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gao_GAO-05-514

gao_GAO-05-514_0

Monitoring. Although FEMA retained responsibility for providing leadership and direction for Project Liberty, it assigned primary responsibility to SAMHSA for oversight and monitoring through an interagency agreement. Remaining Grant Funds Primarily Relate to Unresolved Issues at NYC DOEd Approximately $121 million, more than three-quarters of the $154.9 million in federal funds provided to Project Liberty, were reported as expended as of September 30, 2004, leaving a remaining balance of $33.9 million. As of March 31, 2005, NYS OMH had accepted alternative forms of supporting evidence to pay $5.2 million of NYC DOEd expense claims; however, this type of alternative evidence provides only limited assurance of the propriety of the claimed amounts. Timing of Reported Expenditures For the period September 11, 2001, through September 30, 2004, Project Liberty reported that it had expended all of the $22.8 million ISP grant and about $98.2 million of the $132.1 million RSP grant for total reported expenditures of approximately $121 million, leaving a remaining balance $33.9 million. However, we found that although the budgets were developed using estimates established during the initial stages of the disaster, FEMA and SAMHSA never required the state of New York to formally submit revised budget requests to reflect new information and significant changes to the program that occurred as the needs of the affected population became better identified. As a result, FEMA and SAMHSA did not have realistic budget information that could be used to effectively assess how responsible city and state officials planned to spend Project Liberty grant funds. Federal Oversight of Project Liberty’s Financial Information Was Limited While SAMHSA provided oversight of Project Liberty’s delivery of services, it provided only limited oversight of financial information reported by Project Liberty about the cost of those services. SAMHSA received periodic financial reports but did not perform basic analyses of expenditures to obtain a specific understanding of how Project Liberty was using federal funds. Without useful financial information, including updated budgets, and without analyses of the financial information Project Liberty was reporting, SAMHSA was not in a position to exercise a reasonable level of oversight to ensure that grant funds were effectively used to address the needs of those affected by the September 11 terrorist attacks. Assessments of Project Liberty Ongoing Both the state of New York and the federal government have taken steps to assess how Project Liberty delivered services. FEMA plans to consider lessons learned from NYS OMH and NCPTSD when conducting its own internal review of the CCP. Objectives, Scope, and Methodology To determine the extent to which Project Liberty spent the Immediate Services Program (ISP) and Regular Services Program (RSP) grant funds received from the Federal Emergency Management Agency (FEMA), we did the following: Reviewed various documents, including quarterly RSP expenditure reports for the first (June 15, 2002, through September 14, 2002) through the ninth (June 15, 2004, through September 30, 2004) quarters; a detailed listing of the outstanding advance balances as of September 30, 2004, obtained from the Research Foundation for Mental Hygiene, Inc. (RFMH); a summary of expense claims submitted by the New York City Department of Education (NYC DOEd) as of March 2005; internal control summaries prepared by NYC DOEd for its personnel and other- than-personnel expenses; a draft internal control summary prepared by NYC DOEd for its community-based expenses; Crisis Counseling Assistance and Training Program (CCP) guidance on appropriate uses of grant funds; and FEMA and Department of Health and Human Services (HHS) regulations pertaining to the CCP. To identify the steps that have been taken by the federal government in partnership with the state of New York to assess Project Liberty, we reviewed documentation of assessments performed, including a draft of the National Center for Post-Traumatic Stress Disorder case study of Project Liberty, NYS OMH summaries of survey results, an article written by the Deputy Commissioner of NYS OMH on lessons learned about the mental health consequences of the September 11 terrorist attacks, articles published by the New York Academy of Medicine, and documentation from FEMA related to its internal review of the CCP; reviewed various documents related to Project Liberty including the grant applications and the response to conditions of the grant award set out by FEMA and SAMHSA; reviewed GAO and FEMA Office of Inspector General reports to determine whether the CCP was evaluated; and interviewed officials from FEMA headquarters, SAMHSA’s CMHS, and NYS OMH.

Why GAO Did This Study To help alleviate the psychological distress caused by the September 11, 2001, attacks the Federal Emergency Management Agency (FEMA) awarded the state of New York two grants totaling $154.9 million to provide crisis counseling and public education. Because of questions about whether the program, called Project Liberty, had spent all the funds it received from the federal government, GAO was asked to determine (1) the extent to which the program expended the funds awarded from the federal government, (2) whether the federal government had an effective process in place to determine the amount of funds to provide the program, (3) whether the federal government had adequate financial oversight of the program, and (4) steps taken by the federal government and New York State to assess the program's effectiveness. What GAO Found For the period September 11, 2001, through September 30, 2004, Project Liberty reported that it had expended approximately $121 million, or three-quarters of the $154.9 million in grants awarded by FEMA, leaving a remaining balance of $33.9 million. The majority of the remaining balance, approximately $32 million, related to unresolved issues involving the adequacy of supporting documentation for the New York City Department of Education's (NYC DOEd) expense claims. As of March 31, 2005, city and state officials told GAO they had accepted alternative forms of supporting evidence related to $5.2 million in NYC DOEd expenses; however, this alternative evidence provides only limited assurance of the propriety of the claimed amounts. It is unclear whether similar alternative sources of evidence will be accepted for the remaining $26.8 million in NYC DOEd expense claims. FEMA assisted state officials in developing estimated funding needs for Project Liberty immediately after the terrorist attacks. By necessity, these initial budgets were developed using estimates established during the initial stages of the disaster. However, FEMA never required Project Liberty to prepare adjusted budgets to reflect new information or subsequent changes to the program. As a result, FEMA did not have realistic budget information to assess how city and state officials were planning to spend Project Liberty grant funds. FEMA assigned primary responsibility for oversight and monitoring to the Substance Abuse and Mental Health Services Administration (SAMHSA) through an interagency agreement. Although SAMHSA had procedures in place to monitor Project Liberty's delivery of services, it performed only limited monitoring of financial information reported by Project Liberty about the cost of those services. For example, while SAMHSA received periodic financial reports from Project Liberty, it did not perform basic analyses of expenditures in order to obtain a specific understanding of how the grant funds were being used and, as noted above, did not have updated budget information to gauge how actual spending compared to budgets. As a result, SAMHSA was not in a position to exercise a reasonable level of oversight to ensure that funds were being used efficiently and effectively in addressing the needs of those affected by the September 11 attacks. Both the state of New York and the federal government have taken steps to assess how Project Liberty delivered services. These assessments were ongoing as of March 2005. FEMA plans to consider lessons learned from Project Liberty when conducting its own internal review of the crisis counseling program.

