking accounts from check truncation. In interviews with bank consumers, the majority of them accepted not receiving their canceled checks and being able to access information about their checking account activity online. Several reported that they did not need the "extra paper" from canceled checks and that image statements and online reviewing was more secure than receiving canceled checks. Eleven percent of the 108 consumers still preferred to receive canceled checks. Most consumers reported that they were not significantly concerned about their ability to demonstrate proof of payment using a substitute check or check image rather than a canceled check and few reported that they suffered errors from the check truncation process. Also, GAO found that the federal banking regulators reported few consumer complaints relating to Check 21. To the extent that banks have employed check truncation, bank consumers have realized benefits and costs relating to faster processing and access to account information. GAO found that some banks have extended the hours for accepting deposits for credit on the same business day, which can result in faster availability of deposited funds for consumers. Based on consumer interviews, consumers have benefited from receiving simpler imaged account statements and immediate access to information about check payments. Check 21's expedited recredit (prompt investigation of claims that substitute checks were improperly charged to accounts and recrediting of the amount in question) also is considered a consumer benefit. However, based on our consumer and bank interviews, it appears that a small number of consumers have filed expedited recredit claims. Based on analysis of survey data on bank fees, GAO found some consumers may incur fees related to receiving canceled checks and images. Since 2004, fees for canceled checks appear to have increased, while fees for images appear to have remained relatively flat.

gao_NSIAD-96-32

gao_NSIAD-96-32_0

Refuge management activities are already underway. The majority of the cost has been for studying the site and resolving disagreements. These actions may contribute significantly to permanent solutions. EPA’s and the state of Colorado’s initial cleanup proposals were estimated to cost about $2.7 billion; Shell Oil Company’s was $1.6 billion; and the Army’s was in the middle, at about $2.1 billion. As of December 1994, Shell and the Army had spent approximately $354 million on studies, which represents about 37 percent of the total costs incurred by Shell and the Army at the Arsenal. IV for a detailed chronology of major legal actions involving Rocky Mountain Arsenal.) Interim Response Actions Addressed Critical Threats Although final cleanup has not begun, the Army and Shell have made efforts to mitigate the most critical threats at the Arsenal. The conceptual agreement reached in June 1995 resolved the major disputes and outlined a $2.1-billion cleanup to be completed in 2012. However, the current cost and completion targets may be overly optimistic given remaining uncertainties about the final details. Cleanup Agreement Outlines Final Cleanup Remedy According to the conceptual agreement, the parties are expected in 1996 to adopt a final cleanup plan or record of decision for a $2.1-billion cleanup effort. Cleanup Estimates May Be Optimistic The parties agreed in concept on a $2.1-billion cleanup, but until the record of decision is finalized, the cost and time frame estimates remain uncertain. The cleanup estimate reported to Congress just prior to the June settlement called for $2.3 billion in appropriated funds, in addition to Shell’s $500-million share, for a total of $2.8 billion. The Army expects to complete its analysis for the May 1996 record of decision. Army Will Pay the Majority of Costs Under Cost-Sharing Arrangement Under the cost-sharing agreement between the Army and Shell, Shell’s share of cleanup costs decreases on a sliding scale from 50 percent to 20 percent as total costs increase. Cost-Sharing Formula Because its operations contributed to the contamination problem, Shell agreed to pay a portion of the cleanup costs. The cost-sharing formula divides cleanup costs equally between the Army and Shell for the first $500 million of allocable or shared costs, but then reduces Shell’s share to 35 percent of the next $200 million of these costs, and 20 percent of all allocable costs exceeding $700 million. Each party agreed to absorb its own program management costs. To determine the status of the cleanup work at the Rocky Mountain Arsenal, we attended public hearings and reviewed applicable documents and records maintained by DOD and EPA.

Why GAO Did This Study Pursuant to a congressional request, GAO reviewed the cleanup program at the Rocky Mountain Arsenal, focusing on the: (1) status of cleanup efforts; (2) completion plans for the cleanup; and (3) cost-sharing plans between the Army and Shell Oil Company, which leased a portion of the Arsenal. What GAO Found GAO found that: (1) permanent cleanup at Rocky Mountain Arsenal has been delayed for years due to lawsuits and numerous other disputes between the parties involved; (2) in June 1995, Colorado and five other key parties signed an agreement for a conceptual remedy to address the lawsuits and disputes; (3) although about $300 million of the nearly $1 billion spent to date has been for interim actions to mitigate the most urgent environmental threats, the majority has been spent on studies and other management activities; (4) the June 1995 conceptual agreement resolves the most significant issues and paves the way for a final settlement, or record of decision, in 1996; (5) based on the agreement, the Army currently estimates the cleanup will cost $2.1 billion and take until 2012; (6) prior to the agreement, the Army had estimated a $2.8-billion to $3.6-billion cleanup effort to be complete in about 2010; (7) although the agreement addresses many of the disputed issues, the final details are yet to be negotiated; (8) until the cleanup plan is detailed and finalized in the record of decision, the cost and completion estimates will be subject to change; (9) under a 1989 settlement, the Army and Shell are sharing cleanup costs, and the costs to correct damages attributable solely to either the Army or to Shell are to be financed by the responsible party; (10) however, most contamination was commingled, and these cleanup costs will be shared under a formula requiring each party to pay 50 percent of the first $500 million in cleanup costs, with Shell's share decreasing as total costs increase; (11) although the agreement does not limit total contributions, Shell estimated its total costs will be about $500 million and so far has contributed $274 million; (12) by the time the final phase of cleanup begins in May 1996, under an expected record of decision, the Army will be responsible for 80 percent of the costs for commingled contamination; and (13) these costs represent most of the remaining cleanup.

gao_GAO-03-187

gao_GAO-03-187_0

Under its contract, NQF was scheduled to make a final recommendation to CMS prior to the national reporting of quality indicators. Appropriateness of Quality Indicators Proposed for Public Reporting Is Unresolved CMS’s initiative to augment existing public data on nursing home quality has considerable merit but more time is needed to assure that the indicators proposed by CMS for public reporting are appropriate in terms of their validity and reliability. Our review of available portions of the Abt report, however, raised serious questions about whether testing and validation of the selected indicators has been sufficient to move forward with national reporting at this time. CMS’s decision to implement national reporting in November 2002 is troubling, given the issues raised by our review of the available portions of Abt’s validation report. CMS Has Not Addressed Concerns About the Underlying Accuracy of MDS Data Used to Develop Quality Indicators Two different Abt studies have presented CMS with conflicting messages about the accuracy of MDS data. Our analysis of the data currently available in the six pilot states demonstrated the potential for public confusion over both the quality indicators themselves and inconsistencies with other available data on deficiencies identified during nursing home surveys—which, to date, are the primary source of public data on nursing home quality. Generally, hotline staff did not express a preference for using either nursing home surveys or quality indicators in choosing a nursing home. Thus, CMS focused the pilot evaluation on identifying improvements that could be incorporated into the initiative’s design prior to the scheduled national implementation in November 2002. NQF was asked to delay recommending a set of indicators for national reporting until 2003, in part, to provide sufficient time for it to review Abt’s report. CMS’s own evaluation of the pilot, designed to help refine the initiative, was limited to fit CMS’s timetable for the initiative and the preliminary finding were not available until October 2002, leaving little time to incorporate the results into the planned national rollout. We also have serious concerns about the potential for public confusion over quality data, highlighting the need for clear descriptions of the data’s limitations and easy access to informed experts at both the Medicare and QIO hotlines. CMS has not yet demonstrated its readiness to meet these consumer needs either directly or through the QIOs. Recommendations for Executive Action To ensure that publicly reported quality indicator data accurately reflect the status of quality in nursing homes and fairly compare homes to one another, we recommend that the Administrator of CMS delay the implementation of nationwide reporting of quality indicators until there is greater assurance that the quality indicators are appropriate for public reporting—including the validity of the indicators selected and the use of an appropriate risk-adjustment methodology—based on input from the NQF and other experts and, if necessary, additional analysis and testing; and a more thorough evaluation of the pilot is completed to help improve the initiative’s effectiveness, including an assessment of the presentation of information on the Web site and the resources needed to assist consumers’ use of the information. Although CMS stated it would use our report to help improve the initiative over time, it intends to move forward with national implementation in November 2002 as planned. It stated that “waiting for more reliability, more validity, more accuracy, and more usefulness will delay needed public accountability, and deprive consumers, clinicians, and providers of important information they can use now.” The NQF commented that it unequivocally supports CMS’s plans to publicly report quality indicators but indicated that the initiative would benefit from a short-term postponement of 3 to 4 months to achieve a consensus on a set of indicators and to provide additional time to prepare the public on how to use and interpret the data.

Why GAO Did This Study GAO was asked to review the Centers for Medicare & Medicaid Services (CMS) initiative to publicly report additional information on its "Nursing Home Compare" Web site intended to help consumers choose a nursing home. GAO examined CMS's development of the new nursing home quality indicators and efforts to verify the underlying data used to calculate them. GAO also reviewed the assistance CMS offered the public in interpreting and comparing indicators available in its six-state pilot program, launched in April 2002, and its own evaluation of the pilot. The new indicators are scheduled to be used nationally beginning in November 2002. What GAO Found CMS's initiative to augment existing public data on nursing home quality has considerable merit, but its planned November 2002 implementation does not allow sufficient time to ensure the indicators are appropriate and useful to consumers. CMS's plan urges consumers to consider nursing homes with positive quality indicator scores, in effect, attempting to use market forces to encourage nursing homes to improve the quality of care. However, CMS is moving forward without adequately resolving important open issues on the appropriateness of the indicators chosen for national reporting or the accuracy of the underlying data. To develop and help select the quality indicators, CMS hired two organizations with expertise in health care data--Abt Associates, Inc. and the National Quality Forum (NQF). Abt identified a list of potential quality indicators and tested them to verify that they represented the actual quality of care individual nursing homes provide. GAO's review of the available portions of the report raised serious questions about the basis for moving forward with national reporting at this time. NQF, which was created to develop and implement a national strategy for measuring health care quality, was hired to review Abt's work and identify core indicators for national reporting. To allow sufficient time to review Abt's validation report, NQF agreed to delay its recommendations for national reporting until 2003. CMS limited its own evaluation of its six-state pilot program for the initiative so that the November 2002 implementation date could be met. Early results were expected in October 2002, leaving little time to incorporate them into the national rollout. Despite the lack of a final report from NQF and an incomplete pilot evaluation. CMS has announced a set of indicators it will begin reporting nationally in November 2002. GAO has serious concerns about the potential for public confusion by the quality information published, especially if there are significant changes to the quality indicators due to the NQF's review. CMS's proposed reporting format implies a precision in the data that is lacking at this time. While acknowledging this problem, CMS said it prefers to wait until after the national rollout to modify the presentation of the data. GAO's analysis of data currently available from the pilot states demonstrated there was ample opportunity for the public to be confused, highlighting the need for clear descriptions of the data's limitations and easy access to impartial experts hired by CMS to operate consumer hotlines. CMS has not yet demonstrated its readiness to meet these consumer needs either directly or through the hotlines fielding public questions about confusing or conflicting quality data. CMS acknowledged that further work is needed to refine its initiative, but believes that its indicators are sufficiently valid, reliable, and accurate to move forward with national implementation in November 2002 as planned.

gao_GAO-02-422

gao_GAO-02-422_0

The PRO program, which is designed to monitor and improve quality of care for Medicare beneficiaries, currently includes the goal of increasing the use of flu and pneumonia immunizations, as well as breast cancer screening, in each state. The Use of Individual Preventive Services Has Increased over Time but a Minority Receive Multiple Services Information on usage for 4 of the 10 preventive services covered under Medicare is available in the data we used—immunizations against pneumonia and flu and screening for cervical and breast cancer. For example, in most states, screening rates for breast and cervical cancer were higher than rates for colorectal screens. Similarly, about 70 percent of whites and “other” ethnic groups received flu shots during the year compared to 49 percent of African Americans. For income and education, in general, as income and education rose, the rates at which individuals used preventive services also increased. Efforts Under Way to Increase Use of Some Preventive Services CMS has studied various types of interventions to increase the use of preventive services among seniors. These and other interventions found to be effective follow. For breast cancer screening, efforts are focusing on developing integrated reminder systems, such as chart stickers or computer-based alerts that physicians’ offices can use to contact patients on a timely basis. CMS officials expect information on the results by the summer of 2002.

Why GAO Did This Study Preventive medicine, including immunizations for many diseases and screening for some types of cancer, holds the promise to extend and improve the quality of life for millions of Americans. Medicare now covers three preventive services for immunizations and three for screenings, and the Centers for Medicare and Medicaid Services (CMS) sponsors "interventions" to increase the use of preventive services. What GAO Found GAO found that the use of preventive services varies widely by service, state, ethnic group, income, and education. The greatest differences among ethnic groups were for immunization rates. Cancer screening rates tended to differ according to income and education level. CMS pays for interventions that promote breast cancer screenings and pneumonia and flu shots. Most of the techniques being used, such as reminder systems that medical offices can use to alert doctors and patients to needed cancer screenings, have been effective. CMS is evaluating what its current efforts have accomplished and expects the results later this year.

gao_GAO-05-174

gao_GAO-05-174_0

Federal housing assistance can generally be categorized as follows: Single-family programs that provide mortgage insurance, loan guarantees, or direct loans for homeowners and grants or loans for home repairs or modifications; Multifamily programs that provide loans, subsidies, mortgage insurance or loan guarantees, or a combination of these to support the development and rehabilitation of rental properties, including: Production programs that provide federal funds to construct or substantially rehabilitate units for households with extremely low to moderate incomes; and Mortgage insurance/loan guarantee programs that provide incentives for lenders to finance rental housing by reducing risk; Rental assistance programs, which can be used for multifamily and some single-family housing and generally pay property owners the difference between 30 percent of a household’s adjusted income and its rent, including: Tenant-based rental assistance that provides vouchers for eligible tenants to rent privately owned apartments or single-family homes and that tenants can use in new residences if they move; and Project-based rental assistance that is attached to specific properties and is available to tenants only when they are living in units at these properties; and Public housing, which is provided through HUD and offers units for eligible tenants in properties administered by public housing authorities. USDA does not have specific goals related to the elderly in its fiscal year 2004 Annual Performance Plan. Many Housing Programs Offer Assistance for the Elderly, but Information on Their Effectiveness Is Limited We identified a total of 23 federal housing programs that are targeted at or have special features for the elderly: 2 that are intended for the elderly only, 3 that are targeted to the elderly and disabled, and another 18 that have special features, such as properties designated for elderly occupants and income adjustments that lower elderly households’ rental payments. Data on the number of elderly served are not available for each program; however, analysis of available data shows that the elderly occupied at least 1.3 million units provided through several of these programs. For example, USDA’s fiscal year 2003 report provides little useful information on the effectiveness of USDA’s housing programs in assisting the elderly because of the lack of specific goals and objectives related to improving housing options for the elderly. Of the 23 housing assistance programs that we reviewed, 4 required the owners of properties developed under the programs to ensure that supportive services were available. HUD Has Other Programs that Assist the Elderly in Obtaining Supportive Services While USDA does not generally provide funding for supportive services for residents of federally assisted housing, HUD has two programs that link residents of public and multifamily properties developed under HUD programs to supportive services, and two that provide supportive services. The volunteer group provides a variety of services for the residents, such as transportation. HUD and USDA Have Policies in Place to Avoid Duplicating Programs Although the potential for duplication exists, HUD and USDA have established policies and procedures to guide the development of multifamily housing for the elderly in rural areas. In addition to obtaining one another’s input on proposed developments, HUD field office and state USDA office staffs assess the markets in areas where a new development is proposed. Site visits to HUD and USDA field offices in three states revealed that while staff did not consistently follow coordination procedures, each office did analyze market conditions in the proposed locations. Objectives, Scope, and Methodology To determine the extent to which federal housing assistance programs provide benefits to elderly households, we first identified the relevant programs through a literature search, review of the Catalog of Federal Domestic Assistance, and consultation with Department of Housing and Urban Development (HUD) and Department of Agriculture (USDA) officials. To determine how HUD and USDA avoid overlap and duplication in programs that offer similar types of housing assistance to the elderly, we first determined which programs were actively producing new units in the same areas. The programs are organized in alphabetical order according to their administering agency.

Why GAO Did This Study According to the 2003 American Housing Survey sponsored by the U.S. Department of Housing and Urban Development (HUD), nearly one-third of elderly households--those whose head was age 62 or older--were experiencing housing affordability problems. Further, a congressional commission reported in 2002 that investment in affordable housing is decreasing, although the elderly population is expected to increase. A number of federal housing programs provide assistance, including rent subsidies, mortgage insurance, and loans and grants for the purchase or repair of homes, to low-income renters and homeowners. These programs are administered primarily by HUD or the U.S. Department of Agriculture (USDA). GAO was asked to determine the extent to which federal housing programs provide benefits to elderly households, summarize information on the programs' effectiveness in assisting the elderly and supportive services, and determine how HUD and USDA avoid overlap and duplication in their programs. What GAO Found A total of 23 federal housing programs target or have special features for the elderly. Specifically, one HUD and one USDA program target the elderly exclusively, while three HUD programs target the elderly and disabled. The remaining 18 programs serve a variety of household types but have special features for elderly households, such as income adjustments that reduce their rents. The 13 programs for which data were available provide about 943,000 housing units designated for occupancy by the elderly. However, many programs also serve the elderly in undesignated units. Available occupancy data show that the elderly occupied at least 1.3 million units under rental assistance, public, and multifamily housing programs as of spring 2004. Information on the effectiveness of housing programs that assist the elderly is limited. HUD has an overall goal related to elderly housing, but not all individual programs that assist the elderly are explicitly linked to this goal. USDA does not have specific goals related to elderly housing. Most of the 23 housing assistance programs we reviewed are not designed to provide supportive services for the elderly. Four programs require the owners of program properties to ensure that services such as meals or transportation are available to their residents. In addition, HUD administers four programs--for example, the Service Coordinator Program--that can be used in conjunction with various housing programs to help the elderly obtain supportive services. Supportive services are also available to elderly residents of subsidized housing through partnerships between individual properties and local organizations. To avoid overlap and duplication in the development of rural housing for the elderly, HUD and USDA have established policies and procedures that require field offices from both agencies to notify their counterparts of applications to build new housing and consider each other's input on local market conditions. GAO visits to selected HUD field offices and state USDA offices revealed that staff were not consistently following these policies and procedures but were analyzing markets to ensure the need for proposed housing. Overall, however, funding and geographic constraints limit the potential for overlap and duplication in the construction of rural housing for the elderly.

gao_T-HEHS-97-106

gao_T-HEHS-97-106_0

To qualify as long term, hospitals must have an average length of stay of a least 25 days for their Medicare patients. Post-Acute Care Cost Growth The Medicare SNF, home health, and inpatient rehabilitation benefits are three of the fastest growing components of Medicare spending. The number of beneficiaries receiving home health care more than doubled in the last few years, from 1.7 million in 1989 to about 3.9 million in 1996. Some of this increase in beneficiary use was due to increases in the number of acute-care admissions that often lead to use of rehabilitation facilities. Administration’s Proposals for Prospective Payment Systems The goal in designing a PPS is to ensure that providers have incentives to control costs and that, at the same time, payments are adequate for efficient providers to furnish needed services and at least recover their costs. Good choices for unit of service and cost coverage can be overwhelmed by bad data. This project was recently expanded to include coverage of ancillary costs in the prospective payment rates. Proposal for a Home Health PPS The summary of the administration’s proposal for a home health PPS is very general, saying only that a PPS for an appropriate unit of service would be established in 1999 using budget neutral rates calculated after reducing expenditures by 15 percent. As we reported in March 1996, controls over the use of home health care are virtually nonexistent. Consolidated Billing for SNFs The administration has also announced that it will propose requiring SNFs to bill Medicare directly for all services provided to their beneficiary residents except for physician and some practitioner services. The administration has therefore announced that it will in the future recommend a coordinated payment system for post-acute care services. Moreover, bearing risk often gives incentive to shift the risk to others and raises concerns about quality. Medicare Skilled Nursing Facility and Home Health Expenditures, 1980-96 The first copy of each GAO report and testimony is free.

Why GAO Did This Study GAO discussed Medicare's skilled nursing facility (SNF), home health care, and inpatient rehabilitation benefits and the administration's forthcoming legislative proposals related to them. What GAO Found GAO noted that: (1) Medicare's SNF costs have grown primarily because a larger portion of beneficiaries use SNFs than in the past and because of a large increase in the provision of ancillary services; (2) for home health care costs, both the number of beneficiaries and the number of services used by each beneficiary have more than doubled; (3) although the average length of stay has decreased for inpatient rehabilitation facilities, a larger portion of Medicare beneficiaries use them now, which results in cost growth; (4) the administration's major proposals for both SNFs and home health care are designed to to give the providers of these services increased incentives to operate efficiently by moving them from a cost reimbursement to a prospective payment system; (5) what remains unclear about these proposals is whether an appropriate unit of service can be defined for calculating prospective payments and whether the Health Care Financing Administration's data bases are adequate for it to set reasonable rates; (6) administration officials also have discussed their intention to propose in the future a coordinated payment system for post-acute care as methods to give providers efficiency incentives; (7) these concepts have appeal, but GAO has concerns about them similar to those it has for SNF and home health prospective payments; (8) finally, the administration is proposing that SNFs be required to bill for all services provided to their Medicare residents rather than allowing outside suppliers to bill; and (9) this latter proposal has merit because it would make control over the use of ancillary services significantly easier.

gao_GAO-12-78

gao_GAO-12-78_0

The organizations that certify DBEs may include the state DOT, local airport authorities, state and local transit agencies, and city and county governments. FHWA’s Oversight of State DOT DBE Programs FHWA Uses a Risk-Based Approach to Oversee State DOT DBE Programs and Has Identified the DBE Program as a Risk Area Federal agencies should perform a number of oversight activities to safeguard against fraud and to ensure that federal programs meet their objectives and comply with federal regulations. Division office risk assessments. FHWA Has Recently Increased Its Oversight to Help Ensure State DOTs’ Compliance with DBE Regulations In response to the current administration’s focus on small business programs (such as the DBE program), U.S. DOT’s interest in increasing accountability in DBE program implementation, and FHWA’s continued designation of the DBE program as an agencywide high risk area, FHWA and U.S. FHWA hired a full-time National DBE Program Manager in 2010 to help oversee state DOTs’ implementation of the DBE program. FHWA Faces Fundamental Problems in Its Use of DBE Data FHWA faces two fundamental problems with the DBE data it collects from state DOTs to assess whether state DOTs have met their DBE goals. Second, the proxy data that FHWA uses to measure whether goals were met—data on committed spending on DBEs—may or may not be a reasonable proxy of state DOTs’ actual spending on DBEs. According to U.S. Based on the committed spending data in the Uniform Reports, about half of the state DOTs met their DBE goals each fiscal year from fiscal years 2006 through 2010. FHWA has not conducted a nationwide analysis comparing committed spending to actual spending to know whether it is a reasonable proxy for actual spending. Without a nationwide analysis comparing committed spending to actual spending, FHWA cannot be certain whether committed spending reflects actual spending for DBEs in all state DOTs. Therefore, FHWA does not know whether its data on committed spending can be relied on to evaluate state DOTs’ progress in meeting goals; hold state DOTs accountable for meeting their DBE goals, as emphasized in U.S. DOT’s update to its regulations; make program decisions based on whether state DOTs are meeting their DBE goals on an annual basis; or provide assistance to state DOTs that are not meeting their goals. However, FHWA’s reporting of data on committed spending to describe progress towards DBE goals does not include statements about potential limitations of the data—namely that the data on committed spending on DBEs might not reflect actual spending. FHWA Oversight of Certifying Organizations U.S. For example, FHWA is responsible for overseeing the certification activities of state DOTs—which primarily certify DBEs that work on highway projects—because these state DOTs receive federal-aid highway funds. U.S. DOT’s working group that considers various improvements to the administration of the DBE program provides FHWA with an opportunity to identify options it can use to evaluate whether the committed spending data it uses to determine if state DOTs have met their DBE goals is a reasonable proxy for actual spending and whether this data can be relied on to measure progress towards goals. 2. In the information it provides to decision makers, including Congress, include statements about potential limitations of the data it uses to determine state DOTs’ progress towards goals. DOT agreed to consider our modified recommendation. Specifically, the objectives of this report were to examine how FHWA (1) oversees state DOTs to ensure that they are implementing their DBE programs in accordance with applicable regulations, (2) assesses whether state DOTs have met their DBE goals, and (3) oversees organizations that certify DBEs that work on federal-aid highway projects. To determine how FHWA assesses whether state DOTs have met their DBE goals, we reviewed and analyzed FHWA’s national data on state DOTs’ committed and actual spending and how FHWA determined whether state DOTs achieved their DBE goals over a 5-year period (fiscal years 2006 through 2010) for state DOTs in all 50 states, the District of Columbia, and Puerto Rico. Finally, to determine how FHWA oversees organizations that certify DBEs, we obtained information or interviewed officials from U.S. DOT’s and FHWA’s Offices of Civil Rights, and the Federal Aviation Administration’s (FAA) and Federal Transit Administration’s (FTA) Offices of Civil Rights. DBE Goals Based on Committed Spending Data from Uniform Reports, Fiscal Years 2006 through 2010 The U.S. Department of Transportation’s (DOT) Disadvantaged Business Enterprise (DBE) regulations require that each state DOT set an annual goal for DBE participation in federal-aid highway projects, expressed as the percent of federal-aid highway funds it will expect to spend on DBEs for contracts that are awarded or committed in a fiscal year.

Why GAO Did This Study The U.S. Department of Transportation's (DOT) Disadvantaged Business Enterprise (DBE) program aims to increase the participation of small businesses owned and controlled by socially and economically disadvantaged individuals--known as DBEs--in highway contracting. In 2009, U.S. DOT awarded, through state and local governments, about $4 billion to DBEs nationwide. State DOTs are required to establish DBE programs and implement them on federal-aid highway projects. This report responds to a congressional request to examine U.S. DOT's Federal Highway Administration's (FHWA) oversight of state DOT DBE programs. It examines how FHWA (1) oversees state DOTs to ensure they implement their DBE programs according to applicable regulations, (2) assesses whether state DOTs have met their DBE goals, and (3) oversees organizations that certify businesses as DBEs. GAO analyzed FHWA data; reviewed relevant laws and regulations; and interviewed FHWA, and state DOT officials from five states, selected to obtain variation in, among other things, the methods state DOTs use to meet DBE goals.. What GAO Found FHWA uses a risk-based approach, which includes conducting risk assessments and day-to-day monitoring, to oversee DBE programs that state DOTs implement. In response to FHWA's designation of the DBE program as an agencywide high-risk area from 2007 through 2010 and other reasons, FHWA recently increased its oversight of state DOT DBE programs. For example, in 2010, FHWA hired a full-time DBE Program Manager and required FHWA division offices in each state to explain to FHWA headquarters how they oversee their state DOTs' DBE programs. While these steps could help FHWA ensure state DOT compliance with regulations, it is too early to assess their effectiveness. Although FHWA has increased its oversight, FHWA faces two fundamental problems with the DBE data it collects from state DOTs to assess whether state DOTs have met their DBE goals. First, the data that FHWA collects from state DOTs on actual spending on DBEs can cover multiple fiscal years and cannot be meaningfully compared to state DOTs' DBE goals, which reflect the percent of federal-aid highway funds state DOTs will expect to spend on DBEs for one fiscal year. Thus, FHWA may not be able to effectively track whether state DOTs have met their goals as required by federal internal control standards. Second, data on committed spending on DBEs--the proxy measure that FHWA uses instead to measure whether goals were met--shows that about half of the state DOTs met their DBE goals each fiscal year from fiscal years 2006 through 2010; however, FHWA has not conducted a nationwide analysis comparing committed to actual spending to know whether committed spending reflects actual spending for DBEs in all state DOTs. Thus, FHWA does not know whether its data on committed spending can be relied on to evaluate a state DOT's progress in meeting DBE goals. Ensuring that committed spending data are a reasonable proxy is important because state DOTs and FHWA make program decisions based on this information. U.S. DOT's working group that considers various improvements to the administration of the DBE program could provide FHWA with an opportunity to identify options it can use to evaluate its proxy data. Also, while FHWA uses committed spending data to facilitate timely reporting of whether state DOTs have met their goals, FHWA's reporting of data on committed spending to describe progress towards DBE goals does not include statements about potential limitations of the data--namely that the data on committed spending on DBEs might not reflect actual spending. FHWA oversees the certification activities of state DOTs, which certify that DBEs primarily working on federal-aid highway projects meet federal eligibility requirements. Other U.S. DOT administrations--the Federal Aviation Administration and the Federal Transit Administration--oversee other certifying organizations, such as local airport authorities and state transit agencies, that certify DBEs for work primarily in those areas; such DBEs might also have the skills required (e.g., paving) to work on highway projects. FHWA divisions use their discretion to determine how much and how often to oversee state DOT DBE certification activities. What GAO Recommends GAO recommends that FHWA (1) evaluate its committed spending data to determine if it is a reasonable proxy and (2) include statements in information provided to decision makers about potential data limitations. U.S. DOT provided comments on the draft recommendations; GAO clarified the recommendations based on U.S. DOT's comments. U.S. DOT agreed to consider the recommendations.

gao_GAO-17-66

gao_GAO-17-66_0

Background Border Patrol is to apply consequences under CDS to all apprehended aliens, which numbered over 1.1 million along the southwest border from fiscal year 2013 through 2015. Border Patrol Methodology for Calculating Recidivism Makes It Difficult to Assess Effectiveness of the Consequence Delivery System Border Patrol uses an annual recidivism rate for the southwest border, along with other performance indicators, to monitor the effectiveness of CDS; however, weaknesses in the methodology used to calculate this rate limit its usefulness in assessing CDS. Border Patrol Agents Did Not Generally Apply the Consequence Identified in CDS guides as the Most Effective and Efficient in Each Southwest Border Sector Our analysis of Border Patrol agents’ application of the Most Effective and Efficient consequences as defined in each southwest border sector’s CDS guide showed that agents applied the Most Effective and Efficient consequence for 18 percent of the approximately 300,000 apprehensions in fiscal year 2015, a decline over the previous two years. Border Patrol has not assessed reasons agent application of the Most Effective and Efficient consequence in CDS guides is relatively low, but cited various challenges including agent concerns about whether the Most Effective and Efficient consequence has a greater impact on recidivism than other consequences. Sector personnel are encouraged to review these data when determining the ranking of CDS consequences from Most Effective and Efficient to Least Effective and Efficient. According to CBP, some consequences, such as criminal prosecution, require involvement and resources of up to four federal agencies. Border Patrol Does Not Have Controls for Its Classification of Aliens Necessary to Apply the Most Effective and Efficient CDS Consequence Border Patrol reports that agent classification of aliens into one of the three criminal or four noncriminal classifications pursuant to CDS guidance is critical to selecting the Most Effective and Efficient consequence to deter future illegal border crossings. Additional actions on the part of Border Patrol could strengthen implementation and oversight of the CDS program. Recommendations for Executive Action To better inform on the effectiveness of CDS implementation and border security efforts, we recommend that the Chief of Border Patrol: strengthen the methodology for calculating recidivism such as by using an alien’s apprehension history beyond one fiscal year and excluding aliens for whom there is no record of removal and who may remain in the United States; collect information on reasons agents do not apply the CDS guides’ Most Effective and Efficient consequences to assess the extent that agents’ application of these consequences can be increased and modify development of CDS guides, as appropriate; revise CDS guidance to ensure consistent and accurate methodologies for estimating Border Patrol costs across consequences and to factor in, where appropriate and available, the relative costs of any federal partner resources necessary to implement each consequence; ensure that sector management is monitoring progress in meeting their performance targets and communicating performance results to Border Patrol headquarters management; and provide consistent guidance for alien classification and take steps to ensure CDS PMO and sector management conduct data integrity activities necessary to strengthen control over the classification of aliens. DHS did not concur with one recommendation in the report. With regard to the first recommendation, to strengthen its methodology for calculating recidivism such as by using an alien's apprehension history beyond one fiscal year and excluding aliens for whom there is no record of removal and who may remain in the United States, DHS did not concur. Figure 11 provides an overview of Border Patrol’s recidivism rate calculation as well as the three alternative methods we used to determine the extent to which Border Patrol’s measure of recidivism assesses CDS effectiveness. For each of the nine Border Patrol sectors along the southwest border and each of the seven alien classifications, tables 5 and 6 provide: the unique number of apprehended aliens, the recidivism rate based on Border Patrol’s methodology (aliens’ apprehension history within fiscal year 2015), the recidivism rate based on alien apprehension history over three years (fiscal years 2013 through 2015), the recidivism rate based on an aliens’ apprehension history over three years (fiscal years 2013 through 2015) and excluding aliens who ICE data show have not been removed and may remain in the United States, and the percentage of apprehended aliens who ICE data show have not been removed and may remain in the United States.

Why GAO Did This Study To address smuggling along the U.S. southwest border, the U.S. Border Patrol developed CDS—a process to classify each apprehended alien into criminal or noncriminal categories and apply consequences, such as federal prosecution. Each Border Patrol sector ranks up to eight consequences from Most to Least Effective and Efficient to reduce recidivism. GAO was asked to review and assess Border Patrol's implementation of CDS across the southwest border. This report examines the extent to which Border Patrol (1) has a methodology for calculating recidivism that allows it to assess CDS program effectiveness, (2) applied consequences it determined to be most effective and efficient in each southwest border sector and (3) established guidance and controls to monitor field implementation of CDS. GAO analyzed Border Patrol's recidivism rate methodology; apprehension data and CDS application along the southwest border for fiscal years 2013 through 2015, the most recently available data; and DHS's U.S. Immigration and Customs Enforcement data on alien removals. GAO also interviewed Border Patrol personnel and reviewed CDS guidance. What GAO Found The U.S. Border Patrol (Border Patrol), an office within the Department of Homeland Security's (DHS) U.S. Customs and Border Protection, uses an annual recidivism rate to measure performance of the Consequence Delivery System (CDS)—a process that identifies consequences as Most Effective and Efficient to deter illegal cross border activity in each sector—however, methodological weaknesses limit the rate's usefulness for assessing CDS effectiveness. GAO found that Border Patrol's methodology does not account for an alien's apprehension history beyond one fiscal year and neither accounts for nor excludes apprehended aliens for whom there is no record of removal after apprehension and who may have remained in the United States without an opportunity to recidivate. GAO's analysis of recidivism for fiscal year 2015 considering these factors showed a 29 percent recidivism rate, compared to Border Patrol's 14 percent recidivism rate. Border Patrol could more accurately assess recidivism and CDS effectiveness by strengthening its recidivism rate methodology, such as by using an alien's apprehension history beyond one fiscal year and excluding aliens for whom there is no record of removal from the United States. Agent application of consequences Border Patrol identified in CDS guidance as the Most Effective and Efficient has declined from 28 percent in fiscal year 2013 to 18 percent in fiscal year 2015 across the southwest border. In addition, Border Patrol has not assessed reasons for the relatively low application of consequences determined to be the Most Effective and Efficient consequence in each sector; but some agency officials stated that challenges include agents' hesitation to apply consequences that require referral to federal partners facing capacity constraints, such as Department of Justice immigration courts. Assessing why agents do not apply the Most Effective and Efficient consequence could inform Border Patrol of actions needed to increase application of Most Effective and Efficient consequences to reduce recidivism. Border Patrol established some mechanisms to facilitate monitoring field implementation of CDS, but lacked controls to ensure effective performance management. For example, six of nine field locations missed performance targets for application of the Most Effective and Efficient consequences in fiscal year 2015 as shown in the figure below. Ensuring consistent oversight of performance management would provide greater assurance that Border Patrol is most effectively using CDS to address cross-border illegal activity. What GAO Recommends GAO is making six recommendations to strengthen the methodology for measuring recidivism, assess reasons agents do not apply CDS guides' Most Effective and Efficient consequence, and ensure performance management oversight. DHS concurred with all but one recommendation, which relates to strengthening its recidivism methodology, citing other means to measure CDS performance. GAO believes the recommendation remains valid, as discussed in the report.

gao_NSIAD-96-17

gao_NSIAD-96-17_0

The Deputy Assistant Secretary of Defense for Equal Opportunity (DASD(EO)) is primarily responsible for monitoring the services’ equal opportunity programs, including preparing written analyses of the services’ MEOAs and a DOD summary. While MEOAs provide some useful information, the analyses of this information did not consistently identify and assess the significance of possible racial or gender disparities. Certain Useful Data Is Not Required for Two MEOA Categories Two important factors in analyzing the progression of minorities and women in the services are how competitive they are for promotions and whether they are leaving the services at disproportionate rates. Although DOD’s MEOA guidance requires reporting on promotions and separations, it does not require the services to report racial and gender data for all promotions or voluntary separations. Further analysis would be necessary to determine why the disparities occurred. Using these eligible pools, we found statistically significant racial and gender disparities that may warrant further analysis. Although these policies and procedures do not apply to active-duty military personnel, the Department of Defense (DOD) directive and instruction related to its military equal opportunity program set forth similar requirements.

Why GAO Did This Study Pursuant to a congressional request, GAO reviewed the services' Military Equal Opportunity Assessments (MEOA) to determine whether certain active-duty personnel data reflect racial and gender disparities within the services. What GAO Found GAO found that: (1) MEOA do not consistently identify and assess the significance of possible racial and gender disparities within the services; (2) MEOA categories are reported differently by each service, since the services are not required to report data on low rank promotions and voluntary separations; (3) the Deputy Assistant Secretary of Defense for Equal Opportunity (DASD EO) has not analyzed the services' MEOA or Department of Defense (DOD) summaries for fiscal year 1993; (4) there are significant statistical disparities in the number of minorities considered for accessioning, career enhancement, and promotion; and (5) some of these disparities can be attributed to job-related and societal factors.

gao_GAO-11-449T

gao_GAO-11-449T_0

The United States Has Taken Steps to Implement Its Counterpiracy Plan but Needs to Evaluate Its Efforts and Update Its Plan As we reported in September 2010, the U.S. government has made progress implementing its Action Plan for countering piracy, in collaboration with international and industry partners. We continue to believe that actions are needed to update the Action Plan to respond to the evolving pirate threat, and enhance and sustain interagency collaboration in U.S. efforts, but currently it is too early to assess the interagency effort. In collaboration with their international and industry partners, U.S. agencies have taken steps across the three lines of action established in the Action Plan to: (1) prevent attacks by reducing the vulnerability of the maritime domain, (2) disrupt acts of piracy in ways consistent with international law and the rights and responsibilities of coastal and flag states, and (3) ensure that those who commit acts of piracy are held accountable for their actions by facilitating the prosecution of suspected pirates. The United States has advised industry partners on self-protection measures, contributed leadership and assets to an international coalition patrolling pirate-infested waters, and concluded a prosecution arrangement with the Seychelles. Many stakeholders anecdotally credit international, industry, and U.S. government efforts with preventing and disrupting piracy off the Horn of Africa, but despite these efforts from 2007 through 2010 pirates greatly expanded their area of operations, the number of pirate attacks increased, the number of hostages captured rose substantially, and the size of ransom payments grew. The total number of reported pirate attacks increased from 30 in 2007 to 219 in 2010. Since 2007, there have been at least eight reported attempted attacks on U.S.- flagged vessels, two of which involved pirates successfully boarding or hijacking vessels—the attacks on the MV Maersk Alabama and SV Quest. Additionally, while we previously reported the rate of successful attacks had dropped from 40 percent in 2007 to 22 percent in 2009, the rate had rebounded to almost 30 percent at the end of 2010. In following up with cognizant departments on the current status of their counterpiracy efforts, all of the departments provided comments to clarify information in this statement, and an NSS official provided the following information: As part of a broader U.S. approach toward the region, the Maritime Security Interagency Policy Committee (MSIPC) is conducting an ongoing review of U.S. piracy policy. During this review, the MSIPC is focusing on the Countering Piracy off the Horn of Africa: Partnership and Action Plan and as part of this effort, departments and agencies are examining and developing metrics, roles and responsibilities, and implementation actions to serve as the focus of U.S. efforts for the next several years. We also reported in September 2010 that as pirates operations had evolved, the U.S. government had not systematically tracked the cost or effectiveness of its counterpiracy activities to determine whether its investment had achieved the desired results or should be revised. As a result, in our September 2010 report, we also recommended that the NSC, in collaboration with the same federal departments, identify measures of effectiveness to use in evaluating U.S. counterpiracy efforts; and direct the Counter-Piracy Steering Group to identify the costs of U.S. counterpiracy efforts including operational, support, and personnel costs; and assess the effectiveness of U.S. counterpiracy activities. Agencies Have Worked Collaboratively with Partners but Could Take Key Steps to Enhance and Sustain Collaboration in Counterpiracy Efforts As we reported in September 2010, U.S. agencies have generally collaborated well with international and industry partners to counter piracy; however, U.S. agencies could implement other key practices to further enhance and sustain collaboration among U.S. interagency partners. Partnering with Industry. The NSC has not identified roles and responsibilities for implementing these tasks, and officials have acknowledged that the agencies have not developed joint guidance to ensure their efforts work together efficiently and effectively. According to State officials, State has drafted a governmentwide counterpiracy strategic communication plan for interagency review but as of March 2011, the department had not finalized this plan. Disrupting Pirate Revenue. Multiple agencies collect or examine information on pirates’ financial activities, including DOD, Justice, State, and the Treasury. Commenting on our testimony statement, however, the NSS provided a statement indicating that an ongoing MSIPC policy review is examining roles and responsibilities and other implementation actions to guide U.S. counterpiracy efforts. Such challenges, along with the growing frequency and severity of piracy off the Horn of Africa, provide a renewed a sense of urgency to implement our recommendations to update the counterpiracy Action Plan and take other steps to prevent, disrupt, and prosecute acts of piracy. In addition, pirates have captured more ships and taken more hostages each year from 2007 through 2010. This is a work of the U.S. government and is not subject to copyright protection in the United States.

Why GAO Did This Study Somali pirates have attacked 640 ships and taken more than 3,150 hostages since 2007. A few U.S.-flagged vessels have been affected--most recently the SV Quest, a private yacht on which four Americans were killed in February 2011. The growing frequency and severity of attacks renew the urgency to address the piracy threat. As Somalia is unable to repress piracy, the U.S. National Security Council (NSC) developed the interagency Countering Piracy off the Horn of Africa: Partnership and Action Plan in December 2008 to prevent, disrupt, and prosecute piracy in collaboration with international and industry partners. In September 2010, GAO issued a report evaluating the extent to which U.S. agencies (1) have implemented the plan, and the challenges they face, and (2) have collaborated with partners. This testimony is based on the September 2010 report and its objectives, and work GAO conducted in March 2011 to update report findings. What GAO Found As GAO reported in September 2010, the U.S. government has made progress in implementing its plan for countering piracy, in collaboration with industry and international partners. However, piracy is an escalating problem, and the U.S. government has not updated its plan as GAO recommended. The United States has advised industry partners on self-protection measures, contributed leadership and assets to an international coalition patrolling pirate-infested waters, and concluded a prosecution arrangement with the Seychelles. Many stakeholders credit collaborative efforts with reducing the pirates' rate of success in boarding ships and hijacking vessels, but since 2007 the location of attacks has spread from the heavily patrolled Gulf of Aden--the focus of the Action Plan--to the vast and much harder to patrol Indian Ocean. Also, from 2007 to 2010 the total number of reported hijackings increased sevenfold, and, after dropping in 2008 and 2009, the pirates' success rate rebounded from 22 percent in 2009 to almost 30 percent in 2010. In addition, the number of hostages captured and the amount of ransom paid increased sharply, and pirate attacks have grown more violent. The Action Plan's objective is to repress piracy off the Horn of Africa as effectively as possible, but as pirate operations have evolved, changes to the plan have not kept pace. The United States has not systematically tracked the costs of its counterpiracy efforts and is unable to determine whether counterpiracy investments are achieving the desired results. According to a statement by an NSS official, the United States is reviewing U.S. piracy policy to focus future U.S. efforts. These recent steps are encouraging because the growing frequency and severity of piracy off the Horn of Africa provides a renewed sense of urgency for taking action. GAO's September 2010 report found that U.S. agencies have generally collaborated well with international and industry partners to counter piracy, but they could take additional steps to enhance and sustain interagency collaboration. According to U.S. and international stakeholders, the U.S. government has, among other things, collaborated with international partners to support prosecution of piracy suspects and worked with industry partners to educate ship owners on how to protect their vessels from pirate attack. However, agencies have made less progress on several key efforts that involve multiple U.S. agencies--such as those to address piracy through strategic communications, disrupt pirate finances, and hold pirates accountable. For instance, the departments of Defense, Justice, State, and the Treasury all collect or examine information on pirate finances, but none has lead responsibility for analyzing that information to build a case against pirate leaders or financiers. In September 2010, GAO recommended that the NSC identify roles and responsibilities for implementing these tasks, and develop guidance to ensure agency efforts work together efficiently and effectively. In March 2011, an NSS official stated that an interagency policy review will examine roles and responsibilities and implementation actions to focus U.S. efforts for the next several years. It is too early to assess this effort's effectiveness in bolstering interagency collaboration in U.S. counterpiracy efforts. What GAO Recommends GAO is not making new recommendations in this statement. GAO previously recommended that the NSC (1) update its Action Plan; (2) assess the costs and effectiveness of U.S. counterpiracy activities; and (3) clarify agency roles and responsibilities. A National Security Staff (NSS) official provided a statement that an interagency group is reviewing U.S. piracy policy, costs, metrics, roles, and responsibilities. Agencies also commented to clarify information in this statement.

gao_GAO-17-579T

gao_GAO-17-579T_0

According to the 2016 Financial Report, the federal deficit in fiscal year 2016 increased to $587 billion—up from $439 billion in fiscal year 2015. Spending increases in 2016 were driven by Social Security (the Old-Age and Survivors Insurance and Disability Insurance programs), Medicare, Medicaid, and interest on debt held by the public (net interest). Debt held by the public was 77 percent of GDP at the end of fiscal year 2016—an increase from 74 percent at the end of fiscal year 2015. Since 1946 the debt-to-GDP ratio has averaged 44 percent. The long-term fiscal projections in the federal government’s 2016 Financial Report and those prepared annually by CBO and GAO each use somewhat different assumptions, but their results are the same: absent policy changes, the federal government’s fiscal path is unsustainable with debt held by the public as a share of GDP projected to grow continuously. Projections show that under current law it will grow to exceed the historical high of 106 percent in 15 to 25 years. Of further concern is the fact that none of these long-term projections include certain fiscal risks that create fiscal exposures that could affect the government’s financial condition in the future. Some examples of such fiscal risks include: The Pension Benefit Guaranty Corporation’s (PBGC) financial future is uncertain because of long-term challenges related to PBGC’s governance and funding structure. The 2016 Financial Report, CBO, and GAO all make the point that the longer action is delayed, the greater and more drastic the changes will have to be. Medicare’s Hospital Insurance trust fund, and Social Security’s OASI and DI trust funds face financial challenges that add to the importance of beginning action soon. (See figure 5.) It is important to develop and begin to implement a long-term fiscal plan for returning to a sustainable path. Debt Limit Is Not a Control on Debt As currently structured, the debt limit—a legal limit on the amount of federal debt that can be outstanding at one time—does not restrict Congress and the President’s ability to enact spending and revenue legislation that affects the level of debt; nor does it otherwise constrain fiscal policy. In other words, the debt limit restricts Treasury’s authority to borrow to finance the decisions already enacted by Congress and the President. We did not endorse a specific option but we did recommend that Congress consider alternative approaches that better link decisions about the debt limit with decisions about spending and revenue at the time those decisions are made. However, in our prior work we have also identified numerous actions Congress and agencies can take now to help improve the fiscal situation. Although these actions alone cannot put the U.S. government on a sustainable fiscal path, they would improve both the fiscal situation and the federal government’s operations. Since fiscal year 2003—when certain agencies began reporting improper payments as required by the Improper Payments Information Act of 2002 (IPIA)—cumulative reported improper payment estimates have totaled over $1.2 trillion, as shown in figure 6. Opportunities Exist to Improve Efficiency and Effectiveness of Government Programs For the last 7 years, we have annually presented actions Congress or executive branch agencies could take to reduce, eliminate, or better manage fragmentation, overlap, or duplication; achieve cost savings; or enhance revenue. We also maintain our High-Risk List to bring attention to government operations that are at high risk of fraud, waste, abuse, and mismanagement, or that need broad-based transformation to address economy, efficiency, or effectiveness challenges of government operations. Fully addressing the issues we raise in those reports could yield additional benefits, such as increased savings, better services to the public, and improved federal programs. While these issues span the government, a substantial number of them involve five agencies that made up 69 percent—$3.0 trillion—of federal outlays in fiscal year 2016: the Departments of Defense, Health and Human Services, and Veterans Affairs; the Social Security Administration; and the Office of Management Budget. Multiple Strategies Needed to Address the Persistent Tax Gap The tax gap—the difference between taxes owed to the government and total taxes paid on time—has been a persistent problem for decades despite the Internal Revenue Service’s (IRS) efforts to improve voluntary compliance. We have identified actions IRS and Congress can take to reduce the tax gap. In particular, decision making could be improved by strengthening internal controls over financial reporting to ensure the statements are fully auditable, increasing attention to tax expenditures, and effectively implementing the DATA Act. The material weaknesses in internal control underlying these three major impediments continued to (1) hamper the federal government’s ability to reliably report a significant portion of its assets, liabilities, costs, and other related information; (2) affect the federal government’s ability to reliably measure the full cost, as well as the financial and nonfinancial performance of certain programs and activities; (3) impair the federal government’s ability to adequately safeguard significant assets and properly record various transactions; and (4) hinder the federal government from having reliable financial information to operate in an efficient and effective manner. Having a broader fiscal plan to put the federal government on a more sustainable long-term path would help with these tough decisions. Appendix I: Related GAO Work Long-Term Fiscal Outlook The Nation’s Fiscal Health: Action is Needed to Address the Federal Government’s Fiscal Future.

Why GAO Did This Study The Congress and administration face serious economic, security, and social challenges that will require difficult policy choices in the short term about the level of federal spending and investments as well as ways to obtain needed resources. At the same time, the federal government is highly leveraged in debt by historical norms. In addition to near term financing decisions, a broader fiscal plan is needed to put the government on a more sustainable long-term path. In January 2017, GAO reported on the need for such a plan by outlining the fiscal condition of the U.S. government and its future path based on current fiscal policies. This statement summarizes GAO’s work on this issue and also discussed how Congress and executive branch agencies can help in the near term by taking action to address improper payments; duplication, overlap, or fragmentation; high-risk areas; and the tax gap. What GAO Found The Federal Government Is on an Unsustainable Fiscal Path According to the 2016 Financial Report , the federal deficit in fiscal year 2016 increased to $587 billion—up from $439 billion in fiscal year 2015. Federal receipts grew a modest $18.0 billion due primarily to extensions of tax preferences, but that was outweighed by a $166.5 billion increase in spending, driven by Social Security, Medicare, and Medicaid, and interest on debt held by the public (net interest). Debt held by the public rose as a share of gross domestic product (GDP), from 74 percent at the end of fiscal year 2015 to 77 percent at the end of fiscal year 2016. This compares to an average of 44 percent of GDP since 1946. The 2016 Financial Report , the Congressional Budget Office (CBO), and GAO projections all show that, absent policy changes, the federal government’s fiscal path is unsustainable and that the debt-to-GDP ratio would surpass its historical high of 106 percent within 15 to 25 years (see figure). Of further concern is the fact that none of the long-term projections include certain other fiscal risks that could affect the federal government’s financial condition in the future. Some examples of such fiscal risks are the Pension Benefit Guaranty Corporation’s funding and governance structure, U.S. Postal Service’s retiree health and pension funds, government insurance programs such as the National Flood Insurance Program, and military, economic, financial, or weather-related crises. Importance of Early Action: The 2016 Financial Report , CBO, and GAO all make the point that the longer action is delayed, the greater and more drastic the changes will have to be. As shown in the timeline, the trust funds face financial challenges that add to the importance of beginning action. It is important to develop and begin to implement a long-term fiscal plan for returning to a sustainable path. Debt Limit Is Not a Control on Debt: The current debt limit is not a control on debt, but rather an after-the-fact measure that restricts the Department of the Treasury’s authority to borrow to finance the decisions already enacted by Congress and the President. GAO has suggested Congress consider alternative approaches that would better link decisions about borrowing to finance the debt with decisions about spending and revenue at the time those decisions are made. Opportunities to Begin to Address the Government’s Fiscal Health GAO has identified actions Congress and agencies can take now to help improve the fiscal situation. GAO highlighted five agencies—the Departments of Defense, Health and Human Services, and Veterans Affairs; the Social Security Administration; and the Office of Management and Budget. These agencies made up 69 percent—$ 3.0 trillion—of federal outlays in fiscal year 2016. Although these actions alone cannot put the federal government on a sustainable fiscal path, they would improve both the fiscal situation and the federal government’s operations. Actions Needed to Reduce Improper Payments: Reducing payments that should not have been made or that were made in an incorrect amount could yield significant savings. The improper payments estimate in fiscal year 2016 was over $144 billion. Since fiscal year 2003, cumulative estimates have totaled over $1.2 trillion. Opportunities Exist to Improve the Efficiency and Effectiveness of Government Operations : GAO has identified government operations that are at high risk of fraud, waste, abuse, and mismanagement and has presented numerous areas to reduce, eliminate, or better manage fragmentation, overlap, or duplication; achieve cost savings; or enhance revenue. Fully addressing the issues raised could yield increased savings, better services to the public, and improved federal programs. Multiple Strategies Needed to Address the Persistent Tax Gap: Reducing the gap between taxes owed and those paid on time could increase tax collections by billions. Most recently, the annual gross tax gap was estimated to be $458 billion. Action Needed to Improve Information on Programs and Fiscal Operations: Decision-making could be improved by ensuring the government’s financial statements are fully auditable, increasing attention to tax expenditures, and effectively implementing the Digital Accountability and Transparency Act of 2014.

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Background Over the years, Congress has established many employment-related programs to help people with disabilities obtain jobs. In fiscal year 2005, the grant program was funded at approximately $37 million. In addition to its duties related to establishing and maintaining a procurement list of goods and services that must be purchased through qualified JWOD suppliers, the Committee for Purchase is required to: establish rules, regulations, and policies to carry out the purposes of the JWOD program, and to provide that nonprofit agencies employing individuals who are blind have priority in obtaining JWOD contracts; monitor nonprofit agency compliance with Committee for Purchase inform federal agencies about the JWOD program and encourage their participation, and, to the extent possible, monitor federal agencies’ compliance with JWOD requirements; and study and evaluate its activities on a continual basis to ensure the effective and efficient administration of the JWOD Act. Three of the Four Programs Have Established Goals and Measures Federal performance goals and measures have been established for three of the four programs we reviewed. Education has one goal for the Supported Employment State Grants program, but the goal only provides an indirect measure of the program’s performance because the data also include individuals with significant disabilities who receive supported employment services funded under state VR programs. According to Education officials, no formal federal performance goals or measures currently exist for the Randolph-Sheppard program, but they are under development and expected to be completed by April 2007. Education Has a Supported Employment State Grants Program Goal That Indirectly Measures Performance Education has a GPRA goal for the Supported Employment State Grants program that the department uses to indirectly measure the program’s performance. The goal of the PWI program is to create and expand job opportunities for people with disabilities in the competitive labor market by engaging business and industry in the rehabilitation process. For example, one measure is the percentage of individuals served by the program who were placed into competitive employment. We visited four PWI grantees in the four states and found that these projects set goals that are consistent with the goals of the PWI program, such as placing people in competitive employment. One of the plan’s five goals is to expand employment opportunities. Furthermore, some of the performance measures are not clearly defined or may be difficult to measure, thus making it difficult to assess performance. Specifically, Education has established oversight procedures for the PWI and the Supported Employment State Grants programs that, if consistently followed, should provide reasonable assurance of compliance with relevant laws and regulations. Education relies primarily on self-reported data for its monitoring of the Randolph-Sheppard program and does not routinely analyze or report the data it collects. Finally, the Committee for Purchase has established procedures for monitoring and overseeing the JWOD program, but has prescribed regulations that delegate most of the responsibility for carrying out these procedures to two central nonprofit agencies that are also responsible for representing the interests of the JWOD nonprofit agencies they monitor, raising questions about independence. Education Provides Little Oversight of the Randolph- Sheppard Program Education provides little oversight of the Randolph-Sheppard program. Additionally, Education has not provided clear guidance or policies regarding when federal agencies may charge fees or commissions to licensed vendors as a condition of operating a vending facility on federal property. Postal Service in exchange for permission to operate vending facilities on the agency’s properties. This system of compensation may create a disincentive for NIB and NISH to identify instances of noncompliance that could result in the JWOD nonprofit agency losing its contract, especially for those JWOD nonprofit agencies that are generating large volumes of JWOD sales. To obtain additional information about the performance goals and measures, and determine the extent that the agencies responsible for these programs have established adequate procedures for overseeing program implementation and assuring that laws and regulations are followed, we (1) reviewed federal laws, regulations, and guidance to determine the programs’ requirements; and (2) interviewed agency officials at the Rehabilitation Services Administration (RSA) within the Department of Education, and the Committee for Purchase from People Who Are Blind or Severely Disabled (Committee for Purchase).

Why GAO Did This Study Congress has created 20 federal employment-related programs that are aimed at helping people with disabilities obtain jobs. Little is known about the effectiveness and the management of some of these programs. GAO was asked to review four of these programs; the Department of Education (Education) oversees three--Projects with Industry (PWI), Supported Employment State Grants, and Randolph-Sheppard. An independent federal agency, the Committee for Purchase, oversees the fourth, Javits-Wagner-O'Day (JWOD). Specifically, GAO assessed the extent to which (1) performance goals and measures have been established for these programs and (2) the agencies responsible have established adequate oversight procedures. We reviewed program planning and performance information, interviewed agency officials, and visited each of the four programs in four states. What GAO Found Three of the four programs have federal performance goals. No federal performance goals or measures currently exist for the Randolph-Sheppard program, which provides opportunities for individuals who are blind to operate vending facilities on federal properties. Without goals, it is difficult to assess the program's performance, but Education officials told GAO they are developing them. Education has a goal and a measure for the Supported Employment State Grants program--a federal grant program that provides job coaching and other support to help individuals with severe disabilities secure jobs. The goal indirectly measures the program's performance because grant funds are mixed with other funding sources to provide supported employment services. Education has also developed one goal for the PWI program--a federal grant program that helps individuals with disabilities obtain competitive employment--that is consistent with the mission of the program. The goal is to create and expand job opportunities for individuals with disabilities in the competitive labor market by engaging business and industry, and one of the measures tracks the percentage of individuals placed in employment in work settings making at least minimum wage. The Committee for Purchase, which oversees the JWOD program--a program that helps to create jobs through the federal property management and procurement systems--first developed federal goals and measures for its fiscal year 2005-2007 strategic plan and has since revised them. The revised measures still have limitations, such as not being clearly defined or being difficult to measure. Education's and the Committee for Purchase's oversight of the four programs has been uneven. Education has established procedures, such as on-site reviews, for the PWI and Supported Employment State Grants programs that, if consistently followed, would provide reasonable assurance that the programs are in compliance with applicable laws and regulations. However, Education conducts limited oversight of the Randolph-Sheppard program. For example, Education does not routinely analyze or report the data it collects from states and has provided little guidance to ensure states comply with laws or consistently interpret program requirements. One area in which Education has not provided sufficient guidance is the circumstances under which federal agencies may charge fees to licensed vendors operating vending facilities on their properties. As a result, vendors in some locations were paying commissions or fees but those in other locationswere not. Finally, the Committee for Purchase delegates most of its oversight responsibilities to two central nonprofit agencies that also represent the interests of the JWOD nonprofit agencies they oversee. This arrangement, as well as the fact that they receive a percentage of the total value of the contracts from the JWOD nonprofit agencies, raises questions about their independence and gives them little incentive to identify instances of noncompliance that could result in the JWOD nonprofit agency losing its federal contract.

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Underfunded pension plans are a symptom of the financial turmoil the airline industry currently faces. Several industry trends, such as the emergence of well-capitalized low cost airlines and reliance on the Internet to distribute tickets, are fundamentally reshaping the structure of the airline industry. These and other factors have combined to create a highly competitive environment, which has been particularly challenging for the legacy airlines. As we reported in August, the financial performance and viability of legacy airlines has deteriorated significantly compared with low-cost airlines since 2000. Legacy airlines have collectively lost $24.3 billion over the last 3 years, while low-cost airlines made $1.3 billion in profits. Legacy airlines also face considerable debt and pension funding obligations in the next few years. As part of reducing their labor costs, a number of legacy airlines have begun to consider terminating their DB pension plans, under current bankruptcy and pension laws. United Airlines recently announced that it would not make roughly $500 million in contributions to its pension plans this year. The potential termination of these underfunded pension plans confronts Congress with three key policy issues. The most visible is the financial exposure of PBGC. The agency reports that airline pensions are currently underfunded by $31 billion. Second, thousands of plan participants and beneficiaries will lose pension benefits due to limits on PBGC guarantees and certain provisions affecting PBGC’s insurance program. Finally, airlines that terminate their plans may gain a competitive advantage because such terminations effectively lower overall labor costs. Pension Problems Extend Broadly We have highlighted several potential sources of problems in the pension system that have contributed to the broad underfunding of DB pension plans generally, including airline plans. Single-employer pension plans have suffered from a so-called “perfect storm” of key economic conditions, in which declines in stock prices lowered the value of pension assets used to pay benefits, while at the same time a decline in interest rates inflated the value of pension liabilities. The combined “bottom line” result is that many plans have insufficient resources to pay all of their future promised benefits. While these cyclical factors may improve and reverse some of the pension underfunding, other trends suggest more serious structural problems to the single-employer insurance program’s long-term viability. These include a declining number of DB plans, a decline in the percentage of participants that are active (as opposed to retired) workers, and a rise in alternative retirement savings vehicles, such as defined contribution (DC) plans, which provide retirement benefits with more portability but which transfer the investment risk from the employer to the employee. In addition, as the PBGC takeover of severely underfunded plans suggests, the existing pension funding rules have not ensured that sponsors contribute enough to their plans to pay all the retirement benefits promised to date. The current pension crisis facing the airline industry and PBGC illustrates the need for comprehensive pension reform that tackles the full range of challenges across all industries, not just airlines. Reforms must include meaningful incentives for sponsors to adequately fund their plans. They must provide additional transparency for participants, and ensure accountability for those firms that fail to match the benefit promises they make with the resources necessary to fulfill them. Pension Policy Issues Have Broad Implications The rules of the current pension system, and any attempts to reform these rules, carry wide-ranging implications for airlines and other industries, as well as pension participants and beneficiaries, the PBGC, and potentially the American taxpayer. The current problems plaguing many pensions in the airline industry should be seen as symptomatic for the pension system overall and should demonstrate that the way we currently fund and insure pension benefits has to change.

Why GAO Did This Study At the same time that "legacy" airlines face tremendous competitive pressures that are contributing to a fundamental restructuring of the airline industry, they face the daunting task of shoring up their underfunded pension plans, which currently are underfunded by an estimated $31 billion. Terminating these pension plans confronts Congress with three policy issues. The most visible is the financial exposure of the Pension Benefit Guaranty Corporation (PBGC), the federal agency that insures private pensions. The agency's single-employer pension program already faces a deficit of an estimated $9.7 billion, and the airline plans present a potential threat to the agency's viability. Second, plan participants and beneficiaries may lose pension benefits due to limits on PBGC guarantees. Finally, airlines that terminate their plans may gain a competitive advantage because such terminations effectively lower overall labor costs. This testimony addresses (1) the situation the airlines are facing today, (2) overall pension developments, and (3) the policy implications of addressing these issues. What GAO Found The problems posed by the airlines' underfunded plans, while extremely serious in the short term, are only the latest symptom of the decline in the health of our nation's defined benefit (DB) pension system. These problems illustrate weaknesses in the pension system overall and demonstrate that the way plans currently fund and insure pension benefits has to change. Underfunded pension plans are a symptom of the financial turmoil currently facing the airline industry. Industry trends, including the emergence of well-capitalized low cost airlines and other factors, have created a highly competitive environment that has been particularly challenging for the legacy airlines. Since 2000, the financial performance of legacy airlines has deteriorated significantly. Legacy airlines have collectively lost $24.3 billion over the last 3 years. Despite cost-cutting efforts, legacy airlines continue to face considerable debt and pension funding obligations. In this context, a number of legacy airlines have begun to consider terminating their DB pension plans. For example, United Airlines recently announced that it would not make roughly $500 million in contributions to its pension plans this year and US Airways announced that it does not plan to make roughly $100 million in contributions. The problems of underfunded DB pension plans extend far beyond the airline industry. We have highlighted several problems that have contributed to the broad underfunding of DB plans generally, including airline plans. These problems include cyclical factors like the so called "perfect storm" of key economic conditions, in which declines in stock prices lowered the value of pension assets used to pay benefits, while at the same time a decline in interest rates inflated the value of pension liabilities. The combined "bottom line" result is that many plans today have insufficient resources to pay all of their future promised benefits. Other long term trends suggest more serious structural problems to the system, including a declining number of DB plans, a decline in the percentage of participants that are active (as opposed to retired) workers, and other factors. Existing pension funding rules and the current structure for paying PBGC insurance premiums have not ensured that sponsors contribute enough to their plans to pay promised benefits. The current pension crisis facing the airline industry and PBGC, and how the Congress chooses to address that crisis, has wide-ranging implications for airlines and other industries, as well as for pension participants, PBGC, and potentially the American taxpayer. This crisis also illustrates the need for comprehensive pension reform that tackles the full range of challenges crossing all industries and not just airlines. Such a comprehensive reform would include meaningful incentives for sponsors to adequately fund their plans, provide additional transparency for participants, and ensure accountability for those firms that fail to match the benefit promises they make with the resources necessary to fulfill those promises.

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1.) Because the utilities operated as monopolies, wholesale and retail electricity pricing was regulated by the federal government and the states. The Federal Government Has Taken Steps to Increase Competition in the Electricity Industry and Wholesale Markets The goal of federal efforts to restructure the electricity industry is to increase competition in order to provide benefits to consumers, such as lower prices and access to a wider range of services, while maintaining reliability. Over the past 13 years, the federal government has taken a series of steps to encourage this restructuring that generally fall into four key categories: (1) market structure, (2) supply, (3) demand, and (4) oversight. Electricity Markets Have Changed in Several Important Ways Since Restructuring Began Federal restructuring efforts, combined with efforts undertaken by states, have created a patchwork of electricity markets, broadened electricity supplies, disconnected wholesale and retail markets, and shifted how the electricity industry is overseen. Taken together, these developments have produced some positive and some negative outcomes for consumers. In particular, efforts at wholesale restructuring have led to a significant change in the way electricity is supplied in those markets. Those states that have not restructured their markets retain key roles in overseeing and regulating electricity markets directly and indirectly through such activities as setting rates to recover costs and siting of power plants and transmission lines and other capital investments needed to supply electricity. However, as consumers in California and across other parts of the West will attest, there have been many negative effects, including higher prices and market manipulation. Making Wholesale Market Structures Work Better Together With several fundamentally different electricity market structures in place simultaneously in various parts of the country, it is important that these markets work together better in order to meet regional needs. Providing Timely, Clear, and Consistent Signals to Help Ensure Adequate Regional Supplies Broadening of restructured electricity markets has made the federal government, the states, and localities more dependent on each other in order to ensure a sufficient supply of electricity. Connecting Wholesale and Retail Markets As we have previously reported, for competitive wholesale electricity markets to provide the full benefits expected of them, it is essential that they be connected to the retail markets, where most electricity is sold and consumed. This occurs when consumers do not see prices at the retail level that accurately reflect the higher wholesale market prices. While FERC has been supportive of increasing the role of demand-response programs in the wholesale markets that it oversees, there have been limited efforts to do so in retail markets—these markets are outside FERC’s jurisdiction and overseen by the states. While authority over the electricity industry is divided, restructuring has served to make the success of each of the oversight efforts more interdependent, and FERC and the states will have to rely on each other, as well as on new entities, to a greater degree than before to be successful. GAO staff who contributed to this report are listed in the appendix. Electricity Markets: Consumers Could Benefit from Demand Programs, but Challenges Remain. Electricity Restructuring Electricity Restructuring: 2003 Blackout Identifies Crisis and Opportunity for the Electricity Sector. Energy Markets: Results of Studies Assessing High Electricity Prices in California.

Why GAO Did This Study The electricity industry is in the midst of many changes, collectively referred to as restructuring, evolving from a highly regulated environment to one that places greater reliance on competition. This restructuring is occurring against a backdrop of constraints and challenges, including a shared responsibility for implementing and enforcing local, state, and federal laws affecting the electricity industry and an expected substantial increase in electricity demanded by consumers by 2025, requiring significant investment in new power plants and transmission lines. Furthermore, several recent incidents, including the largest blackout in U.S. history along the East Coast in 2003 and the energy crisis in California and other parts of the West in 2000 and 2001, have drawn attention to the need to examine the operation and direction of the industry. At Congress's request, this report summarizes results of previous GAO work on electricity restructuring, which was conducted in accordance with generally accepted government auditing standards. In particular, this report provides information on (1) what the federal government has done to restructure the electricity industry and the wholesale markets that it oversees, (2) how electricity markets have changed since restructuring began, and (3) GAO's views on key challenges that remain in restructuring the electricity industry. What GAO Found Over the past 13 years, the federal government has taken a variety of steps to restructure the electricity industry with the goal of increasing competition in wholesale markets and thereby increasing benefits to consumers, including lower electricity prices and access to a wider array of retail services. In particular, the federal government has changed (1) how electricity is priced--shifting from prices set by regulators to prices determined by markets; (2) how electricity is supplied--including the addition of new entities that sell electricity; (3) the role of electricity demand--through programs that allow consumers to participate in markets; and (4) how the electricity industry is overseen--in order to ensure consumer protection. Federal restructuring efforts, combined with efforts undertaken by states, have created a patchwork of wholesale and retail electricity markets; broadened electricity supplies; disconnected wholesale markets from retail markets, where most demand occurs; and shifted how the electricity industry is overseen. Taken together, these developments have produced some positive outcomes, such as progress in introducing competition in wholesale electricity markets, as well as some negative outcomes, such as periods of higher prices. We have identified four key challenges to the effective operation of the restructured electricity industry: making wholesale markets work better together so that restructuring can deliver the benefits to consumers that were expected; providing clear and consistent signals to private investors when new plants are needed so that there are adequate supplies to meet regional needs; connecting wholesale markets to retail markets through consumer demand programs to keep prices lower and less volatile; and, resolving divided regulatory authority to ensure that these markets are adequately overseen. The theme cutting across each of these challenges is the need to better integrate the various market structures, factors affecting supply and demand, and various efforts at market oversight.

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About 2,200 Metric Tons of Spent Nuclear Fuel Is Expected to Accumulate Annually, Mostly in Wet Storage, but This Pace Is Expected to Change as Reactors Shut Down Spent nuclear fuel is expected to accumulate at an average rate of about 2,200 metric tons per year in the United States, mostly in wet storage, but this rate and the amount in wet storage are expected to decrease as more reactors, as projected, begin to shut down in the 2030s. By 2067—after the last of the currently operating reactors have shut down—nearly all the 139,000 metric tons of spent fuel expected to be generated by currently operating reactors is expected to be in dry storage. Federal Liability for Spent Nuclear Fuel Management Is Based on Costs Incurred Because DOE Has Not Met Contract Obligations Federal liability for managing spent nuclear fuel has been based on costs that owners and generators of this fuel have paid because DOE has not met its contractual obligations to begin disposing of this fuel, and DOE’s estimate of future liability—$21.4 billion through 2071—is based on how long the federal government is expected to pay these costs. Under the standard contract, DOE was obligated to take title to and dispose of a certain quantity of spent nuclear fuel beginning in 1998. DOE’s estimate of future liability is based on how long DOE expects the federal government to continue to pay for managing spent nuclear fuel that DOE was obligated to have begun disposing of if it had begun picking up the fuel in 1998. This estimate assumes that DOE will begin accepting spent nuclear fuel in 2021 and complete the process in 2071, ending the federal government’s liability. However, DOE has previously extended the dates in its liability estimates several times. Experts and Stakeholders Identified Challenges to and Suggestions for Managing Spent Nuclear Fuel at Interim Storage Facilities within DOE’s Time Frames Experts and stakeholders in the area of spent nuclear fuel management, including DOE and other government officials, identified four major types of challenges to the federal government’s ability to meet DOE’s time frames for managing spent nuclear fuel at consolidated interim storage facilities. Fourth, achieving sustainable public acceptance of transporting and storing spent nuclear fuel is a societal challenge that will need to be addressed irrespective of any policy that is implemented and that experts said DOE could mitigate with a coordinated outreach strategy. DOE officials said, however, that the agency’s strategy could not be fully implemented until Congress provides direction on a path forward. A coordinated outreach strategy would be an important aspect of informing the public about spent nuclear fuel management plans and DOE’s current management efforts irrespective of which path Congress agrees upon. DOE officials confirmed that they do not have a coordinated outreach strategy for communicating with specific stakeholders and the general public about their activities related to spent nuclear fuel management. To identify the basis of federal liability for spent nuclear fuel management to date and of DOE’s estimate of future liabilities, we reviewed documents from the Departments of Energy (DOE) and Justice. To assess the challenges, if any, that experts and stakeholders have identified to the federal government’s ability to meet DOE’s time frames for managing spent nuclear fuel at consolidated interim storage facilities and potential ways for DOE to mitigate the challenges, we identified individuals with spent nuclear fuel management experience and expertise. Under the Exelon Settlement agreements, DOE is liable for spent nuclear fuel storage costs that owners and generators would not have incurred if DOE had accepted and disposed of the fuel at this rate. Dry Storage Costs: Costs to purchase canisters and casks, including canisters that may be licensed for transport and casks for transferring spent nuclear fuel to the dry storage facility; costs to load spent nuclear fuel into and to transport canisters and casks to the dry storage facility; costs of ancillary equipment for casks and cask loading, such as crawler-type transporters, dollies, and vacuum-drying equipment; costs to conduct initial loading demonstrations required by the Nuclear Regulatory Commission (NRC); costs for training and development of procedures; costs for cask-loading campaign mobilization and demobilization; costs to study and to evaluate spent nuclear fuel storage options; costs for quality assurance inspections of cask vendors; costs for security improvements required by NRC for the dry storage facility; costs of maintaining and operating the dry storage facility; costs for security improvements or upgrades required to comply with utility’s security plan approved by the NRC; and costs to design, license and build the dry storage facility, including costs of building the portion of the facility that will be required for the dry storage of the utility’s spent nuclear fuel in addition to utility’s allocations, provided that the utility can demonstrate that it was more cost effective to incur the costs to design, license and build the dry storage facility during the claim period rather than after termination of the agreement. 3. Appendix V: Process and Costs of Transferring Spent Nuclear Fuel from Wet to Dry Storage (Text for Interactive Figure 7) Appendix V: Process and Costs of Transferring Spent Nuclear Fuel from Wet to Dry Storage (Text for Interactive Figure 7) Nuclear power reactor and spent nuclear fuel pools—Spent nuclear fuel typically cools for at least 5 years in a pool before a canister ($700,000 to $1.5 million) is placed in the pool, filled with spent nuclear fuel, removed from the pool, and dried.

Why GAO Did This Study DOE is responsible for disposing of commercial spent nuclear fuel. DOE entered into contracts with owners and generators of spent nuclear fuel to begin disposing of it beginning in 1998, with plans for disposal in a national repository. DOE, however, was unable to meet the 1998 date and, as a result of lawsuits, the federal government has paid out about $3.7 billion for storage costs. DOE proposed a new strategy in January 2013 to build consolidated interim storage facilities—starting operations in 2021 and 2025. GAO was asked to review issues related to DOE's strategy for managing spent nuclear fuel. This report (1) describes the expected rate of spent nuclear fuel accumulation in wet and dry storage, (2) identifies the basis of federal liability for spent nuclear fuel management to date and of DOE's estimate of future liabilities, and (3) assesses challenges, if any, that experts and stakeholders have identified to the federal government's ability to meet DOE's time frames for managing spent nuclear fuel at consolidated interim storage facilities and potential ways for DOE to mitigate the challenges. GAO reviewed documents from DOE and other agencies, and interviewed experts and stakeholders from industry, federal and state governments, interest groups, and independent entities. What GAO Found Spent nuclear fuel—the used fuel removed from nuclear power reactors—is expected to accumulate at an average rate of about 2,200 metric tons per year in the United States. This spent nuclear fuel is mostly stored wet, submerged in pools of water. However, since pools have been reaching their capacities, owners and generators of spent nuclear fuel (typically utilities and reactor operators) have been transferring it to canisters that are placed in casks on concrete pads for dry storage—which is an expensive and time-consuming process. When operating reactors' licenses begin to expire in the 2030s, the rate of spent nuclear fuel accumulation is expected to decrease, but the amount in dry storage will increase as the pools are closed and all spent nuclear fuel is transferred to dry storage. By 2067, the currently operating reactors are expected to have generated about 139,000 metric tons of spent nuclear fuel, nearly all of which is expected to be transferred to dry storage. Federal liability for managing spent nuclear fuel has been based on costs that owners and generators of this fuel have paid because the Department of Energy (DOE) has not met its contractual obligation to dispose of spent nuclear fuel. DOE's estimate of future federal liability is based on how long DOE expects the federal government to continue to pay the costs for managing spent nuclear fuel to plant owners and generators. Generally, the damages paid—mostly for the costs of transferring spent nuclear fuel from wet to dry storage—have been for costs that owners and generators would not have incurred if DOE had begun disposing of the spent nuclear fuel. DOE's most recent estimate of future liability—$21.4 billion through 2071—assumes that DOE will begin taking title to and possession of spent nuclear fuel in 2021 and complete the process in 2071, thereby ending the federal liability. DOE has extended the expected date that the last of the spent nuclear fuel will be picked up several times, and each extension has added to the future federal liability. Spent nuclear fuel management experts and stakeholders GAO spoke with identified several legislative, regulatory, technical, and societal challenges to meeting DOE's time frames for managing spent nuclear fuel at interim storage facilities. Although DOE has begun to take actions to address some of these challenges, officials noted that the department's strategy cannot be fully implemented until Congress provides direction on a new path forward. However, experts and stakeholders believe that one key challenge—building and sustaining public acceptance of how to manage spent nuclear fuel—will need to be addressed irrespective of which path Congress agrees to take. In this context, they suggested the need for a coordinated public outreach strategy regarding spent nuclear fuel management issues, including perceived risks and benefits, which would be consistent with the Administration's directive to be more transparent and collaborative. DOE officials stated they currently do not have such a strategy. Without a better understanding of spent nuclear fuel management issues, the public may be unlikely to support any policy decisions about managing spent nuclear fuel. What GAO Recommends DOE should implement a coordinated outreach strategy to better inform the public about federal spent nuclear fuel management issues. DOE generally agreed with the findings and recommendation in the report.