gao_GAO-02-901T

gao_GAO-02-901T_0

Additionally, the proposal to establish the DHS calls for coordination with nonfederal entities and directs the new Secretary to reach out to state and local governments and the private sector in order to: ensure that adequate and integrated planning, training, and exercises occur, and that first responders have the equipment they need; coordinate and, as appropriate, consolidate the federal government’s communications systems relating to homeland security with state and local governments’ systems; direct and supervise federal grant programs for state and local emergency distribute or, as appropriate, coordinate the distribution of warnings and information to state and local government personnel, agencies and authorities, and the public. Many aspects of the proposed consolidation of homeland security programs are in line with previous recommendations and show promise towards reducing fragmentation and improving coordination. In addition, the recent proposal for establishing DHS should not be considered a substitute for, nor should it supplant, the timely issuance of a national homeland security strategy. In areas ranging from fire protection to drinking water to port security, the new threats are prompting a reassessment and shift of longstanding roles and responsibilities. However, proposed shifts in roles and responsibilities are being considered on a piecemeal and ad hoc basis without benefit of an overarching framework and criteria to guide this process. A national strategy could provide such guidance by more systematically identifying the unique capacities and resources of each level of government and matching them to the job at hand. The challenges posed by the new threats are prompting officials at all levels of government to rethink long standing divisions of responsibilities for such areas as fire services, local infrastructure protection and airport security. The nation does not have a baseline set of performance goals and measures upon which to assess and improve preparedness. Appropriate Tools Need to Be Selected For Providing Assistance The choice and design of the policy tools the federal government uses to engage and involve other levels of government and the private sector in enhancing homeland security will have important consequences for performance and accountability. The choice of policy tools will affect sustainability of efforts, accountability and flexibility, and targeting of resources. The DHS will clearly have a central role in the success of efforts to strengthen homeland security, but it is a role that will be made stronger within the context of a larger, more comprehensive and integrated national homeland security strategy.

What GAO Found The challenges posed by homeland security exceed the capacity and authority of any one level of government. Protecting the nation against these threats calls for a truly integrated approach, bringing together the resources of all levels of government. The proposed Department of Homeland Security will have a central role in efforts to enhance homeland security. The proposed consolidation of homeland security programs has the potential to reduce fragmentation, improve coordination, and clarify roles and responsibilities. However, formation of a department should not be considered a replacement for the timely issuance of a national homeland security strategy to guide implementation of the complex mission of the department. Appropriate roles and responsibilities within and between the government and private sector need to be clarified. New threats are prompting a reassessment and shifting of long-standing roles and responsibilities, but these shifts are being considered on a piecemeal and ad hoc basis without benefit of an overarching framework and criteria. A national strategy could provide guidance by more systematically identifying the unique capacities and resources at each level of government to enhance homeland security and by providing increased accountability within the intergovernmental system. The nation does not yet have performance goals and measures upon which to assess and improve preparedness and develop common criteria that can demonstrate success; promote accountability; and determine areas where resources are needed, such as improving communications and equipment interoperability. A careful choice of the most appropriate tools is critical to achieve and sustain national goals. The choice and design of policy tools, such as grants, regulations, and tax incentives, will enable all levels of government to target areas of highest risk and greatest need, promote shared responsibilities, and track and assess progress toward achieving preparedness goals.

gao_GGD-97-3

gao_GGD-97-3_0

Objectives, Scope, and Methodology Our objectives were to determine (1) whether there is any basis for an allegation regarding EMCA abuse and (2), if so, what steps the Service is taking and could take to help avoid or minimize EMCA revenue losses. We reviewed data provided by the Service’s collection agency on the amount of EMCA-related postage lost due to invalid EMCAs. Postal employees at post offices and processing plants do not have automated access to valid EMCA numbers—which totaled about 113,000 in February 1996. Some EMCA customers overdrew their EMCA accounts, and the Postal Service continued to accept Express Mail packages from these customers. The Service did not plan to provide the terminals to employees in mail-processing plants who accept Express Mail packages. These employees will still lack access to valid EMCA numbers and current fund balances, and the Service will continue to be vulnerable to revenue losses when customers drop Express Mail packages in collection boxes and include invalid EMCA numbers on the packages. Planned Actions Do Not Fully Address EMCA Control Weaknesses Although completion of Service actions discussed above should help to improve controls over EMCAs and reduce related revenue losses, control weaknesses will remain. If EMCAs are determined to be a necessary or desirable method, we recommend that the Service (1) establish stronger requirements for opening EMCAs and (2) hold managers and employees accountable for handling EMCA transactions in accordance with the new requirements as well as existing Service policies and procedures for verifying EMCA numbers, closing EMCAs with negative balances, and recording required data for all Express Mail packages accepted. Comments From the U.S.

Why GAO Did This Study Pursuant to a congressional request, GAO reviewed the U.S. Postal Service's controls over Express Mail Corporate Accounts (EMCA), focusing on: (1) whether there is any basis for the allegation of EMCA abuse; and (2) if so, what steps the Service is taking to help avoid or minimize EMCA revenue losses. What GAO Found GAO found that: (1) some mailers obtained Express Mail services using invalid EMCA in fiscal year 1995; (2) the Service did not collect the postage due or verify EMCA which were later determined to be invalid; (3) some EMCA customers overdrew their accounts and carried negative balances; (4) the Service plans to provide post office employees with automated access to valid EMCA numbers and fund balances, but has no plans to provide similar access to employees at mail-processing plants; (5) although the Service's planned actions to improve controls over EMCA operations will take a considerable amount of money and time to complete, they will not have addressed several other EMCA control weaknesses; (6) to determine whether EMCA continue to be necessary or desirable, the Service could evaluate the relative customer convenience, cost-effectiveness, and other relevant factors; and (7) if EMCA are continued, Service employees need to follow new and existing procedures designed to help prevent EMCA revenue losses.

gao_GGD-96-89

gao_GGD-96-89_0

IRS does not use DIF scores for partnerships and S corporations because of the age of the underlying TCMP audits. Objectives, Scope, and Methodology The objectives of this assignment were to (1) determine the possible effects on IRS’ compliance programs of postponing the 1994 TCMP and (2) identify some potential short- and long-term alternatives to the planned TCMP for collecting this data. However, updated compliance data will be needed in the short term if IRS still plans to update the audit selection formulas and in the long term to validate and improve IRS’ compliance efforts. Regardless of how IRS plans to mitigate the loss of 1994 TCMP data, it would have to start soon in order to minimize the adverse effects of not updating its compliance programs. According to IRS officials, a number of alternative sampling strategies could fill the short-term data gap created by postponing TCMP indefinitely. From these strategies, we identified several alternative samples that met three basic objectives we considered important: (1) reducing the sample size to make data collection less costly for IRS and less burdensome to taxpayers, (2) maintaining IRS’ ability to update the DIF scoring system, and (3) maximizing use of the work already completed to identify returns and collect data for the 1994 TCMP sample. Long-Term Compliance Measurement Considerations Because a significant portion of IRS’ workload and future revenue depends on compliance programs, it is important that IRS determine how to measure compliance. Using Multiyear TCMP Audits The multiyear TCMP alternative envisions annual TCMP-type audits on a smaller sample of tax returns which, over the course of several years, could be combined to obtain the required statistical precision. Using data from operational audits would provide a large amount of compliance data. In the long term, such disruptions are likely to result in increased burdens on compliant taxpayers as more of them are selected for audit.