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VA and DOD Abandoned Plans for a Single System, but Their New Approach to Achieving an Interoperable Electronic Health Record Is Not Supported by Sufficient Cost and Schedule Analysis or a Complete Plan About 2 years after taking actions toward the development of iEHR, VA and DOD announced changes to their plan—essentially abandoning their effort to develop a single, integrated electronic health record system for both departments. The Departments Abandoned Plans for a Single System in Favor of Separate Modernization Efforts In February 2013, the Secretaries of Defense and Veterans Affairs announced that they would not continue with their joint development of a single electronic health record system that was intended to result in an integrated electronic health record. In particular, major investment decisions (which can include, for example, terminating or significantly restructuring an ongoing program) should be justified using analyses that compare relative costs and schedules for proposed investments. Until VA and DOD provide a plan that reflects their current approach, the departments and their stakeholders may not have a shared understanding of how they intend to address their common health care business needs, including an interoperable electronic health record, going forward. Collaboration between VA and DOD Has Been Hindered by Long-standing Barriers and Ineffective Implementation of the IPO We have previously reported on IT management barriers that prevented the departments from effectively collaborating to address their common health care system needs in the areas of enterprise architecture and IT investment management. In addition, the Interagency Program Office, established by the fiscal year 2008 NDAA to act as a single point of accountability for the departments’ development and implementation of interoperable health records, was to better position the departments to collaborate. Specifically, the departments did not provide the IPO with authority over essential resources or with the autonomy to establish key interagency processes for managing joint activities. For example, VA and DOD have not further developed a joint health architecture that could guide their efforts to address their common health care business needs, as we recommended. The IPO was to better position the departments to collaborate on joint health IT initiatives. However, in addition to reducing the IPO’s role, responsibilities, and authority over these efforts in its 2013 charter, the departments have identified other offices to execute health data interoperability initiatives formerly managed by the IPO. However, the departments’ assertion is questionable because they have not developed cost and schedule estimates to substantiate their claim or justify their decision. In the absence of credible analyses to guide decisions about how to cost-effectively and expeditiously develop the interoperable electronic health record needed to provide service members and veterans with the best possible care, VA and DOD have fallen back on the divergent approaches that each department has determined to be best for it—VA intends to modernize VistA, and DOD expects to acquire a new commercially available system. While the departments have begun planning for these separate systems, they have yet to develop plans describing what a future interoperable health record will consist of or how, when, and at what cost it will be achieved. Recommendations for Executive Action To bring transparency and credibility to the Secretaries of Veterans Affairs and Defense’s assertion that VA and DOD’s current approach to achieving an interoperable electronic health record will cost less and take less time than the previous single-system approach, we recommend that the secretaries develop a cost and schedule estimate for their current approach, from the perspective of both departments, that includes the estimated cost and schedule of VA’s VistA Evolution program, DOD’s DHMSM program, and the departments’ joint efforts to achieve interoperability between the two systems; then, compare the cost and schedule estimates of the departments’ current and previous (i.e., single-system) approaches. To better position the Interagency Program Office for effective collaboration between VA and DOD and to efficiently and effectively fulfill the office’s stated purpose of functioning as the single point of accountability for achieving interoperability between the departments’ electronic health record systems, we recommend that the Secretaries of Veterans Affairs and Defense ensure that the IPO has authority over dedicated resources (e.g., budget and staff), to develop interagency processes, and to make decisions over the departments’ interoperability efforts. Appendix I: Objectives, Scope, and Methodology The objectives of this study were to (1) describe changes the Department of Defense (DOD) and Department of Veterans Affairs (VA) have made to the Integrated Electronic Health Record (iEHR) program since its inception, and evaluate the departments’ current plans for the program and (2) determine whether the departments, including the DOD/VA Interagency Program Office (IPO), are effectively collaborating on management of the iEHR program.

Why GAO Did This Study VA and DOD operate two of the nation's largest health care systems, serving approximately 16 million veterans and active duty service members, and their beneficiaries, at total annual costs of over $100 billion. The departments have recognized the importance of developing capabilities for sharing electronic patient health information and have worked since 1998 to develop such capabilities. In February 2011, VA and DOD initiated a program to develop a single, common electronic health record system—iEHR—to replace their existing health record systems. This program was to be managed by the IPO and implemented by 2017. However, the departments made significant changes to the program in 2013. GAO was asked to review the iEHR program. This report (1) describes changes to the program and evaluates the departments' current plans and (2) determines whether the departments are effectively collaborating on management of the program. GAO reviewed relevant program documents and interviewed agency officials. What GAO Found The Departments of Veterans Affairs (VA) and Defense (DOD) abandoned their plans to develop an integrated electronic health record (iEHR) system and are instead pursuing separate efforts to modernize or replace their existing systems in an attempt to create an interoperable electronic health record. Specifically, in February 2013, the secretaries cited challenges in the cost and schedule for developing the single, integrated system and announced that each department would focus instead on either building or acquiring similar core sets of electronic health record capabilities, then ensuring interoperability between them. However, VA and DOD have not substantiated their claims that the current approach will be less expensive and more timely than the single-system approach. Major investment decisions—including terminating or significantly restructuring an ongoing program—should be justified using analyses that compare the costs and schedules of alternative proposals. Yet, the departments have not developed revised cost and schedule estimates for their new modernization efforts and any additional efforts needed to achieve interoperability between the new systems, and compared them with the relevant estimates for their former approach. In the absence of such a comparison, VA and DOD lack assurance that they are pursuing the most cost-effective and timely course of action for delivering the fully interoperable electronic health record the departments have long pursued to provide the best possible care for service members and veterans. The departments have initiated their separate system efforts. VA intends to deploy clinical capabilities of its new system at two locations by September 2014, and DOD has set a goal of beginning deployment of its new system by the end of fiscal year 2016. However, the departments have yet to update their joint strategic plan to reflect the new approach or to disclose what the interoperable electronic health record will consist of, as well as how, when, and at what cost it will be achieved. Without plans that include the scope, lines of responsibility, resource requirements, and an estimated schedule for achieving an interoperable health record, VA, DOD, and their stakeholders may not have a shared understanding of how the departments intend to address their common health care business needs. VA and DOD have not addressed management barriers to effective collaboration on their joint health information technology (IT) efforts. As GAO previously reported, the departments faced barriers to effective collaboration in the areas of enterprise architecture and IT investment management, among others. However, they have yet to address these barriers by, for example, developing a joint health care architecture or a joint IT investment management process to guide their collaboration. Further, the Interagency Program Office (IPO), established by law to act as a single point of accountability for the departments' development of interoperable health records, was to better position the departments to collaborate; but the departments have not implemented the IPO in a manner consistent with effective collaboration. For example, the IPO lacks effective control over essential resources such as funding and staffing. In addition, recent decisions by the departments have diffused responsibility for achieving integrated health records, potentially undermining the IPO's intended role as the point of accountability. Providing the IPO with control over essential resources and clearer lines of authority would better position it for effective collaboration. What GAO Recommends GAO recommends that VA and DOD develop and compare the estimated cost and schedule of their current and previous approaches to creating an interoperable electronic health record and, if applicable, provide a rationale for pursuing a more costly or time-consuming approach. GAO also recommends that the departments develop plans for interoperability and ensure the IPO has control over needed resources and clearer lines of authority. VA and DOD concurred with GAO's recommendations.

gao_GGD-99-123

gao_GGD-99-123_0

This resulted in a need for an additional $6.1 million. During the first 6 months of this period (from about April through September), PBS compiles information on the various budget elements, including the rental-of-space account; reviews the information for reasonableness and accuracy; and prepares its budget estimates. We checked to see that the elements discussed were included in the Galaxy program. Galaxy–GSA’s Major Effort to Improve Tracking and Estimating in Its Rental-of-Space Account GSA has taken corrective actions to specifically improve its tracking of the rental-of-space account and to improve its budget estimating for this account. The major step taken to improve both the tracking and estimating of the rental-of-space account was GSA’s development of the Galaxy program to be the primary tool to manage the rental-of-space account for fiscal year 1999 and to help manage project expenditures for fiscal year 2001. Galaxy has seven basic components, which include the elements PBS has identified as needed for tracking actual expenditures and estimating the funding requirements for future expenditures from the rental-of-space account. The training manual states that all active leases and projects loaded in Galaxy “must be validated.” The manual lists five steps that the analyst must follow to validate the information. This process should help ensure that the projects are entered into STAR. We agree that good communication between the analysts maintaining Galaxy and the realty specialists maintaining STAR is critical to the accuracy of the data in Galaxy. To project the rent expenditure account, it is particularly important to obtain data on lease projects, which reflect potential changes in the inventory. First, a GSA official told us that GSA regions would use local market rental rate increases to determine the region’s estimated rental rate increase for a budget year. Conclusions Galaxy appears to have elements needed to track PBS’ rental-of-space account and aid in more accurately estimating this account for future budgets. To the extent that PBS effectively implements the steps it has taken to maintain accurate data and good communications within GSA and with its customer agencies, has improved its estimation and budgetary process, and has corrected the problems it identified as causing its underestimation of the rental-of-space account, it should be able to produce better estimates of this account in the future.

Why GAO Did This Study Pursuant to a congressional request, GAO reviewed the General Services Administration's (GSA) Galaxy program for estimating the rental expenses of the Federal Buildings Fund, focusing on whether the: (1) new Galaxy program included the elements needed for tracking actual rental expenditures and forecasting future rental-of-space funding requirements; and (2) additional actions the Public Building Service (PBS) was taking to improve its budget process addressed the causes of its underestimation of the rental-of-space account. What GAO Found GAO noted that: (1) Galaxy has seven basic components that appear capable of providing the data elements needed to track the actual expenditures made from the rental-of-space account and thus aid in forecasting the funding required for the rental-of-space account for budget purposes; (2) PBS has recognized that the success of the Galaxy program depends on the accuracy and maintenance of the data entered into Galaxy; (3) consequently, it has emphasized this issue in its training manual for Galaxy; (4) this manual states that all active leases and projects loaded into Galaxy must be validated; (5) the manual lists five steps that the analyst must follow to validate the information; (6) rent account analysts that GAO interviewed emphasized the need to maintain good communications among: (a) themselves, who maintain Galaxy; (b) the realty specialists, who maintain PBS' System for Tracking and Administering Real Property, the system from which the data in Galaxy were downloaded; and (c) customer agencies that provide information on their space needs; (7) GAO agrees that GSA and its customer agencies need to have good communications to ensure that GSA knows about any potential changes in inventory that a customer agency may plan in a given fiscal year, so that those changes are reflected in GSA's budget submission; (8) PBS has taken steps to improve: (a) how it calculates the rental-of-space estimate, such as using local market rental increases instead of national averages in calculating the rent increase estimates; and (b) the budgeting process in general, by establishing the Office of Financial and Information systems to oversee budget formulation, including estimating the rental-of-space account funding requirements; and (9) GAO believes that the actions PBS has identified to improve its budgeting process, if effectively implemented, address the causes it identified for its underestimation of the rental-of-space account.

gao_GAO-13-240

gao_GAO-13-240_0

Severely Underfunded Plans Have Cut Benefits to Current Employees and Increased Employer Contributions, but Financial Outlook for Some Plans Remains Bleak The large majority of the most severely underfunded multiemployer plans—those in critical status—have, according to a 2011 survey, both increased required employer contributions and reduced participant benefits in an effort to improve plans’ financial positions. Plan officials explained that these changes have had or are expected to have a range of effects, and in some cases may severely affect employers and participants. While most critical status plans expect to recover from their current funding difficulties, about 25 percent do not and instead seek to delay eventual insolvency. In addition, the plan considered the impact of funding the necessary contribution increases through reductions to base pay. PBGC Provides Financial Assistance to a Greater Number of Plans Each Year, Endangering the Multiemployer Program and Guaranteed Retiree Benefits PBGC’s financial assistance to multiemployer plans has increased significantly in recent years, and projected plan insolvencies may exhaust PBGC’s multiemployer insurance fund. While retirees of insolvent plans generally receive reduced monthly pension payments under the PBGC pension guarantee, this amount would be further reduced to an extremely small fraction of what PBGC guarantees, or nothing, if the multiemployer insurance fund were to be exhausted. PBGC officials said that the insolvency of either of these two large plans would exhaust the insurance fund in 2 to 3 years. Key Options to Reduce Liabilities and Change Plan Designs Could Help Improve Financial Stability, but Pose Trade-offs Experts and stakeholders we interviewed cited two key policy options to avoid the insolvencies of severely underfunded plans and the PBGC multiemployer insurance fund, and a number of other options for longer term reform of the multiemployer system (see fig. They noted that this flexibility is essential because 1) the most severely distressed plans will be unable to avoid insolvency using traditional methods—increasing employer contributions and/or reducing future benefit accruals or adjustable benefits—and 2) benefit reductions will occur in any case and will be more severe in the event of plan insolvency, especially in the event of the insolvency of PBGC’s multiemployer insurance fund. Representatives of one of these plans referred to appeal letters to the plan that had been submitted by participants and/or their spouses, noting that older workers or retirees can be in some financially difficult situations, and cuts to accrued benefits would deepen and increase the number of such hardships. For example, given the sacrifice it would impose on participants, several experts and plan representatives said that allowing reductions in accrued benefits should only be considered as a last resort for plans headed for insolvency. Changes to Plan Design and Other Options Could Address Challenges of Withdrawal Liability and Improve Long-Term Financial Stability Addressing the Problems Associated with Withdrawal Liability Policies ERISA requires that employers wishing to withdraw from a multiemployer plan pay for their share of the plan’s unfunded liabilities. For example, representatives from one of the largest plans said that due to the relatively large size of their plan and the amount of their funding shortfall, a merger is not an option for them. Matters for Congressional Consideration Given the serious challenges facing PBGC’s multiemployer insurance fund and critically underfunded multiemployer plans, and to prevent the significant adverse effects of PBGC insolvency on workers and retirees, Congress should consider comprehensive and balanced structural reforms to reinforce and stabilize the multiemployer system. We received formal written comments from the PBGC, which generally agreed with our findings and analysis. 2) To what extent have plans relied on PBGC assistance since 2009, and what is known about the prospective financial condition of the multiemployer plan insurance program? 3) What options are available to address PBGC’s impending funding crisis and enhance the program’s future financial stability? Specifically, we obtained data on the liabilities attributable to plans on PBGC’s list of plans that are insolvent or considered likely to become insolvent in the next 10 years, as well as those thought likely to become insolvent in the next 10 to 20 years. To identify and assess available options, we interviewed a wide range of pension experts—including academics, actuaries, attorneys, plan trustees and administrators, employers and trade associations, unions, advocacy organizations, government officials, and other relevant stakeholders.

Why GAO Did This Study Multiemployer pension plans--created by collective bargaining agreements including more than one employer-- cover more than 10 million workers and retirees, and are insured by the PBGC. In recent years, as a result of investment market declines, employers withdrawing from plans, and demographic challenges, many multiemployer plans have had large funding shortfalls and face an uncertain future. GAO examined (1) actions that multiemployer plans in the weakest financial condition have taken to improve their funding levels; (2) the extent to which plans have relied on PBGC assistance since 2009, and the financial condition of PBGC's multiemployer plan insurance program; and (3) options available to address PBGC's impending funding crisis and enhance the multiemployer insurance program's future financial stability. GAO analyzed government and industry data and interviewed government officials, pension experts--including academics, actuaries, and attorneys, multiemployer plans' trustees and administrators, employers and trade associations, unions, advocacy organizations, and other relevant stakeholders. What GAO Found The most severely distressed multiemployer plans have taken significant steps to address their funding problems and, while most plans expected improved financial health, some did not. A survey conducted by a large actuarial and consulting firm serving multiemployer plans suggests that the large majority of the most severely underfunded plans--those designated as being in critical status--either have increased or will increase employer contributions or reduce participant benefits. In some cases, these measures will have significant effects on employers and participants. For example, several plan representatives stated that contribution increases had damaged some firms' competitive position in the industry, and, in some cases, threatened the viability of such firms. Similarly, reductions in certain benefits--such as early retirement subsidies--may create hardships for some older workers, such as those with physically demanding jobs. Most of the 107 surveyed plans expected to emerge from critical status, but about 25 percent did not and instead seek to delay eventual insolvency. The Pension Benefit Guaranty Corporation's (PBGC) financial assistance to multiemployer plans continues to increase, and plan insolvencies threaten PBGC's multiemployer insurance fund's ability to pay pension guarantees for retirees. Since 2009, PBGC's financial assistance to multiemployer plans has increased significantly, primarily due to a growing number of plan insolvencies. PBGC estimated that the insurance fund would be exhausted in about 2 to 3 years if projected insolvencies of either of two large plans occur in the next 10 to 20 years. More broadly, by 2017, PBGC expects the number of insolvencies to more than double, further stressing the insurance fund. PBGC officials said that financial assistance to plans that are insolvent or are likely to become insolvent in the next 10 years would likely exhaust the insurance fund within the next 10 to 15 years. If the insurance fund is exhausted, many retirees will see their benefits reduced to an extremely small fraction of their original value because only a reduced stream of insurance premium payments will be available to pay benefits. Experts and stakeholders cited two policy options to avoid the insolvencies of severely underfunded plans and the PBGC multiemployer insurance fund, as well as other options for longer term reform. Experts and stakeholders said that, in limited circumstances, trustees should be allowed to reduce accrued benefits for plans headed toward insolvency. Also, some experts noted that, in their view, the large size of these reductions for some severely underfunded plans may warrant federal financial assistance to mitigate the impact on participants. Experts and stakeholders also noted tradeoffs, however. For example, reducing accrued benefits could impose significant hardships on some retirees, and any possible financial assistance must be considered in light of the existing federal debt. Options to improve long term financial stability include changes to withdrawal liability--payments assessed to an employer upon leaving the plan based on their share of unfunded vested benefits--to increase the amount of assets plans can recover or to encourage employers to remain in or join the plan. In addition, experts and stakeholders said an alternative plan design that permits adjustments in benefits tied to key factors, such as the funded status of the plan, would provide financial stability and lessen the risk to employers. These and other options also have important tradeoffs, however. What GAO Recommends Congress should consider comprehensive and balanced structural reforms to reinforce and stabilize the multiemployer system. PBGC generally agreed with our findings and analysis.

gao_HEHS-97-23

gao_HEHS-97-23_0

An HMO paid by capitation is called a risk-contract HMO because it assumes the financial risk of providing health care within a fixed budget. Objectives, Scope, and Methodology In February 1996, Senator Pryor, the Ranking Minority Member of the Senate Special Committee on Aging asked us to examine issues related to the marketing, education, and enrollment practices of health plans participating in the Medicare risk-contract HMO program. This report focuses on information that can help beneficiaries become discerning consumers. In particular, the report reviews (1) HCFA’s performance in providing beneficiaries comparative information about Medicare HMOs to assist their decision-making and (2) the usefulness of readily available data that could inform beneficiaries and caution them about poorly performing HMOs. In addition, each HMO develops its own format to summarize its benefits and premiums. Instead, HCFA plans to make information on benefits, copayments, and deductibles available on the Internet. HCFA also collects other information that could be useful to beneficiaries, including HMOs’ financial data and reports from HCFA’s periodic monitoring visits to HMOs. These initiatives may eventually provide Medicare beneficiaries with objective information that will help them compare available plans. Nonetheless, HCFA does not routinely compare plans’ disenrollment rates or disclose such information to the public. High disenrollment rates may result from poor education of enrollees during an HMO’s marketing and enrollment process. 3.2.) The Secretary should direct the HCFA Administrator to require standard formats and terminology for important aspects of HMOs’ informational materials for beneficiaries, including benefits descriptions; require that all literature distributed by Medicare HMOs follow these produce benefit and cost comparison charts with all Medicare options available for each market area; and widely publicize the availability of the charts to all beneficiaries in markets served by Medicare HMOs and ensure that beneficiaries considering an HMO are notified of the charts’ availability.

Why GAO Did This Study Pursuant to a congressional request, GAO reviewed the marketing, education, and enrollment practices of health maintenance organizations (HMO) participating in the Medicare risk-contract program, focusing on whether: (1) the Health Care Financing Administration (HCFA) provides Medicare beneficiaries with sufficient information about Medicare HMO; and (2) available HCFA data could be used to caution beneficiaries about HMO that perform poorly. What GAO Found GAO found that: (1) HCFA does not provide beneficiaries any of the comparative consumer guides that federal government and many employer-based health insurance programs routinely provide to their employees and retirees; (2) Medicare beneficiaries seeking similar information face a laborious, do-it-yourself process which includes calling to request area HMO names and telephone numbers, calling each HMO to request marketing materials, and attempting to compare plans from HMO brochures that may not use the same format or standardized terminology; (3) HCFA collects volumes of information that could be packaged and distributed to help consumers choose between competing Medicare HMO and also compiles data regarding HMO disenrollment rates, enrollee complaints, and certification results; (4) HCFA is developing comparison charts that will contain information on the benefits and costs for all Medicare HMO, but plans to post the charts in electronic format on the Internet rather than distribute them to beneficiaries; and (5) HCFA provision of information on HMO disenrollment rates may be particularly useful in helping beneficiaries to distinguish among competing HMO, since beneficiaries could then ask HMO representatives questions and seek additional information before making an enrollment decision.

gao_GAO-12-430T

gao_GAO-12-430T_0

Background As the central human resources agency for the federal government, OPM is tasked with ensuring that the government has an effective civilian workforce. To carry out this mission, OPM delivers human resources products and services including policies and procedures for recruiting and hiring, provides health and training benefit programs, and administers the retirement program for federal employees. Specifically, OPM noted that: current processes are paper-based and manually intensive, resulting in a higher number of errors and delays in providing benefit payments; the high costs, limited capabilities, and other problems with the existing information systems and processes pose increasing risks to the accuracy of benefit payments; current manual capabilities restrict customer service; federal employees have limited access to retirement records, making planning for retirement difficult; and attracting qualified personnel to operate and maintain the antiquated retirement systems, which have about 3 million lines of custom programming, is challenging. However, following attempts over more than two decades, the agency has not yet been successful in achieving the modernized retirement system that it envisioned. IT Management Weaknesses Have Contributed to OPM’s Unsuccessful Retirement Modernization Efforts OPM’s efforts to modernize its retirement system have been hindered by weaknesses in several key IT management disciplines. For example, in reporting on RSM in February 2005, we noted weaknesses in key management capabilities, such as project management, risk management, and organizational change management. Although OPM had defined major retirement modernization project components, it had not defined the dependencies among them. By not identifying critical dependencies among retirement modernization components, OPM increased the risk that unforeseen delays in one activity could hinder progress in other activities. OPM officials acknowledged that they did not have a process for identifying and tracking retirement modernization project risks and mitigation strategies on a regular basis but stated that the agency’s project management consultant would assist it in implementing a risk management process. Without such a process, OPM did not have a mechanism to address potential problems that could adversely impact the cost, schedule, and quality of the retirement modernization project. We subsequently reported on OPM’s retirement modernization again in January 2008, as the agency was on the verge of deploying a new automated retirement processing system. At the time of our review, 1 month before OPM planned to deploy a major system component, test results showed that the component had not performed as intended. The high degree of concurrent testing that OPM planned to meet its February 2008 deployment schedule increased the risk that the agency would not have the resources or time to verify that the planned system worked as expected. Without a reliable cost estimate, OPM did not have a sound basis for formulating retirement modernization budgets or for developing the cost baseline that is necessary for measuring and predicting project performance. Fundamental to reliable EVM is the development of a baseline against which variances are calculated. However, this view of project performance was not reliable because the baseline on which it was based did not reflect the full scope of the project, had not been validated, and was unstable (i.e., subject to frequent changes). We recommended that the Director of OPM address these deficiencies by, among other things, conducting effective system tests prior to system deployment, in addition to improving program cost estimation and progress reporting. Our April 2009 report made new recommendations that OPM address the weaknesses in the retirement modernization project that we identified. Although the agency began taking steps to address them, the recommendations were overtaken by the agency’s decision in February 2011 to terminate the retirement modernization project. OPM Has a New Plan to Improve Retirement Processing In mid-January 2012, OPM released a new plan that describes the agency’s intention to improve retirement processing through actions that include hiring and training 56 new staff to adjudicate retirement claims and 20 additional staff to support the claims process; establishing higher production standards and identifying potential retirement process improvements; and working with other agencies to improve the accuracy and completeness of the data they provide to OPM for use in retirement processing. Recognizing that its previous, large-scale efforts to automate the retirement process have failed, the agency characterizes its new plan as representing partial, progressive IT improvements.

Why GAO Did This Study The Office of Personnel Management (OPM) is the central human resources agency for the federal government and, as such, is responsible for ensuring that the government has an effective civilian workforce. As part of its mission, OPM defines recruiting and hiring processes and procedures; provides federal employees with various benefits, such as health benefits; and administers the retirement program for federal employees. OPM’s use of information technology (IT) is critical in carrying out its responsibilities; in fiscal year 2011 the agency invested $79 million in IT systems and services. For over 2 decades, OPM has been attempting to modernize its federal employeeretirement process by automating paper-based processes and replacing antiquated information systems. However, these efforts have been unsuccessful, and OPM canceled its most recent large-scale retirement modernization effort in February 2011. GAO was asked to summarize its work on challenges OPM has faced in attempting to modernize the federal employee retirement process. To do this, GAO relied on previously published work in addition to reviewing OPM’s recent plan for retirement services. What GAO Found In a series of reviews, GAO found that OPM’s retirement modernization efforts were hindered by weaknesses in key management practices that are essential to successful IT modernization projects. For example, in 2005, GAO made recommendations to address weaknesses in the following areas: Project management : While OPM had defined major components of its retirement modernization effort, it had not identified the dependencies among them, increasing the risk that delays in one activity could have unforeseen impacts on the progress of others. Risk management : OPM did not have a process for identifying and tracking project risks and mitigation strategies on a regular basis. Thus, OPM lacked a mechanism to address potential problems that could adversely impact the cost, schedule, and quality of the modernization effort. Organizational change management : OPM had not adequately prepared its staff for changes to job responsibilities resulting from the modernization by developing a detailed transition plan. This could lead to confusion about roles and responsibilities and hinder effective system implementation. In 2008, as OPM was on the verge of deploying an automated retirement processing system, GAO reported deficiencies in and made recommendations to address additional management capabilities: Testing : The results of tests 1 month prior to the deployment of a major system component revealed that it had not performed as intended. These defects, along with a compressed testing schedule, increased the risk that the system would not work as intended upon deployment. Cost estimating : The cost estimate OPM developed was not fully reliable. This meant that the agency did not have a sound basis for formulating budgets or developing a program baseline. Progress reporting : The baseline against which OPM was measuring the progress of the program did not reflect the full scope of the project; this increased the risk that variances from planned performance would not be detected. In 2009, GAO reported that OPM continued to have deficiencies in its cost estimating, progress reporting, and testing practices and made recommendations to address these deficiencies, as well as additional weaknesses in the planning and oversight of the modernization effort. OPM agreed with these recommendations and began to address them, but the agency terminated the modernization effort in February 2011. More recently, in January 2012, OPM released a new plan to improve retirement processing that aims at targeted, incremental improvements rather than a largescale modernization. Specifically, OPM plans to hire new claims-processing staff, take steps to identify potential process improvements, and work with other agencies to improve data quality. Further, OPM intends to make IT improvements that allow retirees to access and update their accounts and automate the retirement application process. However, the plan reflects a less ambitious retirement processing timeliness goal and does not address improving or eliminating the legacy systems that support retirement processing. What GAO Recommends GAO is not making new recommendations at this time. GAO has previously made numerous recommendations to address IT management challenges OPM has faced in carrying out its retirement modernization efforts. Fully addressing these challenges remains key to the success of OPM’s efforts.

gao_NSIAD-97-181

gao_NSIAD-97-181_0

Some of the aircraft in a training configuration have been modified to an interim configuration. Total Cost of the B-2 Appears to Have Stabilized The Air Force’s estimate of the total program cost for the B-2 program has changed less than 1 percent since 1994; however, the estimate has been affected by changes made by both Congress and the Air Force. Table 1.1 shows the Air Force’s 1994-96 cost estimates for the development, procurement, and military construction of the B-2 as reported in annual selected acquisition reports. Through fiscal year 1997, the Air Force was appropriated $43,178 million, or 96 percent, of the $44,754 million total program estimate. In the last 3 fiscal years, Congress added $734 million to the B-2 program—$125 million to preserve the B-2 industrial base, $493 million to upgrade the first test aircraft to operational status, and $116 million to enhance the block 30 capabilities. I) is understated by $89 million. Air Force officials said that without these funds, two of the test aircraft would not be upgraded to fully capable aircraft, leaving only 19 fully capable B-2s. B-2 Cost Increases Are Possible B-2 estimated costs could increase if (1) the flight test program is extended beyond March 1998, (2) more B-2 performance deficiencies are identified during the time remaining in the acquisition program, and (3) additional development and procurement activities are initiated to better maintain the low-observable features of the B-2s. Full operational capability of the B-2 is planned to be achieved in 1999. The Air Force is reviewing specific B-2 deployment requirements and working to resolve deployment-related problems by the time the B-2s are scheduled to be fully capable in 1999. B-2 Bomber: Status of Cost, Development, and Production (GAO/NSIAD-95-164, Aug. 4, 1995).

Why GAO Did This Study Pursuant to a legislative requirement, GAO reviewed the B-2 bomber, focusing on the current status of cost and operational issues. What GAO Found GAO noted that: (1) the total cost of the B-2 appears to have stabilized; (2) the Air Force has reported that the total estimated B-2 acquisition costs (development, procurement, and military construction) decreased from $44,946 million in early 1995 to $44,754 million in early 1997; (3) the estimated cost declined even though Congress added new requirements to the B-2 program and provided additional funds of $734 million in fiscal years 1995, 1996, and 1997; (4) Air Force officials advised GAO that the $44,754 million in cost reported to Congress was understated by $89 million; (5) they said that the impact of the understatement would be that two of the test aircraft would not be fully upgraded to block 30, making them less than fully capable; (6) through fiscal year 1997, Congress appropriated funds for about 96 percent of the estimated total cost of $44,754 million; (7) although the cost estimate has not changed substantially since 1995, costs could increase if: (a) the flight test program is extended beyond March 1998; (b) more performance deficiencies than predicted are identified during the remaining portions of the acquisition program; and (c) unplanned development and procurement activities become necessary to better maintain the low-observable features of the B-2s; (8) the Air Force declared on April 1, 1997, that the B-2s in an interim configuration had achieved initial operational capability; (9) however, the Air Force decided it was unrealistic to plan on deploying the interim aircraft to forward operating locations because of difficulties being experienced in maintaining low-observable characteristics at the B-2's main operating base; and (10) the Air Force is reviewing specific B-2 deployment requirements and working to resolve deployment-related problems by the time the B-2s are scheduled to be fully capable in 1999.

gao_GAO-06-569T

gao_GAO-06-569T_0

Certain Aspects of the Title Insurance Market Merit Further Study We identified several important items for further study, including the way policy premiums are determined, the role played by title agents, the way that title insurance is marketed, the growth of affiliated business arrangements, and the involvement of and coordination among the regulators of the multiple types of entities involved in the marketing and sale of title insurance. The Extent to Which Premium Rates Reflect Underlying Costs Is Not Always Clear For several reasons, the extent to which title insurance premium rates reflect insurers’ underlying costs is not always clear. 1). However, most state regulators do not consider title search expenses to be part of the premium, and do not include them in regulatory reviews that seek to determine whether premium rates accurately reflect insurers’ costs. Costs for title search and examination work do not appear to rise as loan or purchase amounts increase, and such costs are insurers’ largest expense. The Extent of Regulatory Focus on Title Agents Merits Further Review Title agents play a more significant role in the title insurance industry than agents do in most other types of insurance, performing most underwriting tasks as well as the title search and examination work. However, the amount of attention they receive from state regulators is not clear. The Extent of Competition in the Industry That Could Benefit Consumers Is Not Clear For several reasons, the competitiveness of the title insurance market has been questioned. First, while consumers pay for title insurance, they generally do not know how to “shop around” for the best deal and may not even know that they can. Instead, they often rely on the advice of a real estate or mortgage professional in choosing a title insurer. As a result, title insurers and agents normally market their products exclusively to these types of professionals, who in some cases may recommend not the least expensive or most reputable title insurer or agent but the one that represents the professional’s best interests. 2). These entities include real estate brokers and agents, mortgage brokers, lenders, and builders, all of which may refer clients to particular agencies and insurers. For example, one state insurance regulator with whom we spoke told us that the agency coordinated to some extent with the state real estate commission and at the federal level with HUD, but only informally. Some of these investigations of the marketing of title insurance by title insurers and agents, real estate brokers, and builders have turned up allegedly illegal activities. Recent State and Federal Investigations Have Identified Areas of Potential Interest Federal and state investigations have identified two primary types of potentially illegal activities in the sale of title insurance, but the extent to which such activities occur in the title insurance industry is unknown. The first involves allegations of kickbacks–that is, fees that title agents or insurers may give to home builders, real estate agents and brokers, or lenders in return for referrals. State and federal investigators have also alleged the existence of inappropriate or fraudulent affiliated business arrangements. These involve a “shell” title agency that generally has no physical location, employees, or assets, and does not actually perform title and settlement business. Investigators have also looked at the various types of alleged kickbacks that title agents have provided, including gifts, entertainment, business support services, training, and printing costs. Proposed Regulatory Changes Raise a Number of Issues Over the past several years, regulators and others have suggested changes to regulations that would affect the way title insurance is sold, and further study of the issues raised by these potential changes could be beneficial. In June 2005, HUD announced that it was again considering revisions to the regulations. In addition, NAIC officials told us that the organization was considering changes to the model title insurance and agent laws to address current issues such as the growth of affiliated business arrangements and to more closely mirror RESPA’s provisions on referral fees and sanctions for violators. Finally, some consumer advocates have suggested that requiring lenders to pay for the title policies from which they benefit might increase competition and ultimately lower costs for consumers, because lenders could then use their market power to force title insurers to compete for business based on price.

Why GAO Did This Study Title insurance is a required element of almost all real estate purchases and is not an insignificant cost for consumers. However, consumers generally do not have the knowledge needed to "shop around" for title insurance and usually rely on professionals involved in real estate--such as lenders, real estate agents, and attorneys--for advice in selecting a title insurer. Recent state and federal investigations into title insurance sales have identified practices that may have benefited these professionals and title insurance providers at the expense of consumers. At the request of the House Financial Services Committee, GAO currently has work under way studying the title insurance industry, including pricing, competition, the size of the market, the roles of the various participants in the market, and how the industry is regulated. This testimony discusses the preliminary results of GAO's work to date and identifies issues for further study. In so doing, this testimony focuses on: (1) the reasonableness of cost structures and agent practices common to the title insurance market that are not typical of other insurance markets; (2) the implications of activities identified in recent state and federal investigations that may have benefited real estate professionals rather than consumers; and (3) the potential need for regulatory changes that would affect the way that title insurance is sold. What GAO Found Some cost structures and agent practices that are common to the title insurance market are not typical of other lines of insurance and merit further study. First, the extent to which premium rates reflect underlying costs is not always clear. For example, most states do not consider title search and examination costs--insurers' largest expense--to be part of the premium, and do not review these costs. Second, while title agents play a key role in the underwriting process, the extent to which state insurance regulators review agents is not clear. Few states collect information on agents, and three states do not license them. Third, the extent to which a competitive environment exists within the title insurance market that benefits consumers is also not clear. Consumers generally lack the knowledge necessary to "shop around" for a title insurer and therefore often rely on the advice of real estate and mortgage professionals. As a result, title agents normally market their business to these professionals, creating a form of competition from which the benefit to consumers is not always clear. Fourth, real estate brokers and lenders are increasingly becoming full or part owners of title agencies, which may benefit consumers by allowing one-stop shopping, but may also create conflicts of interest. Finally, multiple regulators oversee the different entities involved in the title insurance industry, but the extent of involvement and coordination among these entities is not clear. Recent state and federal investigations have identified potentially illegal activities--mainly involving alleged kickbacks--that also merit further study. The investigations alleged instances of real estate agents, mortgage brokers, and lenders receiving referral fees or other inducements in return for steering business to title insurers or agents, activities that may have violated federal or state anti-kickback laws. Participants allegedly used several methods to convey the inducements, including captive reinsurance agreements, fraudulent business arrangements, and discounted business services. For example, investigators identified several "shell" title agencies created by a title agent and a real estate or mortgage broker that had no physical location or employees and did not perform any title business, allegedly serving only to obscure referral payments. Insurers and industry associations with whom we spoke said that they had begun to address such alleged activities but also said that current regulations needed clarification. In the past several years, regulators, industry groups, and others have suggested changes to the way title insurance is sold, and further study of these suggestions could be beneficial. For example, the Department of Housing and Urban Development announced in June 2005 that it was considering revisions to the regulations implementing the Real Estate Settlement Procedures Act. In addition, the National Association of Insurance Commissioners is considering changes to model laws for title insurers and title agents. Finally, at least one consumer advocate has suggested that requiring lenders to pay for the title policies from which they benefit might increase competition and ultimately lower consumers' costs.

gao_GAO-09-789

gao_GAO-09-789_0

This authority allows NIST to procure the services of up to 200 experts or consultants per year. To date, NIST has used its authority under 5 U.S.C. NIST Has Awarded 39 Contracts Totaling about $1.9 Million to Obtain the Services of Experts From August 2007 through April 2009, NIST had awarded 39 contracts to obtain the services of individual experts to assist with a variety of urgent or short-term research projects. 1). None of the 38 contracts that NIST funded exceeded the statutory limit of 1 year in duration. The number of hours purchased averaged 939 hours per contract and ranged from 149 hours to 2,080 hours (see fig. In general, for the 38 contracts that NIST funded, the contract experts designed and conducted experiments, analyzed data, and delivered the results of their work in reports that are expected to meet NIST’s standards for publication in a professional journal. NIST officials also stated that despite limits on this authority, their ability to perform high-quality research in the future will be hampered if this authority is not extended. Fourth, most laboratory officials told us that they value the COMPETES Act authority because they have interpreted it to mean that NIST is allowed to award personal services contracts without competition. According to NIST officials, nonpersonal services contracts are not as effective as the personal services contracts they have awarded under the authority because they do not allow for a direct working relationship with the contract expert and also require time-consuming contract modifications to redirect the research, if needed. For example, NIST officials explained that when the agency awards nonpersonal services contracts to organizations, the agency has limited ability to select the individual experts who will be assigned to conduct the work. NIST Has Applied Safeguards over the Use of the COMPETES Act Authority, but Congressional Direction Is Needed if the Authority Is Extended NIST has developed and implemented a set of procedures to guide the use of personal services contracts awarded to individual experts under the COMPETES Act authority and has adopted some of the safeguards contained in the FAR and some contained in the OPM regulations. However, it is unclear whether additional safeguards are needed for NIST’s use of this authority because which safeguards NIST is legally required to apply is an unsettled question. Because of the unclear guidance from Commerce and OPM, NIST contracting officials told us that they had difficulty in determining which specific laws and regulations to apply when using the COMPETES Act authority. Consequently, to help limit the risk to the agency, they adopted some safeguards from the FAR and some from OPM’s regulations for NIST’s procedures. Because the statutes granting NIST authority to obtain the temporary services of experts and consultants do not clearly state whether NIST is required to obtain the services by appointing individuals as federal employees in accordance with OPM regulations or by awarding personal services contracts in accordance with the FAR, NIST faces substantial uncertainty as it continues to formulate procedures and safeguards for the use of the authority granted by the COMPETES Act. In our view, the question of which safeguards NIST is legally required to apply—and thus the need for any additional safeguards—is unclear at this time. Appendix I: Scope and Methodology The objectives of this study were to determine (1) the extent to which and for what purposes the National Institute of Standards and Technology (NIST) has used its authority under the America Creating Opportunities to Meaningfully Promote Excellence in Technology, Education, and Science Act (COMPETES Act) to obtain the services of experts, (2) how effective this authority has been in helping NIST meet its need for experts to assist with urgent and short-term research projects, and (3) the extent to which NIST policies and procedures provide appropriate safeguards over the use of this authority. The descriptive information we collected included, among other things, the NIST laboratory that requested the expert, information on whether the expert had worked at NIST in some capacity or at another federal agency, the number of labor hours covered by the contract, the total contract award amounts for labor and travel, the duration of the contract, and information on whether the contract was for a fixed price.