Why GAO Did This Study GAO assessed the potential effects on the Internal Revenue Service's (IRS) compliance programs of postponing the 1994 Taxpayer Compliance Measurement Program (TCMP) survey and identified some potential short- and long-term TCMP alternatives. What GAO Found GAO found that: (1) IRS postponed the 1994 TCMP because of criticisms and budget constraints; (2) IRS does not know how it will obtain the taxpayer compliance data it needs; (3) the loss of 1994 TCMP data could increase compliant taxpayers' burden over the long term because audits may become less targeted; (4) to mitigate the data losses over the short term, IRS could employ a number of alternatives, including doing a smaller survey; (5) any alternative should reduce sample size to lessen taxpayer burden and administrative costs, maintain IRS ability to update the discriminant function scoring system, and maximize the use of already completed work; (6) a limited survey would reduce the quantity and quality of the data collected, but still provide national compliance data; (7) IRS must determine how it will measure compliance over the long term, since its workload and future revenues depend on taxpayers' voluntary compliance; (8) long-term alternatives include conducting small multiyear TCMP audits, using data from operational audits to assess compliance changes, and conducting periodic national mini-TCMP audits; (9) IRS must decide on a compliance information-gathering alternative in the near term, since any alternative will take several years to develop and implement; and (10) the alternatives will likely not gather data as comprehensive as the originally planned TCMP data.

gao_GAO-07-775T

gao_GAO-07-775T_0

Background VA, Education, and Labor assess education and training programs for various purposes. 1). Legislative Changes Effective in 2001 Created Additional Responsibilities for SAAs In 2001, SAAs received additional responsibilities as a result of legislative changes. This included responsibility for actively promoting the development of apprenticeship and on-the-job training programs and conducting more outreach activities to eligible persons and veterans to increase awareness of VA education assistance. From fiscal years 2003 to 2006, SAA funding increased from $13 million to $19 million to expand services and support the additional responsibilities. Funding is scheduled to begin to decrease in fiscal year 2008. Many Education and Training Programs Approved by SAAs Have Also Been Approved by Education or Labor, and VA Has Taken Few Steps to Coordinate Approval Activities with These Agencies Many education and training programs approved by SAAs have also been approved by Education and Labor. Sixty-nine percent of all programs approved by SAAs are offered by institutions that have also been certified by Education. Similar categories of approval standards exist across agencies, but the specific standards within each category vary and the full extent of overlap is unknown. Also among the student achievement standards, VA requires schools to give appropriate credit for prior learning, while Education does not have such a requirement. Despite the overlap in approved programs and standards, VA and SAAs have made limited efforts to coordinate approval activities with Education and Labor. Information is not available to determine the amount of resources spent on SAA duties and functions, including those that may overlap with those of other agencies. VA does not require SAAs to collect information on the amount of resources they spend on specific approval activities. SAAs Reportedly Add Value to the Approval Process for Education and Training Programs, but the Lack of Outcome- Oriented Performance Measures Makes It Difficult to Assess the Significance of Their Efforts SAA and other officials reported that SAA activities add value because they provide enhanced services to veterans and ensure program integrity. According to these officials, SAAs’ added value includes a focus on student services for veterans and on VA benefits, more frequent on-site monitoring of education and training programs than Education and Labor, and assessments and approval of a small number of programs that are not reviewed by other agencies, such as programs offered by unaccredited schools, on-the-job training programs, and apprenticeship programs not approved by Labor. States, schools, and apprenticeship officials we spoke with reported that without SAAs, the quality of education for veterans would not change. However, veterans’ receipt of benefits could be delayed and the time required to complete their education and training programs could increase. Despite areas of apparent added value, it is difficult to fully assess the significance of SAA efforts. VA does measure some outputs, such as the number of supervisory visits SAAs conduct, but it does not have outcome- oriented measures, such as the amount of benefit adjustments resulting from SAAs’ review of school certification transactions, to evaluate the overall effectiveness and progress of SAAs. In addition, we recommended that the Secretary of the Department of Veterans Affairs establish outcome-oriented performance measures to assess the effectiveness of SAA efforts.

Why GAO Did This Study In fiscal year 2006, the Department of Veterans Affairs (VA) paid $19 million to state approving agencies (SAA) to assess whether schools and training programs are of sufficient quality for veterans to receive VA education assistance benefits when attending them. The Departments of Education and Labor also assess education and training programs for various purposes. This testimony describes (1) changes that have occurred in state approving agencies' duties and functions since 1995, (2) the extent to which the SAA approval process overlaps with efforts by the Departments of Education and Labor, and (3) the additional value that SAA approval activities bring to VA education benefit programs. This testimony is based on a March 2007 report (GAO-07-384). What GAO Found Since 1995, legislative changes effective in 2001 created additional responsibilities for SAAs, including promoting the development of apprenticeship and on-the-job training programs, providing outreach services, and approving tests for occupational licensing. From fiscal years 2003 to 2006, SAA funding increased from $13 million to $19 million to expand services and support the additional responsibilities. However, funding is scheduled to decrease beginning in fiscal year 2008. Many education and training programs approved by SAAs have also been approved by Education or Labor, and VA has taken few steps to coordinate approval activities with these agencies. More than two-thirds of all programs approved by SAAs are offered by institutions that have been certified by Education. Many apprenticeship programs approved by SAAs have also been approved by Labor, although apprenticeship programs make up less than 2 percent of all programs approved by SAAs. Similar categories of approval standards, such as student achievement, exist across agencies, but the specific standards within each category vary and the full extent of the overlap is unknown. For example, VA requires schools to give appropriate credit for prior learning while Education does not have such a requirement. Despite the overlap in approved programs and standards, VA and SAAs have made limited efforts to coordinate approval activities with other federal agencies. VA does not require SAAs to collect information on the amount of resources they spend on specific approval activities; therefore, information is not available to determine the amount of resources spent on SAA duties and functions, including those that may overlap with those of other agencies. SAAs reportedly add value to the approval process for education and training programs, but the lack of outcome-oriented performance measures makes it difficult to assess the significance of their efforts. Areas of added value include (1) a focus on student services for veterans and on the integrity of VA benefits, (2) more frequent on-site monitoring of education and training programs than provided by Education or Labor, and (3) assessments and approval of a small number of programs that are not reviewed by other agencies. States, schools, and apprenticeship officials we spoke with reported that without SAAs, the quality of education for veterans would not change. However, veterans' receipt of benefits could be delayed and the time required to complete their education and training programs could increase. Despite areas of apparent added value, it is difficult to fully assess the significance of SAA efforts. VA measures some outputs, such as the number of supervisory visits SAAs conduct, but it does not have outcome-oriented performance measures, such as the amount of benefit adjustments resulting from SAAs' reviews, to evaluate the overall effectiveness of SAAs.

gao_GAO-14-90

gao_GAO-14-90_0

Within HHS, several offices and agencies have specific responsibilities for public health preparedness and response. Within ASPR, BARDA—established by the Pandemic and All-Hazards Preparedness Act of 2006—oversees and supports advanced development and procurement of some medical countermeasures into the SNS. HHS and PHEMCE establish federal medical countermeasure development and procurement priorities through a multistep process. This process includes assessing the threat posed by CBRN agents and the potential consequences they pose to public health, determining medical countermeasure requirements—the type of countermeasure (vaccines, drugs, or medical devices such as diagnostics), the amount needed, and characteristics of the countermeasures (such as formulations, dosing, and packaging)—for these agents, evaluating public health response capability, and developing and procuring countermeasures against these CBRN agents. HHS Has Established Timelines and Milestones for Key PHEMCE Priorities but Has Not Yet Provided Previously Recommended Anticipated Spending Estimates for Priority Countermeasures HHS has established timelines and milestones for the 72 priority activities, threat-based approaches, and capabilities identified in the 2012 PHEMCE Implementation Plan as key to fulfilling PHEMCE’s strategic goals. However, while HHS has developed spending estimates for its priority medical countermeasures for internal planning purposes, it has not made these estimates publicly available, as we previously recommended in 2011. Leading practices for program management call for establishing time frames and milestones as part of a plan to ensure that organizations achieve intended results.In the implementation plan, HHS has assigned each of the 33 priority activities, the 25 priority threat-based approaches, and the 14 priority capabilities to one of three time frames for completion—near-term (fiscal years 2012 through 2014), midterm (fiscal years 2015 through 2017), and long-term (fiscal year 2018 and beyond). HHS has also identified deliverables and milestones for some of the priority activities, threat-based approaches, and capabilities, and assigned them more specific timelines. PHEMCE partners have tied each deliverable to a specific milestone or set of milestones, which delineate the steps necessary to complete the deliverable. Examples of deliverables, milestones, and more specific timelines for PHEMCE priorities include the following: For the priority activity that states that ASPR is to lead PHEMCE in developing or updating medical countermeasure requirements for certain CBRN threats by the end of fiscal year 2014, ASPR has identified the requirements for each specific threat—such as requirements for countermeasures for mustard gas and other blister agents—as the individual deliverables for this activity. The blister agents requirement deliverable has four associated milestones that reflect the various activities of a PHEMCE working group to develop the requirements and the levels of PHEMCE and HHS approval needed, culminating in the approval by the ASPR Assistant Secretary by September 2013. For the remaining 12 priority activities, 15 priority threat-based approaches, and 6 priority capabilities, HHS has not established specific deliverables with milestones and timelines other than the overall completion of the priority within the specified near- or midterm time frame. According to HHS officials, during these monthly meetings, PHEMCE participants discuss their progress in completing deliverables, potential barriers to completion, and any options to help mitigate these barriers. As of September 2013 (the most recent information available): PHEMCE partners reported completing five deliverables for the 21 priority activities. We previously recommended that HHS provide more specific information on anticipated countermeasure spending when it updated its 2007 plan. However, the plan does not include any estimates of how much of these funds HHS may spend to develop or procure specific priority countermeasures. HHS officials told us that while PHEMCE has developed spending estimates for internal planning, they are hesitant to provide these estimates to manufacturers because they do not want to create the expectation that the estimates would reflect any final contract amounts. However, the nature and format of the spending estimates that would be included in the plan had not been determined. As we stated in our previous recommendation, information on anticipated spending would allow HHS’s industry partners to suitably target research and development to fulfill PHEMCE’s countermeasure priorities, especially in tighter budget climates. PAHPRA’s requirement for HHS to include spending estimates for each medical countermeasure priority in future PHEMCE implementation plans is consistent with our 2011 recommendation. Appendix I: HHS Spending on Advanced Research, Development, and Procurement of Medical Countermeasures The Department of Health and Human Services (HHS) spent approximately $3.6 billion in advanced research, development, and procurement of chemical, biological, radiological, and nuclear (CBRN) and pandemic influenza medical countermeasures from fiscal year 2010 through fiscal year 2013. GAO-10-204.

Why GAO Did This Study Public health emergencies--the 2001 anthrax attacks, the 2009 H1N1 influenza pandemic, and others--have raised concerns about national vulnerability to threats from chemical, biological, radiological, and nuclear agents and new infectious diseases. There are some medical countermeasures--drugs, vaccines, and medical devices such as diagnostics--available to prevent, diagnose, or mitigate the public health impact of these agents and diseases, and development continues. HHS leads federal efforts to develop and procure countermeasures through the interagency PHEMCE. The Pandemic and All-Hazards Preparedness Reauthorization Act of 2013 mandated GAO to examine HHS's and PHEMCE's planning documents for medical countermeasure development and procurement needs and priorities. This report examines the extent to which HHS developed timelines, milestones, and spending estimates for PHEMCE priorities. GAO reviewed relevant laws; analyzed HHS's 2012 PHEMCE Strategy and Implementation Plan, HHS's tools for tracking the implementation of PHEMCE activities, and data on countermeasure spending from fiscal years 2010 through 2013; and interviewed HHS officials. What GAO Found The Department of Health and Human Services (HHS) has established timelines and milestones for the 72 Public Health Emergency Medical Countermeasures Enterprise (PHEMCE) priorities--33 activities, 25 threat-based approaches, and 14 capabilities--that HHS selected as key to fulfilling PHEMCE strategic goals. However, HHS has not made spending estimates for its medical countermeasure development or procurement priorities (priority countermeasures) publicly available. In the PHEMCE implementation plan, HHS has grouped the 72 PHEMCE priorities into three time frames for completion--near-term (fiscal years 2012 through 2014), midterm (fiscal years 2015 through 2017), and long-term (fiscal year 2018 and beyond). For 21 priority activities, 10 priority threat-based approaches, and 8 priority capabilities, HHS and PHEMCE have identified specific deliverables, each tied to a milestone or set of milestones that delineate the steps necessary to complete deliverables, and established more specific timelines for completion of deliverables and milestones. For example, HHS's Office of the Assistant Secretary for Preparedness and Response (ASPR) is to lead the development of medical countermeasure requirements, which outline countermeasure quantity, type, and desired characteristics. Deliverables are the threat-specific requirements, such as for antidotes for mustard gas and other blister agents. Milestones for mustard gas antidote requirements reflect the PHEMCE activities to develop the requirements and the necessary approvals; the milestones are tied to interim timelines and culminate in approval by the ASPR Assistant Secretary by September 2013. HHS has not established specific deliverables, milestones, or timelines for the remaining 12 priority activities, 15 priority threat-based approaches, and 6 priority capabilities other than their overall completion within the specified near- or midterm time frame. HHS monitors progress in completing deliverables and milestones for the priorities monthly, with PHEMCE partners meeting to discuss potential barriers to completing deliverables or meeting milestones and possible options to mitigate these barriers. As of September 2013 (the most recent information available), HHS reported that PHEMCE partners have completed 10 deliverables for the 72 priorities, resulting in completion of 5 priorities. GAO did not examine the status of the priorities that did not have specific deliverables, timelines, and milestones. HHS has developed spending estimates for priority countermeasures for internal planning purposes but has not made them publicly available. In 2011, GAO recommended that HHS provide more specific anticipated spending information in an updated plan to assist with long-term planning. HHS's 2012 plan contains information on how countermeasures may be funded, such as through advanced development funds, but does not include estimates of how much PHEMCE may spend to develop specific countermeasures. HHS officials said they are hesitant to provide estimates because they do not want to create the expectation that estimates would reflect final contract amounts. However, consistent with our prior recommendation and Pandemic and All-Hazards Preparedness Reauthorization Act requirements, HHS plans to include spending estimates in the next iteration of the plan, anticipated in September 2014, but has not determined the nature and format of the estimates that would be included. Providing estimates would allow HHS's industry partners to suitably target research and development to fulfill countermeasure priorities, especially in tighter budget climates. What GAO Recommends Although GAO is not making any new recommendations, based on prior work GAO is continuing to emphasize its 2011 recommendation that HHS make more specific anticipated spending information available to countermeasure developers. In its comments, HHS discussed its efforts to develop spending estimates.