Why GAO Did This Study The America COMPETES Act gave the National Institute of Standards and Technology (NIST), within the Department of Commerce, the authority, through 2010, to obtain the temporary services of up to 200 experts or consultants per year, but did not specify how the agency should acquire these services. NIST has used this authority to award personal services contracts to obtain the services of individuals. The act requires GAO to report on whether additional safeguards would be needed if NIST's authority were to be made permanent. To meet that requirement, GAO determined (1) the extent to which NIST has used its authority; (2) how effective the authority has been in helping NIST meet its need for experts; and (3) the extent to which NIST has provided appropriate safeguards over its use, and what additional safeguards are needed. GAO reviewed statutes, regulations, federal guidance, and NIST's contracts. In addition, GAO interviewed officials at NIST, Commerce, and the Office of Personnel Management (OPM). What GAO Found From August 2007 through April 2009, NIST had awarded 39 contracts totaling about $1.9 million using the COMPETES Act authority. Work under 16 of these contracts has been completed, 1 was canceled prior to being funded, and work on 22 is ongoing. Four of NIST's seven laboratories awarded 32 of the 38 funded contracts. Award amounts averaged $50,754. Award amounts covered the costs of labor hours and, in 9 cases, the costs of travel. No contract exceeded 1 year in duration, and the number of hours purchased averaged 939 hours per contract. In general, the experts designed and conducted experiments, analyzed data, and delivered their results in peer-reviewed reports. These experts also assisted with research projects, such as a study of the lighting sources and the materials used for traffic signs and road markings. According to NIST officials, the COMPETES Act authority, despite limitations, has been highly effective in helping NIST meet its need for experts. These officials told GAO that the authority allows NIST to award personal services contracts that enable the agency to quickly redirect research as needed. The officials also stated that the authority allows NIST to respond to the short-term research needs of other agencies that do not merit NIST hiring new staff. Most of these officials value the authority because they interpret it as allowing NIST to award contracts without competition, which helps them to quickly select individuals with specialized expertise. Nonetheless, some officials said the authority limits the amount of pay that can be offered, which may prevent NIST from contracting with the most highly qualified experts; although none of these officials could provide an example of when this had occurred. Also, because NIST has strictly applied the 1-year limit in the authority, NIST officials said they are limited in their ability to retain experts, even if the experts are still needed. If the authority is not made permanent, NIST officials said they will have to revert to the use of nonpersonal services contracts, which they believe are less effective in meeting the agency's needs because they require time-consuming contract modifications to redirect research and limit NIST's ability to select specific experts to do the work. NIST has developed procedures that include safeguards for using the authority, but it had difficulty determining which specific laws and regulations to apply because it did not receive clear guidance from Commerce or OPM. As a result, to help limit the risk to the agency, NIST adopted some safeguards from the Federal Acquisition Regulation (FAR) that apply to contracts and some from OPM's regulations that implement personnel statutes. For example, NIST awarded the contracts at a firm fixed price, a FAR safeguard, and limited the pay offered to experts, a safeguard in the personnel statute. Neither the COMPETES Act nor a second law incorporated in the act clearly state whether NIST is required to use its new authority by appointing individuals as federal employees in accordance with OPM regulations or by awarding personal services contracts in accordance with the FAR. Because the question of which safeguards NIST is legally required to apply is unsettled, the need for any additional safeguards is also unclear at this time.

gao_GAO-04-898

gao_GAO-04-898_0

In prior censuses, the Bureau has generally included “federally affiliated” groups—members of the military and federal employees and their dependents—but has excluded private citizens residing abroad from all but the 1960 and 1970 Censuses. Scope and Methodology As agreed with your offices, our objectives for this report were to assess (1) whether the Bureau implemented the test consistent with its design, and (2) the initial lessons learned from the test results and their implications for future overseas enumerations. Return on Investment for Overseas Enumeration is Low Not only were response levels low, they were extremely expensive to obtain on a unit basis—roughly $1,450 for each returned questionnaire, based on the $7.8 million the Bureau spent preparing for, implementing, and evaluating the 2004 overseas test. In contrast, the unit cost of the 2000 Census was about $56 per household. Although the two surveys are not directly comparable because the 2000 Census costs covered operations not used in the overseas test, the 2000 Census was still the most expensive census in our nation’s history. The effort helped secure a 72-percent return rate. Replicating this level of effort on a worldwide basis would be impractical, and still would not produce a complete count. Ensuring a Smooth Overseas Enumeration Could Stretch the Bureau’s Resources The Bureau’s experience in conducting the 2004 overseas test underscored the difficulties of administering a complex operation from thousands of miles away. For example, during the overseas test, the Bureau found that French privacy laws restrict the collection of personal data such as race and ethnic information. The Design of the Overseas Census Lacks the Building Blocks of a Successful Census The Bureau’s experience in counting the nation’s population for the 2000 and earlier censuses sheds light on some of the specific operations and other elements that together form the building blocks of a successful head count (see fig. The Bureau has found that response rates to mandatory surveys are higher than the response rates to voluntary surveys. Although more comprehensive results will not be available until the Bureau completes its evaluation of the test early next year, a key lesson learned is already clear: The current approach to counting this population group—a voluntary survey that largely relies on marketing to ensure a complete count—would be costly and yield poor results. What’s more, the Bureau already faces the difficult task of carrying out a cost-effective stateside enumeration in 2010. Furthermore, the Bureau noted, “should Congress request and fund” further research on counting overseas Americans, it would be equipped to do that research itself.

Why GAO Did This Study The U.S. Census Bureau (Bureau) has typically counted overseas members of the military, federal civilian employees, and their dependents. However, it usually excluded private citizens residing abroad. In July 2004, the Bureau completed a test of the practicality of counting all overseas Americans. GAO was asked to assess (1) whether the Bureau implemented the test consistent with its design, and (2) the lessons learned from the test results. What GAO Found The Bureau generally implemented the overseas census test on schedule and consistent with its research design. Still, participation was poor, with just 5,390 questionnaires returned from the three test sites--France, Kuwait, and Mexico. Moreover, because of the low response levels, obtaining those questionnaires proved to be quite expensive--around $1,450 per response, which is far costlier on a unit basis than the 2000 Census. Although the two are not directly comparable because the 2000 Census included operations not used in the overseas test, the 2000 Census cost around $56 per household. Further, boosting the response rate globally might not be practical. On the domestic front, during the 2000 Census, the Bureau spent $374 million on a months-long publicity campaign that consisted of television and other advertising that helped yield a 72-percent return rate. Replicating this level of effort on a worldwide basis would be difficult, and still would not produce a complete count. Ensuring a smooth overseas count could also stretch the Bureau's resources. For example, at each test site the Bureau encountered various challenges that needed to be resolved such as French privacy laws. Moreover, managing a complex operation from thousands of miles away also proved difficult. The approach used to count the overseas population in the 2004 test--a voluntary survey that largely relies on marketing to secure a complete count, lacks the basic building blocks of a successful census. The Bureau has done some initial research on alternatives, but all require more extensive review. Given that the Bureau already faces the difficult task of securing a successful stateside count in 2010, having to simultaneously count Americans abroad would only add to the challenges facing the Bureau.

gao_GAO-02-275

gao_GAO-02-275_0

WIA also requires that many federal programs work together to provide employment and training services through the one-stop system. To implement these measures, states and localities had to change the way they collected and reported performance data. States and localities also faced challenges in implementing the measures due to their complexity and the resource demands they created, and some had to develop new procedures to obtain UI wage records. Supplemental data cannot be used to measure earnings change and replacement. Local staff are reluctant to provide WIA-funded services to job seekers who may be less likely to get and keep a job. Performance Measures May Not Accurately Assess Performance of the Three WIA-Funded Programs Even when fully implemented, WIA performance measures may still not provide an accurate picture of performance for the three WIA-funded programs largely because data are neither comparable across states nor timely. State and local officials generally supported many of the performance measures as relevant indicators of the success of an employment and training program. Thus, at least 23 states have not used additional data to help them meet their performance levels. Existing Performance Measures Fail to Gauge Overall One- Stop Performance Although there are performance measures for the three WIA-funded programs and most of the programs required to provide services in the one-stop, no measures exist to assess how well the overall one-stop systems are working. In this way, Florida has attempted to measure the system overall as well as outcomes for individual programs.

Why GAO Did This Study Congress passed the Workforce Investment Act (WIA) in 1998 to bring most federally funded employment and training services into a single, one one-stop center system. GAO assessed three programs that provide service through this system. What GAO Found States and localities have begun to implement the new performance measurement system for the three WIA-funded programs but report several challenges. States had to change the way they collected and reported performance data. They also faced challenges in implementing these measures due to their complexity and the resource demands created by new measures. Some developed new procedures to obtain access to sensitive records. The performance levels are of particular concern to state and local officials because failure to meet them can result in financial sanctions. As a result, states may be choosing to serve only those job seekers who are most likely to be successful. Even when fully implemented, performance measures may not provide a true picture of WIA-funded program performance because data are neither comparable across states nor timely. The measures include many of the indicators relevant to an employment and training program, such as getting and keeping jobs and increasing wages and skills. Although measures exist to gauge the performance of the three WIA-funded programs, there are no measures to gauge the performance of the one-stop system as a whole. At least 17 programs provide services through the one-stop system, and most have their own performance measures. Although these performance measures may be used for assessing outcomes for individual programs, they cannot be used to measure the success of the overall system.

gao_GGD-99-46

gao_GGD-99-46_0

Background NGISC was established pursuant to the National Gambling Impact Study Commission Act (NGISC Act). GSA also concluded that FACA applies to NGISC. Applicability of and Compliance With FACA Is NGISC subject to FACA and, if so, did it follow FACA with respect to three specific meetings? 2. NGISC did not publish a 15-day advance notice of the meeting in the Federal Register, as required by FACA’s implementing regulations. Two days before the teleconference, NGISC faxed a notice of the teleconference to approximately 730 people from the media and general public that expressed interest in NGISC activities. We note that while NGISC did provide in its Federal Register notice the dates and location of the February retreat more than 15 days in advance of the meeting, information about the retreat agenda was posted to the website and sent by fax less than 15 days in advance of the meeting. Award of Major Contracts What contracting procedures were used in NGISC’s award of major contracts? With respect to our review of the three contracts, we found that (1) NGISC’s Chair described an award process in which competition was sought, but NGISC’s Chair did not document the selection process when contracting for legal services; (2) NGISC entered into a sole-source contract for research consulting services, and we found no basis for questioning its determination that the person selected was uniquely qualified; and (3) documentation maintained by NGISC showed that it made a reasonable effort to obtain competition when it contracted for the national survey on American gambling behavior and the creation of a database. NGISC Contracted for Legal Counsel Why did the NGISC contract for legal counsel instead of using government legal support? NGISC Contractor Interference Did NGISC attempt to interfere in an inappropriate way with the work of one of its contractors? Through review of NGISC documents provided to us and interviews with NGISC’s Chair and selected NGISC and Regent University staff, we identified six persons, other than the Chair, who were affiliated with Regent University and had some involvement in NGISC’s activities. The three other individuals were part-time NGISC employees for some period of time. Two Regent University employees, who reported to the Chair in her capacity as Dean of the Robertson School of Government, have had involvement in NGISC. In addition, two individuals who were Regent University graduate students and one Regent University graduate volunteered their services to NGISC for 2 days in August 1997 to assist with meeting preparations. Another Regent University graduate was employed by NGISC for approximately a week and a half in June 1997 to assist in its establishment. Relocation Costs Has NGISC paid for relocating any staff? Alternate Work Location Were NGISC employees allowed to work at a location other than the NGISC office? NGISC’s Administrative Officer said that he did not have written work schedules with supervisory approval for any of its employees. Further, NGISC’s time and attendance process did not require its supervisor to approve employees’ official time sheets. We found no evidence that the two NGISC employees who were authorized to work at locations other than NGISC’s office did not work the hours scheduled or did not accomplish the work they were expected to complete. 2, section 3(2). At GSA’s request, on June 15, 1997, the Commission filed a charter with GSA stating that: “The Commission is subject to the standards and requirements of the Federal Advisory Committee Act (FACA, as amended), with respect to meetings, hearings, and the availability of Commission records, and other matters.” On October 31, 1997, the Commission unanimously adopted operating rules, that included the statement that NGISC “is an independent legislative commission which will, in general, conduct its activities in accordance with the standards and requirements of the FACA, the Freedom of Information Act (FOIA), and the Government in the Sunshine Act (GISA) .

Why GAO Did This Study Pursuant to a congressional request, GAO reviewed selected operational practices of the National Gambling Impact Study Commission (NGISC), focusing on: (1) whether NGISC is subject to the Federal Advisory Committee Act (FACA) and, if so, whether NGISC followed FACA with respect to three specific meetings; (2) what contracting procedures were used in NGISC's award of three major contracts; (3) why NGISC contracted for legal counsel instead of using government legal support; (4) whether NGISC attempted to interfere with the work of one of its contractors; (5) how Regent University employees were involved in NGISC activities; (6) whether NGISC has paid for relocating any staff; and (7) whether NGISC employees are allowed to work at a location other than the NGISC office. What GAO Found GAO noted that: (1) FACA applies to NGISC; (2) for one of the three meetings, NGISC did not provide the 15-day advance notice in the "Federal Register" that is required under FACA and its implementing regulations; (3) a 2-day notice faxed to about 730 people from the media and general public allowed them to participate; (4) for another meeting, NGISC published notice of the meeting in the "Federal Register" more than 15 days in advance, but did not publish a summary of the agenda in the time required by FACA's implementing regulations; (5) information obtained from procurement records and NGISC indicated that NGISC sought competition in the award of two of the three major contracts that GAO reviewed and awarded the third on a sole-source basis after determining that one source was uniquely qualified; (6) however, NGISC did not document its efforts to seek competition for one of the three contracts, which left no record to assess NGISC's efforts; (7) NGISC contracted for legal counsel instead of using government legal support because the federal agencies from which NGISC sought legal assistance either could not or would not provide it, and NGISC determined that it would not be feasible to hire in-house counsel with the variety of expertise desired; (8) a National Research Council official involved in the administration of the NGISC's contract said that NGISC did not attempt to interfere in the Academy's contract work; (9) GAO identified six persons affiliated with Regent University, in addition to NGISC's Chair, who had some involvement in NGISC's work; (10) two of these persons were Regent University graduate students and a third was a graduate, all of whom volunteered their services for 2 days in August 1997 to assist in meeting preparations; (11) a fourth person, another Regent University graduate, worked part-time for NGISC for approximately 2 weeks in June 1997 to assist in NGISC's establishment; (12) the fifth and sixth individuals were Regent University employees who worked for NGISC's Chair in her capacity as Dean of Regent University's Robertson School of Government; (13) NGISC records did not indicate that it had paid for the relocation costs for any employee; (14) according to NGISC, two employees worked at locations other than NGISC's office for part of their regular work schedule for some period of time; (15) GAO found some confusion among NGISC staff concerning the details of one of the three employees, thus GAO believes that NGISC's internal controls over time and attendance were insufficient to prevent misunderstandings; and (16) NGISC improved these controls in early 1999.

gao_GAO-17-706

gao_GAO-17-706_0

Refugee Admissions Program (USRAP) partners of whether the applicant qualifies for the U.S. The adjudication process includes, among other things, at least one in- person interview; security checks; and, in some instances, additional review of the applicant’s case to address national security concerns. Approved application: Determination by USCIS officer that the applicant meets the refugee definition and is otherwise eligible for resettlement in the United States, and will subsequently be processed for travel to the United States. Based on the interviews and security checks conducted, USCIS officers will either approve or deny an applicant’s case. As figure 3 indicates, during this time frame, more than 75 percent of applications were from refugees fleeing 6 countries—Iraq, Burma, Syria, Somalia, the Democratic Republic of Congo, and Bhutan—and the number of applicants from certain countries has changed over time. For example, according to WRAPS data, about 9,000 applications submitted in fiscal years 2011 or 2012 were active in June 2016 and the applicants had not yet received a USCIS interview. State’s USRAP Overseas Processing Manual provides an outline of the policies and procedures involved in overseas processing for USRAP, including instructions for using WRAPS, requirements for what information RSCs should collect during prescreening, and instructions and requirements for initiating certain national security checks, among other things. Specifically, we observed 27 prescreening interviews conducted by RSC caseworkers at the four RSCs we visited and found that these caseworkers generally adhered to State requirements during these interviews. USCIS headquarters officials also offer feedback to State headquarters officials on RSC operations after circuit ride teams return to Washington, D.C. State Has Controls in Place to Monitor RSCs, but Does Not Have Outcome-based Indicators to Assess RSC Performance across Key Activities State has control activities in place to monitor how RSCs implement policies and procedures for USRAP, but it does not have outcome-based performance indicators to assess whether RSCs are meeting their objectives under USRAP. Although State has established objectives and monitors several quantitative goals for RSCs—including the number of refugees that depart each year for the United States and the number of applicants who receive cultural orientation training—it has not established outcome- based performance indicators for key RSC activities such as prescreening applicants or accurate case file preparation, or monitored RSC performance consistently across such indicators. State could develop an indicator from this information and measure progress against it. Developing outcome-based performance indicators, as required by State policy and performance management guidance, and monitoring RSC performance against such indicators on a regular basis, would better position State to determine whether all RSCs are processing refugee applications in accordance with their responsibilities under USRAP. USCIS Has Policies and Procedures for Adjudicating Refugee Applications, but Could Improve Training and Quality Assurance USCIS Has Policies and Procedures to Assign Officers and Adjudicate Refugee Applications Staffing USCIS Circuit Rides USCIS has policies and procedures to determine how to assign officers— RAD, IO, and temporary duty officers from other USCIS divisions—on circuit rides to adjudicate USRAP applications. For example, USCIS has developed a refugee application assessment tool that all officers are to use when interviewing the applicant to determine if the applicant was appropriately granted access to USRAP, had past persecution or a well-founded fear of persecution, is credible, is not a persecutor, and is admissible to the United States—including whether the applicant might be inadmissible due to national security or terrorism-related concerns. State and USCIS Have Mechanisms to Help Detect and Prevent Applicant Fraud, but Could Jointly Assess Applicant Fraud Risks State, RSCs, and USCIS Have Implemented Mechanisms to Help Detect and Prevent Fraud Committed by USRAP Applicants Fraud can occur in the refugee process in a number of ways, and State, RSCs, and USCIS have implemented certain mechanisms to help detect and prevent fraud by USRAP applicants. USCIS officers can encounter indicators of fraud while adjudicating refugee applications, and State has suspended USRAP programs in the past because of fraud. Because the management of USRAP involves several agencies, without jointly and regularly assessing applicant fraud risks and determining the fraud risk tolerance of the entirety of USRAP, in accordance with leading practices, State and USCIS do not have comprehensive information on the inherent fraud risks that may affect the integrity of the refugee application process and therefore do not have reasonable assurance that State, USCIS, and other program partners have implemented controls to mitigate those risks. Moreover, regularly assessing applicant fraud risks program-wide could help State and USCIS ensure that fraud prevention and detection efforts across USRAP are targeted to those areas that are of highest risk, in accordance with the program’s fraud risk tolerance. Moreover, developing and implementing a plan to deploy additional USCIS SVPI officers with national security expertise on select circuit rides would better ensure that USCIS provides interviewing officers with the resources needed to efficiently and effectively adjudicate cases with national security concerns. In addition, conducting regular quality assurance assessments of refugee adjudications would also provide USCIS officials with key information about the quality of USCIS refugee adjudications and allow them to identify any areas where officers face challenges, allowing RAD and IO to target training or guidance to areas where it may be most needed. To better ensure that USCIS officers effectively adjudicate applications for refugee status, the Director of USCIS should take the following three actions: provide additional training, such as infield training, for any temporary officers who adjudicate refugee applications on future circuit rides; develop and implement a plan to deploy officers with national security expertise on circuit rides; and conduct regular quality assurance assessments of refugee application adjudications across RAD and IO. CAM is jointly run by the Department of State’s (State) Bureau of Population, Refugees, and Migration and the Department of Homeland Security’s (DHS) U.S. Citizenship and Immigration Services (USCIS). Nine State-funded Resettlement Support Centers (RSCs) with distinct geographic areas of responsibility communicate directly with applicants to process their applications, collect their information, conduct a prescreening interview, and prepare applications for adjudication by USCIS.

Why GAO Did This Study Increases in the number of USRAP applicants approved for resettlement in the United States from countries where terrorists operate have raised questions about the adequacy of applicant screening. GAO was asked to review the refugee screening process. This report (1) describes what State and DHS data indicate about the characteristics and outcomes of USRAP applications, (2) analyzes the extent to which State and RSCs have policies and procedures on refugee case processing and State oversees RSC activities, (3) analyzes the extent to which USCIS has policies and procedures for adjudicating refugee applications, and (4) analyzes the extent to which State and USCIS have mechanisms in place to detect and prevent applicant fraud. GAO reviewed State and DHS policies, analyzed refugee processing data and reports, observed a nongeneralizable sample of refugee screening interviews in four countries in 2016 (selected based on application data and other factors), and interviewed State and DHS officials and RSC staff. What GAO Found From fiscal year 2011 through June 2016, the U.S. Refugee Admission Program (USRAP) received about 655,000 applications and referrals—with most referrals coming from the United Nations High Commissioner for Refugees—and approximately 227,000 applicants were admitted to the United States (see figure). More than 75 percent of the applications and referrals were from refugees fleeing six countries—Iraq, Burma, Syria, Somalia, the Democratic Republic of Congo, and Bhutan. Nine Department of State- (State) funded Resettlement Support Centers (RSC) located abroad process applications by conducting prescreening interviews and initiating security checks, among other activities. Such information is subsequently used by the Department of Homeland Security's (DHS) U.S. Citizenship and Immigration Services (USCIS), which conducts in-person interviews with applicants and assesses eligibility for refugee status to determine whether to approve or deny them for resettlement. a After receiving an application, USRAP partners determine whether the applicant qualifies for a U.S. Citizenship and Immigration Services (USCIS) interview. b USCIS officers may place an application on hold after their interview if they determine that additional information is needed to adjudicate the application. State and RSCs have policies and procedures for processing refugee applications, but State has not established outcome based-performance measures. For example, State's USRAP Overseas Processing Manual includes requirements for information RSCs should collect when prescreening applicants and initiating national security checks, among other things. GAO observed 27 prescreening interviews conducted by RSC caseworkers in four countries and found that they generally adhered to State requirements. Further, State has control activities in place to monitor how RSCs implement policies and procedures. However, State has not established outcome-based performance indicators for key activities—such as prescreening applicants and accurate case file preparation—or monitored RSC performance consistently across such indicators. Developing outcome-based performance indicators, and monitoring RSC performance against such indicators on a regular basis, would better position State to determine whether RSCs are processing refugee applications in accordance with their responsibilities. USCIS has policies and procedures for adjudicating applications—including how its officers are to conduct interviews, review case files, and make decisions on refugee applications—but could improve training, the process for adjudicating applicants with national security concerns, and quality assurance assessments. For example, USCIS has developed an assessment tool that officers are to use when interviewing applicants. GAO observed 29 USCIS interviews and found that officers completed all parts of the assessment. USCIS also provides specialized training to all officers who adjudicate applications abroad, but could provide additional training for officers who work on a temporary basis, which would better prepare them to adjudicate applications. In addition, USCIS provides guidance to help officers identify national security concerns in applications and has taken steps to address challenges with adjudicating such cases. For example, in 2016, USCIS completed a pilot that included sending officers with national security expertise overseas to support interviewing officers in some locations. USCIS determined the pilot was successful and has taken steps to formalize it. However, USCIS has not developed and implemented a plan for deploying these additional officers, whose expertise could help improve the efficiency and effectiveness of the adjudication process. Further, USCIS does not conduct regular quality assurance assessments of refugee adjudications, consistent with federal internal control standards. Conducting regular assessments of refugee adjudications would allow USCIS to target training or guidance to areas of most need. a All persons traveling to the United States by air are subject to standard U.S. government vetting practices. State and USCIS have mechanisms in place to detect and prevent applicant fraud in USRAP, such as requiring DNA testing for certain applicants, but have not jointly assessed applicant fraud risks program-wide. Applicant fraud may include document and identity fraud, among other things. USCIS officers can encounter indicators of fraud while adjudicating refugee applications, and fraud has occurred in USRAP programs in the past. Because the management of USRAP involves several agencies, jointly and regularly assessing fraud risks program-wide, consistent with leading fraud risk management practices and federal internal control standards, could help State and USCIS ensure that fraud detection and prevention efforts across USRAP are targeted to those areas that are of highest risk. This is a public version of a sensitive report issued in June 2017. Information that the Departments of Defense, Homeland Security, and State deemed to be sensitive is not included in this report. What GAO Recommends GAO recommends that State (1) develop outcome-based indicators to measure RSC performance and (2) monitor against these measures; USCIS (1) enhance training to temporary officers, (2) develop a plan to deploy additional officers with national security expertise, and (3) conduct regular quality assurance assessments; and State and DHS jointly conduct regular fraud risk assessments. State and DHS concurred with GAO's recommendations.

gao_RCED-98-104

gao_RCED-98-104_0

Industry officials with whom we spoke informed us that FDA’s and FSIS’ actions did not, to their knowledge, result in the widespread destruction of beef, pork, poultry, or fish products, but some eggs had to be destroyed. One-Part-Per-Trillion Dioxin Concentration Level Chosen to Distinguish Elevated Dioxin Levels From Normal Background Levels FDA and FSIS requested the producers and processors to halt the distribution of the affected food products with dioxin levels above one part per trillion because of their concern about the potential risk to human health. Although scientists have not yet determined the level at which dioxin may pose a risk to human health, the agencies chose a level of dioxin that is somewhat higher than the background level in food products to distinguish the food products affected by the use of adulterated feed from other food products. According to these officials, FDA did not provide any evidence to support the decision to request that products with a dioxin level of one part per trillion be halted. In addition, the producers expressed concern that the agencies did not allow enough time for them to comply with the requirements. EPA, FSIS, and FDA Cooperated to Identify the Source of the Dioxin Contamination and to Decide on the Actions Necessary to Address Potential Health Risk Once EPA confirmed that the dioxin levels in the poultry samples were higher than naturally occurring background levels, officials from FSIS and FDA were included in the investigation into the source of the dioxin. The Current Food Safety System Resulted in Inefficiencies and Hardships for Some Producers and Processors The agencies involved in addressing the dioxin incident had to overcome the inherent inefficiencies associated with the current food safety system, in which responsibility for ensuring food safety is spread among several agencies. As we have reported on numerous occasions, this fragmented food safety system necessitates extensive coordination efforts to minimize wasteful duplication of effort, prevent gaps in regulatory coverage, and avoid conflicting actions. While FDA and FSIS worked together to make decisions on the preferred course of action, each agency was responsible for communicating its decisions to producers or processors under its jurisdiction. We believe the report describes the Food and Drug Administration’s actions and adequately captures the agency’s reasons for choosing to halt the distribution of food products with dioxin levels above one part per trillion. However, as we have stated, the Food Safety and Inspection Service’s guidance to the affected producers and processors was impractical because it did not provide enough time for some processors to test and receive results before the agency’s deadline and because it was not delivered to the producers in a timely manner so that they were aware of the steps that needed to be taken before they could deliver their products to market. 2. 3.

Why GAO Did This Study Pursuant to a congressional request, GAO reviewed the performance of federal agencies in handling their investigation into elevated dioxin levels in poultry samples, focusing on: (1) the basis for the agencies' decisions to require producers to demonstrate their food products did not contain levels of dioxin above one part per trillion; (2) their effectiveness in working together to make decisions to address the problem of dioxin; and (3) the impact of the food safety system on the handling of this dioxin incident. What GAO Found GAO noted that: (1) the Food Safety and Inspection Service (FSIS) and the Food and Drug Administration (FDA) requested the producers and processors to halt the distribution of food products with dioxin levels above one part per trillion because of their concern about the potential risk to human health that these products might present; (2) while scientists have not yet determined the level of dioxin that poses a danger to human health, FDA and FSIS believed that one part per trillion was an appropriate level to use for halting the distribution of these products; (3) FDA chose the one-part-per-trillion level to distinguish food products with elevated dioxin levels from those products with background dioxin levels; (4) the federal agencies worked cooperatively to identify the source of the dioxin contamination and to decide on the actions that might be necessary to address any health risks the contaminated food products posed to consumers; (5) however, their guidance to the affected producers and processors was sometimes unclear and impractical, which left the affected producers confused about the actions they needed to take; (6) for example, FDA, which is responsible for fish products, told producers they had to test their products, but the agency did not tell them how to collect their samples for testing; (7) in addition, the producers expressed concern that the agencies did not provide them with adequate time to comply with the agencies' testing requirements; (8) in some instances, the testing process took longer than the time allowed under the deadline; (9) although these regulatory actions delayed some food products from reaching the market, industry officials told GAO that FDA's and FSIS's actions did not result in the widespread destruction of affected food products; (10) in addressing the dioxin incident, the agencies involved had to overcome the inherent inefficiencies associated with the current food safety system, which divides responsibility for ensuring food safety among several agencies; and (11) as GAO has reported on numerous occasions, this fragmented food safety system necessitates extensive coordination efforts to minimize wasteful duplication of effort, prevent gaps in regulatory coverage, and avoid conflicting actions.

gao_NSIAD-99-11

gao_NSIAD-99-11_0

However, we found that (1) some initiatives do not support the first digitized division, although the Army initially justified WRAP funding on the basis of the need to urgently field technologies associated with the first digitized division; (2) funds have been used both for production items and development work; and (3) future initiatives may not have sufficient test data for proper evaluation. Some initiatives did not meet all the Army’s criteria for WRAP funding, and others will not be fielded with the first digitized division in 2000. Program Delays Have Affected the Goal of Early Fielding The key to securing timely congressional approval of WRAP candidates is the Army’s ability to finalize its selection early enough in the budget cycle. In requesting the release of fiscal year 1997 funds from DOD, the Army did not initially justify the need for or indicate the ultimate destination of the funds, delaying the start-up and implementation of programs. As a result, approval of WRAP funds was delayed until very late in the fiscal year (see app. The Army initially estimated that 9 of the first 11 WRAP initiatives would accelerate the fielding of new technologies by an average of about 20 months. Congress Not Notified of Program Changes The Army made substantial changes to some WRAP initiatives. These changes prolonged implementation. The congressional defense committees were not informed of these developments. To date, the Army has not submitted any of the required reports. The Army’s criteria for WRAP candidates are open-ended and do not ensure that initiatives share a common set of characteristics. Recommendation to the Secretary of Defense We recommend that the Secretary of Defense direct the Secretary of the Army to issue WRAP guidance that calls for specific deadlines for candidate identification and selection to ensure timely submission of candidates to Congress and timely obligation of funds, minimum testing and experimentation requirements for WRAP candidates, periodic reports to Congress on the status of ongoing WRAP initiatives. Scope and Methodology To assess the current status of the program, we reviewed the criteria used to identify, evaluate, and select WRAP candidates.

Why GAO Did This Study Pursuant to a congressional request, GAO reviewed the Army's implementation of the Warfighting Rapid Acquisition Program (WRAP), focusing on the current status of the program. What GAO Found GAO noted that: (1) the Army's criteria for selecting WRAP candidates are open-ended and allow room for different interpretations; (2) as a result, although the Army initially justified WRAP funding on the basis of the need to urgently field technologies associated with the first digitized division, not all WRAP initiatives support the first digitized division; (3) furthermore, some initiatives do not meet all the Army's criteria for WRAP funding; (4) the Army is reducing the testing of new technologies through large-scale warfighting experiments; (5) as a result, the Army may need to change the criteria used to evaluate and rate WRAP candidates; (6) this may affect the quality of future candidates; (7) to date, the Army has not been able to finalize its selection of WRAP candidates early enough to ensure timely approval by Congress; (8) as a result, the final approval of funds and the subsequent start-up of initiatives have been delayed; (9) delays also occurred because the Army did not obtain the timely release of WRAP funds from the Department of Defense (DOD) and because DOD reduced funding for WRAP; (10) in spite of these delays, GAO believes that WRAP funds may still help speed the fielding of some new technologies, though not as much as originally estimated; (11) after initial congressional approval of the first 11 WRAP initiatives, the Army made substantial changes to some of them; (12) these changes affected program implementation; and (13) Congress was not informed of the changes because current reporting requirements do not require the Army to report such changes.

gao_GAO-10-394

gao_GAO-10-394_0

While there were references to efficiency in several different sections of the 2007 and 2008 PART guidance, two PART questions focused specifically on development of program-level efficiency measures with annual targets for improvement: “Does the program have procedures (e.g., competitive sourcing/cost comparisons, information technology (IT) improvements, appropriate incentives) to measure and achieve efficiencies and cost effectiveness in program execution?” In order to receive a “yes” response for this question, a program was to have regular procedures in place to achieve efficiencies and cost effectiveness, and had to have at least one efficiency measure with baseline and targets. (In some cases, the available information on the measure was insufficient for us to place it into one of the three categories, so we labeled these measures as “unclear.”) As figures 1 and 2 below illustrate, our analysis of the 36 efficiency measures from our selected programs and a random sample of the remaining efficiency measures indicates that about half of the efficiency measures contained typical elements by including both an input and an output or outcome. Programs Showed Mixed Results in Terms of Improvements in Efficiency and Use of Efficiency Measures for Decision Making The selected programs that had measures with both elements of a typical efficiency measure reported mixed results under PART in terms of gains and losses in efficiency. Forest Service officials said they reached agreement with OMB to develop an outcome-oriented efficiency measure based on the cost of improving or maintaining the condition of watershed acres. GPRA Could Provide a Framework for Structuring a More Strategic Approach to Improving Government Efficiency The administration has not clearly indicated whether it will continue to emphasize measuring efficiency at the program level as it did under PART. This provision has not been fully implemented, however. Further, as the focal point for overall management in the executive branch, OMB could provide guidance and management and reporting tools to increase federal agencies’ focus on efficiency improvements. OMB could also support mechanisms to share information and encourage agency efforts to improve efficiency. OMB has sponsored various management councils, such as the President’s Management Council and the Performance Improvement Council, which include representatives of agencies and serve as forums for information sharing among agencies and with OMB. Nevertheless, other forms of measures intended to improve efficiency, such as those focused on reducing costly error rates, could still provide useful information. Officials for some selected programs we reviewed indicated that the efficiency measures reported for PART were useful and described ways in which they used data for efficiency measures, such as to evaluate proposals from field units, lower the cost of a contract, or make decisions to shift production. Other officials we interviewed did not find the measures useful for decision making. Officials for all of the programs described challenges to developing and using efficiency measures that were similar to challenges we previously reported on in prior work on PART and performance measures in general. GAO staff who made major contributions to this report are listed in appendix V. Appendix I: Objectives, Scope, and Methodology The objectives of our review were to examine: (1) the types of efficiency measures reported through the Program Assessment Rating Tool (PART) for agency programs overall, and particularly for selected programs in five selected agencies, focusing on the extent to which they included typical elements of an efficiency measure; (2) for selected programs, the extent to which programs reporting efficiency measures through PART have shown efficiency gains and how programs have used efficiency measures for decision making; (3) for selected programs, the types of challenges to developing and using efficiency measures they have faced; and (4) other strategies that can be used to improve efficiency. Using this information, we determined whether each of the measures included the program’s inputs (such as cost or hours worked by employees) as well as its outputs or outcomes.

Why GAO Did This Study Given record budget deficits and continuing fiscal pressures, the federal government must seek to deliver results more efficiently. The prior Administration sought to improve efficiency under the Program Assessment Rating Tool (PART) by requiring programs to have at least one efficiency measure and procedures for improving efficiency, and show annual efficiency gains. The current administration has also emphasized efficiency in some initiatives. GAO was asked to examine (1) the types of PART efficiency measures and the extent to which they included typical elements of an efficiency measure; (2) the extent to which selected programs showed gains and how they used efficiency measures for decision making; (3) the challenges selected programs faced in developing and using efficiency measures; and (4) other strategies that can be used to improve efficiency. GAO analyzed the 36 efficiency measures in 21 selected programs in 5 agencies and a generalizable sample from the other 1,355 measures governmentwide, reviewed documents and interviewed officials from selected programs, reviewed literature on efficiency, and interviewed experts. What GAO Found Under PART, most programs developed an efficiency measure. However, according to GAO's analysis, 26 percent did not include both typical efficiency measure elements--an input (e.g., labor hours or costs) as well as an output or outcome (e.g., the product, service, or result produced). Most frequently missing was the input (69 percent). For example, a measure developed by the National Nuclear Safety Security Administration considered the number of information assets reviewed for certification without considering costs of review. This could result in measures that do not capture efficiency. GAO has previously recommended agencies improve cost information for decision making, but they are in various stages of implementation. However, alternative forms of measurement, such as reducing costly error rates, could still be useful. Of the efficiency measures GAO reviewed that had both typical elements, a similar number reported gains and losses. Officials for some programs stated that the efficiency measures reported for PART were useful, and described ways in which they used the data, such as to evaluate proposals from field units, lower the cost of a contract, or make decisions to shift production. Others did not find the efficiency measures useful because, for example, the program lacked control over key cost drivers, such as contractually required staffing levels, or because of concern that raising output could lower quality. Officials for all of the programs reviewed described challenges to developing and using program-level efficiency measures and performance measures in general. Challenges included interpreting outcome-level efficiency information, such as the cost of improving or maintaining the condition of watershed acres, when factors other than program funding, such as past impacts from mining, affected conditions as well; achieving required annual efficiency gains in cases where a program intervention takes years to implement; and inconsistent or limited guidance and technical assistance from the Office of Management and Budget (OMB) to agencies on how to measure efficiency. A variety of approaches have been used to improve efficiency, including governmentwide reviews, agency restructurings, process and technology improvements, and strategic spending approaches. The Administration has some initiatives along these lines, such as information technology and procurement reforms. The Government Performance and Results Act (GPRA) provides a framework for planning future efficiency gains while maintaining or improving effectiveness and quality of outputs or outcomes. OMB, as the focal point for management in the executive branch, provides guidance and supports information-sharing mechanisms, such as the Performance Improvement Council, which could also be used to create a more strategic and crosscutting focus on agency efforts to improve efficiency. OMB has not clearly indicated whether programs should continue measuring efficiency nor has it emphasized efficiency in its GPRA guidance to agencies.

gao_RCED-95-258

gao_RCED-95-258_0

USDA Allocates Loan and Grant Funds to State Offices Through a Formula USDA administers the Water and Waste Disposal Program—referred to in this report as the water and sewer program—through its Rural Utilities Service. No state may receive more than 5 percent of the total loan and grant funds initially allocated. This report provides information on (1) funding levels for the program and the projects supported, (2) the formula that USDA uses to allocate loan and grant funds among its state offices, and (3) the approach that USDA state and district offices use to distribute funds within states. It consists of three weighted factors for each state: rural population (50 percent), rural poverty (25 percent), and rural unemployment (25 percent). USDA’s Water and Sewer Formula May Partially Satisfy Allocation Criteria The current formula may partially reflect the need for services and the ability to pay for such services, but it does not reflect cost differences between the states. Award Determination Approach Provides Flexibility While Resulting in Differing Funding Decisions for Similar Communities USDA state and district officials have the authority to vary the amount of grant and loan funds that they award to communities eligible to receive funding for water and sewer projects.