gao_GAO-07-1085

gao_GAO-07-1085_0

For example, if a vessel’s limit of liability is $10 million and a spill resulted in $12 million in costs, the responsible party only has to pay up to $10 million—the Fund will pay for the remaining $2 million. 3). Many of the companies have contractual agreements with responsible parties and the Coast Guard. Oil Spills Costing More than $1 Million Occurred Infrequently Since 1990, but Estimated Costs Total $860 Million to $1.1 Billion On the basis of information we were able to assemble about responsible parties’ expenditures and payments from the Fund, we estimate that 51 oil spills involving removal costs and damage claims totaling $1 million or more have occurred since 1990. The number of spills and their costs varied from year to year and showed no discernable trends in either frequency or cost. Less Than 2 Percent of Oil Spills Occurring Since 1990 Were Major Spills Less than 2 percent of oil spills from vessels, since 1990, had removal costs and damage claims of $1 million or greater. These 51 spills occurred in a variety of locations. Total Cost of Major Spills Ranges from $860 Million to $1.1 Billion, and Responsible Parties Pay the Majority of Costs The total cost of the 51 spills cannot be precisely determined, for several reasons: Private-sector expenditures are not tracked: The NPFC tracks federal removal costs expended by the Fund for Coast Guard and other federal agencies’ spill response efforts, but it does not oversee costs incurred by the private sector. Key Factors Affect Oil Spill Costs in Unique Ways Location, time of year, and type of oil are key factors affecting oil spill costs, according to industry experts, agency officials, and our analysis of spills. According to state officials with whom we spoke and industry experts, there are three primary characteristics of location that affect costs: Remoteness: For spills that occur in remote areas, spill response can be particularly difficult in terms of mobilizing responders and equipment, and they can complicate the logistics of removing oil from the water—all of which can increase the costs of a spill. Type of Oil Spilled Impacts the Extent of the Response Effort and the Amount of Damage The type of oil spilled affects the degree to which oil can be cleaned up and removed, as well as the nature of the natural resource damage caused by the spill—both of which can significantly impact the costs associated with an oil spill. Fund Has Been Able to Cover Costs Not Paid by Responsible Parties, but Risks Remain The Fund has been able to cover costs from major spills that responsible parties have not paid, but risks remain. We estimate that not making such adjustments in the past potentially cost the Fund $39 million between 1990 and 2006. Liability Limits Have Not Been Adjusted for Inflation Although OPA requires adjusting liability limits to account for significant increases in inflation, no adjustments to the limits were made between 1990 and 2006, when the Congress raised the limits in the Coast Guard and Maritime Transportation Act. We collected information on the limits of liability of the vessels at the time of the spill and the limits of liability for vessels after changes in liability limits in the Coast Guard and Maritime Transportation Act of 2006.

Why GAO Did This Study When oil spills occur in U.S. waters, federal law places primary liability on the vessel owner or operator--that is, the responsible party--up to a statutory limit. As a supplement to this "polluter pays" approach, a federal Oil Spill Liability Trust Fund administered by the Coast Guard pays for costs when a responsible party does not or cannot pay. The Coast Guard and Maritime Transportation Act of 2006 directed GAO to examine spills that cost the responsible party and the Fund at least $1 million. This report answers three questions: (1) How many major spills (i.e., $1 million or more) have occurred since 1990, and what is their total cost? (2) What factors affect the cost of spills? and (3) What are the implications of major oil spills for the Oil Spill Liability Trust Fund? GAO's work to address these objectives included analyzing oil spill costs data, interviewing federal, state, and private-sector officials, and reviewing Coast Guard files from selected spills. What GAO Found On the basis of cost information collected from a variety of sources, GAO estimates that 51 spills with costs above $1 million have occurred since 1990 and that responsible parties and the federal Oil Spill Liability Trust Fund (Fund) have spent between about $860 million and $1.1 billion for oil spill removal costs and compensation for damages (e.g., lost profits and natural resource damages). Responsible parties paid between about 72 percent and 78 percent of these costs; the Fund has paid the remainder. Since removal costs and damage claims may stretch out over many years, the costs of the spills could rise. The 51 spills, which constitute about 2 percent of all vessel spills since 1990, varied greatly from year to year in number and cost. Three main factors affect the cost of spills: a spill's location, the time of year, and the type of oil spilled. Spills that occur in remote areas, for example, can increase costs involved in mobilizing responders and equipment. Similarly, a spill occurring during tourist or fishing season might produce substantial compensation claims, while a spill occurring during another time of year may not be as costly. The type of oil affects costs in various ways: fuels like gasoline or diesel fuel may dissipate quickly but are extremely toxic to fish and plants, while crude oil is less toxic but harder to clean up. Each spill's cost reflects a unique mix of these factors. To date, the Fund has been able to cover costs from major spills that responsible parties have not paid, but risks remain. Specifically, the Coast Guard and Maritime Transportation Act of 2006 increased liability limits, but GAO's analysis shows the new limit for tank barges remains low relative to the average cost of such spills. Since 1990, the Oil Pollution Act required that liability limits be adjusted above the limits set forth in statute for significant increases in inflation, but such changes have never been made. Not making such adjustments between 1990 and 2006 potentially shifted an estimated $39 million in costs from responsible parties to the Fund.