Why GAO Did This Study Pursuant to a congressional request, GAO reviewed the Department of Agriculture's (USDA) process for allocating and distributing loan and grant funds for water and sewer projects, focusing on: (1) funding levels for the Water and Waste Disposal Program; (2) the formula used to allocate funds among USDA state offices; and (3) the approach that USDA state offices use to distribute funds within states. What GAO Found GAO held that: (1) the USDA water and sewer program has provided loan and grant support totalling about $28 billion, supporting almost 17,000 projects, and assisting over 12,500 communities throughout the United States; (2) the three factors that USDA considers in its allocation formula for water and sewer funds are rural population, rural poverty, and rural unemployment; (3) no state may receive more than 5 percent of the total available funds in the initial allocation; (4) the allocation formula may partially reflect states' needs and ability to pay, but it does not reflect cost differences between states; and (5) although USDA state and district offices have considerable flexibility in determining the amount of grant assistance for individual projects under the current approach, this flexibility can result in differing funding decisions for similar communities.

gao_GAO-09-77

gao_GAO-09-77_0

2). As of February 2008, BLM has set AML for 197 out of 199 HMAs. Most of the field offices we surveyed considered similar factors in determining AML, such as rangeland conditions and climate data; however, BLM has not provided specific formal guidance to the field offices on how to set AML. The extent to which BLM has actually met AML depends on the accuracy of BLM’s wild horse and burro population counts. Nineteen of the 26 field officials we surveyed used a method that consistently undercounts animals and does not provide a statistical range of population estimates. Therefore, without clear guidance, BLM cannot ensure that the factors considered in future revisions of AML determinations will be consistent across HMAs. At the national level, BLM was closer to meeting AML in 2007 than in any other year since 1984 (when AML levels were first reported by BLM), with a population of 28,563, or about 1,000 animals over the upper limit of AML (see fig. Since 2001, about 74,000 animals have been removed from the range, while only about 46,400 have been adopted or sold. Thirty-six percent fewer wild horses and burros were adopted in 2007, compared to average adoption rates in the 1990s—a trend BLM officials attribute to the decrease in adoption demand and increasing hay and fuel costs. As of June 2008, BLM was holding 30,088 animals in short- and long-term holding facilities, compared with the estimated 9,807 held in 2001. To accommodate the increase in animals removed from the range and the decline in adoptions and sales, BLM has increased the number of short- and long-term holding facilities. Challenges to the Long-Term Sustainability of the Program Include Growing Holding Costs and Limited Options for Dealing with Unadoptable Animals The long-term sustainability of BLM’s Wild Horse and Burro Program depends on the resolution of two significant challenges. If Not Controlled, Off-the- Range Holding Costs Will Continue to Overwhelm the Program The portion of the Wild Horse and Burro Program’s spending that is directed toward short- and long-term holding has increased from 46 percent of the program’s direct costs in 2000 to 67 percent in 2007. 10). The Wild Free-Roaming Horses and Burros Act, as amended, requires that excess animals, for which the adoption demand is not sufficient to absorb all the animals removed from the range, be destroyed in the most humane and cost-efficient manner possible or, under certain circumstances, be sold without limitation. While BLM has made significant progress in increasing the number of HMAs that have set AML and in moving toward meeting AML, its recent removal efforts have resulted in the agency managing almost the same number of animals off of the range as they manage in the wild. However, despite public concerns about the humane treatment of these animals, BLM has not provided the public with easily accessible information about their treatment. To improve the management of BLM’s Wild Horse and Burro Program, we make four recommendations that the Secretary of the Interior direct BLM to: finalize and issue the new Wild Horse and Burro Program Handbook that establishes a policy for setting AML to ensure that AML is determined based on consistent factors across HMAs into the future; continue to adopt and employ statistically based methods to estimate animal populations across HMAs, such as those being evaluated by animal population researchers, to improve the accuracy of population estimates integral to BLM’s management of wild horses and burros on the range and in planning for capacity needed for excess animals once they are removed from the range; track the number of animals harmed or killed during the gather process in a centralized database system and determine what information on the treatment of gathered animals, short-term and long-term holding animals, and adopted animals could easily be provided to the public to help inform them about the treatment of wild horses and burros; and develop cost-effective alternatives to the process of caring for wild horses removed from the range in long-term holding facilities and seek the legislative changes that may be necessary to implement those alternatives. GAO staff who made major contributions to this report are listed in appendix V. Appendix I: Objectives, Scope, and Methodology We examined (1) the Bureau of Land Management’s (BLM) progress in managing wild horses and burros on the range through setting and meeting appropriate management levels (AML); (2) BLM’s management of wild horses and burros off of the range through adoption, sales, and holding facilities; (3) the controls BLM has in place to help ensure humane treatment of wild horses and burros; and (4) what challenges, if any, BLM faces in managing for the long-term sustainability of the Wild Horse and Burro Program. We also surveyed, and analyzed documents from, 26 of the 44 BLM field offices that manage wild horses and burros.

Why GAO Did This Study The Department of the Interior's Bureau of Land Management (BLM) manages about 33,100 wild horses and burros on 199 Herd Management Areas (HMA) in 10 western states. Under the Wild Free-Roaming Horses and Burros Act of 1971, as amended, BLM is to protect wild horses and burros, set appropriate management levels (AML), maintain current inventory counts, and remove excess animals to prevent overpopulation and rangeland damage. Over the years, various stakeholders have raised issues about BLM's management of the animals on and off the range. GAO examined (1) BLM's progress in setting and meeting AML; (2) BLM's management of animals off the range through adoptions, sales, and holding facilities; (3) BLM's controls to help ensure the humane treatment of animals; and (4) what challenges, if any, BLM faces in managing for the long-term sustainability of the program. GAO surveyed and analyzed documents from 26 of the 44 BLM offices that manage wild horses and burros. What GAO Found BLM has made significant progress toward setting and meeting AML (the optimum number of animals which results in a thriving natural ecological balance and avoids range deterioration). BLM has set AML for 197 out of 199 HMAs. Most of the field offices GAO surveyed considered similar factors in determining AML, such as rangeland conditions; however, BLM has not provided specific formal guidance to the field offices on how to set AML. Without clear guidance, BLM cannot ensure that the factors considered in future AML revisions will be consistent across HMAs. At a national level, in 2007, BLM was closer to meeting AML (about 27,200 animals) than in any other year since AMLs were first reported in 1984. The extent to which BLM has actually met AML depends on the accuracy of BLM's population counts. Nineteen of the 26 field officials GAO surveyed used a counting method which, researchers say, consistently undercounts animals and does not provide a statistical range of population estimates. Undercounting can put animals at risk and lead to increased program costs. The number of animals removed from the range is far greater than the number adopted or sold, which has resulted in the need for increased short-term and long-term holding. Since 2001, over 74,000 animals have been removed from the range, while only about 46,400 have been adopted or sold. Thirty-six percent fewer animals were adopted in 2007 than compared to the average adoption rates in the 1990s. As of June 2008, BLM was holding 30,088 animals in holding facilities, up from 9,807 in 2001. To accommodate the increased removals and declining adoptions and sales, BLM has increased the number of short-term and long-term holding facilities. BLM has implemented multiple controls to help ensure humane treatment, including random checks on adopted horses and agreements with adopters and buyers to prevent slaughter. Although BLM state offices collect data on the treatment of the animals, BLM does not always compile the information in its central database or report it to the public. Providing additional information to the public on the treatment of these animals could help inform the public about their treatment and improve transparency. The long-term sustainability of BLM's Wild Horse and Burro Program depends on the resolution of two significant challenges: (1) If not controlled, off-the-range holding costs will continue to overwhelm the program. The percentage of the program's direct costs for holding animals off the range increased from $7 million in 2000 (46 percent) to $21 million in 2007 (67 percent). In 2008, these costs could account for 74 percent of the program's budget. (2) BLM has limited options for dealing with unadoptable animals. The act provides that unadopted excess animals shall be humanely destroyed or, under certain circumstances, sold without limitation. However, BLM only manages these animals through sales with limitations. BLM is concerned about the possible reaction to the destruction of healthy animals.

gao_GAO-04-968T

gao_GAO-04-968T_0

Background In 2000, in response to calls from Congress, SEC directed U.S. stock and options markets to change from quoting equity securities and options in fractions of a dollar, such as 1/16th, to quoting in decimals. However, even before the transition to decimal pricing, some stocks were trading in increments of less than the MPV, such as 1/256th of a dollar. According to SEC staff, data on the extent to which subpenny increments are used to quote securities across all U.S. equity markets are not routinely reported or readily available. SEC staff also conducted a study of the use of subpennies in trading that took place between April 21 and 25, 2003, and found that subpenny trades accounted for about 13 percent of trades in Nasdaq stocks, 10 percent of trades in American Stock Exchange stocks, and 1 percent of the trades in NYSE stocks. According to SEC staff and market participants with whom we spoke, subpenny quotes are used primarily by professional traders, such as day traders or traders for hedge funds, to gain a competitive price advantage over other traders. However, some ECNs that were allowing their customers to use subpenny quoting more widely have significantly curtailed the number of stocks that could be quoted in subpennies. Market Participants Cited Advantages and Disadvantages to Subpenny Pricing Although some market participants saw benefits to subpenny pricing, most cited various disadvantages to the use of subpenny quotes. Some market participants said subpenny quoting allowed traders to raise the priority of their orders. According to market participants, many broker- dealers do not accept orders from their customers in subpenny increments, and so the average investor generally cannot access the subpenny quotes. These traders find that their orders go unexecuted or have to be resubmitted when other traders step ahead of them by quoting a better price in increasingly small amounts. Recent SEC and Nasdaq studies of subpenny trading found that most trades executed in subpenny increments clustered at prices 1/10th of a cent above and below the next full penny increment, suggesting that subpenny quotes were primarily being used to gain priority over other orders and were not otherwise the result of natural trading activities. SEC’s Proposal to Ban Subpenny Quoting Appears to Have Widespread Support SEC’s proposed rule to prohibit market participants from pricing stocks in increments of less than one penny appears to be widely supported. According to the staff, banning subpenny pricing should also reduce the extent to which limit orders lose priority because of subpenny pricing, thereby preserving incentives to display limit orders, which are an important source of liquidity for the markets. Most market participants we have contacted to date and most commenting on SEC’s proposal appear to support a ban on subpenny pricing for stocks priced at more than one dollar. However, other market participants and other commenters opposed SEC’s proposal to ban subpenny quoting. Several of the organizations that opposed a ban said that subpenny quotes allow traders more ability to improve the prices they offer to others. A ban could also reduce incentives for other market participants to invest in innovative technologies. GAO’s Review of the Impacts of Decimal Pricing Is Ongoing At the request of this Committee’s Subcommittee on Securities and Investment, we are conducting additional work to review the impact of decimal pricing on the securities markets, securities firms, and retail and institutional investors. In addition, we plan to conduct research and analysis using a comprehensive electronic database of quotes and trades that have occurred on U.S. stock markets. Observations Because we are continuing to review issues relating to decimal pricing, we do not have definitive conclusions on subpenny pricing at this time.

Why GAO Did This Study In 2001, U.S. stock and options markets, which had previously quoted prices in fractions, began quoting in decimals. Since then, various positive and negative effects have been attributed to the transition to decimal pricing. As part of this transition, the major stock markets chose one penny ($.01) as the minimum price variation for quoting prices for orders to buy or sell. However, some electronic trading systems allowed their customers to quote in increments of less than a penny (such as $.001). The use of subpenny prices for securities trades has proved controversial and the Securities and Exchange Commission (SEC) has proposed a ban against subpenny quoting for stocks priced above one dollar across all U.S. markets. As part of ongoing work that examines a range of issues relating to decimal pricing, GAO reviewed (1) how widely subpenny prices are used and by whom, (2) the advantages and disadvantages of subpenny pricing cited by market participants, and (3) market participants' reactions to SEC's proposed ban. What GAO Found Data on the extent to which market participants are quoting in subpenny increments across all U.S. equity markets are not routinely reported or readily available. However, studies of limited scope conducted by regulators and one market found that subpenny prices were not widely used. For example, a study done by the Nasdaq Stock Market in 2001 of Nasdaq stocks found that subpenny increments were used in less than 15 percent of the orders that specified a price (limit orders). Currently, the major markets do not allow subpenny quoting but a few electronic trading systems that match customer orders do. On electronic trading systems, professional traders (such as those employed by hedge funds) use subpenny quotes to gain a competitive price advantage over other orders. However, many market participants GAO interviewed cited numerous disadvantages to the use of subpenny quoting. They argued that subpenny quotes primarily benefit the professional traders who subscribe to market data systems displaying subpenny prices and who use fast systems to transmit their orders to take advantage of such prices. As a result, most investors do not benefit from subpenny quotes because they do not use these systems and because many broker-dealers do not accept orders from their customers in subpenny increments. In addition, participants said that subpenny quotes allow some traders to step ahead of others' orders for an economically insignificant amount. They said this discourages other traders from submitting limit orders and reduces overall transparency and liquidity in the markets. Based on the work GAO has conducted to date, including a limited review of comments on SEC's proposal to ban subpenny quoting, most market participants support SEC's proposed action. However, some organizations opposed to the ban said that it could reduce the ability of traders to offer better prices and stifle technological innovation and reduce market participants' incentive to invest in better systems. Although some electronic trading systems supported the ban, others indicated that the decision to use subpenny quotes should be left to market participants who, as technology advances, may increasingly find subpenny quotes more useful than they do today. In addition to reviewing subpenny pricing, GAO continues to review the broader impacts of decimal pricing on markets, securities firms, and investors. As part of this work, we plan to conduct original analysis using a comprehensive database of trades and quotes from U.S. markets to identify trends in quoted spreads, clustering of quotes and trades across certain prices, and other potential changes since decimal pricing was introduced.

gao_GAO-02-51

gao_GAO-02-51_0

Missions and Organization of DOE To foster a secure and reliable energy system that is environmentally and economically sustainable; to be a responsible steward of the Nation’s nuclear weapons; to clean up the department’s facilities; to lead in the physical sciences and advance the biological, environmental, and computational sciences; and to provide premier scientific instruments for the Nation’s research enterprise. Diverse Missions, Dysfunctional Structure, and Weak Culture of Accountability Are Fundamental Impediments to Improvement The persistence of DOE management weaknesses and project problems, despite the many actions taken by the department to improve its performance, are indicative of underlying impediments that have not been addressed. We found that the department’s diverse missions, dysfunctional organizational structure, and weak culture of accountability impede fundamental improvement at DOE. Unless these underlying and interrelated impediments are addressed, DOE’s management and performance problems will likely continue. The most problematic organizational problems have involved the nuclear weapons complex. Information Technology: Department of Energy Does Not Effectively Manage Its Supercomputers (GAO/RCED-98-208, July 17, 1998).

Why GAO Did This Study The Department of Energy (DOE) manages the nation's nuclear weapons production complex, cleans up the environmental legacy from the production of nuclear weapons, and conducts research and development into both energy and basic science. DOE launched several reforms in the 1990s to realign its organizational structure, reduce its workforce, strengthen contracting procedures by competitive awards practices, streamline oversight of activities, and delegate some responsibilities to the private sector. What GAO Found Despite these reforms, GAO found that management weaknesses persist because DOE's reforms were piecemeal solutions whose effect has been muted by three impediments to fundamental improvement: the department's diverse missions, dysfunctional organizational structure, and weak control of accountability. Management weaknesses and performance problems will likely continue unless DOE addresses these impediments in a comprehensive fashion.

gao_GAO-07-1129

gao_GAO-07-1129_0

NRC Has Implemented Many Actions to Prepare Its Workforce for New Reactor Licensing Reviews, but Several Key Elements Are Still Under Way In preparing for COL application reviews in the time frame since our January 2007 report, NRC has continued its hiring and training efforts and made substantial progress in implementing reviewer and management tools. However, NRC has not yet fully developed criteria for allocating resources across COL applications, and it has not applied separate decision-making criteria for allocating funding for licensing activities and for support activities, such as developing computer-based review tools. NRC Has Taken Steps to Increase Staffing, Training, and Reviewer Tools to Support Its New Reactor Efforts, but Several Actions Are Not Complete In response to the electric power industry’s growing commitment to building new reactors following the enactment of the Energy Policy Act of 2005, NRC has significantly increased its hiring and funding for its new reactor licensing program. To support its review of new reactor COL applications, NRC initially reorganized the Office of Nuclear Reactor Regulation to create a division solely responsible for new reactor licensing work and substantially increased its size to more than 750 employees by hiring of entry- and midlevel employees. In addition, NRC is increasing staff to five other offices with new reactor responsibilities. As a result, staff reviews may not be as timely and consistent until these computer-based tools are available, and NRC may not benefit from intended productivity efficiencies. NRC has developed plans for allocating resources for a design certification application and an early site permit it is currently reviewing, 20 COL applications, 2 additional design certification applications, and a design certification amendment application—all of which NRC expects to have in its review process over the next 18 months. NRO plans to use contracts to support at least one-third of the COL application review process—for fiscal year 2008, NRO’s budget request is about the same for contractor support as it is for staff salaries and benefits. Clarifying the Resource Management Board’s role. NRC Has Significantly Revised Its Overall Regulatory Framework and Review Process, but Several Activities Are Still in Progress In redesigning its regulatory framework to better resolve issues early and promote standardization and predictability in the licensing process, NRC reached out to stakeholders, particularly those who would be seeking certification for designs or applying for licenses. In June 2007, 3 months before it expected to receive the first COL applications, NRC announced it would expand its acceptance review process to include not only an evaluation of the application’s completeness but also its technical sufficiency. The intent of the new process is to enable NRC to identify areas of potential concern early in the process and discuss them with the applicant. By the end of September 2007, NRC plans to publicly release associated internal guidance that its staff will use for deciding whether to accept, delay, or reject docketing. NRC is still developing its process for tracking requests for additional information from applicants. NRC managers plan to clarify the board’s responsibilities. Scope and Methodology To examine the steps NRC has taken to prepare its workforce to review new reactor license applications and manage its workload, we obtained information about its workforce preparation by reviewing NRC documents, conducting semi-structured interviews with several managers directly responsible for the planning and implementation of new reactor licensing activities, and observing internal NRC meetings. In April 1989, NRC promulgated 10 CFR Part 52 to reform its licensing process for new nuclear power plants. Draft Revision 1 revises one or more sections of nearly all chapters.

Why GAO Did This Study Nearly three decades after the last order for a new nuclear power reactor in the United States, electric power companies plan to submit 20 applications in the next 18 months to the Nuclear Regulatory Commission (NRC) for licenses to build and operate new reactors. Since 1989, NRC has developed a new license review process that allows a power company to obtain a construction permit and an operating license through a single combined license (COL) based on one of a number of standard reactor designs. NRC expects its new process to enhance the efficiency and predictability of its reviews. GAO reviewed NRC's readiness to evaluate these applications by examining the steps NRC has taken to (1) prepare its workforce and manage its workload and (2) develop its regulatory framework and review process for new reactor activities. GAO reviewed NRC documents for new reactor workforce staffing and training, examined NRC's guidance for the review of license applications, interviewed NRC managers and representatives of nearly all of the COL applicants, and observed NRC's public meetings. What GAO Found NRC has taken many steps to prepare its workforce for new reactor licensing reviews, but several key elements of its preparations are still underway. As a result, uncertainties remain about NRC's ability to manage its workload associated with the surge of applications. Specifically, NRC has increased its funding for new reactor activities, created the Office of New Reactors and reorganized several other offices, and hired a significant number of entry-level and midlevel professionals. To assist its staff in reviewing the applications, NRC also plans to contract out about one-third of its fiscal year 2008 workload. However, several elements of NRC's preparatory activities are still in progress, including hiring for some critical positions; developing key training courses; and developing computer-based tools intended to enhance consistency and coordination in reviewing like sections of COL applications. In addition, NRC has not fully developed criteria for setting priorities if the workload exceeds available staff and contractor resources. Finally, while the Office of New Reactors established a cross-divisional resource management board early in 2007 for coordinating certain office review activities, it has not clearly defined the extent of the board's responsibilities. NRC has significantly revised its regulatory framework and review process to prepare for licensing new reactors, but until NRC completes certain additional actions, it may not fully realize the anticipated benefits of the new process. NRC has revised, augmented, and clarified most rules, guidance, and inspection oversight criteria to provide for early resolution of issues, standardization, and predictability in the license review process. However, NRC has not yet completed several actions to implement this process. For example, NRC only recently modified its acceptance review process to include an evaluation of the application's technical sufficiency in addition to its completeness. NRC plans to complete new acceptance review guidance and tools reflecting this change by the end of September 2007. NRC also is refining its process for tracking requests to each applicant for more information but has not developed a coordinating mechanism to avoid unnecessarily requesting information from multiple applicants.

gao_GAO-03-163

gao_GAO-03-163_0

Thirty-Nine Federal Contractors Had Adjudicated Violations of Federal Environmental, Labor, or Antitrust Laws We identified 39 federal contractors (involved in 47 cases), among the 16,819 contractors awarded new federal contracts in amounts of at least $100,000 during fiscal year 2000, that had been found by a federal court or adjudicated administrative decision to have violated one or more federal environmental, labor or employment, or antitrust laws in cases closed by enforcement agencies during fiscal years 1997 through 1999. As table 1 shows, 7 of these 39 contractors had been convicted of a crime in federal court; 5 had a judgment in a civil case brought by the federal government in federal court rendered against them; and 27 had an adverse decision by a federal ALJ, board, or commission finding a violation of law. We did not identify any contractors that were found by a federal court or adjudicated administrative decision to have violated consumer protection or tax laws during this time frame. However, most of these cases that involved alleged law violations were resolved before a court or adjudicated administrative decision was made as to whether a violation of law had occurred. The remaining cases were resolved with a wide range of outcomes, including consent agreements and orders, before a decision by a court or administrative adjudicator was reached as to whether a violation of law had occurred. Additionally, contracting officers would face significant difficulties in verifying or obtaining contractor compliance history information. Moreover, the FAR rule may have created the need for additional record keeping by contractors in order to monitor their compliance histories. From these cases, we identified 39 contractors that were found by a court or ALJ, board, or commission decision to have violated federal law in the areas specified by the FAR rule. However, most of these contractors would not have been required to report the law violations to the contracting officer in the certification in their offers (that is, by checking the box in the certification indicating that the prospective contractor or its principals have had a violation) if they had been prospective contractors. As shown in table 6, based on our conceptual application of the revoked FAR rule’s certification criteria, 7 of the 39 contractors would have been required to report their violations in the certification accompanying their offers. In addition, administrative agreements or settlements resolving cases were not reportable under the FAR rule’s certification requirement. Although the FAR rule guidance stated that contracting officers should give consideration to any administrative agreements entered into with prospective contractors who take corrective action after disclosure of an alleged law violation (in the initial charge or complaint filed by the enforcement agency), the FAR rule did not specifically require prospective contractors to report such agreements. In fact, 18 of the 43 federal contractors who responded to our attempts to verify their involvement in enforcement agency cases reported that they did not currently have the capability to identify or track the various types of enforcement actions taken against them. To quantify the extent to which federal contractors had violated federal environmental, labor and employment, antitrust, consumer protection, and tax laws, we did the following: We focused on contractors that were awarded new federal contracts in amounts expected to be at least $100,000 per contract and federal enforcement agency cases closed during fiscal years 1997 through 1999 because these were the types of contracts and cases that would have been covered by the FAR rule’s contractor certification requirement if it had been applied beginning with fiscal year 2000, and We used federal court or administrative decisions in determining whether a case involving a contractor resulted in an actual adjudicated determination of a violation of federal environmental, labor and employment, antitrust, consumer protection, or tax laws because these were the types of adjudicated decisions contracting officers were instructed by the FAR rule to give the greatest weight in making their responsibility determinations.

Why GAO Did This Study Because of its interest in this area, Congress asked that we address the following questions: (1) To what extent have federal contractors violated federal environmental, labor and employment, antitrust, consumer protection, and tax laws (the areas of law specified in the Federal Acquisition Regulation (FAR) rule)? and (2) What FAR rule implementation issues were identified in our work in response to the first question? What GAO Found We identified 39 contractors among the 16,819 contractors that were awarded new federal contracts in amounts of at least $100,000 during fiscal year 2000 and that were found by a federal court or adjudicated administrative decision to have violated one or more federal environmental, labor and employment, or antitrust laws in enforcement agency cases that were closed during fiscal years 1997 through 1999. Of these 39 contractors, 7 had been convicted of a crime in federal court; 5 had a federal court judgment in a civil case brought by the federal government rendered against them, and 27 had an adverse decision by a federal Administration Law Judge, board, or commission indicating a violation of law. We did not identify any contractors that were found by a federal court or adjudicated administrative decision to have violated consumer protection or tax laws. We also identified another 3,403 contractors that were involved in enforcement agencies' cases covered by our review and closed during this 3-year period. However, most of these cases that involved alleged law violations were resolved before a decision by a court or administrative adjudicator was reached as to whether a violation of law had occurred. In most instances, these cases were resolved through some form of "administrative agreement" or "settlement" with the government in which the contractor typically did not admit--and sometimes specifically denied--the violation charged and which did not constitute a judgment or adjudicated administrative decision that a violation had actually occurred. We identified several FAR rule implementation issues through our work in determining the incidence of contractor violations in response to the first question. First, the FAR rule's contractor certification requirement focused on only certain types of law violations. As a result--on the basis of our conceptual application of the certification criteria specified in the revoked FAR rule--only 7 of the 39 contractors we identified as being found by a court or administrative decision to have violated the law would have been required to report the violations in their certifications if they were prospective contractors submitting an offer. The remaining 32 contractors with violations found by a court or administrative decision, as well the 3,403 contractors whose cases were otherwise resolved, would not have been required to report any noncompliance with the law. Further, although many cases were resolved through administrative agreements--and the FAR rule stated that contracting officers should take such information into consideration--the FAR rule did not require prospective contractors to report such agreements. Second, we found that contracting officers would face significant difficulties in verifying or obtaining contractor compliance history information. Third, the FAR rule may have required additional record keeping for some prospective contractors in order for them to track their companies' compliance with applicable laws and accurately certify as to their compliance when submitting their offers. Of the 43 federal contractors who provided us information on the issue of tracking their compliance history, 18 told us that they did not have the capability to identify or track all of the various types of enforcement actions that may have been taken against them.

gao_GAO-16-733T

gao_GAO-16-733T_0

Digital Service Teams Are Intended to Improve the Federal Government’s IT Efforts 18F and USDS were formed in 2014 to help address the federal government’s troubled IT efforts. Agency Digital Service Teams In an effort to make improvements to critical IT services throughout the federal government, the Presidents’ Budget for fiscal year 2016 proposed funding for the 24 Chief Financial Officers Act agencies, as well as the National Archives and Records Administration, to establish digital services teams. 18F and USDS Provided a Variety of Development and Consulting Services Supporting Agency Technology Efforts and Agencies Were Generally Satisfied with the Programs As part of our ongoing work, we determined that 18F and USDS have provided a variety of development and consulting services to agencies to support their technology efforts. Specifically, between March 2014 and August 2015, 18F staff helped 18 agencies with 32 projects and generally provided six types of services to the agencies, the majority of which related to development work. USDS Provided Seven Types of Consulting Services Aimed at Helping Agencies Improve IT From August 2014 through August 2015, USDS provided assistance on 13 projects across 11 agencies. Quality assurance. Problem identification and recommendations. Information security assessment. Software engineering. In addition to helping agencies improve IT services, USDS has developed guidance for agencies. A Majority of Surveyed Agency Project Managers Were Satisfied with Services Provided by 18F and USDS In response to a satisfaction survey we administered to agency managers of selected 18F and USDS projects, a majority of managers were satisfied with the services they received from the groups. Establish and implement procedures for prioritizing IT projects. 18F Has Goals and Procedures for Prioritizing Projects, but Needs to Fully Define Outcome- Oriented Goals and Measure Performance In our draft report, we determined that 18F has developed several outcome-orientated goals, performance measures, and procedures for prioritizing projects, which it has largely implemented. However, not all of its goals are outcome-oriented and it has not yet measured program performance. 18F has largely implemented its procedures. Further, USDS has only measured actual results for one of its goals. Until USDS ensures that all of its goals are outcome- oriented and establishes performance measures and targets for each goal, it will be difficult to hold the program accountable for results. Of the 25 agencies that requested funding to establish teams, OMB has established charters with 6 agencies for their digital service teams—the Departments of Defense, Health and Human Services, Homeland Security, the Treasury, State, and Veterans Affairs. In addition, according to the Deputy USDS Administrator, USDS plans to establish charters with an additional 3 agencies by the end of the fiscal year—the Department of Education, the Social Security Administration, and Small Business Administration. For the remaining 16 agencies, as of April 2016, 8 agencies reported that they plan to establish digital service teams but have yet to establish charters with USDS—the Department of Housing and Urban Development, Environmental Protection Agency, General Services Administration, National Aeronautics and Space Administration, National Archives and Records Administration, National Science Foundation, Nuclear Regulatory Commission, and Office of Personnel Management. The other 8 agencies reported that they do not plan to establish digital service teams by September 2016 because they did not receive requested funding—the Departments of Agriculture, Commerce, Energy, the Interior, Justice, Labor, and Transportation; and the U.S. Agency for International Development. Table 7 summarizes agency and OMB efforts to establish digital service teams. The lack of defined relationships is due, in large part, to the fact that USDS policy on digital service teams does not describe the expected relationship between agency CIOs and these teams. Until OMB updates the USDS policy to clearly define the responsibilities and authorities governing the relationships between CIOs and digital services teams and ensures that existing agency digital service team charters or other documentation reflect this policy, agency CIOs may not be effectively involved in the digital service teams. Additionally, they have not fully measured program performance. Accordingly, our draft report contains two planned recommendations to GSA and four to OMB. The draft report also includes recommendations for OMB to: ensure that all goals and associated performance measures are outcome-oriented and that performance measures have targets; assess actual results for each performance measure; establish a time frame for developing the report identifying the highest priority projects, develop the report within that established time frame and on a quarterly basis thereafter, and consider the highest priority IT projects as part of the established process for prioritizing projects; and update USDS policy to clearly define the responsibilities and authorities governing the relationships between CIOs and the digital services teams and require existing agency digital service teams to address this policy.

Why GAO Did This Study In an effort to improve IT across the federal government, in March 2014 GSA established a team, known as 18F that provides IT services to agencies. In addition, in August 2014 the Administration established USDS, which aims to improve the federal IT services provided to citizens. OMB also required agencies to establish their own digital service teams. GAO was asked to summarize its draft report that (1) describes 18F and USDS efforts to address problems with IT projects and agencies' views of services provided, (2) assesses these programs' efforts against practices for performance measurement and project prioritization, and (3) assesses agency plans to establish their own digital service teams. In preparing the draft report on which this testimony is based, GAO reviewed 32 18F projects and 13 USDS projects that were underway or completed as of August 2015 and surveyed agencies about these projects; reviewed 18F and USDS in key performance measurement and project prioritization practices; reviewed 25 agencies' efforts to establish digital service teams; and reviewed documentation from four agencies, which were chosen based on their progress made in establishing digital service teams. What GAO Found In a draft report, GAO determined that the General Service Administration's (GSA) 18F and Office of Management and Budget's (OMB) U.S. Digital Service (USDS) have provided a variety of services to agencies supporting their information technology (IT) efforts. Specifically, 18F staff helped 18 agencies with 32 projects and generally provided development and consulting services, including software development solutions and acquisition consulting. In addition, USDS provided assistance on 13 projects across 11 agencies and generally provided consulting services, including quality assurance, problem identification and recommendations, and software engineering. Further, according to GAO's survey, managers were generally satisfied with the services they received from 18F and USDS on these projects (see table). Both 18F and USDS have partially implemented practices to identify and help agencies address problems with IT projects. Specifically, 18F has developed several outcome-oriented goals and related performance measures, as well as procedures for prioritizing projects; however, not all of its goals are outcome-oriented and it has not yet fully measured program performance. Similarly, USDS has developed goals, but they are not all outcome-oriented and it has established performance measures for only one of its goals. USDS has also measured progress for just one goal. Further, it has not fully implemented its procedures for prioritizing projects. Until 18F and USDS fully implement these practices, it will be difficult to hold the programs accountable for results. Agencies are beginning to establish digital service teams. Of the 25 agencies that requested funding for these teams, OMB has established charters with 6 agencies for their digital service teams. In addition, according to the USDS Deputy Administrator, USDS plans to establish charters with an additional 3 agencies by the end of the fiscal year—the Department of Education, as well as the Social Security Administration and Small Business Administration. For the remaining 16 agencies, as of April 2016, 8 agencies reported that they plan to establish digital service teams but have yet to establish charters with USDS. The other 8 agencies reported that they do not plan to establish digital service teams by September 2016 because they did not receive requested funding. Further, of the four agencies GAO selected to review, only one has defined the relationship between its digital service team and the agency Chief Information Officer (CIO). This is due, in part, to the fact that USDS policy does not describe the expected relationship between CIOs and these teams. Until OMB updates its policy and ensures that the responsibilities between the CIOs and digital services teams are clearly defined, it is unclear whether CIOs will be able to fulfill their statutory responsibilities with respect to IT management of the projects undertaken by the digital service teams. What GAO Recommends GAO's draft report includes two recommendations to GSA and three recommendations to OMB to improve goals and performance measurement. In addition, GAO's draft report is recommending that OMB update USDS policy to define the relationships between CIOs and digital services teams.

gao_GAO-07-779T

gao_GAO-07-779T_0

The Bureau estimates that the 2010 Census will cost $11.3 billion over its life-cycle, making it the most expensive in the nation’s history. 1). The Bureau Has Taken Steps to Increase Response Rates The Bureau has reengineered the decennial census, including implementing new initiatives aimed at increasing the response rate. While the difference between the long and short form response rates are significant, the Bureau in its initial assumption for the 2010 Census predicted that conducting a short-form-only census will yield only a 1-percent increase in the overall mail response rate. According to Bureau officials targeted second mailing will be a part of the 2010 Census design. The Bureau’s Plans for Greater Use of Automation and Technology Demand Greater Risk Management The MCD is a keystone to the reengineered census. It allows the Bureau to automate operations and eliminate the need to print millions of paper questionnaires and maps used by census workers to conduct address canvassing and NRFU, as well as assisting to manage field staff’s payroll. The benefits of using the MCD were tested in the 2004 and 2006 tests. If after the 2008 Dress Rehearsal the MCD is found not to be reliable, the Bureau could be faced with the daunting possibility of having to revert to the costly, paper-based census used in 2000. We reported on the Bureau’s progress in implementing acquisitions and management capabilities for these initiatives. The Bureau expects to spend over $2 billion to employ about 525,000 temporary field staff for that activity. However, opportunities exist for the Bureau to hone its recruiting efforts to identify individuals who would be more likely to be effective at census work and willing to continue working throughout an operation. Field workers we spoke to during the 2006 test noted two related issues on which they had not received sufficient training— dealing with reluctant respondents and handling location-specific challenges. Bureau Is Designing Decennial Activities in the Geographic Area Affected by Hurricanes Katrina and Rita As part of our evaluation of the Bureau’s LUCA dress rehearsal, we visited the localities along the Gulf Coast to assess the effect the devastation caused by Hurricanes Katrina and Rita might have on LUCA and possibly other operations. 3). It must also overcome significant challenges of a demographic and socioeconomic nature due to the nation’s increasing diversity in language, ethnicity, households, and housing type, as well as an increase in the reluctance of the population to participate in the census. Yet, there is more that the Bureau can do in examining and refining its recruiting, hiring, and training practices and in preparing to enumerate in the hurricane-affected areas. 2010 Census: Planning and Testing Activities Are Making Progress. 2010 Census: Cost and Design Issues Need to Be Addressed Soon.

Why GAO Did This Study The decennial census is a Constitutionally-mandated activity that produces data used to apportion congressional seats, redraw congressional districts, and allocate billions of dollars in federal assistance. The Census Bureau (Bureau) estimates the 2010 Census will cost $11.3 billion, making it the most expensive in the nation's history. This testimony discusses the Bureau's progress in preparing for the 2010 Census to (1) implement operations to increase the response rate and control costs; (2) use technology to increase productivity; (3) hire and train temporary staff; and (4) plan an accurate census in areas affected by hurricanes Katrina and Rita. The testimony is based on previously issued GAO reports and work nearing completion in which GAO observed recruiting, hiring, and training practices in the 2006 test, and visited localities that participated in the Local Update of Addresses Dress Rehearsal as well in the Gulf Coast region. What GAO Found The Bureau has made progress towards implementing a re-engineered census design that holds promise for increasing the response rate, thereby controlling the cost of the census while promoting accurate results. The re-engineered design includes a short form only census designed to increase the response rate by about 1 percent and a targeted second mailing, which is expected to increase response by between 7 to 10 percent. Both of these initiatives are new, have been tested, and will be a part of the 2010 Census design. According to Bureau officials, a 1 percent increase in the response rate can save $75 million, making these initiatives critical to the new design. Uncertainty surrounds a keystone to the reengineered census, the mobile computing device (MCD). The MCD allows the Bureau to automate operations and eliminate the need to print millions of paper questionnaires and maps used by census workers to conduct census operations and to assist in managing payroll. The MCD, tested in the 2004 and 2006 census tests, was found to be unreliable. While a contractor has developed a new version of the MCD, the device will not be field tested until next month, leaving little time to correct problems that might emerge during the 2008 Dress Rehearsal. The Bureau faces challenges in recruiting, hiring, and training an estimated 600,000 temporary employees. For example, opportunities exist for the Bureau to hone its recruiting efforts to identify individuals who would be more likely to be effective at census work and willing to work throughout an operation. Also, census workers indicated a need for additional training on reluctant respondents as well as location-specific challenges they encounter. The Bureau must also be prepared to accurately count the population affected by hurricanes Katrina and Rita. The Bureau has contacted local officials in the Gulf Area and is developing a plan that includes workshops and special staffing considerations.

gao_GAO-11-317

gao_GAO-11-317_0

Federal Funding for Climate Change Activities Increased Substantially from 2003 through 2010, and Reflects a Complex, Crosscutting System Funding for climate change activities reported by OMB increased from $4.6 billion in 2003 to $8.8 billion in 2010. From 2003 through 2010, total technology funding increased from $2.56 billion to $5.5 billion (115 percent, or 83 percent after adjusting for inflation), according to OMB. While most respondents indicated that their own organization consistently interpreted and applied methods for defining and reporting climate change funding, far fewer said that other agencies across the federal government did so. Certain factors identified by respondents help to explain this limitation, including the difficulty in distinguishing between programs related and not related to climate change. Several respondents indicated and stakeholders said that federal agencies use their own interpretation of definitions to account for climate-related activities, resulting in an inconsistent accounting of these activities across the federal government. These sources identified two key factors that complicate these efforts: (1) the lack of a shared understanding of federal strategic priorities among federal officials and (2) the fact that existing mechanisms that could help align agency funding with priorities are nonbinding, limiting their effectiveness where they conflict with agency responsibilities and priorities. This is partly due to the multiple, often inconsistent messages articulated in different forums and in different policy documents. Federal entities reported that they are already taking steps to implement several of these options. Options to Improve the Tracking and Reporting of Climate Change Funding Respondents identified two key options to improve how climate change funding is tracked and reported, a key element in improving how funding is aligned with priorities: an integrated budget review process that provides a more centralized and predictable approach for collecting and reviewing climate change funding, and enhanced guidance on how to define and report funding. A Governmentwide Strategic Planning Process According to questionnaire respondents, available literature, and stakeholders, a governmentwide strategic planning process could enhance how strategic priorities are set by articulating what individual agencies are expected to do within the overall federal response to climate change. Many respondents called for improved coordination to better align funding with priorities. Among the key issues identified by questionnaire responses, available literature, and interviews with stakeholders are that (1) methods for defining and reporting climate change funding are not interpreted consistently across the federal government, and (2) federal officials do not have a shared understanding of strategic priorities. Without further improvement in these areas, it will be difficult for Congress and the public to fully understand how climate change funds are accounted for and how they are spent. Recommendations for Executive Action To improve the coordination and effectiveness of federal climate change programs and activities, we recommend that the appropriate entities within the Executive Office of the President, including the Council on Environmental Quality, Office of Energy and Climate Change Policy, Office and Management and Budget, and Office of Science and Technology Policy, in consultation with Congress, work together with relevant federal agencies and interagency coordinating bodies to take the following two actions: Clearly establish federal strategic climate change priorities, including the roles and responsibilities of the key federal entities, taking into consideration the full range of activities within the federal climate change enterprise. Assess the effectiveness of current practices for defining and reporting federal climate change funding and aligning funding with priorities, and make improvements to such practices as needed for Congress and the public to fully understand how climate change funds are spent. They did not provide official written comments to include in our report. Instead, they provided technical comments, which we incorporated as appropriate. Appendix I: Scope and Methodology This report examines (1) federal funding for climate change activities and how these activities are organized; (2) the extent to which methods for defining and reporting climate change funding are interpreted consistently across the federal government; (3) federal strategic climate change priorities, and the extent to which funding is aligned with these priorities; and (4) options, if any, available to better align federal climate change funding with strategic priorities. We administered a Web-based questionnaire that was accessible through a secure server. Funding from the American Recovery and Reinvestment Act of 2009 (Pub. What options, if any, are available to better align federal climate change funding with strategic priorities? 26.