gao_GAO-09-15

gao_GAO-09-15_0

Even though they may be funded entirely, or nearly so, from the federal treasury, FFRDCs are regarded as contractors not federal agencies. Nevertheless, it is the only centrally reported information on federal funding for FFRDCs. Most Agencies Compete Cost- Reimbursement Contracts for Operating Their FFRDCs, but Some Do Not Have Specific Personal Conflict-of- Interest Requirements The four agencies we reviewed use cost-reimbursement contracts with the organizations that operate their FFRDCs, and three of these agencies generally use full and open competition in awarding these contracts. While the agencies require that their FFRDCs be free from organizational conflicts of interest in accordance with federal regulations, only DOD and DOE have agencywide requirements that prescribe specific areas that FFRDC contractors must address to ensure their employees are free from personal conflicts of interest. In contrast, DOD continues to award its FFRDC contracts on a sole-source basis under statutory exemptions to competition. The agencies determine appropriateness of work conducted by their FFRDCs; perform on-going and annual assessments of performance, costs and internal controls; and conduct comprehensive reviews prior to renewing sponsoring agreements. Agencies Approve Research Plans and Work Conducted at Their FFRDCs To ensure work remains within each FFRDCs purpose, mission, scope of effort, and special competency, sponsoring agencies develop and approve annual research plans for the FFRDCs and review and approve FFRDC work assigned on a project-by-project basis. In determining the proposed research plan, DOD must abide by congressionally set workload caps. HHS and DOD also have work-for-others programs for the FFRDCs they sponsor. DOE uses a performance-based contracting approach with its FFRDCs, which includes several mechanisms to assess performance. During the reviews prior to agreement renewal, sponsoring agencies should include the following five areas identified by the FAR examination of the continued need for FFRDC to address its sponsor’s technical needs and mission requirements; consideration of alternative sources, if any, to meet those needs; assessment of the FFRDC’s efficiency and effectiveness in meeting the sponsor’s needs, including objectivity, independence, quick response capability, currency in its field(s) of expertise, and familiarity with the sponsor; assessment of the adequacy of FFRDC management in ensuring a cost- determination that the original reason for establishing the FFRDC still exists and that the sponsoring agreement is in compliance with FAR requirements for such agreements. There is no formal mechanism, however, for sharing of best practices and lessons learned among sponsoring agencies. DHS mirrored most of DOD’s FFRDC Management Plan, and officials have stated that the STE limitations for DOD could be a potentially useful tool for focusing FFRDCs on the most strategic and critical work for the agency. Also, DHS officials stated they have made use of DOE’s experience in contracting for and overseeing the operation of its laboratories, such as including a DOE official in the DHS process to select a contractor to operate its laboratory FFRDC. Currently, although DHS and HHS have policies that generally require their FFRDC contractors to implement such safeguards, they lack the specificity needed to ensure their FFRDC contractors will consistently address employees’ personal conflicts of interest. Recommendations for Executive Action To ensure that FFRDC employees operate in the government’s best interest, we recommend that the Secretary of Homeland Security revise agency policies to address specific areas for potential personal conflicts of interest for FFRDC personnel in a position to make or materially influence research findings or agency decision making; and that the Secretary of Health and Human Services review agency policy regarding personal conflicts of interest for its sponsored FFRDC and revise as appropriate to ensure that this policy addresses all personnel in a position to make or materially influence research findings or agency decision making.

Why GAO Did This Study In 2006, the federal government spent $13 billion--14 percent of its research and development (R&D) expenditures--to enable 38 federally funded R&D centers (FFRDCs) to meet special research needs. FFRDCs--including laboratories, studies and analyses centers, and systems engineering centers--conduct research in military space programs, nanotechnology, microelectronics, nuclear warfare, and biodefense countermeasures, among other areas. GAO was asked to identify (1) how federal agencies contract with organizations operating FFRDCs and (2) agency oversight processes used to ensure that FFRDCs are well-managed. GAO's work is based on a review of documents and interviews with officials from eight FFRDCs sponsored by the departments of Defense (DOD), Energy (DOE), Health and Human Services (HHS), and Homeland Security (DHS). What GAO Recommends What GAO Found Federal agencies GAO reviewed use cost-reimbursement contracts with the organizations that operate FFRDCs, and three of the agencies generally use full and open competition to award the contracts. Only DOD consistently awards its FFRDC contracts on a sole-source basis, as permitted by law and regulation when properly justified. FFRDCs receive funding for individual projects from customers that require the FFRDCs' specialized research capabilities. Because FFRDCs have a special relationship with their sponsoring agencies and may be given access to sensitive or proprietary data, regulations require that FFRDCs be free from organizational conflicts of interest. DOD and DOE also have policies that prescribe specific areas that FFRDC contractors must address to ensure their employees are free from personal conflicts of interest. In a May 2008 report, GAO recognized the importance of implementing such safeguards for contractor employees. Currently, although DHS and HHS have policies that require their FFRDC contractors to implement conflicts-of-interest safeguards, these policies lack the specificity needed to ensure their FFRDC contractors will consistently address employees' personal conflicts of interest. Sponsoring agencies use various approaches in their oversight of FFRDC contractors, including: (1) Review and approval of work assigned to FFRDCs, or conducted for other agencies or entities, to determine consistency with the FFRDC's purpose, capacity, and special competency. In this process, only DOD must abide by congressionally imposed annual workload limits for its FFRDCs. (2) Conduct performance reviews and audits of contractor costs, finances, and internal controls. (3) Conduct a comprehensive review before a contract is renewed to assess the continuing need for the FFRDC and if the contractor can meet that need, based on annual assessments of contractor performance. Some agencies have adopted other agencies' FFRDC oversight and management practices. For example, DHS mirrored most of DOD's FFRDC Management Plan--an internal DOD guidance document--in developing an approach to FFRDC oversight, and DHS officials told us they learned from DOE's experience in selecting and overseeing contractors for laboratory FFRDCs. In addition, HHS plans to implement certain DOE practices, including rewarding innovation and excellence in performance through various contract incentives. While agency officials have acknowledged the potential benefits from sharing best practices, there is currently no formal cross-agency forum or other established mechanism for doing so.

gao_GAO-09-667T

gao_GAO-09-667T_0

Almost Half of MUAs Lacked a Health Center Site in 2006, and Types of Services Provided by Each Site Could Not Be Determined In August 2008, we reported that almost half of MUAs nationwide— 47 percent, or 1,600 of 3,421—lacked a health center site in 2006, and there was wide variation among the four census regions and across states in the percentage of MUAs that lacked health center sites. We could not determine the types of primary care services provided at individual health center sites because HRSA did not collect and maintain readily available data on the types of services provided at individual sites. 2007 Awards Reduced the Number of MUAs That Lacked a Health Center Site, but Wide Geographic Variation Remained In August 2008, we reported that our analysis of new access point grants awarded in 2007 showed that these awards reduced the number of MUAs that lacked a health center site by about 7 percent. The South census region experienced the greatest decline in the number of MUAs lacking a health center site in 2007 in large part because it was awarded more new access point grants that year than any other region. From 2006 to 2007, HRSA’s new access point awards achieved modest success in reducing the percentage of MUAs that lacked a health center site nationwide. However, in 2007, 43 percent of MUAs continued to lack a health center site, and the new access point awards made in 2007 had little impact on the wide variation among census regions and states in the percentage of MUAs lacking a health center site. We reported that HRSA awards new access point grants to open new health center sites, which increase access to primary health care services for underserved populations in needy areas, including MUAs. However, HRSA’s ability to target these awards and place new health center sites in locations where they are most needed is limited because HRSA does not collect and maintain readily available information on the services provided at individual health center sites. Having readily available information on the services provided at each site is important for HRSA’s effective consideration of need when distributing federal resources for new health center sites, because each health center site may not provide the full range of comprehensive primary care services.