Why GAO Did This Study Climate change poses risks to many environmental and economic systems, including agriculture, infrastructure, and ecosystems. Federal law has periodically required the Office of Management and Budget (OMB) to report on federal climate change funding. GAO was asked to examine (1) federal funding for climate change activities and how these activities are organized; (2) the extent to which methods for defining and reporting climate change funding are interpreted consistently across the federal government; (3) federal climate change strategic priorities, and the extent to which funding is aligned with these priorities; and (4) what options, if any, are available to better align federal climate change funding with strategic priorities. GAO analyzed OMB funding reports and responses to a Web-based questionnaire sent to federal officials, reviewed available literature, and interviewed stakeholders. What GAO Found Funding for climate change activities reported by OMB increased from $4.6 billion in 2003 to $8.8 billion in 2010, and is organized in a complex, crosscutting system. OMB reports funding in four categories: technology to reduce emissions, science to better understand climate change, international assistance for developing countries, and wildlife adaptation to respond to actual or expected changes. Over this period, technology funding, the largest category, increased from $2.56 billion to $5.5 billion and increased as a share of total funding. OMB also reported $26.1 billion as funding for climate change programs and activities in the American Recovery and Reinvestment Act of 2009, and tax expenditures to encourage emissions reductions, with $7.2 billion in federal revenue losses in 2010. Many federal entities manage related activities, including interagency programs that coordinate agency actions. Questionnaire responses suggest that methods for defining and reporting climate change funding are not interpreted consistently across the federal government. Respondents identified three methods for defining and reporting climate change funding, foremost of which is guidance contained in OMB Circular A-11. While most said their own organization consistently applied these methods internally, far fewer said that they were applied consistently across the government. Some, for example, noted that other agencies use their own interpretation of definitions, resulting in inconsistent accounting across the government, because of several factors, such as the difficulty in distinguishing between programs related and unrelated to climate change. Respondents, literature, and stakeholders identified two key factors that complicate efforts to align funding with priorities. First, notwithstanding existing coordinating mechanisms, questionnaire results indicated that federal officials do not have a shared understanding of strategic priorities. This is in part due to inconsistent messages articulated in strategic plans and other policy documents. A 2008 Congressional Research Service analysis had similarly found no "overarching policy goal for climate change that guides the programs funded or the priorities among programs." Second, respondents indicated that since mechanisms for aligning funding with priorities are nonbinding, they are limited when in conflict with agencies' own priorities. Questionnaire respondents also identified options to better align funding with strategic priorities. Such options included (1) a governmentwide strategic planning process that promotes a shared understanding among agencies of strategic priorities by articulating what they are expected to do within the overall federal response to climate change and (2) an integrated budget review process that better aligns these priorities with funding decisions through a more consistent method of reporting and reviewing climate change funding. Federal entities are beginning to implement some of these options. However, without further improvement in how federal climate change funding is defined and reported, strategic priorities are set, and funding is aligned with priorities, it will be difficult for the public and Congress to fully understand how climate change funds are accounted for and how they are spent. Among GAO's recommendations are that the appropriate entities within the Executive Office of the President (EOP), in consultation with Congress, clearly establish federal strategic climate change priorities and assess the effectiveness of current practices for defining and reporting related funding. Relevant EOP entities did not provide official written comments, but instead provided technical comments, which GAO incorporated as appropriate.

gao_GAO-17-164

gao_GAO-17-164_0

Category Management In December 2014, OFPP issued a memorandum that directs agencies to take specific actions to implement category management, an approach which is intended to manage entire categories of spending across government for commonly purchased goods and services. As a result, the agencies were missing opportunities to leverage their buying power and more effectively acquire IT services. Overall agency adoption of the FSSIs, however, has remained low, resulting in reduced potential savings. FSSIs Achieved Savings and Other Benefits, but Low Federal Agency Spending through the FSSIs Continues to Limit Potential Savings From fiscal year 2011 to fiscal year 2015, GSA reported that agencies spent almost $2 billion through the FSSIs and achieved an estimated total of $470 million in savings, an overall savings rate of about 25 percent. In fiscal year 2015, GSA reported that agencies spent $462 million through the FSSIs and saved $129 million, a savings rate of 28 percent. Had agencies spent the entire $4.5 billion of addressable spending through the FSSIs and achieved a similar savings rate of 28 percent, we estimate that up to $1.3 billion in fiscal year 2015 savings could have been achieved (see figure 3). In addition to accountability, federal internal control standards call for agencies to monitor and evaluate results. Because Information Retrieval does not collect transactional data from all of its vendors, it lacks the data needed to calculate savings based on price. Consequently, ensuring that small business concerns are appropriately addressed under the category management initiative is the fourth key lesson learned. But unlike leading companies that use their strategic sourcing vehicles 90 percent of the time, federal agencies directed less than 10 percent of their spending on the goods and services offered under the FSSIs, resulting in a missed opportunity to potentially have saved billions of dollars over the last 5 years. Recommendations for Executive Action To better promote federal agency accountability for implementing the FSSI and category management initiatives, we recommend that the Administrator of Federal Procurement Policy take the following four actions: Ensure that transition plans are submitted and monitored as required by FSSI guidance and guidance governing specific category management initiatives; Update the Leadership Council charter to establish an expectation that Leadership Council agencies develop agency-specific targets for use of the solutions approved; Revise the 2015 category management guidance to establish a process for setting targets and performance measures for each Leadership Council agency’s adoption of proposed FSSIs and category management solutions and ensure agency specific targets and measures are set; and Report on agency specific targets and metrics as part of the category management CAP goal. OMB and GSA concurred with our recommendations to improve oversight and accountability of FSSI and category management efforts. OMB staff stated that for example, the Office Supplies FSSI has been designated as a best in class solution, which will require agencies to submit transition plans. Appendix I: Summary of Federal Strategic Sourcing Initiatives Included in Our Review Appendix II: Objectives, Scope, and Methodology We were asked to examine the Federal Strategic Sourcing Initiative (FSSI) program and lessons learned. This report addresses (1) the extent to which savings and other benefits have been achieved by the FSSI program, and (2) lessons, if any, from the Office of Federal Procurement Policy (OFPP) and General Services Administration (GSA) implementation of the FSSI program and the extent to which those lessons have been incorporated into OFPP’s category management initiative. To determine what lessons, if any, from OFPP and GSA implementation of the FSSI program and the extent to which those lessons have been incorporated into OFPP’s category management initiative we reviewed the seven current FSSIs and conducted interviews with GSA and Library of Congress officials responsible FSSI implementation, as well as GSA officials and OFPP staff responsible for oversight.

Why GAO Did This Study Each year, federal agencies obligate over $400 billion on goods and services, but they miss out on savings when they do not leverage their collective buying power. In 2005, the Office of Management and Budget (OMB) directed agencies to leverage spending through strategic sourcing. In 2014, OFPP, an office in OMB, announced its category management initiative, which is intended to further streamline and manage entire categories of spending across the government more like a single enterprise. GAO was asked to examine the current status of the FSSI program and the extent to which OFPP has incorporated lessons learned from the program into its category management initiative. This report addresses (1) savings and other benefits the FSSI program has achieved, and (2) lessons identified and incorporated into OFPP's category management initiative. GAO analyzed FSSI spending, savings, and adoption data for all seven active FSSIs for fiscal years 2011 through 2015; reviewed OMB, OFPP, Leadership Council, and GSA strategic sourcing and category management guidance; and interviewed GSA and FSSI program officials and OFPP staff. What GAO Found From fiscal year 2011 through 2015, federal agencies reported spending almost $2 billion through the Federal Strategic Sourcing Initiatives (FSSI) GAO reviewed and reported an estimated total of $470 million in savings. Federal agencies' low use of the FSSIs, however, diminished the potential savings that could have been achieved. For example, in fiscal year 2015, federal agencies spent an estimated $6.9 billion on the types of goods and services available through these FSSIs. Of this amount, $4.5 billion was considered “addressable” and could have been spent through the FSSIs, but just $462 million was. While total savings reported for fiscal year 2015 came in at $129 million—a savings rate of 28 percent—had all of the agencies directed their addressable spending through FSSIs, up to $1.3 billion in savings could have been achieved, assuming the same savings rate. See figure. GAO found that FSSI use has been low, in part, because Leadership Council agencies, a cohort of large federal agencies responsible for FSSI governance, directed only 10 percent of their collective spending to the FSSIs. FSSI guidance requires agencies to develop plans to transition from existing agency vehicles to FSSIs, but Office of Federal Procurement Policy (OFFP) staff and General Services Administration (GSA) officials stated such plans were not collected or used to monitor FSSI use. Ensuring agencies submit these plans and monitoring them is consistent with internal control standards to evaluate and hold agencies accountable for performance. OFPP's category management initiative largely incorporates key lessons learned from the FSSIs into guidance, such as addressing small business concerns and obtaining data on prices paid. OFPP, however, has not yet ensured that agency-specific targets and performance measures for adoption of FSSI and category management solutions are set. Until OFPP takes action to do so, it is at risk of agencies underutilizing existing FSSI and category management solutions and, in turn, of diminished cost savings. What GAO Recommends To increase potential savings, GAO is making 6 recommendations, including that OFPP ensure agencies submit transition plans, monitor their use, and ensure agency specific targets and performance metrics to measure adoption of FSSI and category management solutions are set. OMB and GSA concurred with the recommendations.

gao_GAO-01-761

gao_GAO-01-761_0

Conclusions USDA’s fiscal year 2000 performance report and fiscal year 2002 performance plan have the potential for focusing the department’s missions, but these efforts are compromised in a number of areas. USDA’s goals and measures are too general to give insight into the actual achievements that USDA is striving to make. In particular, it is difficult to assess USDA’s progress when it uses unrealistic goals to achieve strategic outcomes and when it uses untimely data that has not been consistently verified. In two particular areas—strategic human capital management and information security—the process of measuring USDA’s performance could be improved by including goals and measures in USDA’s annual performance plan. Finally, USDA missed the opportunity to develop strategies and plans to respond to the major management challenges identified by the OIG.

What GAO Found The Department of Agriculture's (USDA) fiscal year 2000 performance report and fiscal year 2002 performance plan have the potential for focusing the department's missions, but these efforts are compromised in several areas. USDA's goals and measures are too general to give insight into what USDA is actually trying to achieve. It is difficult to assess USDA's progress when it uses unrealistic goals to achieve strategic outcomes and when it uses untimely data that has not been consistently verified. In two areas--strategic human capital management and information security--progress in measuring USDA's performance has been frustrated by the lack of goals and measures for identified issues. Finally, by not sharing information about the major management challenges identified by its own Inspector General, USDA's agencies miss the opportunity to develop strategies and plans to respond to these issues.

gao_GAO-08-104

gao_GAO-08-104_0

DOD’s Methods for Developing TRS Premiums DOD is required by law to set premiums for TRS at a level that it determines to be reasonable using an appropriate actuarial basis. The total premium for individual coverage under tier 1 was 72 percent higher than the average cost per plan of providing benefits through the program. Similarly, the total premium for family coverage under tier 1 was 45 percent higher than the average cost per plan of providing benefits. In 2006, the Premium for Both Individual and Family Coverage under TRS Exceeded the Reported Costs per Plan of Providing Benefits through the Program In 2006, the premium for both individual and family coverage under TRS exceeded the reported costs per plan of providing TRICARE benefits through the program. By statute, the portion of the TRS premium paid by enrollees in tier 1—and all enrollees as of October 1, 2007—is to cover 28 percent of the full premium. Had DOD been successful in establishing TRS premiums that were equal to the average reported cost per TRS plan in 2006, enrollees’ share of the premium would have been $566 for single coverage and $2,099 for family coverage in that year. Basing TRS Premiums on BCBS Premiums Is Unlikely to Successfully Align TRS Premiums with Benefit Costs Basing TRS premiums on BCBS premiums is unlikely to align TRS premiums with benefit costs because of several differences between the TRS and BCBS populations and programs that DOD did not take into account. DOD based TRS premiums on BCBS premiums because at the time DOD was developing TRS, actual data on the costs of delivering TRS benefits to the TRS population did not exist. DOD’s cost projections were too high largely because it overestimated the number of reservists who would enroll in TRS as well as the associated cost per plan of providing benefits through the program. Prior to TRS’s implementation, DOD estimated that total costs of providing benefits through the program would amount to about $70 million in fiscal year 2005 and about $442 million in fiscal year 2006. In contrast, reported costs in those years only amounted to about $5 million and about $40 million, respectively. DOD officials told us that they considered TRS cost and enrollment data when developing future year projections of program costs and enrollment levels, but they chose not to use these data as part of their projections because of uncertainty about whether they would provide an accurate indication of likely future experience. However, cost data that reflect actual experience under the program are now becoming available, and limitations associated with them should decrease over time as DOD gains more experience with the program and more reservists enroll in it. Nonetheless, due to the uncertainty associated with predicting future health care costs, premiums are unlikely to exactly match program costs, even when they are based on cost data from prior years. Other insurance programs have methods to address discrepancies between premiums and program costs, which are not provided to DOD in the law governing TRS. Recommendations for Executive Action With the goal of eventually eliminating reliance on BCBS premiums and to better align premiums with the costs of providing TRS health care benefits, we recommend that the Secretary of Defense direct the Assistant Secretary for Health Affairs to stop basing TRS premium adjustments only on BCBS premium adjustments and use the reported costs of providing benefits through the TRS program when adjusting TRS premiums in future years as limitations associated with the reported cost data decrease. Appendix II: Scope and Methodology To compare the annual TRS premiums established by DOD to the reported average costs per plan of providing benefits under TRS in 2006, we reviewed DOD’s reported TRS enrollment data and data on the cost of providing TRS benefits through TRICARE-authorized civilian providers or hospitals, data on the administrative costs associated with providing TRS benefits, and data on the costs of providing TRS benefits through military treatment facilities (MTF). At the time covered by our analysis, TRS included three tiers of eligibility with enrollees paying different portions of the premium based on the tier for which they qualified. To compare DOD’s projected costs for the TRS program before implementation to DOD’s reported costs for the program in 2005 and 2006, we reviewed the analyses prepared by DOD before TRS’s implementation that projected (1) the number of individual and family plans in each tier of the TRS program and (2) the costs per plan of providing the TRS benefit.

Why GAO Did This Study (DOD) TRICARE Reserve Select (TRS) program allows most reservists to purchase coverage under TRICARE, the military health insurance program, when not on active duty. DOD intends to set premiums at a level equal to the expected costs of providing TRS benefits. The National Defense Authorization Act for 2007 required GAO to review TRS costs. As discussed with the committees of jurisdiction, GAO compared (1) the TRS premiums established by DOD to the reported costs of providing benefits under TRS in 2006 and (2) DOD's projected costs for TRS before implementation to DOD's reported costs for the program in 2005 and 2006. To do this work, GAO examined DOD analyses and interviewed DOD officials and external experts. What GAO Found In 2006, the premium for both individual and family coverage under TRS--which DOD based on Blue Cross and Blue Shield (BCBS) premiums--exceeded the reported average cost per plan of providing TRICARE benefits through the program. TRS currently serves less than 1percent of the overall TRICARE population, and unlike most other TRICARE beneficiaries, TRS enrollees pay a premium to receive health care coverage. At the time of GAO's analysis, TRS consisted of three tiers, established by law, with reservists in each tier paying different portions of the total premium, based on the tier for which they qualified. Over 90 percent of reservists who purchased TRS coverage enrolled in tier 1. The premium for individual coverage under tier 1 was 72 percent higher than the average cost per plan of providing benefits through the program. Similarly, the premium for family coverage under tier 1 was 45 percent higher than the average cost per plan of providing benefits. DOD based TRS premiums on BCBS premiums because, at the time DOD was developing TRS, actual data on the costs of TRS did not exist; however, these data are now available. Had DOD been successful in establishing premiums that were equal to the cost of providing benefits in 2006, the portion of the premium paid by enrollees in tier 1--which is set by law to cover 28 percent of the full premium--would have been lower that year. Reasons that TRS premiums did not align with benefit costs included differences between the TRS and BCBS populations and differences in the way the two programs are designed, which DOD did not consider in its methodology. According to experts, the most successful methods for aligning premiums with actual program costs involve using program cost data when setting premiums. The regulation governing TRS premium adjustments allows DOD to use either BCBS premiums or other means as the basis for TRS premiums. However, DOD officials told GAO that they plan to continue, at least for the near future, to base TRS premiums on BCBS premiums because of limitations associated with using currently available data to predict future TRS costs. However, these limitations should decrease over time as DOD gains more experience with the program and enrollment increases. Nonetheless, due to the uncertainty associated with predicting future health care costs, premiums are unlikely to exactly match program costs, even when they are based on cost data from prior years. Other insurance programs have methods to address differences between premiums and program costs, which are not provided to DOD in the law governing TRS. DOD overestimated the total cost of providing benefits through TRS. While the department projected that its total costs would amount to about $70 million in fiscal year 2005 and about $442 million in fiscal year 2006, DOD's reported costs in those years were about $5 million and about $40 million, respectively. DOD's cost projections were too high largely because it overestimated the number of reservists who would purchase TRS and the associated cost per plan of providing TRS benefits. DOD officials told GAO that they chose not to use TRS cost and enrollment data when projecting future year program costs and enrollment levels because of uncertainty about whether they would provide an accurate indication of future experience.

gao_GAO-09-133

gao_GAO-09-133_0

The Integrated Wireless Network (IWN) was intended to be a collaborative effort among the Departments of Justice (DOJ), Homeland Security (DHS), and the Treasury to provide secure, seamless, interoperable, and reliable nationwide wireless communications in support of federal agents and officers engaged in law enforcement, protective services, homeland defense, and disaster response missions. To address our objective, we reviewed and analyzed documentation from DOJ, DHS, and Treasury to determine the status of IWN, interviewed officials from each department about the extent to which they are collaborating with the other departments on IWN or an alternative joint radio communications solution, reviewed and analyzed documentation for independent radio communications projects at DOJ and DHS to identify actions the departments are taking to improve their radio communications systems, reviewed and analyzed past and present agreements among the departments to determine the extent to which a governance structure is in place that enables effective collaboration, and compared collaboration activities performed by the departments to selected practices previously identified by GAO as helpful to sustaining collaboration Objective, Scope, and Methodology among federal agencies. While DOJ, DHS, and Treasury had originally intended IWN to be a joint radio communications solution to improve communication among law enforcement agencies, IWN is no longer being pursued as a joint development project. Instead of focusing on a joint solution, the departments have begun independently modernizing their own wireless communications systems. While DOJ and Treasury (and later DHS) collaborated on a pilot demonstration of IWN in the Seattle/Blaine area that continues to provide service to multiple agencies, the departments have determined that this specific system design cannot be implemented on a nationwide scale, and they have not acted collaboratively to identify an alternative approach for a jointly coordinated communications solution. In addition, the formal governance structure that was established among the three departments has been disbanded, and the contract for developing a new IWN design, awarded over a year and a half ago, is not being used jointly by the departments for this purpose. Currently, DOJ is planning to implement a nationwide network for its component agencies, and DHS and its components are pursuing numerous independent solutions. A primary reason why the collaboration on a joint communications solution has not been successful is that the departments did not effectively employ key cross-agency collaboration practices. Specifically, they could not agree on a common outcome or purpose to overcome their differences in missions, cultures, and established ways of doing business; they have not established a collaborative governance structure with a process for decision making and resolving disputes; and they have not developed a joint strategy for moving forward. While DHS considers improving radio communications at the nation’s borders to be a major priority, DOJ’s priorities are in other areas. Program officials from both departments acknowledged that differing priorities led to an inability to resolve conflicts. As a result, they now have several initiatives aimed at high-level coordination, none of which are focused on developing a joint communications solution. Department officials have indicated that they have not made any progress on re- establishing a joint governance structure and decision-making procedures for a joint communications solution. In abandoning collaboration on a joint solution, the departments risk duplication of effort and inefficient use of resources as they continue to invest significant resources in independent solutions. Further, these stovepipe efforts will not ensure the interoperability needed to serve day-to-day law enforcement operations or a coordinated response to terrorist or other events. The Congress should consider requiring that the Departments of Justice, Homeland Security, and Treasury collaborate on the development and implementation of a joint radio communications solution.

Why GAO Did This Study The Integrated Wireless Network (IWN) was intended to be a collaborative effort among the Departments of Justice (DOJ), Homeland Security (DHS), and the Treasury to provide secure, seamless, interoperable, and reliable nationwide wireless communications in support of federal agents and officers engaged in law enforcement, protective services, homeland defense, and disaster response missions. GAO was asked to determine the extent to which the three departments are developing a joint radio communications solution. To address this objective, GAO reviewed and analyzed relevant documentation and interviewed department officials about the extent to which they are collaborating with the other departments on IWN or an alternative joint radio communications solution. What GAO Found The Departments of Justice, Homeland Security, and the Treasury had originally intended IWN to be a joint radio communications solution to improve communication among law enforcement agencies; however, IWN is no longer being pursued as a joint development project. Instead of focusing on a joint solution, the departments have begun independently modernizing their own wireless communications systems. While the Departments of Justice and the Treasury (and later the Department of Homeland Security) collaborated on a pilot demonstration of IWN in the Seattle/Blaine area that continues to provide service to multiple agencies, the departments have determined that this specific system design cannot be implemented on a nationwide scale, and they have not acted collaboratively to identify an alternative approach for a jointly coordinated communications solution. In addition, the formal governance structure that was established among the three departments has been disbanded, and the contract for developing a new IWN design, awarded over a year and a half ago, is not being used jointly by the departments for this purpose. Currently, the Department of Justice is planning to implement a nationwide network for its component agencies, and the Department of Homeland Security and its components are pursuing numerous independent solutions. A primary reason why the collaboration on a joint communications solution has not been successful is that the departments did not effectively employ key cross-agency collaboration practices. Specifically, they could not agree on a common outcome or purpose to overcome their differences in missions, cultures, and established ways of doing business; they have not established a collaborative governance structure with a process for decision making and resolving disputes; and they have not developed a joint strategy for moving forward. While the Department of Homeland Security considers improving radio communications at the nation's borders to be a major priority, the Department of Justice's priorities are in other areas. Program officials from both departments acknowledged that these differing priorities led to an inability to resolve conflicts. As a result, they now have several initiatives aimed at high-level coordination, none of which are focused on developing a joint communications solution. While department officials have signed an updated memorandum of understanding related to coordinating their radio communications projects, they have not made any progress on reestablishing a joint governance structure and decision-making procedures to address the challenges of collaborating on a joint communications solution. In abandoning collaboration on a joint solution, the departments risk duplication of effort and inefficient use of resources as they continue to invest significant resources in independent solutions. Further, these efforts will not ensure the interoperability needed to serve day-to-day law enforcement operations or a coordinated response to terrorist or other events.

gao_GAO-03-556T

gao_GAO-03-556T_0

A focus on the quality of program performance and effective management is critical today, and now is the time to act. The President has identified five crosscutting management initiatives that are interrelated and support each other. These five initiatives are: strategic human capital management, budget and performance integration, expanded electronic government, and competitive sourcing. Considerable progress has been made in this area since we designated it as high risk in 2001. Serious human capital shortfalls, however, continue to erode the ability of many agencies, and threaten the ability of others, to economically, efficiently, and effectively perform their missions. Such efforts to begin implementing a consistent and transparent framework for performance budgeting and financial information are key steps needed to provide a greater focus on performance and improve congressional decision making as envisioned in GPRA, but the federal government has a long way to go before it can meet these goals. Integrating management and performance issues with budgeting is absolutely critical for progress in government performance and management. Improved Financial Performance The PMA initiative to improve financial performance is aimed at ensuring that federal financial systems produce accurate and timely information to support operating, budget, and policy decisions. Nevertheless, much work remains to be done, given the magnitude of its challenges to safeguard program payments. Expanded Electronic Government Electronic government (e-government) offers many opportunities to better serve the public, make government more efficient and effective, and reduce costs. Although substantial progress has been made, the government has not yet fully reached its potential in this area. In order to help ensure the success of the President’s objective of expanding e-government to improve the potential value of government to citizens, we have recommended that the Director of OMB ensure that the managing partners for all e-government initiatives (1) focus on customers by soliciting input from the public and conducting user needs assessments, (2) work with partner agencies to develop and document effective collaboration strategies, and (3) provide OMB with adequate information to monitor the cost, schedule, and performance. Competitive Sourcing As part of the PMA initiative to achieve efficient and effective competition between public and private sources, the administration has committed to simplifying and improving the procedures for evaluating public and private sources. As part of the administration’s efforts to advance this PMA initiative and implement the recommendations of the Commercial Activities Panel, OMB published proposed changes to Circular A-76 for public comment. There are several areas, however, where the proposed revisions to the circular were not consistent with the principles or recommendations of the panel. Congressional support has proven to be critical in sustaining interest in management initiatives over time.

Why GAO Did This Study As part of its work to improve the management and the performance of the federal government, GAO monitors progress and continuing challenges related to the five crosscutting initiatives in the President's Management Agenda (PMA). The President cited GAO's high-risk areas and major management challenges in developing these initiatives. GAO remains committed to working with the Congress and the Administration to help address these complex issues. What GAO Found There has been continuing progress in implementing the five crosscutting PMA initiatives to improve the management and performance of the federal government. However, progress has been uneven, and a continuing focus is needed to improve the management and performance of the federal government and ensure accountability. These five crosscutting PMA initiatives are interrelated and must be addressed in an integrated way. Strategic human capital management: Considerable progress has been made in this area since we designated it as high risk in 2001. Serious human capital shortfalls, however, continue to erode the ability of many agencies, and threaten the ability of others, to economically, efficiently, and effectively perform their missions. Budget and performance integration: The administration has set forth an ambitious agenda for performance budgeting but the federal government has a long way to go before it can meet its goals. More explicitly infusing performance information into resource allocation decisions is critical for further progress in government performance and management. Improved financial performance: This initiative is aimed at ensuring that federal financial systems produce accurate and timely information to support operating, budget, and policy decisions. Although a range of improvements is under way, much work remains to be done across government. Expanded electronic government: E-government offers many opportunities to better serve the public, make government more efficient and effective, and reduce costs. Although substantial progress has been made, the government has not yet fully reached its potential in this area. Competitive sourcing: The administration has committed to using competitions to determine whether public or private sources should provide commercial services. OMB has proposed changes to the procedures for conducting public-private competitions under its Circular A-76. However, some of the proposed changes are not consistent with sourcing principles or recommendations of the Commercial Activities Panel. Congressional support has proven to be critical in sustaining interest in management initiatives over time. A focus on the quality of program performance and effective management is critical today, and now is the time to act.

gao_GAO-09-596T

gao_GAO-09-596T_0

NOAA is also planning the next generation of satellites, known as the GOES-R series, which are planned for launch beginning in 2015. The agency estimated that the revised program would cost $7 billion. In addition to the reductions in scope, NOAA also delayed the launch of the first satellite from September 2012 to December 2014. However, since it relies on the National Aeronautics and Space Administration’s (NASA) acquisition experience and technical expertise to help ensure the success of its programs, NOAA implemented an integrated program management structure with NASA for the GOES-R program. GOES-R Is in Development, but Costs Have Increased, Envisioned Functionality Has Been Reduced, and Schedules Have Been Delayed NOAA and NASA have made progress on the GOES-R program. Figure 1 depicts the schedule for both the program and key instruments. After reconciling the program office’s cost estimate with an independent cost estimate, the agency established a new program cost estimate of $7.67 billion, an increase of $670 million from the previous estimate. Because NASA has agreed to a 72-month development cycle for the spacecraft segment (from contract award date to launch readiness), the launch date of GOES-R will likely be delayed until at least May 2015. Any delays in the launch of the first GOES-R satellite run counter to NOAA’s policy of having a backup satellite in orbit at all times and could lead to gaps in satellite coverage. The GOES-R Program Office Has Taken Steps to Address Lessons Learned from Other Satellite Programs, but Important Actions Remain GOES-R has taken steps to address lessons from other satellite programs. These actions include ensuring sufficient technical readiness of the spacecraft and ground segments prior to awarding the contracts. Specifically, key technology risks remain—affecting both the ground segment and the instruments. To date, the program office has performed integrated baseline reviews on the instruments and obtains and reviews variance reports for each of the instruments. NOAA Has Not Developed Plans for Meeting Requirements for Advanced Products Before it was cancelled in September 2006, the Hyperspectral Environmental Suite was originally planned as part of the GOES-R satellite series to meet requirements for products that are currently produced by GOES satellites as well as new technically-advanced products not currently produced by GOES satellites. Until a decision is made on whether and how to provide the advanced products, key system users will not be able to meet their goals for improving the lead times or accuracy of severe weather warnings, and climate research organizations will not obtain the data they need to enhance the science of climate, coastal, environmental, and oceanic observations. Until NOAA and NASA act to address this risk, the United States’ ability to maintain the continuity of data required for weather forecasting is in jeopardy. In addition, NOAA has not yet developed a plan or a timeline for recovering the advanced capabilities that were removed.

Why GAO Did This Study The Department of Commerce's National Oceanic and Atmospheric Administration (NOAA), with the aid of the National Aeronautics and Space Administration (NASA), plans to procure the next generation of geostationary operational environmental satellites, called the Geostationary Operational Environmental Satellite-R series (GOES-R). GOES-R is to replace the current series of satellites, which will likely begin to reach the end of their useful lives in 2014. This series is considered critical to the United States' ability to maintain the continuity of data required for weather forecasting through the year 2028. GAO was asked to summarize its report being released today that (1) determines the status of the GOES-R program, (2) evaluates whether plans for the acquisition address problems experienced on similar programs, and (3) determines whether NOAA's plan will be adequate to support current data requirements. What GAO Found NOAA has made progress on the GOES-R acquisition, but the program's cost, schedule, and scope have changed. The GOES-R program has awarded development contracts for key instruments and plans to award contracts for the spacecraft and ground segments by mid-2009. However, after reconciling program and independent cost estimates, the program established a new cost estimate of $7.67 billion--a $670 million increase from the prior $7 billion estimate. The program also reduced the number of products the satellites will produce from 81 to 34 and slowed the delivery of these products in order to reduce costs. More recently, the program also delayed key milestones, including the launch of the first satellite, which will likely be delayed from December 2014 until at least May 2015. This delay in the GOES-R launch runs counter to NOAA's policy of having a backup satellite in orbit at all times and could lead to gaps in satellite coverage if GOES-O or P fail prematurely. GOES-R has taken steps to address lessons from other satellite programs, but important actions remain to be completed. These actions include ensuring sufficient technical readiness of the system's components prior to key decisions. However, technical challenges remain on the ground segment and instruments, the program did not perform a comprehensive review after rebaselining a critical instrument, and it has not documented all of the reasons for cost overruns. Until these issues are addressed, NOAA faces an increased risk that the GOES-R program will repeat the same mistakes that have plagued other satellite programs. While NOAA and the science community expressed a continuing need for advanced products that were removed from the program, the agency has not developed plans or a timeline for meeting these requirements. Until a decision is made on whether and how to proceed in providing the advanced products, key system users, such as weather forecasters, will not be able to meet their goals for improving the accuracy of severe weather warnings.

gao_GAO-08-1019T

gao_GAO-08-1019T_0

Factoring Organizational Performance into Senior Executive Performance Appraisal Decisions In our past work on performance management, we have identified the alignment of individual performance expectations with organizational goals as a key practice for effective performance management systems. Further, OPM requires agencies to consider organizational performance in appraising senior executive performance to receive certification of their SES appraisal systems. All of the selected agencies have policies in place for factoring organizational performance into senior executive appraisal decisions. The selected agencies varied in how they provided and communicated organizational performance assessments to PRB members and other reviewing officials to help inform senior executive appraisal recommendations. All of the selected agencies have four or five rating levels in place for assessing senior executive performance. While the selected agencies designed their appraisal and pay systems to help make meaningful distinctions in performance through ratings, our analysis shows that the senior executives were concentrated at the top two rating levels for the most recently completed appraisal cycle, as shown in figure 1. These results show that making meaningful distinctions in bonuses and pay can be a challenge. All of the selected agencies have built safeguards into their senior executive performance appraisal and pay systems—such as predecisional checks of performance appraisal recommendations through higher-level reviews and PRBs as well as transparency in communicating the aggregate results—to help enhance the credibility, fairness, and transparency of their systems, although they varied in how the safeguards have been implemented. Our preliminary results show that there are opportunities for improvement in the communication of aggregate appraisal results to all senior executives. Appendix I: Background on the Senior Executive Performance-Based Pay System and Certification Criteria In November 2003, Congress authorized a new performance-based pay system for members of the Senior Executive Service (SES). If an agency’s senior executive performance appraisal system is certified by the Office of Personnel Management (OPM) and the Office of Management and Budget (OMB) concurs, the caps are increased to $172,200 for base pay (Level II of the Executive Schedule) and $221,100 for total compensation (the total annual compensation payable to the Vice President).

Why GAO Did This Study In 2003, Congress and the administration established a performance-based pay system for Senior Executive Service (SES) members that requires a link between individual and organizational performance and pay. Specifically, agencies are allowed to raise SES pay caps if their systems are certified by the Office of Personnel Management (OPM) with concurrence by the Office of Management and Budget (OMB) as meeting specified criteria. GAO was asked to testify on preliminary results of ongoing work analyzing selected executive branch agencies' policies and procedures for their SES performance-based pay systems in the following areas: (1) factoring organizational performance into senior executive performance appraisal decisions, (2) making meaningful distinctions in senior executive performance, and (3) building safeguards into senior executive performance appraisal and pay systems. GAO selected the U.S. Departments of Defense (DOD), Energy (DOE), State, and the Treasury; the U.S. Nuclear Regulatory Commission (NRC); and the United States Agency for International Development (USAID) based on variations in agency mission, organizational structure, and size of their career SES workforces. To date, GAO has analyzed agencies' SES performance management policies and guidance and analyzed aggregate SES performance appraisal data as provided by the agencies for fiscal year 2007. What GAO Found Overall, the selected agencies are making positive steps toward three key areas related to OPM and OMB's certification criteria, with some opportunities for refinements in these areas: (1) Factoring organizational performance into senior executive performance appraisal decisions: -all of the selected agencies have policies in place that require senior executives' performance expectations to be aligned with organizational results and organizational performance to be factored into appraisal decisions. Improvements in communicating organizational performance to reviewing officials could be made. (2) Making meaningful distinctions in senior executive performance: -while all of the selected agencies have multiple rating levels in place for assessing senior executive performance, senior executives were concentrated at the top two rating levels in the fiscal year 2007 appraisal cycle. (3) Building safeguards into senior executive performance appraisal and pay systems: -the selected agencies varied in how they implemented predecisional checks of appraisal recommendations through higher-level reviews and Performance Review Boards as well as transparency in the aggregate results with opportunities to improve communication of aggregate appraisal results to all senior executives.

gao_GGD-98-23

gao_GGD-98-23_0

Eligibility Requirements Employers that sponsor DC plans generally establish certain minimum age and/or service requirements that employees must meet before they are allowed to participate in these plans. Most Employers Did Not Specify Their Liability for Contributions in Their SPDs Of the 3,297 employers included in our review, 883 (or 27 percent) of the employers included enough information in their SPDs to allow us to calculate the maximum potential cost, or liability, of making employer contributions—matching, nonmatching, or both—to their plans. Similarly, 57 percent of the subset of larger employers provided for employees to become fully vested in any matching contributions within 4 years, compared with 25 percent for nonmatching contributions within the same time period. A considerable portion of the employers with 100 or more employees that sponsored only single-employer DC plans in 1993 did not specify in their SPDs whether participants could direct the investment of contributions made to their accounts, as shown in figure 5. The larger employers were more likely to allow participants to direct the investment of all types of contributions made to their accounts. Nearly two-thirds of the 3,297 employers reported providing plan participants access to a portion of their account balances prior to separation from employment. The federal TSP includes a loan program, which allows participants to borrow from their own contributions (and earnings on those contributions) for any reason. For an annuity, the participant receives regular payments for the participant’s remaining lifetime. Although the majority of employers provided more than one withdrawal option in their plans, less than one-third of the plans specified that participants could opt to withdraw their accounts using a combination of withdrawal options—for example, by taking a portion of their account as a lump-sum withdrawal and purchasing an annuity with the remainder of their account balance. According to these sources, employers that sponsor pension plans are primarily concerned with controlling benefit costs, maximizing the federal tax incentives for providing pensions, and meeting the legal requirements of ERISA, as amended. Employers must also design their compensation and benefit packages to support their overall business and financial goals. Among the information requested was an analysis of the features of private sector DC plans. The objective of our review was to determine, for employers that sponsored only DC plans, the eligibility requirements for employee participation, arrangements for employer and participant contributions, eligibility requirements for employee rights to accrued benefits, employee investment options, loan and other provisions for participant access to plan assets while still employed, and options for withdrawal of benefits upon separation or retirement. Under the Employee Retirement Income Security Act of 1974, private employers must annually file a separate Form 5500 report with the IRS for each of their pension plans. Table II.2: Number and Percent of Employers That Sponsor Only Single-Employer Primary Defined Contribution Pension Plans by Contribution Source and Type and Employer Size (1993) Table II.3: Number and Percent of Employers That Sponsor Only Single-Employer Primary Defined Contribution Pension Plans by Basis for Making Nonmatching Contributions and Employer Size (1993) Basis for making nonmatching contributions Some percent of profits, allocated by participant compensation Some percent of profits, allocated by participant contributions Maximum employer nonmatching contributions expressed (as a percent of participant salary) Maximum participant contribution eligible for employer matching(percent of salary) Note 1: Of the 3,297 employers with 100 or more employees in our study, 1,410 employers provided matching contributions to the primary plan.

Why GAO Did This Study Pursuant to a congressional request, GAO reviewed the general features of defined contribution (DC) plans in the private sector, focusing on: (1) eligibility requirements for employee participation; (2) arrangements for employer and participant contributions; (3) eligibility requirements for employee rights to accrued benefits; (4) employee investment options; (5) loan and other provisions for participant access to plan assets while still employed; (6) options for withdrawal of benefits upon separation or retirement; (7) the six features for the Thrift Savings Plan; and (8) a summary of the explanations provided in retirement literature and by pension experts on why employers might decide to sponsor more than one pension plan for the same groups of employees. What GAO Found GAO noted that: (1) the designs of DC plans for the 3,297 employers with 100 or more employees that sponsored only single-employer plans in 1993 varied greatly with respect to eligibility requirements, contribution arrangements, accrual of benefits, investment options, loan provisions, and withdrawal options so that no single plan design could be identified as representing a typical DC plan; (2) the employers reported that they generally established eligibility requirements that their employees must satisfy to participate in their plans; (3) ninety-seven percent of the 3,297 employers provided for employer contributions to the plan rather than requiring participants to fully fund their own pensions; (4) employers generally did not include enough information in their summary plan descriptions to allow GAO to determine the maximum potential cost, or liability, of making employer contributions, expressed as a percentage of compensation; (5) although by law participants have always owned their own contributions (and earnings on those contributions) to DC plans, employers have often established minimum service requirements that participants were required to meet before they could own, or become vested in, employer contributions to the plan; (6) the employers used vesting requirements that generally required fewer years of service for employees to own matching contributions, as compared with non-matching contributions; (7) a significant portion of the employers did not specify in their summary plan descriptions whether participants could direct how the contributions made to their accounts were invested, although the subset of larger employers were more likely to so specify; (8) nearly two-thirds of the employers reported providing plan participants access to a portion of their account balances prior to separation from employment; (9) nearly all the employers allowed participants to take their account balances as a lump-sum distribution when they retired; while two thirds allowed participants to withdraw their accounts in even installment payments over a specified period of time, and nearly half provided for an annuity that would produce a regular monthly payment for the rest of the participant's life; and (10) according to pension experts, and pension-related literature, private employers design their pension programs principally to control costs, maximize federal tax incentives, and comply with the Employee Retirement Income Security Act of 1994, as amended, while at the same time structuring their compensation and benefits to support their overall business and financial goals.

gao_GAO-17-599T

gao_GAO-17-599T_0

CBP’s Air Predeparture Programs Interdict High-Risk Air Travelers, but CBP Has Not Fully Assessed the Programs’ Performance CBP Identifies and Interdicts High-Risk Travelers before They Board U.S-Bound Flights As we reported in January 2017, CBP electronically vets all travelers before they board U.S.-bound flights and continues to do so until they land at a U.S. port of entry. Through these vetting efforts, CBP seeks to identify high-risk travelers from the millions of individuals who travel to the United States each year. CBP’s Air Predeparture Programs Interdict High- Risk Travelers on U.S.- Bound Flights, but CBP Has Not Evaluated Overall Effectiveness of Air Predeparture Programs As we reported in January 2017, throughout the travel process, CBP’s predeparture programs use the results of NTC’s efforts to identify and interdict high-risk individuals destined for the United States while they are still overseas; however, we found that CBP had not evaluated the effectiveness of its predeparture programs as a whole, including implementing a system of performance measures and baselines to assess whether the programs are achieving their stated goals. CBP operates three air predeparture programs that are responsible for all U.S.-bound air travelers—Preclearance; the Immigration Advisory Program (IAP) and Joint Security Program (JSP); and the regional carrier liaison groups (RCLG). As we reported in January 2017, CBP data indicated that these programs identified and ultimately interdicted approximately 22,000 high-risk air travelers in fiscal year 2015, the most recent data available at the time of our review. Preclearance. Therefore, we recommended that CBP develop and implement a system of performance measures and baselines for each program to help ensure that these programs are achieving their intended goals. In response, CBP established a working group to develop and implement a system of performance measures and baselines to evaluate the effectiveness of CBP’s predeparture programs. ICE Aims to Strengthen Screening of Visa Applicants through its Visa Security Program The Homeland Security Act of 2002 authorized DHS to assign officers to each diplomatic and consular post at which visas are issued, and also authorized DHS to immediately assign personnel to Saudi Arabia to review all visa applications prior to final adjudication. In March 2011, we reported, among other things, on DHS’s efforts to expand VSP and challenges to VSP operations overseas. DHS did not concur with this recommendation and stated that VSP captured all the required performance metrics. We continue to believe that without collecting comprehensive data on performance measures, DHS cannot accurately demonstrate progress of VSP in enhancing national security. DHS did not concur with our recommendation and stated that ICE tracked case investigation hours through its case management system, and that adding the metric to the VSP tracking system would be redundant. However, we found at the time, according to ICE documentation, that ICE could not accurately determine the amount of time that VSP agents spent on investigative and visa security activities because ICE did not distinguish between the hours logged by VSP agents and hours logged by other ICE officials at posts abroad and that ICE did not maintain accurate data on the time VSP agents spent on visa security activities at posts. ICE did not take action to implement these recommendations and we continue to believe that it needs to take steps to address issues we identified. We have ongoing work assessing DHS, State, and other U.S. agency efforts to strengthen the security of the visa process, including oversight of VSP, in which we plan to follow up on the findings and recommendations from our March 2011 report related to ICE’s efforts to enhance VSP performance measurement, among other things. We plan to report later this year on the results of this work. All VWP Countries Have Entered into Information Sharing Agreements or Equivalents, but Not All Are Sharing Information as Required In May 2016, among other things, we reported that all 38 countries participating in the VWP had entered into the three types of required information-sharing agreements, or their equivalents, to (1) report lost and stolen passports, (2) share identity information about known or suspected terrorists, and (3) share criminal history information. In May 2016, we recommended that DHS specify time frames for working with VWP countries to institute the additional VWP security requirements, including the requirement that the countries fully implement agreements to share information about known or suspected terrorists through the countries’ HSPD-6 arrangements and PCSC agreements with the United States. DHS concurred with the recommendation and, as of April 2017, reported that officials are continuing to work with VWP countries on time frames for implementing program requirements.

Why GAO Did This Study DHS seeks to identify and interdict travelers who are potential security threats to the United States, such as foreign fighters and potential terrorists, human traffickers, drug smugglers and otherwise inadmissible persons, at the earliest possible point in time. DHS also adjudicates petitions for certain visa categories and has certain responsibilities for strengthening the security of the visa process, including oversight of VSP and VWP. State manages the visa adjudication process for foreign nationals seeking admission to the United States. This statement addresses (1) CBP programs aimed at preventing high-risk travelers from boarding U.S.-bound flights; (2) ICE's management of VSP; and (3) DHS's oversight of VWP. This statement is based on prior products GAO issued from March 2011 through January 2017, along with selected updates conducted in April 2017 to obtain information from DHS on actions it has taken to address prior GAO recommendations. What GAO Found In January 2017, GAO reported that the Department of Homeland Security's (DHS) U.S. Customs and Border Protection (CBP) operates predeparture programs to help identify and interdict high-risk travelers before they board U.S.-bound flights. CBP officers inspect all U.S.-bound travelers on precleared flights at the 15 Preclearance locations and, if deemed inadmissible, a traveler will not be permitted to board the aircraft. CBP also operates nine Immigration Advisory Program and two Joint Security Program locations, as well as three Regional Carrier Liaison Groups, through which CBP may recommend that air carriers not permit identified high-risk travelers to board U.S.-bound flights. CBP data showed that it identified and interdicted over 22,000 high-risk air travelers through these programs in fiscal year 2015 (the most recent data available at the time of GAO's report). However, CBP had not fully evaluated the overall effectiveness of these programs using performance measures and baselines. CBP tracked some data, such as the number of travelers deemed inadmissible, but had not set baselines to determine if predeparture programs are achieving goals, consistent with best practices for performance measurement. GAO recommended that CBP develop and implement a system of performance measures and baselines to better position CBP to assess if the programs are achieving their goals. CBP concurred and has established a working group to develop such measures and baselines. In March 2011, GAO reported on the Visa Security Program (VSP) through which DHS's U.S. Immigration and Customs Enforcement (ICE) deploys personnel to certain U.S. overseas posts to review visa applications. Among other things, GAO found that ICE did not collect comprehensive data on all VSP performance measures or track the time officials spent on visa security activities. DHS did not concur with GAO's recommendations to address these limitations, stating that ICE collected data on all the required performance measures and tracked VSP case investigation hours. However, GAO continues to believe DHS needs to address these limitations. GAO has ongoing work assessing U.S. agencies' efforts to strengthen the security of the visa process, including oversight of VSP, in which GAO plans to follow up on the findings and recommendations from its March 2011 report related to ICE's efforts to enhance VSP performance measurement. In May 2016, GAO reported on DHS's oversight of the Visa Waiver Program (VWP), which allows nationals from 38 countries to travel visa-free to the United States for business or pleasure for 90 days or less. GAO reported, among other things, that all 38 countries entered into required agreements, or their equivalents, to (1) report lost and stolen passports, (2) share identity information about known or suspected terrorists, and (3) share criminal history information. However, not all countries shared such information. In August 2015, DHS established a new requirement for VWP countries to implement the latter two agreements; however, DHS did not establish time frames for instituting the amended requirements. GAO recommended that DHS work with VWP countries to implement these agreements and DHS concurred. As of April 2017, DHS reported that officials are continuing to work with VWP countries on time frames for implementing program requirements. What GAO Recommends GAO previously made recommendations to improve evaluation of CBP's predeparture programs' performance and strengthen DHS's oversight of VSP and VWP. DHS agreed with GAO's recommendations related to CBP's predeparture programs and VWP. DHS did not agree with some of GAO's recommendations related to VSP. GAO has ongoing work related to, among other things, DHS's management and oversight of VSP and plans to report later this year on the results of this work.

gao_AIMD-97-49

gao_AIMD-97-49_0

Prior GAO Work on IRS Computer Security Over the past 3 years, we testified and reported numerous times on serious weaknesses with security and other internal controls used to safeguard IRS computer systems and facilities. The unauthorized electronic access of taxpayer data by IRS employees— commonly referred to as browsing—has been a longstanding problem for the Service. During our five on-site reviews, we found numerous weaknesses in the following eight functional areas: physical security, logical security, data communications management, risk analysis, quality assurance, internal audit and security, security awareness, and contingency planning.Primary weaknesses were in the areas of physical and logical security. The following are examples of these weaknesses: Collectively, the five facilities could not account for approximately 6,400 units of magnetic storage media, such as tapes and cartridges, which could contain taxpayer data. Printouts containing taxpayer data were left unprotected and unattended in open areas of two facilities where they could be compromised. For example, two of the facilities had not audited operations within the last 5 years. None of the five facilities visited had comprehensive disaster recovery plans. Punishments Assessed for Browsing Not Consistently Publicized to Deter Violations IRS facilities did not consistently publicize the penalties assessed in browsing cases to deter such behavior. Conclusions IRS’ current approach to computer security is not effective. Serious weaknesses persist in security controls intended to safeguard IRS computer systems, data, and facilities and expose tax processing operations to the serious risk of disruption and taxpayer data to the risk of unauthorized use, modification, and destruction. Recommendations Because of the serious and persistent security problems cited in our January 30, 1997, “Limited Official Use” version of this report, we recommended that the Commissioner of Internal Revenue, within 3 months of the date of that report, prepare a plan for (1) correcting all the weaknesses identified at the five facilities we visited, as detailed in the January 30, 1997 report, and (2) identifying and correcting security weaknesses at the other IRS facilities. Objectives, Scope, and Methodology The objectives of our review were to (1) determine whether IRS is effectively managing computer security and (2) determine whether IRS is effectively addressing employee browsing of electronic taxpayer data.

Why GAO Did This Study Pursuant to a congressional request, GAO reviewed the Internal Revenue Service's (IRS) computer security, focusing on whether IRS is effectively: (1) managing computer security; and (2) addressing employee browsing of electronic taxpayer data. What GAO Found GAO noted that: (1) over the last 3 years, GAO has reported on a number of computer security problems at IRS and has made recommendations for strengthening IRS' computer security management effectiveness; (2) nevertheless, IRS continues to have serious weaknesses in the controls used to safeguard IRS computer systems, facilities, and taxpayer data; (3) GAO's recent on-site reviews of security at five facilities disclosed many weaknesses in the areas of physical security, logical security, data communications management, risk analysis, quality assurance, internal audit and security, security awareness, and contingency planning; (4) for example, the five facilities could not account collectively for approximately 6,400 missing units of magnetic storage media, such as tapes and cartridges, which could contain taxpayer data; (5) in addition, printouts containing taxpayer data were left unprotected and unattended in open areas of two facilities where they could be compromised; (6) also, none of the facilities visited had comprehensive disaster recovery plans, which threaten the facilities' ability to restore operations following emergencies or natural disasters; (7) one area of unauthorized access that has been the focus of considerable attention is electronic browsing of taxpayer data by IRS employees; (8) despite this attention, IRS is still not effectively addressing the problem via thorough employee monitoring, accurate recording of browsing violations, or consistent application and publication of enforcement actions; (9) for example, IRS currently does not monitor all employees with access to automated systems and data for electronic browsing activities; (10) in addition, when instances of browsing are identified, IRS does not consistently investigate them or publicize them to deter others from browsing, and does not consistently punish browsers; (11) until these serious weaknesses are corrected, IRS runs the risk of its tax processing operations being disrupted and taxpayer data being improperly used, modified, or destroyed; and (12) IRS should prepare a plan for correcting the weaknesses at the five facilities GAO visited and for identifying and correcting security weaknesses at other IRS locations.

gao_GAO-11-596

gao_GAO-11-596_0

TES Met Some Oversight Requirements for T&E of Acquisition Programs Reviewed; Additional Steps Needed to Ensure That All Requirements Are Met TES met its oversight requirements when approving test plans and test reports in accordance with DHS acquisition and T&E directives for the 11 major acquisition programs we selected for review. However, TES did not consistently document its review and approval of operational test agents or its review of other required acquisition documentation, which could provide more assurance that components were meeting T&E directives when TES reviewed these documents. TES Oversight of Components’ Test Plans and Test Reports TES is to oversee T&E of major DHS acquisition programs by ensuring that the requirements set forth in the T&E directive are met and by working with component program officials to develop T&E documentation, such as test and evaluation master plans, as required by DHS’s acquisition directive. Component officials from each of these six programs stated that TES provided input to the development of the test and evaluation master plans. Additional Steps Needed to Ensure that T&E Requirements Are Met While TES’s oversight of the test plans and reports for major acquisition programs selected for review is in accordance with provisions in the T&E directive, it did not consistently document its review and approval of certain acquisition documentation or document the extent to which certain requirements in the T&E directive were met. TES Did Not Consistently Document the Extent to which Criteria Used in Its Approval of Operational Test Agents Were Met The T&E directive requires that an operational test agent—a government agency or independent contractor carrying out independent operational testing for major acquisition programs—is to meet certain requirements to be qualified and approved by TES, but does not specify how TES’s approval is to be documented. TES provided documentation, such as memoranda, of its approval for 3 of these 8 programs. According to TES officials, they did not have a mechanism in place requiring a consistent method for documenting their review and approval of component agents or the extent to which criteria used in reviewing these agents were met. Without a mechanism for documenting its review and approval of test agents for major acquisition programs, it will be difficult for DHS or an independent third party to validate TES’s decision-making process to ensure that it is effectively overseeing component testing. TES and Component Officials Cited Challenges in Coordinating and Overseeing T&E across DHS; Efforts Are Underway to Address Some Challenges TES and component officials reported challenges faced in coordinating and overseeing T&E across DHS components that fell into four primary categories: (1) ensuring that a program’s operational requirements—the key requirements that must be met for a program to achieve its intended goals—can be effectively tested; (2) working with DHS component program staff that have limited T&E expertise and experience; (3) using existing T&E directives and guidance to oversee complex information technology acquisitions; and (4) ensuring that components allow sufficient time and resources for T&E while remaining within program cost and schedule estimates. Both TES and DHS, more broadly, have begun initiatives to address some of these challenges, but it is too early to determine their effectiveness. Other components in DHS told us they rely more on TES or contractors for T&E expertise. Using Existing T&E Directives and Guidance to Oversee Information Technology Acquisitions Effectively managing IT acquisitions is a governmentwide challenge. Since the efforts DHS is taking to address this challenge have only recently been initiated, it is too early to tell what impact they will have on the overall challenges of T&E for IT programs. Since the Homeland Security Act creating DHS was enacted in 2002, S&T has had the responsibility for overseeing T&E activities across the department. However, S&T did not have staff or the acquisition and T&E directives in place to conduct such oversight across DHS components until May 2009 when DHS issued its T&E directive. Recommendations for Executive Action To better ensure that testing and evaluation requirements are met, we recommend that the Secretary of Homeland Security direct the Under Secretary for Science & Technology to take the following two actions: Develop a mechanism to ensure that TES documents its approval of operational test agents and the extent that the test agents meet the requirements in the T&E directive, and criteria that TES use in reviewing these test agents for major acquisition programs. For example, some programs, such as Customs and Border Protection’s acquisition of Border Patrol Facilities would not involve any T&E activities and therefore would not be subject to the requirements in the T&E directive or DHS Science and Technology Directorate’s Test and Evaluation and Standards office (TES) oversight.

Why GAO Did This Study In recent years, GAO has reported on challenges the Department of Homeland Security (DHS) has faced in effectively managing major acquisitions, including programs which were deployed before appropriate testing and evaluation (T&E) was completed. In 2009 and 2010 respectively, DHS issued new T&E and acquisition directives to address these challenges. Under these directives, DHS Science and Technology Directorate's (S&T) Test & Evaluation and Standards Office (TES) is responsible for overseeing T&E of DHS major acquisition programs--that is, those with over $300 million in life-cycle costs--to ensure that T&E and certain acquisitions requirements are met. GAO was asked to identify (1) the extent to which TES oversees T&E of major acquisitions; and (2) what challenges, if any, TES officials report facing in overseeing T&E across DHS components. GAO reviewed DHS directives and test plans, interviewed DHS officials, and reviewed T&E documentation from a sample of 11 major acquisition programs from each of 11 different DHS components. The results of the sample cannot be generalized to all DHS programs, but provided insights. What GAO Found TES met some of its oversight requirements for T&E of acquisition programs GAO reviewed, but additional steps are needed to ensure that all requirements are met. Specifically, since DHS issued the T&E directive in May 2009, TES has reviewed or approved T&E documents and plans for programs undergoing testing, and conducted independent assessments for the programs that completed operational testing during this time period. TES officials told GAO that they also provided input and reviewed other T&E documentation, such as components' documents describing the programs' performance requirements, as required by the T&E directive. DHS senior level officials considered TES's T&E assessments and input in deciding whether programs were ready to proceed to the next acquisition phase. However, TES did not consistently document its review and approval of components' test agents--a government entity or independent contractor carrying out independent operational testing for a major acquisition--or document its review of other component acquisition documents, such as those establishing programs' operational requirements, as required by the T&E directive. For example, 8 of the 11 acquisition programs GAO reviewed had hired test agents, but documentation of TES approval of these agents existed for only 3 of these 8 programs. Approving test agents is important to ensure that they are independent of the program and that they meet requirements of the T&E directive. TES officials agreed that they did not have a mechanism in place requiring a consistent method for documenting their review or approval and the extent to which the review or approval criteria were met. Without mechanisms in place for documenting its review or approval of acquisition documents and T&E requirements, such as approving test agents, it is difficult for DHS or a third party to review and validate TES's decision-making process and ensure that it is overseeing components' T&E efforts in accordance with acquisition and T&E directives and internal control standards for government entities. TES and DHS component officials stated that they face challenges in overseeing T&E across DHS components which fell into 4 categories: (1) ensuring that a program's operational requirements--the key performance requirements that must be met for a program to achieve its intended goals-- can be effectively tested; (2) working with DHS component program staff who have limited T&E expertise and experience; (3) using existing T&E directives and guidance to oversee complex information technology acquisitions; and (4) ensuring that components allow sufficient time for T&E while remaining within program cost and schedule estimates. Both TES and DHS, more broadly, have begun initiatives to address some of these challenges, such as establishing a T&E council to disseminate best practices to component program managers, and developing specific guidance for testing and evaluating information technology acquisitions. In addition, S&T has reorganized to assist components in developing requirements that can be tested, among other things. However, since these efforts have only recently been initiated to address these DHS-wide challenges, it is too soon to determine their effectiveness. What GAO Recommends GAO recommends, among other things, that S&T develop mechanisms for TES to document its review or approval of component acquisition documentation and T&E requirements, such as approving operational test agents. DHS agreed with GAO's recommendations.

gao_GAO-05-435

gao_GAO-05-435_0

Background U.S. Customs and Border Protection, a component of the Department of Homeland Security, has the primary responsibility for securing the nation’s borders. About 10 percent of the Border Patrol’s agents nationwide are assigned to interior traffic checkpoints in the southwest border sectors, according to the Border Patrol. Permanent and Tactical Checkpoints Have Different but Complementary Roles in the Border Patrol Strategy The Border Patrol uses permanent and tactical checkpoints in 8 of its 9 southwest sectors as part of a multilayered enforcement strategy to deter and defend against potential terrorists and their weapons, contraband smugglers, and persons who have entered the country illegally. This is not the case in the Tucson sector, where legislative language has prohibited the construction of checkpoints since fiscal year 1999. Moreover, starting in mid-2002, and through fiscal year 2004, the Border Patrol relocated or closed checkpoints in the Tucson sector on a regular basis, such as at least once every 7 days. According to the Border Patrol, permanent and tactical checkpoints are part of an integrated, multilayered enforcement strategy intended to achieve two key law enforcement objectives: (1) to increase the likelihood of detection and apprehension of illegal entrants of all types, and thereby to deter other potential illegal entrants from attempting to enter the country, who might otherwise believe that successfully crossing the border would mean that there were no further barriers to them, and (2) to deter illegal entrants from transiting through permanent checkpoints on major roadways, through fear of detection, and thereby to cause them to use less traveled secondary roads on which the Border Patrol is able to stop all or almost all vehicles (because of much lower traffic volume), making illegal entrants more visible and easier to detect and apprehend. Permanent checkpoints’ physical infrastructure gives them different capabilities than tactical checkpoints. In addition, the 2005 Act changed the requirement to relocate checkpoints to “at least an average of once every 14 days.” According to the Border Patrol, the phrase “an average” gave it more flexibility in determining checkpoint operating schedules than the previous years’ requirement of “at least once every 7 days.” As a result, in fiscal year 2005, the Patrol operates the checkpoint on I-19 for 14 days, closes it for 8 hours, and then reopens it for 14 days. It did attempt to close and open for a few days at a time, they said, to try to confuse illegal aliens and contraband smugglers. Studies or reports on checkpoint benefits and costs have also not been performed by the Border Patrol. However, this support is not universal. Most Local Community Leaders We Contacted See Traffic Checkpoints as Benefiting their Communities Local law enforcement, business, and community leaders near interior traffic checkpoints in Temecula, California, in the San Diego sector, and Nogales, Arizona, in the Tucson sector, that we interviewed told us that in their view, the checkpoints and the presence of Border Patrol agents were of considerable benefit to their communities. Our analysis of Border Patrol data suggest that, as measured in apprehensions per agent work year, the restrictions in the Tucson sector may have had a negative impact on the performance of its interior checkpoints, starting at about the time the sector implemented direction from congressional staff to relocate checkpoints every 7 days, in comparison with the three other sectors we visited, where no comparable decline in effectiveness occurred during the same time period. This information could also be useful to the Congress as it considers ways to improve the effectiveness of checkpoints and border security efforts. Recommendations for Executive Action To better gauge the effects of border control efforts, we recommend that the Commissioner of Customs and Border Protection develop additional performance measures for the Border Patrol for the productivity and effectiveness of interior checkpoints, such as apprehensions per agent work year and cost per apprehension, and include in CBP’s Performance and Annual Report data and analysis provided by the additional performance measures on the performance of interior checkpoints and what might be done to improve their effectiveness. DHS stated that CBP will consider our suggestions when developing these measures. According to Border Patrol officials, Laredo is one of the busiest commercial ports of entry in the United States.

Why GAO Did This Study The U.S. Border Patrol, a component of the U.S. Customs and Border Protection (CBP) agency, a part of the Department of Homeland Security (DHS), aims to apprehend persons who illegally enter the United States between official ports of entry, including potential terrorists, aliens, and contraband smugglers, thereby deterring or stopping illegal activity. The Patrol operates permanent and tactical (temporary) interior traffic checkpoints on major and secondary U.S. roads, mainly in the southwest border states where most illegal entries occur, as part of a multi-layer strategy to maximize detection and apprehension of illegal entrants. This report addresses (1) the role of interior checkpoints in the Patrol's strategy; (2) what is known about checkpoint costs and benefits; and (3) how checkpoints are evaluated and what performance measures indicate regarding their effectiveness. What GAO Found The Border Patrol operates 33 permanent traffic checkpoints in 8 of its 9 sectors in the southwest border states, supported by tactical checkpoints. While permanent checkpoints have the advantage of physical infrastructure, tactical ones have the mobility to block routes used to evade permanent ones and to respond to intelligence on illegal activity. A third type of checkpoint operates in the Tucson, Ariz., sector, where the Patrol has been legislatively prohibited from funding construction of checkpoints since fiscal year 1999. This restriction has prevented checkpoint construction. The Patrol also began closing or relocating checkpoints in the sector every 7 days at the instruction of congressional staff in June 2002, and was legislatively required to relocate checkpoints on the same schedule in FY 2003 and 2004, and an average of once every 14 days in FY 2005. Three of six checkpoints in the sector had to close for 7/14 days, as safety considerations made it too hazardous to relocate them. Local law enforcement and business and community leaders we interviewed from communities near interior traffic checkpoints said that benefits resulting from checkpoint operations included reductions in crime and vandalism. Although a few cited traffic delays, most were supportive of checkpoint operations. However, some others were concerned about the impact of the checkpoints on traffic congestion and quality of life in their communities. The Border Patrol does not routinely evaluate the effectiveness of checkpoint operations, or their costs. The Patrol includes limited traditional performance measures in its Performance and Annual Report, such as apprehensions and contraband seized. GAO developed an apprehension per agent work year measure to assess performance. The data suggest that the performance of the Tucson sector interior checkpoints dropped starting in FY 2002, and more in FY 2003, after the Border Patrol began relocating or closing them on a regular basis. Three other sectors we visited that did not have to relocate or close checkpoints experienced no comparable decrease in apprehensions per agent work year during the same time period. Other factors not measured or accounted for might also have contributed to these outcomes, but the Border Patrol's limited measures do not capture or assess them. A broader range of performance measures, when considered with other indicators, could be useful to CBP and the Congress as they consider ways to improve the effectiveness of interior traffic checkpoints and border security efforts.

gao_GAO-10-95

gao_GAO-10-95_0

JIEDDO emerged through a series of attempts to focus counter-IED efforts, but its development did not follow a formal process. Many Different DOD Entities Began Focusing on Counter-IED Issues in an Effort to Address Capability Gaps As IED attacks in Iraq reached nearly 300 per month by October 2003 and over 400 per month by May 2004, many different DOD entities at the service and joint levels began focusing on addressing capability gaps in the areas of counter-IED technologies, qualified personnel with expertise in counter-IED tactics, training, dedicated funding, and expedited acquisition processes. These various actions that led to the development of JIEDDO were done in the absence of DOD having formal guidance for establishing joint organizations. Furthermore, DOD did not systematically evaluate all preexisting counter-IED resources in order to determine whether other entities were engaged in similar efforts within DOD, according to DOD officials. JIEDDO and the Services Lack Full Visibility over Counter-IED Initiatives throughout DOD JIEDDO has taken steps to improve visibility over its counter-IED efforts by, for example, involving the services in the joint counter-IED acquisition process and hosting DOD counter-IED conferences. No Comprehensive IED Defeat Initiative Database Exists throughout DOD JIEDDO and the services have limited visibility over all counter-IED initiatives throughout DOD in that there is no comprehensive database of all existing counter-IED initiatives. JIEDDO is currently developing a management system that will track its initiatives as they move through JIEDDO’s acquisition process. However, this system will only track JIEDDO-funded initiatives—not those being independently developed and procured by the services and other DOD components. The Services Lack Visibility over Some JIEDDO-Funded Initiatives The services lack full visibility over those JIEDDO-funded initiatives that bypass JIEDDO’s acquisition process. JIEDDO Faces Difficulties with Transitioning Joint IED Defeat Initiatives to the Military Services Since its creation, JIEDDO has taken steps to support the services’ and defense agencies’ ability to program and fund counter-IED initiatives approved for transition following JIEDDO’s 2- year transition timeline. However, JIEDDO’s initiative transitions to the services are hindered by funding gaps between JIEDDO’s transition timeline and DOD’s base budget cycle as well as by instances when service requirements are not fully considered during the development and integration of jointly-funded counter-IED initiatives. In a transfer, one of the services may sustain the initiative through funding for current contingency operations. Continuing to fund transferred initiatives with overseas contingency operations appropriations does not ensure funding availability for those initiatives in future years, since these appropriations are not necessarily renewed from one year to the next. In 2006, DOD established the Navy as single manager and executive agent for ground-based jamming systems for DOD. Although JIEDDO has supported service counter-IED training, its lack of clear criteria for the counter-IED training initiatives it will fund has affected its counter-IED training investment decisions. As a result, JIEDDO has funded training initiatives that may have primary uses other than defeating IEDs. As with JIEDDO’s urgent needs criteria for training, these guidelines could also be broadly interpreted, as demonstrated by the above examples. Without criteria specifying which counter-IED training initiatives it will fund, JIEDDO may diminish its ability to fund future initiatives that are more directly related to the counter-IED mission. Appendix I: Scope and Methodology To assess the extent to which capability gaps were initially identified in DOD’s effort to defeat IEDs and how these gaps and other factors led to the development of JIEDDO, we spoke with current and former senior officials involved in the evolution of JIEDDO and examined existing documentation.

Why GAO Did This Study Prior to the Joint Improvised Explosive Device Defeat Organization's (JIEDDO) establishment in 2006, no single entity was responsible for coordinating the Department of Defense's (DOD) counter improvised explosive device (IED) efforts. JIEDDO was established to coordinate and focus all counter-IED efforts, including ongoing research and development, throughout DOD. This report, which is one in a series of congressionally mandated GAO reports related to JIEDDO's management and operations, assesses the extent to which 1) capability gaps were initially identified in DOD's effort to defeat IEDs and how these gaps and other factors led to the development of JIEDDO, 2) JIEDDO has maintained visibility over all counter-IED efforts, 3) JIEDDO has coordinated the transition of JIEDDO-funded initiatives to the military services, and 4) JIEDDO has developed criteria for the counter-IED training initiatives it will fund. To address these objectives, GAO reviewed and analyzed relevant documents and met with DOD and service officials. What GAO Found With the escalation of the IED threat in Iraq, DOD identified several counter-IED capability gaps that included shortcomings in the areas of counter-IED technologies, qualified personnel with expertise in counter-IED tactics, training, dedicated funding, and expedited acquisition processes. For example, prior to JIEDDO's establishment, many different DOD entities focused on counter-IED issues, but coordination among these various efforts was informal and ad hoc. DOD's efforts to focus on addressing these gaps culminated in the creation of JIEDDO, but its creation was done in the absence of DOD having formal guidance for establishing joint organizations. Further, DOD did not systematically evaluate all preexisting counter-IED resources to determine whether other entities were engaged in similar efforts. JIEDDO and the services lack full visibility over counter-IED initiatives throughout DOD. First, JIEDDO and the services lack a comprehensive database of all existing counter-IED initiatives, limiting their visibility over counter-IED efforts across DOD. Although JIEDDO is currently developing a management system that will track initiatives as they move through JIEDDO's acquisition process, the system will only track JIEDDO-funded initiatives--not those being independently developed and procured by the services and other DOD components. Second, the services lack full visibility over those JIEDDO-funded initiatives that bypass JIEDDO's acquisition process. With limited visibility, both JIEDDO and the services are at risk of duplicating efforts. JIEDDO faces difficulties with transitioning Joint IED defeat initiatives to the military services, in part because JIEDDO and the services have difficulty resolving the gap between JIEDDO's transition timeline and DOD's base budget cycle. As a result, the services are mainly funding initiatives with funding for overseas contingency operations rather than their base budgets. Continuing to fund transferred initiatives with overseas contingency operations appropriations does not ensure funding availability for those initiatives in future years since these appropriations are not necessarily renewed from one year to the next. This transition is also hindered when service requirements are not fully considered during the development of joint-funded counter-IED initiatives, as evidenced by two counter-IED jamming systems. As a result, JIEDDO may be investing in counter-IED solutions that do not fully meet existing service requirements. JIEDDO's lack of clear criteria for the counter-IED training initiatives it will fund has affected its counter-IED training investment decisions. As a result, JIEDDO has funded training initiatives that may have primary uses other than defeating IEDs. In March 2009, JIEDDO attempted to update its criteria for joint training initiatives by listing new requirements; however, these guidelines also could be broadly interpreted. Without specific criteria for counter-IED training initiatives, DOD may find that it lacks funding for future initiatives more directly related to the counter-IED mission.

gao_GAO-10-164

gao_GAO-10-164_0

Recipients of assistance from these solely state-funded programs are not subject to TANF requirements. Factors Contributing to the Decline in Cash Recipients Include Declines in the Number of Eligible Families and in Eligible Families’ Participation Since the 1990s, the decline in the number of families receiving cash assistance reflects declines not only in the number of eligible families but also in eligible families’ participation in the program in response to TANF policies. In the same period from 1995 to 2000, the annual unemployment rate for single women with children fell from 16.6 percent in 1995, to 11.0 percent in 2000, according to BLS data. 1.) Eligible families who did not participate in TANF generally had relatively higher incomes and higher education levels than TANF families. 7.) Among Eligible Nonparticipants in 2005, a Portion of Families Did Not Work and Had Very Low Incomes, but Received Public Supports While many eligible families who did not participate in TANF had higher incomes than families on TANF, a portion of nonparticipating families had very low incomes. If the percent of eligible families participating in TANF in 2005 was 84 percent— the rate of participation in AFDC in 1995—rather than about 40 percent— 800,000 fewer children would have been in extreme poverty. Another reason is that TANF benefits are typically too low to raise children in poverty above the federal poverty threshold. In the Current Recession, Changes in Cash Assistance Caseloads Varied Widely in States We Surveyed While Few States Reduced Spending for Family and/or Work Supports TANF and Solely State- Funded Cash Assistance Caseloads Increased to Varying Degrees in the Majority of States We Surveyed Between June 2008—6 months after the start of the current recession— and June 2009, the number of families receiving TANF cash assistance increased in 12 of the 21 states we reviewed, decreased in 6 states and remained relatively unchanged in 3 states, according to state-provided data. Appendix I: Objectives, Scope, and Methodology We designed our study to provide information on (1) the factors that contributed to the decline in families receiving TANF cash assistance since the 1990s, (2) how the characteristics of eligible families who participate in TANF compare to eligible families who do not receive TANF cash assistance, (3) how the participation of eligible families in TANF affects the number of children in extreme poverty and poverty, and (4) the changes states are experiencing in the number of families receiving cash assistance in the current recession and what changes, if any, states have made in their TANF–related spending to respond to any increases. TRIM3 can be used to estimate the effect of rule changes, such as restrictions on eligibility for legal immigrants, on the number of eligible families; compare the income and other characteristics of participating and nonparticipating families; and estimate the effect of higher TANF participation rates on child poverty and extreme child poverty, with incomes below 50 percent of the federal poverty level. We also reviewed relevant federal laws and regulations.

Why GAO Did This Study Following sweeping changes made to federal welfare policy in 1996 with the creation of the Temporary Assistance for Needy Families (TANF) program, the number of needy families who received cash assistance fell by more than half to 1.7 million in 2008. Poverty among children also fell from about 21 percent in 1995 to about 16 percent in 2000, rising again to 19 percent in 2008. The current recession deepened in 2008, raising questions about state TANF programs' response to increased needs. GAO was asked to provide Congress with information on the (1) factors contributing to the decline in the number of families receiving assistance; (2) characteristics of participating and nonparticipating eligible families; (3) impact of higher participation in TANF cash assistance on child poverty; and (4) changes states are experiencing in caseloads and spending in the current recession. GAO's methodologies included using microsimulation analyses; reviewing relevant research and federal laws; interviewing TANF officials in 21 selected states; analyzing state cash assistance data; and interviewing researchers, federal officials, and other experts. What GAO Found The decline in the number of poor families receiving cash assistance from 1995 to 2005 reflects declines in both the number of eligible families and in eligible families' participation. The strong economy of the 1990s, TANF's focus on work, and other factors contributed to increased family incomes and a decline in the number of eligible families. However, most of the caseload decline--about 87 percent--resulted from fewer eligible families participating in the program, perhaps in response to TANF work requirements, time limits, and sanction and diversion policies. Compared to TANF families, eligible nonparticipating families worked more and had higher incomes and educational levels. However, among eligible families who did not participate, 11 percent did not work, did not receive means-tested disability benefits, and had very low incomes. 800,000 fewer children would live in extreme poverty--below half the federal poverty threshold--if participation increased from 40 percent to 84 percent of eligible families, the level it reached in 1995, the year before TANF was created. While TANF benefits would generally increase incomes, higher participation would not significantly change the number of children in poverty overall, partly because many children in poverty are not poor enough to be eligible for TANF and because TANF cash benefits are typically low. From June 2008 to June 2009, the number of families receiving TANF cash assistance rose in 12 of the 21 states GAO surveyed, although the recession's impact on cash assistance caseloads varied by state. To offset higher costs of cash assistance, few states reported reducing TANF-related spending on family- and/or work-supports during this time period. Instead, states paid for increases by using funding sources such as 2009 emergency stimulus funds.

gao_GAO-12-178

gao_GAO-12-178_0

Alternatively, GSA provides federal agencies with a simplified method for procuring office supplies through its Federal Supply Schedule program, also known as the Multiple Award Schedules (MAS) or schedules program. The schedules program can leverage the government’s significant aggregate buying power. The GSA report estimated that the 10 agencies with the highest spending on office supplies accounted for about $1.3 billion, about 81 percent of the total $1.6 billion spent governmentwide on the 14 categories of office supplies during fiscal year 2009. On average, GSA found that agencies paid 75 percent more than schedule prices and 86 percent more than OS II prices for their retail purchases. We were not able to fully quantify the impact of these limitations. Other agencies also questioned the study’s specific findings related to price premiums, but their own studies of price premiums support GSA’s conclusion that better prices can be obtained through consolidated, leveraged purchasing. The GSA study also concluded that buyers compared prices before making purchases, but this conclusion was not based on information from actual purchase card holders. In its report, GSA acknowledged that the data used to analyze governmentwide purchases of office supplies in 2009 had limitations, in part due to the decentralized data sources for office supply purchases and the limited time GSA had to conduct its study. The existence of substantial price differences for a number of items indicates that GSA’s attempts to compare prices may not have adequately controlled for variations in quantities. However, the agencies agreed with GSA’s overall conclusion that better prices can be obtained through leveraged buys. GSA Conclusion on Buyer Price Comparisons Not Supported by Information from Actual Buyers GSA interviewed senior-level acquisition officials to determine how office supply purchasing decisions were made within their respective agencies and concluded that purchase cardholders compared costs at some level prior to making a purchase. New Strategic Sourcing Initiative for Office Supplies Shows Potential for Generating Savings According to initial available data, GSA’s new OS II BPAs have produced savings. The OS II initiative, more so than past efforts, is demonstrating that leveraged buying can produce greater savings and has provided improvements for managing ongoing and future strategic sourcing initiatives. For example, a key aspect of the initiative is that participating vendors provide sales and other information to GSA to help monitor prices, savings, and vendor performance. GSA’s Analysis of OS II Data Shows Savings Are Being Achieved On the basis of the sales data provided by OS II vendors, GSA estimates the federal government saved $16 million from June 2010 through August 2011 by using these BPAs. In addition to the savings from the BPAs, GSA representatives told us that they are also seeing prices decrease on schedules program contracts as vendors that were not selected for the OS II program react to the additional price competition created by the OS II initiative by reducing their schedule prices. OS II Initiative Offers Lessons for Other Strategic Sourcing Initiatives GSA is learning lessons from OS II, its first of the second generation of strategic sourcing initiatives, and is attempting to incorporate these lessons into other strategic sourcing initiatives. To this end, GSA established an office supplies commodity council to identify agencies’ goals and needs. Additional savings are expected as more government agencies participate in the OS II initiative and further leverage the government’s buying power. Agency Comments and Our Evaluation We provided a draft of this report to GSA, DHS, and DOD. GSA also provided additional information on its strategic sourcing initiatives. We revised our report to reflect GSA’s comment. We are sending copies of this report to the Administrator of General Services, the Secretaries of the Department of Homeland Security and Defense as well as the Air Force, Army, and Navy.