Why GAO Did This Study Health centers funded through grants under the Health Center Program--managed by the Health Resources and Services Administration (HRSA) of the U.S. Department of Health and Human Services (HHS)--provide comprehensive primary care services for the medically underserved. The statement GAO is issuing today summarizes an August 2008 report, Health Resources and Services Administration: Many Underserved Areas Lack a Health Center Site, and the Health Center Program Needs More Oversight (GAO-08-723). In that report, GAO examined to what extent medically underserved areas (MUA) lacked health center sites in 2006 and 2007. To do this, GAO obtained and analyzed HRSA data and grant application What GAO Found In its August 2008 report, which is summarized in this statement, GAO found the following: (1) Grant awards for new health center sites in 2007 reduced the overall percentage of MUAs lacking a health center site from 47 percent in 2006 to 43 percent in 2007. (2) There was wide geographic variation in the percentage of MUAs that lacked a health center site in both years. (3) Most of the 2007 nationwide decline in the number of MUAs that lacked a health center site occurred in the South census region, in large part because half of all awards made in 2007 for new health center sites were granted to the South census region. (4) HRSA lacked readily available data on the services provided at individual health center sites. GAO concluded that from 2006 to 2007, HRSA's grant awards to open new health center sites reduced the number of MUAs that lacked a site by about 7 percent. However, in 2007, 43 percent of MUAs continued to lack a health center site, and the grants for new sites awarded that year had little impact on the wide variation among census regions and states in the percentage of MUAs lacking a health center site. GAO reported that HRSA's grants to open new health center sites increased access to primary health care services for underserved populations in needy areas, including MUAs. However, HRSA's ability to place new health center sites in locations where they are most needed was limited because HRSA does not collect and maintain readily available information on the services provided at individual health center sites. Because each health center site may not provide the full range of comprehensive primary care services, having readily available information on the services provided at each site is important for HRSA's effective consideration of need when distributing federal resources for new health center sites.

gao_GAO-02-208T

gao_GAO-02-208T_0

However, the results to date have been inconclusive. The second assessment is a national-level threat assessment of the terrorist threat in the United States. Department of Justice and FBI officials told us that the September 11 terrorist attacks may dictate revisions to these assessments and delay their completion. While we view both of these assessments as positive, the FBI noted that these would be limited to threat assessments only and will not include other important aspects of risk management that we discuss below. The Department of Justice took over that program in fiscal year 2001, and has worked with the FBI to create a risk management tool for state and local governments.This tool includes a step-by-step methodology for assessing threats, risks, and requirements. A Risk Management Approach Can Guide Preparedness Efforts Risk management is a systematic, analytical process to consider the likelihood that a threat will harm an asset or individuals and to identify actions that reduce the risk and mitigate the consequences of an attack or event. However, risk and vulnerability assessments need to be bolstered by a criticality assessment, which is the final major element of the risk management approach.

What GAO Found Because of the terrorist attacks against the World Trade Center and the Pentagon on September 11 and the subsequent appearance of letters containing anthrax, terrorism rose to the top of the national agenda. The Attorney General has indicated that the country needs to be prepared for still more terrorist incidents. The Department of Justice is working with state and local governments to complete risk management tools for the domestic preparedness program. However, the FBI told GAO that these will be limited to threat assessments only and will not include other aspects of risk management that GAO advocates. Despite these inconclusive results, the federal government can benefit from risk management. Risk management is a systematic and analytic process to consider the likelihood that a threat will endanger an asset and to identify actions that reduce the risk and mitigate the consequences of an attack. An effective risk management approach includes a threat assessment, a vulnerability assessment, and a criticality assessment. Such an approach could help the nation prepare against threats it faces and help better target finite resources to areas of highest priority.

gao_GAO-01-719

gao_GAO-01-719_0

Customs’ Limited Tests of Imported Fasteners Found No Evidence of Substandard Fasteners Imported After December 1999 Customs’ Chicago laboratory tested 66 randomly selected shipments of graded bolts (12 in small lots) imported during March and April 2001 and found that none were substandard. Federal Agencies Reported No Evidence of Changes in Industry Practices None of the officials that we spoke with in DSCP or NASA reported any evidence of changes in fastener industry practices resulting from, or apparently resulting from, the small-lot exemption. Conclusion We found no evidence that the fastener industry has changed any practices resulting from, or apparently resulting from, the small-lot exemption.

Why GAO Did This Study This report reviews changes in fastener industry practice "resulting from or apparently resulting from" the small-lot exemption of the Fastener Quality Act. What GAO Found GAO found no evidence that the fastener industry changed any practices resulting from, or apparently resulting from, the small-lot exemption. The Customs Service's limited tests of imported fasteners in 2001 found no evidence of substandard fasteners and no evidence of any decline in the quality of fasteners from the results of tests Customs conducted in 1998.

gao_GAO-12-433

gao_GAO-12-433_0

It also described plans to address these challenges—for example, by introducing retail alternatives in concert with reducing its retail network footprint and operating costs. recommended that it develop a plan for optimizing its retail network that addresses both traditional post offices and retail alternatives. GAO, High Risk Series: Restructuring the U.S. USPS Has Taken Several Actions to Restructure Its Retail Network Over the past 5 years, USPS has taken several actions to change its retail network through reducing its workforce and retail footprints, while expanding retail alternatives. It estimated that it saved about $800 million by reducing retail work hours during this period. It also closed 631 of its post offices, but it did not have cost savings estimates related to these closures. Fewer closures (131) have resulted from the nationwide reviews that USPS initiated in 2009 and 2011. In addition, over the last 5 years, USPS district offices have identified and closed around 500 USPS-operated retail facilities on an individual, ad-hoc basis as they determined the need.response to a postmaster vacancy or the suspension of operations due to These individual closures were in an expired lease or irreparable damage to the facility following a natural disaster. These alternatives include self-service options as well as partnerships with retailers, which could help it contain facility and labor costs while still providing access for customers. Stakeholders Have Expressed Concerns about USPS Retail Initiatives Postal stakeholders, including Members of Congress, PRC, USPS OIG, customers, employee associations, and some community residents have raised concerns about USPS’s retail restructuring initiatives. These concerns include access to postal services, including community residents’ ability to obtain retail services, the adequacy of retail alternatives, and changes to delivery services; the impact of facility closures on communities; the adequacy of data analysis of facilities facing closure and the reliability of data, particularly with regard to the accuracy of cost- savings estimates; the transparency and equity of closure decisions; the fairness of facility closure procedures; and changes in who can manage a post office. Moreover, we have also recommended improvements to USPS’s retail facilities data. USPS expects that this change would give it more staffing flexibility, reduce the number of postmasters, and reduce costs. Challenges Restrict USPS from Changing Its Retail Network USPS faces challenges such as legal restrictions and resistance from some Members of Congress and the public that have limited its ability to restructure its network. Also, certain policy issues are unresolved, and pending legislation takes differing approaches to resolving USPS’s challenges. Further, language in annual appropriations acts has provided that none of the funds appropriated in the acts (about $100 million for fiscal year 2011) shall be used to consolidate or close small rural and other small post offices.“act like a business” and be self-financing, but on the other hand, it is restricted by law from making decisions that businesses would commonly make, such as closing unprofitable units. These policy issues include what level or type of retail services should USPS provide to meet customers’ changing use of postal services; how should the cost of these services be paid; how should USPS restructure its operations, networks, and workforce to support changes in services; and how should Congress provide USPS with flexibility to restructure its networks and workforce while still holding USPS accountable to Congress and the public? Concluding Observations USPS must carefully work to ensure a viable strategy to effectively size its retail network to reduce costs to match declining mail volume while maintaining access to retail services. If Congress prefers to retain the current level of service and associated network, decisions will need to be made about how USPS’s costs for providing these services will be paid, including additional cost reductions or revenue sources. USPS agreed with our findings, noting limitations management faces to restructuring. Further, it observed that its operating model is unsustainable and that maintaining the same level of retail services will require solutions to cover the costs of those services either through cost reductions or revenue enhancements. This report discusses (1) key actions USPS has taken to restructure its retail network over the past 5 years; (2) concerns raised by postal stakeholders, including Congress, the Postal Regulatory Commission (PRC), USPS Office of Inspector General (OIG), and postal business and residential customers, and USPS’s response to these concerns; and (3) the challenges that USPS faces in changing its retail network.