Why GAO Did This Study Concerned that federal agencies may not be getting the best prices available, Congress directed the General Services Administration (GSA) to study office supply purchases by the 10 largest federal agencies. GSA delivered the results of its study in November 2010. The study also discussed GSA’s efforts to implement an initiative focused on leveraging the government’s buying power to realize savings when buying office supplies, known as Office Supplies II (OS II). Under this initiative, GSA entered into agreements with vendors based on discounted prices to be offered to all federal agencies. Congress directed GAO to assess the GSA study, with particular attention to the potential for savings. Accordingly, GAO assessed (1) the support for the findings and conclusions in GSA’s report and (2) how GSA's new office supply contracts support the goal of leveraging the government’s buying power to achieve savings. To conduct this work, GAO analyzed the data GSA used for its study; met with and obtained documentation from officials at GSA and the Departments of Homeland Security (DHS), Air Force, Navy, and Army, which were among the 10 agencies in GSA’s study; and reviewed contract documentation associated with GSA’s new office supplies initiative. GSA and DHS commented on a draft of this report. GSA said it appreciated our recognition that leveraged purchasing can produce savings and also provided technical comments, which we incorporated as appropriate. DHS provided additional information on its strategic sourcing initiatives. What GAO Found GSA estimated that federal agencies spent about $1.6 billion during fiscal year 2009 purchasing office supplies from more than 239,000 vendors. GSA concluded that agency buyers paid higher prices when they bought office supplies outside GSA’s Multiple Award Schedule program than they would have using the schedules or OS II. According to GSA, the price premiums averaged 75 percent compared to the schedule prices and 86 percent compared to OS II. GAO identified data and other limitations in GSA’s study, such as not always controlling for variation in quantities of identical items when comparing prices. GAO was not able to fully quantify the impact of these limitations. Officials from other agencies—Air Force, Army, Navy, and DHS—also questioned the study’s specific findings on price premiums, believing them to be overstated, but their own studies support GSA’s general conclusion that better prices can be obtained through consolidated, leveraged purchasing. The GSA study also concluded that buyers compared prices before making purchases, but this conclusion was based on interviews with senior-level acquisition officials and not on information obtained from any of the approximately 270,000 government purchase cardholders who made the purchasing decisions. According to available data, GSA’s new office supplies sourcing initiative, OS II, has produced savings. GSA estimated that the government saved $16 million from June 2010 through August 2011 through this initiative. According to GSA, the OS II initiative is demonstrating that leveraged buying can produce savings and has provided improvements for managing ongoing and future strategic sourcing initiatives. GSA reports that OS II allowed it to negotiate discounts with vendors who were selected for the initiative, and has spurred price competition among schedule vendors that were not selected as they react to the OS II pricing, resulting in decreased schedule prices. The initiative is also expected to lower government-wide office supply costs through more centralized contract management. Another key aspect of the initiative is that participating vendors provide sales and other information to GSA to help monitor prices, savings, and vendor performance. Finally, the OS II initiative offers lessons learned for other strategic sourcing initiatives, including the importance of identifying agencies’ goals and needs and ensuring buying agency participation.

gao_GAO-17-443

gao_GAO-17-443_0

FDA Takes Steps to Help Ensure the Safety of Imported Seafood from Unsafe Drug Residues and Could Strengthen Its Efforts with Foreign Country Agreements To help ensure the safety of imported seafood from unsafe drug residues, FDA generally depends on the actions of foreign processors and U.S. importers. Specifically, FDA requires processors and importers to follow its Hazard Analysis and Critical Control Point (HACCP) regulations to identify hazards and the critical control points where the hazards, such as pathogen contamination, are likely to occur and to take corrective action. FDA also performs a limited number of (1) inspections of processors and importers each year to ensure HACCP compliance, and (2) samples and tests of imported seafood for contaminants, including unsafe drug residues. FDA Could Strengthen Its Efforts by Pursuing Agreements with Other Countries Requiring That They Test Seafood Exported to the United States FDA is not pursuing agreements with other countries requiring that they test seafood exported to the United States for unsafe drug residues, according to FDA officials, as the EU does. When asked why, agency officials said that it might be worthwhile for FDA to pursue agreements with some countries, but the agency would have to carefully consider a number of factors in determining which countries would be appropriate and has not done so. Specifically, the agency has used them with respect to pathogen hazards in molluscan shellfish intended for export to the United States. Under the plan, FDA is to coordinate with other countries to, among other things, increase their capabilities related to the safety of food exported to the United States and better leverage other countries’ resources. FSIS Takes Steps to Help Ensure the Safety of Imported Catfish from Unsafe Drug Residues and Could Strengthen Its Efforts In assuming responsibility for inspecting imported catfish, FSIS provided for an 18-month transition period—March 1, 2016, through September 1, 2017—to provide foreign countries, importers, and other stakeholders time to transition to the full implementation of the agency’s catfish inspection program for imports. However, FSIS has not made farm visits a routine part of initial equivalence determination and verification on-site audits. In April 2016, FSIS assumed responsibility for inspecting imported catfish at ports of entry. FSIS Could Strengthen Its Efforts to Ensure the Safety of Imported of Catfish As discussed, during FSIS’s on-site audits, which the agency conducts at least once to verify the accuracy of the documentation and information a foreign country seeking an equivalence determination has provided in an SRT, FSIS generally visits government offices, commercial food processing facilities, and food testing laboratories in the foreign country. It is not clear how FSIS could consider the conditions under which imported catfish are raised, as directed by the 2014 Farm Bill, without visiting foreign catfish farms. In addition, the agency will already have its inspectors in the foreign country for an on-site audit. FDA and FSIS Took Key Steps to Coordinate the Transfer of Catfish Oversight, but They Have Not Fully Coordinated on Drug Residue Testing Methods FDA and FSIS took steps to accomplish the transfer of catfish oversight from FDA to FSIS, as called for in the 2014 memorandum of understanding (MOU) that both agencies signed. However, they generally have not coordinated on drug residue testing methods, resulting, in some cases, in differences in MRLs—specifically for unapproved drugs. According to FDA, residues of some drugs can cause cancer or allergic reactions when consumed by humans. Without visiting at least a sample of farms whose catfish are exported to the United States, such as the farms that supply catfish to the seafood processing facilities that FSIS plans to visit during its on-site audits, FSIS may be missing an opportunity to fully understand the conditions under which the catfish are being raised. FSIS stated that it partially agrees with the recommendation that FSIS visit at least a sample of farms whose catfish are exported to the United States to determine the conditions under which the fish are raised. GAO staff members who made contributions to this report are listed in appendix V. Appendix I: Objectives, Scope and Methodology This report addresses how the Food and Drug Administration (FDA) and U.S. Department of Agriculture’s (USDA) Food Safety and Inspection Service (FSIS) ensure the safety of imported seafood from unsafe drug residues. Specifically, this report examines (1) how FDA helps ensure the safety of imported seafood from unsafe drug residues and ways the agency could strengthen its efforts, (2) how FSIS helps ensure the safety of imported catfish from unsafe drug residues and ways the agency could strengthen its efforts, and (3) the extent to which FDA and FSIS coordinate their oversight efforts.

Why GAO Did This Study Most seafood consumed in the United States is imported, and about half of it is raised on fish farms. Because farmed seafood is raised in confined areas and susceptible to infections, farmers may use drugs like antibiotics. The use of unapproved drugs or the misuse of approved drugs may result in unsafe residues in seafood that can cause cancer or allergic reactions, according to FDA, which is charged with ensuring the safety of most seafood. Beginning in April 2016, FSIS became responsible for ensuring the safety of imported catfish. This report examines (1) how FDA helps ensure the safety of imported seafood from unsafe drug residues and ways the agency could strengthen its efforts; (2) how FSIS helps ensure the safety of imported catfish from unsafe drug residues and ways the agency could strengthen its efforts; and (3) the extent to which FDA and FSIS coordinate their oversight efforts. GAO reviewed information from each agency and interviewed agency officials and other key stakeholders. What GAO Found To help ensure the safety of imported seafood from unsafe drug residues, the Food and Drug Administration (FDA) generally depends on the actions of foreign processors and U.S. importers. FDA requires processors and importers to follow its Hazard Analysis and Critical Control Point (HACCP) regulations to identify hazards and the critical control points where the hazards, such as pathogen contamination, are likely to occur and take corrective action. FDA also performs a limited number of (1) inspections of processors and importers each year to ensure HACCP compliance, and (2) tests of imported seafood for contaminants, including unsafe drug residues. FDA could strengthen its efforts to ensure the safety of imported seafood from unsafe drug residues by pursuing agreements with other countries requiring that they test seafood exported to the United States for unsafe drug residues. Under an agency plan, FDA is to coordinate with other countries to increase their capabilities related to the safety of food exported to the United States and better leverage their resources. FDA has used country agreements with respect to pathogen hazards in molluscan shellfish intended for export to the United States. According to FDA officials, it might be worthwhile for the agency to pursue agreements with some countries, but FDA would have to carefully consider a number of factors in determining which countries would be appropriate, which it has not yet done. In assuming responsibility for inspecting imported catfish, the U.S. Department of Agriculture's (USDA) Food Safety and Inspection Service (FSIS) provided foreign countries and others a transition period—March 1, 2016, through September 1, 2017—before full implementation of its catfish inspection program. Following the transition, countries seeking to continue exporting catfish to the United States are to request equivalence determinations by providing documentation showing that their catfish safety inspection systems are equivalent to the U.S. system. FSIS could strengthen its efforts to ensure the safety of imported catfish. The Agricultural Act of 2014 directs FSIS, in part, to consider the conditions under which catfish are raised, domestically and abroad, but FSIS has not made farm visits a routine part of an equivalence determination. It is not clear how FSIS could consider the conditions under which imported catfish are raised consistent with the act without visiting farms. In addition, during this determination, the agency will already have its inspectors in the foreign country for an on-site audit. FSIS officials generally visit government offices, commercial food processing facilities, and food testing laboratories in a foreign country. Without visiting a sample of farms whose catfish are exported to the United States, FSIS may be missing an opportunity to consider the conditions under which catfish are being raised. FDA and FSIS took steps to accomplish the transfer of catfish oversight from FDA to FSIS, as called for in the 2014 memorandum of understanding (MOU) that both agencies signed. However, they generally have not coordinated on drug residue testing methods, resulting, in some cases, in differences in drug residue levels used to determine if seafood is unsafe—specifically for unapproved drugs—as called for in the 1984 MOU. Without this coordination, the agencies do not have reasonable assurance that they are consistently protecting consumers from unsafe drug residues. What GAO Recommends GAO is making five recommendations, including that FDA pursue agreements with other countries to test seafood exported to the United States and that FSIS visit a sample of fish farms as part of foreign country on-site audits; and that FDA and FSIS coordinate in developing testing methods and corresponding residue levels for imported seafood. FDA agreed with or partially agreed with two; FSIS partially agreed with two and stated it already addresses a third. GAO disagrees and believes the recommendations should be implemented.

gao_T-AIMD-96-104

gao_T-AIMD-96-104_0

As you requested, we also assessed Interior’s trust fund management improvement initiatives. However, despite over 5 years of effort and about $21 million in contracting fees, a total of $2.4 billion for 32,901 receipt and disbursement transactions recorded in the general ledger could not be traced to supporting documentation due to missing records. Further, BIA did not disclose that the universe of leases was unknown or the extent to which substitutions were made to the lease sample originally selected for reconciliation. The American Indian Trust Fund Management Reform Act of 1994 required that the Secretary of the Interior report to congressional committees by May 31, 1996, including a description of the methodology used in reconciling trust fund accounts and the tribes’ conclusions as to whether the reconciliation represents as full and complete an accounting of their funds as possible. Legislated Settlement Process If Interior is not able to reach agreement with tribes on the reconciliation results, a legislated settlement process would prove useful in resolving disputes about account balances. The draft legislation would provide for a mediation process and, if mediation does not resolve disputes, a binding arbitration process. Since 1991, our testimonies and reports on BIA’s efforts to reconcile trust fund accounts have called for a comprehensive strategic plan to guide future trust fund management and ensure that trust fund accounts are accurately maintained in the future. These initiatives were planned for implementation in fiscal year 1995. A legislated settlement process could be used to resolve questions about tribal account balances. Three major factors—lack of comprehensive planning, lack of management commitment across the organization, and limited resources—have impeded Interior’s progress in correcting long-standing trust fund management problems. Additional copies are $2 each.

Why GAO Did This Study GAO discussed the Department of the Interior's efforts to reconcile Indian trust fund accounts, focusing on: (1) its efforts to implement trust fund management improvements; and (2) the usefulness of a legislated settlement process for resolving unsettled account balances. What GAO Found GAO noted that: (1) $2.4 billion in receipt and disbursement transactions could not be traced to supporting documentation at the end of fiscal year 1995; (2) Interior did not disclose the methodology used in the reconciliation process in its reconciliation report, or discuss the extent to which substitutions were made to lease samples; (3) 2 tribes have accepted their account reconciliations, 3 tribes are disputing their reconciliation results, and the remaining 275 tribes are undecided; (4) a legislated settlement process could be used to resolve disputes concerning tribal account balances; (5) this legislation would include a mediation process, and if needed, binding arbitration; (6) Interior's trust fund management, and accounting systems controls do not ensure accurate trust fund accounting and asset management; (7) Interior will face costly reconciliations and settlements in the future if it does not correct its trust fund management problems; and (8) Interior needs comprehensive planning, management commitment across all Indian trust program offices, and additional resources to resolve trust fund management problems.

gao_GAO-11-601

gao_GAO-11-601_0

We previously identified several vulnerabilities and weaknesses in the oversight of both FPS’s federal and contract workforces, and FPS is currently undertaking efforts to address these weaknesses and improve management of its security workforce. Most Selected Federal Agencies Use a Combination of In- house and Contract Security Positions to Meet Their Individual Facility Security Requirements Selected Federal Agencies Generally Use In-house Staff to Perform a Wide Range of Security Functions, While Contract Security Guards Typically Perform Routine Access Control Eight of the nine federal agencies selected for our review currently use a combination of both in-house and contract security personnel to secure their facilities, and the distribution of in-house and contract staff vary significantly (see fig. 1). 2). Officials from other agencies reported using contract security guards for what they consider to be lower-risk security posts, such as those providing visitor assistance. For instance, FPS requires a high-school diploma, among other things, for its contract security guards; however, it does not require a law enforcement background or previous law enforcement experience. As a result, VA primarily uses uniformed federal police officers to provide facility security and law enforcement functions. Cited Benefits of Contract Security Staff Are Potential Cost Savings and Personnel Flexibility, While In-house Security Staff Are Viewed as Offering Increased Control over Staff Selection and Development Representatives of the nine federal agencies and ten private sector organizations with whom we spoke identified several issues that present either benefits or challenges for using contract and in-house security staff, as identified in table 5. For example, and as discussed later, Smithsonian officials reported it uses contract security guards at lower-risk areas of its facilities which has enabled it to staff five posts with contract security guards for the same cost as three posts staffed with federal security guards. Representatives from both federal agencies and private sector organizations reported that in-house security staff offer increased control over security staff selection—an important benefit to ensure a qualified security workforce. Need for Upfront Planning in Determining Security and Staffing Needs and Better Oversight of Workforce Were Key Lessons Learned When Changing Staffing Approach Assessing and Determining Security and Staffing Needs Was Cited as a Key Lesson Learned When Changing a Security Workforce Officials from the four selected federal agencies (Air Force, Army, Smithsonian, and TSA) that had undergone a workforce transition cited upfront planning in assessing facility security and staffing needs, including administrative support and training requirements, as a key lesson learned in facilitating a security workforce transition. Legislation has recently been introduced in Congress calling for the implementation of a pilot program to examine the effectiveness of using federal employees to staff the current contract security guard positions at selected higher-risk federal facilities. Agency Comments We provided a draft of this report to GSA, Smithsonian, VA, and the Departments of Defense, Homeland Security, and Justice in order to obtain comments from the nine agencies we studied. Smithsonian, VA, DOD, and DHS provided technical comments that we incorporated where appropriate. Specifically, the objectives of this report were to identify (1) approaches used by selected federal agencies in staffing their facility security workforces; (2) federal agency and private sector representatives’ views on the benefits and challenges of using contract or in-house security staffing approaches; and (3) lessons that the Federal Protective Service (FPS) can learn from other federal agencies that have changed their security staffing approaches. Because the selected organizations are a nonprobability sample, the information we obtained are not generalizable. We reviewed agency documents and conducted semistructured interviews with agency officials on the lessons learned in changing and staffing their security workforces.

Why GAO Did This Study The Federal Protective Service (FPS) within the Department of Homeland Security (DHS) provides security and law enforcement services to over 9,000 federal facilities through its federal and contract security workforce. Over the years, GAO has made numerous recommendations to address significant weaknesses in FPS's oversight and management of its security workforce. Legislation has been introduced that would, among other things, have FPS examine the effectiveness of relying more on federal employees for security. As requested, this report examines: (1) nine federal agencies' approaches for staffing their security workforces; (2) federal and private sector representatives' views on the benefits and challenges of using contract and in-house security staff; and (3) lessons that FPS can learn from federal agencies that have changed their security staffing approaches. GAO reviewed agency documents and conducted interviews with representatives from federal agencies and private sector firms selected based on the use of security guards and experience in changing a security workforce, among other criteria. The selected agencies and private sector firms are a nonprobability sample, and the information we obtained is not generalizable. What GAO Found Eight of the nine selected federal agencies reported using a combination of contract and in-house facility security positions, and the distribution of their security staff varies significantly. Contract security staff are primarily used for routine access control functions, while in-house staff, such as federal security guards and inspectors, tend to perform a variety of security functions, such as patrol and risk assessment. Selected agency officials cited facility risk level and cost, among others, as factors considered when staffing a security workforce. Federal agencies used various types of security staff-- even at high-risk facilities--for protection. As a high-profile law enforcement agency, the Department of Justice uses armed contract security guards with prior law enforcement experience to protect its high-risk facilities. Federal and private sector representatives reported that contract and in-house security staff offer benefits and challenges for agencies to weigh when making staffing decisions. The two primary reported benefits of contract security staff were (1) potential cost savings and (2) flexibility to increase or reduce staff size. Conversely, these two issues were commonly cited as challenges in using in-house security staff. The reported benefits for in-house security staff were greater control to select qualified security staff and develop them to meet organizational needs. Early planning to determine security staffing needs and sufficient oversight were cited as key lessons learned when changing staffing approaches. For example, Smithsonian Institution had time to conduct risk-based assessments, which helped it decide to use contract staff only at lower-risk posts. Other agencies' experiences, as well as FPS's experience in transitioning to an inspector-based workforce, suggest that changing FPS's staffing approach could prove challenging. Early planning could help FPS address some of those challenges in the event a transition is desired or mandated, and sufficient oversight and management of its workforce will be critical to providing effective security. GAO provided the nine agencies with a draft of this report for comment. In response, agencies provided technical comments that were incorporated where appropriate.

gao_GAO-10-71

gao_GAO-10-71_0

1). 2.) CMS Has Taken Steps to Facilitate the Complex Implementation of Medicare Contracting Reform, but Certain Decisions Have Led to Challenges While CMS officials took numerous steps to facilitate Medicare contracting reform, we identified several CMS decisions that led to challenges. In some cases, CMS was able to make midcourse adjustments by incorporating lessons learned. Some of these decisions, for example, caused delays in payments to providers. Despite regular workload monitoring during the MAC transitions, CMS underestimated the appeals and provider call volumes. The agency also reported having revised workload estimates for subsequent MAC transitions. 3.) In four of the six MAC jurisdictions we studied, CMS or the MAC told us that the MACs discovered and corrected claims-processing errors made by legacy contractors, which, in some cases, had generated improper payments to providers and added additional work for the MACs in order to make the corrections themselves during the transition. As of March 2009, CMS had completed all three reviews for three of the MACs in our sample. According to CMS, if a MAC does not meet a performance standard, the agency requires an action plan to address the deficiency. CMS’s QASP Reviews Found the MACs Improved Their Performance but Did Not Meet All Standards CMS’s QASP reviews for the three MACs showed that they had improved their performance from the first review period to the most recent review period we reviewed but did not meet all standards in any one review period. While all three MACs received a portion of the award fees for which they were eligible as a result of the incentive metrics they met in their Award Fee Plan reviews, they did not meet some incentive metrics, particularly metrics in areas related to beneficiary and provider service. All three of the MACs consistently met or partially met the Contract Administration metric—a measure that assessed the contractors’ service to CMS in contract management, such as providing quality deliverables on time. CMS’s Total Costs and Savings to Date for Medicare Contracting Reform Are Uncertain CMS has not tracked and provided information on all of its costs and savings related to Medicare contracting reform, and so the total costs and savings for Medicare contracting reform are uncertain. The agency provided information on some savings due to reductions in operational spending that it attributes to contracting reform and other activities related to claims payment; however, it has not provided information on what it had previously estimated would be the major source of savings, reduced improper payments to providers resulting from contracting reform. CMS Routinely Tracks Some, but Not All, Costs Associated with Contracting Reform, Leading to Uncertainty about Total Costs CMS tracked and provided information on contracting reform costs of about $300 million from fiscal year 2004 through fiscal year 2008, but could not readily account for certain internal administrative costs for implementing the MAC program, such as agency staff salaries and overhead. CMS Did Not Provide Information on Total Savings, and the Extent to Which Identified Savings Can Be Attributed to Contracting Reform Is Uncertain Although CMS estimated that it would achieve savings from two sources— reduced spending on administrative functions and savings from the Medicare trust funds related to better claims review leading to reduced improper payments—the agency has provided information only on administrative savings, making the total amount of any savings and the extent to which they are due to contracting reform uncertain. In 2005, we reported that CMS expected contracting reform to generate savings totaling over $1.9 billion from reduced spending on Medicare administration and from reduced improper payments. However, as of April 2009, CMS was unable to quantify and provide information on total savings realized. HHS also generally agreed with our finding regarding CMS’s performance assessments of three MACs whose reviews we examined. In addition, they elaborated on the challenges created by CMS’s concurrent implementation of the MAC transition with other Medicare initiatives, such as NPI and HIGLAS. Our criteria for selecting the 6 MAC jurisdictions were designed to ensure diversity in geographic region, in the volume of claims workload, in the complexity of transition (such as the number of legacy contractors in the region whose workloads had to be transitioned to a single MAC), bid protest experience, and CMS’s assessment of a jurisdiction’s risk for fraud. MACs; however, we did analyze the results of CMS’s reviews that h conducted for DME and A/B MACs as of March 2009. Appendix VIII: Three Medicare Administrative Contractors’ Award Fees Earned The Centers for Medicare & Medicaid Services’s (CMS) Award Fee Plan reviews for three Medicare Administrative Contractors (MAC) showed that they had improved their performance from the first review period to the most recent review period we reviewed, but because the MACs did not meet all incentive metrics, they did not receive full award fees.

Why GAO Did This Study The Medicare Prescription Drug, Improvement, and Modernization Act of 2003 significantly reformed contracting for payment of Medicare's $310 billion per year in fee-for-service claims. The Centers for Medicare & Medicaid Services (CMS) is transitioning claims administration to 19 new entities known as Medicare Administrative Contractors (MAC) and plans to complete the process ahead of October 1, 2011, the date required by law. In 2005, GAO reported that CMS's plan to accelerate the transition could create challenges and was based on estimated costs and savings that were uncertain. In this report GAO examined (1) how CMS has implemented Medicare contracting reform; (2) how CMS assessed the performance of the MACs and what the results of its assessments have been; and (3) what CMS's costs and savings have been for Medicare contracting reform. GAO selected a sample of 6 transitions to review from among the 10 MAC contracts awarded as of June 2008, based on factors such as geographic diversity, volume of claims workload, and transition complexity. GAO analyzed CMS documents related to the MAC transitions, including performance assessments for 3 of the 6 MACs in the sample that had results available for three types of reviews as of March 2009, and interviewed CMS officials, contractors, and provider groups. What GAO Found CMS took numerous steps to facilitate the complex implementation of Medicare contracting reform, but certain decisions led to challenges during the six MAC transitions we reviewed, such as payment delays to providers. For example, CMS's accelerated implementation schedule overlapped with other Medicare initiatives that affected claims processing, such as requiring that providers re-enroll in order to be paid, which resulted in claims payment delays. In addition, despite regular workload monitoring of the former contractors during the MAC transitions, CMS gave the MACs inaccurate workload estimates. For example, one MAC originally planned on receiving 15,000 appeals cases but actually inherited 46,500 cases, which led to processing backlogs and delayed payments to providers. However, CMS also incorporated lessons learned and made midcourse adjustments to address some of these challenges. CMS has assessed the MACs using a program it developed, and in the reviews we examined the MACs did not meet all standards and metrics. CMS's assessment program includes an initial review of each MAC's internal controls and two subsequent reviews to assess performance. One of these reviews compares a MAC's performance to standards in accordance with its contract and the other provides an incentive award fee if the MAC meets selected metrics that are designed to reflect high performance. Results available as of March 2009 from the assessments of three of the six MACs in GAO's sample show that the three MACs improved their performance over time but did not meet all metrics. For example, while the three MACs consistently met or partially met a metric that assesses contract management, they did not meet some beneficiary and provider service metrics. In addition, because they did not meet all incentive metrics, they did not receive full award fees. CMS's total costs and savings to date for Medicare contracting reform are uncertain because CMS does not track and provide information on all related costs and savings. The agency provided information on costs associated with contracts, which totaled a little over $300 million for fiscal years 2004 through 2008. It also provided information on some internal agency costs for conducting contracting reform, but did not track others, such as agency staff salaries. Although CMS expected contracting reform to generate substantial savings from reduced spending on administrative functions and savings to the Medicare trust funds due to improved claims review to detect payments that should not be made, as of April 2009, CMS was unable to provide information on total savings. CMSprovided some information on savings due to reductions in operational spending, but the extent to which these savings were attributable to contracting reform is uncertain. CMS did not track or provide information on savings to the Medicare trust funds due to reduced improper payments related to contracting reform activities. CMS reviewed a draft of this report and generally agreed with GAO's findings.

gao_GAO-07-478

gao_GAO-07-478_0

The amount and type of information the Corps requests from the applicant may vary by the type of applicant and project, as well as the extent and functional values of the water resources that may be impacted. In 2000, the Congress included a provision in the Water Resources and Development Act to expedite permit processing for nonfederal public agencies. However, two applicants were private companies that were allowed to submit permit applications for expedited review under a nonfederal public entity’s agreement with the Corps. An additional 19 districts told us that they would consider using the authority if it were made permanent. Although the agreements are generally between the Corps and one entity, such as a city or county, various departments within that entity may submit permit applications for expedited review under the agreements. Using the funds received under the section 214 authority, the four districts evaluated and approved 187 permit applications, as of August 2006. Most of the permit applications were from city or county departments, port authorities, or regional water authorities. The legislation does not expressly prohibit the practice of allowing private companies from requesting permit approval under a nonfederal public entity’s section 214 agreement with the Corps. Corps Districts Received More Than $2 Million in Section 214 Funds That Were Used to Primarily Cover Personnel- Related Costs From December 2001 through September 2006, nonfederal public entities provided over $2 million in section 214 funds to the four Corps districts with whom they had section 214 agreements. Each of the four Corps districts that received section 214 funds was able to increase its regulatory staff by either (1) combining the section 214 funds with appropriated funds to hire new project managers to process section 214 applications or (2) paying existing employees to process section 214 applications and using the offsets in regular program expenditures to hire new project managers to process non-section 214 applications. Processing Times Have Both Increased and Decreased Since the Use of the Section 214 Authority Began Although a main goal of the Corps in using the section 214 authority is to expedite permit processing for section 214 applicants, the processing times for these applicants have not consistently decreased. We believe that several factors may have influenced the permit processing times and masked the effect, if any, that the use of the section 214 authority had on them. Officials Cited Other Benefits of Using the Section 214 Authority Officials from the Corps and from nonfederal public entities that entered into section 214 agreements with the Corps told us that they believe the use of the section 214 authority has significantly expedited processing of permits for these applicants. As a result, for the projects for which it approved standard permits, the Sacramento District did not show that the adverse effects of the projects were outweighed by the positive impacts of the projects and did not conclude that the projects were in the public interest. Corps officials cited several reasons for the variance in their adherence to the additional requirements. Recommendations for Executive Action To ensure that the permits processed under the section 214 authority comply with federal regulations and guidance, we are recommending that the Secretary of the Army direct the Corps of Engineers to take the following four actions: clarify the guidance that the districts must follow when evaluating permit applications under the section 214 authority, clarify the documentation that district officials must include in project files to justify and support their decisions, provide training to district officials to ensure that they are aware of the requirements that apply to permits processed under the section 214 authority, and develop an effective oversight approach that will ensure that the districts are following all the appropriate requirements when evaluating projects under the section 214 authority. In this context, we were asked to review the (1) extent to which Corps districts have entered into agreements with nonfederal public entities to receive section 214 funds since 2001 and how many permit applications the Corps has evaluated using these funds, (2) amount of section 214 funds the Corps has received and how it has used these funds, (3) extent to which permit processing times have changed since the Corps began using section 214 funds, (4) extent to which the Corps districts have followed the basic permit review processes when evaluating applications using section 214 funds, and (5) extent to which the districts have met the additional requirements for ensuring that permit decisions made using the section 214 funds are impartial and transparent. To determine the extent to which the Corps followed the existing permit review processes, we first identified key steps for processing permits.

Why GAO Did This Study When a nonfederal public entity such as a city or county wants to build a public works project that could degrade or damage federally regulated waters and wetlands, it must obtain a permit from the U.S. Army Corps of Engineers (Corps) before proceeding. To help expedite the permit process for these entities, the Congress enacted section 214 of the Water Resources and Development Act of 2000, providing the Corps with temporary authority to receive funds from such entities and use the funds to process permits. To ensure the impartiality and transparency of section 214 permit decisions, the Corps requires its districts to adhere to all existing permit review processes, as well as some additional requirements. GAO was asked to identify (1) how many districts have used the section 214 authority, (2) the amount of funds they have received, (3) how permit processing times have changed, (4) the extent to which districts have adhered to the existing review processes and the additional requirements. What GAO Found As of August 2006, 4 of the Corps' 38 districts had agreements with 11 nonfederal public entities to receive section 214 funds, which have been used to evaluate permit applications. These districts received, evaluated, and approved 187 applications using section 214 funds. The types of projects for which permits were requested included ecological restoration, water storage, transportation, and port construction. Most of the section 214 applicants were city or county departments, port authorities, or regional water authorities, but two applicants were private companies that were allowed to submit applications under section 214 agreements with the Corps. The legislation does not expressly prohibit private companies from submitting applications under section 214 agreements. The use of the section 214 authority may become more prevalent in the future because 7 additional districts are in the process of entering into such agreements, and 19 other districts told GAO that they would consider using the authority if the Congress makes it permanent. The Corps received more than $2 million in section 214 funds from nonfederal public entities between December 2001 and September 2006 and used these funds primarily to hire additional project managers to process permits. About 61 percent of the funds were used to cover personnel costs for the project managers who processed section 214 permits; the remainder covered overhead and other costs incurred to implement the authority. Since the Corps began using the section 214 authority, permit processing times have increased in some districts and decreased in others for both section 214 applicants and non-section 214 applicants. However, it is difficult to attribute the changes in processing time directly to the use of the section 214 authority because many other factors may have influenced processing times and may have masked the effects of the authority. For example, the complexity of 214 permit applications may have resulted in greater processing time for these applicants. Generally, Corps officials and nonfederal public entities who used the authority believe that it has expedited permit processing, saved them cost and time, and improved communication between the Corps and the section 214 applicants. The four districts varied in the extent to which they adhered to the existing permit review process and the additional requirements to ensure impartiality of section 214 permit decisions. For example, one district did not follow a key step in reviewing certain types of section 214 permits because officials did not know they were required to do so. In two other districts, lack of documentation in the permit files prevented GAO from determining whether they followed the existing review processes for another type of permit. With regard to the additional requirements imposed by the Corps for section 214 permits, some districts did not comply with these requirements because they were not aware of them, and others did not comply with them because they interpreted the requirements differently than Corps headquarters intended.

gao_HEHS-98-51

gao_HEHS-98-51_0

DOD Uses Surveys to Solicit Some Beneficiary Feedback DOD conducts beneficiary satisfaction surveys—a common private sector health care practice—to measure TRICARE’s performance and reports the results throughout the MHS. Health Affairs currently conducts two such ongoing surveys: an annual systemwide survey of all eligible beneficiaries and a monthly survey of patients’ perceptions of outpatient visits at MTFs.Both surveys are based on widely used private sector survey instruments. While overall satisfaction levels were fairly high, satisfaction with certain aspects of military health care was somewhat lower, according to the 1996 annual survey (see fig. 3). Table 1 shows the survey results for overall satisfaction. DOD Obtains and Processes Beneficiary-Initiated Comments in Varying Ways Across the MHS DOD documents, analyzes for trends, and reports on TRICARE beneficiaries’ complaints and compliments in differing ways throughout the MHS. Yet, managed care support contractor officials told us that they consider systematically tracked beneficiary feedback and rigorous analysis of the root causes of members’ complaints to be hallmarks of a customer service-oriented managed care plan. He wrote: “Their enthusiasm and sincerity is definitely the right attitude needed to administer a program that has had the military ‘rank and file’ feeling a little uncomfortable.” DOD Could Improve Its Feedback Tracking and Reporting by Further Adopting Private Sector Practices DOD’s efforts to track beneficiary feedback resemble those of the private sector, but opportunities for improvement exist. For example, DOD’s beneficiary surveys are similar to private health plan and hospital surveys. Also, MTFs and other DOD offices use complaints to help identify problems, as is done in the private sector. Currently, no systemwide approach to tracking and reporting exists. The beneficiary feedback currently available to DOD managers provides useful information about aspects of TRICARE’s performance and possible problem areas. If DOD were to make its current survey efforts more complete and to consistently record and aggregate complaint information across the system, DOD managers would have more valuable information with which to measure TRICARE’s success and identify and eliminate recurring, systemic problems. Enhanced feedback would also help DOD make the outcomes-based assessments it seeks for future TRICARE contracts. Also, while DOD does not currently have an MTF inpatient care survey, we support DOD’s plans to develop and conduct such a survey. Recommendations To position DOD to obtain and make better use of beneficiary feedback, both now and in the future, the Secretary of Defense should direct the Assistant Secretary of Defense (Health Affairs) to follow through in weighing the costs and benefits associated with civilian network and MTF inpatient care surveys that are comparable to DOD’s current monthly MTF outpatient survey and, as appropriate, implement these surveys and collaborate with the TRICARE contractors to identify options for, and weight the costs and benefits of, achieving consistency in recording beneficiary complaints, analyzing trends, and reporting beneficiary complaints and, as appropriate, implement the most practical, financially prudent approach. However, because of the variability of DOD’s recording of beneficiary comments, we could not determine the range, magnitude, or frequency of beneficiary comments, and we did not review the validity of complaints or how complaints were resolved by the military or contractor organizations that received them. Also, wide differences existed in how much the MTFs analyzed beneficiary feedback for trends. Others are referred through other means, such as priority correspondence, which is referred from congressional and other offices.

Why GAO Did This Study Pursuant to a congressional request, GAO reviewed: (1) whether the Department of Defense (DOD) solicits feedback from beneficiaries of its managed health care program, TRICARE, and, if so, how this is done and what the data show; (2) what other means are available to beneficiaries to provide feedback and what such beneficiary-initiated feedback could reveal about TRICARE's success; and (3) how DOD's approaches to obtaining feedback compare with the private sector's and whether opportunities exist to improve DOD's beneficiary feedback tracking and reporting. What GAO Found GAO noted that: (1) DOD obtains and uses TRICARE beneficiary feedback in several ways across the military health system (MHS); (2) DOD conducts a broad annual beneficiary questionnaire survey and a monthly survey of patients' perceptions of military treatment facilities (MTF) outpatient visits--both of which are based on private-sector models--to measure levels of satisfaction with TRICARE; (3) DOD reports the survey results throughout the MHS; (4) DOD does not conduct such surveys of MTF inpatient users or civilian network care users, though DOD officials told GAO that they are now planning to develop an MTF inpatient survey; (5) as TRICARE continues to be phased in across the MHS, DOD's annual surveys are indicating fairly levels of overall beneficiary satisfaction with the program, but lower satisfaction levels with aspects of military care; (6) DOD also tracks and reports beneficiary-initiated feedback--complaints and other comments--in ways that vary throughout the MHS; (7) a wide range exists in how much feedback information is tracked and in how the different levels of units that compose TRICARE--and other DOD offices--do the tracking; (8) beneficiary-initiated feedback reporting throughout the MHS varies as well; (9) because of the variability of DOD's recording of these data, reliably depicting the range, magnitude, or frequency of beneficiary feedback about TRICARE is not possible; (10) private health care managers rely extensively on beneficiary feedback; (11) surveys, which provide data about whole customer populations, and customer-initiated complaints, which show where specific problems have occurred, are used together as key tools to measure plan performance and identify systemic problems; (12) while no direct private-sector parallel to MHS exists, DOD's feedback efforts are somewhat similar to the private sector's, although adopting certain private practices might improve DOD's feedback systems; (13) more reliable beneficiary feedback data would also help DOD to make customer satisfaction an outcome measure in the next round of TRICARE contracts, which DOD is trying to base more on outcomes and less on process; and (14) to improve its beneficiary feedback approaches, DOD will need to consider a number of cost-benefit issues, the varying sophistication levels of beneficiary feedback management throughout MHS, and other matters.