Why GAO Did This Study Since 2006, USPS has accumulated losses of $25 billion and projects a $14.1 billion net loss for fiscal year 2012. In September 2011, the Postmaster General testified that USPS needed to reduce its annual costs by $20 billion, or 27 percent of its projected expenses. One effort to reduce costs includes restructuring, or optimizing, the size of USPS’s retail network and workforce. The network includes approximately 32,000 USPS-operated facilities, such as traditional post offices, as well as alternative non-USPS-operated locations that sell its products and services. To optimize this network, USPS plans to evaluate and locate its retail facilities to maximize revenue and minimize costs while still providing access to services. As requested, this report discusses (1) key actions USPS has taken over thepast 5 years to restructure its retail network, (2) concerns raised by stakeholders, and (3) the challenges USPS faces in changing its retail network. GAO analyzed USPS documents, interviewed USPS officials and stakeholders, and observed public meetings on retail facility closures. What GAO Found Over the past 5 years, the U.S. Postal Service (USPS) has taken several actions to restructure its retail network through reducing its workforce and its footprint while expanding retail alternatives. USPS officials estimated that it had saved about $800 million from reducing the number of work hours dedicated to retail operations. USPS also closed 631 of its post offices, but it did not have cost-savings estimates for these closures. Most of the facilities closed (500) were in response to a postmaster vacancy or the suspension of operations due to an expired lease or irreparable damage following a natural disaster. Fewer closures (131) have resulted from nationwide reviews that USPS initiated in 2009 and 2011. USPS has also restructured its retail network by expanding alternatives through self-service options as well as partnerships with other retailers. Members of Congress, the Postal Regulatory Commission (PRC), the USPS Office of Inspector General (OIG), customers, employee associations, and some community residents have raised concerns about USPS’s retail restructuring initiatives. The concerns include access to postal services, including community residents’ ability to obtain retail services, the adequacy of retail alternatives, and changes to delivery services; the impact of facility closures on communities; the adequacy of USPS analysis of facilities facing closure and the reliability of USPS data, particularly the accuracy of USPS cost savings estimates; · the transparency and equity of USPS closure decisions; the fairness of USPS’s facility closure procedures; and changes in who can manage a post office. PRC, USPS OIG, and GAO have recommended improvements to address some of these issues. In particular, GAO has recommended that USPS develop a plan that addresses both traditional post offices and retail alternatives and ensures that USPS has a viable strategy for effectively adapting its networks to changing mail use and maintaining adequate service as it reduces costs. USPS officials have said they are in the process of addressing these recommendations. USPS faces challenges, such as legal restrictions and resistance from some Members of Congress and the public, that have limited its ability to change its retail network. For example, USPS is supposed to be self-financing, but it is also restricted by law from making decisions that businesses would commonly make, such as closing unprofitable units. Additionally, some Members of Congress and the public have challenged USPS’s plans to close retail facilities in their districts or communities. Certain policy issues remain unresolved related to what level of retail services USPS should provide, how the cost of these services should be paid, and how USPS should optimize its retail network. Pending legislation takes differing approaches to addressing these policy issues. If Congress prefers to retain the current level of retail service and associated network, decisions will need to be made about how USPS will pay for these services, including through additional cost reductions or revenue sources. What GAO Recommends GAO makes no recommendations in this report, as it has previously reported on the urgency for Congress to allow USPS to adapt its retail network to changing customer behavior and reduce costs. USPS agreed with GAO’s draft report, noting limitations it faces to retailrestructuring. It also observed that maintaining the same level of retail services will require solutions to cover the costs of those services.

gao_GAO-17-114

gao_GAO-17-114_0

DOD and the Coast Guard Determined That the Prevalence of Gambling Disorder Is Low, Based on Military Health System Data DOD and the Coast Guard Determined That the Prevalence of Problem Gambling and Gambling Disorder Is Low, Based on Servicemembers’ Use of the Military Health System Based on DOD data that show 514 DOD and Coast Guard active-duty servicemembers and 72 Reserve Component servicemembers—less than 0.03 percent of the average number of servicemembers in each year—were diagnosed with gambling disorder or seen for problem gambling in fiscal years 2011 through 2015, DOD officials stated that the prevalence of gambling disorder in the military is low. DOD bases its determination of prevalence of gambling disorder and problem gambling on Military Health System data and does not include other sources of information, such as DOD-wide surveys and records of treatment provided outside of the Military Health System. The Defense Health Agency compiles these problem gambling and gambling disorder data in the Military Health System Data Repository, which includes data on clinical interactions between DOD and Coast Guard servicemembers and health-care professionals in military treatment facilities and in civilian facilities through the TRICARE system, and DOD health officials told us that they use these data to determine the prevalence of gambling disorder. The Military Health System Data Repository does not include data on DOD and Coast Guard servicemembers who received treatment or counseling for gambling disorder or problem gambling outside of the Military Health System. DOD and the Coast Guard Do Not Systematically Screen for Gambling Disorder, but DOD and Coast Guard Medical Personnel State That They Address Gambling Disorder in Line with Current Medical Practices DOD and the Coast Guard Do Not Systematically Screen for Gambling Disorder DOD and the Coast Guard do not systematically screen for gambling disorder through DOD’s annual health assessment or any other type of periodic health screening of servicemembers. DOD and Coast Guard officials stated that they do not screen for gambling disorder because they focus military health surveillance on mental-health disorders that are high risk to overall readiness, high volume, and have validated measures for assessment. However, while gambling disorder is a comparatively low-volume disorder, the preoccupation with gambling, financial hardship, and increased risk of suicide can pose a risk to individual readiness and has been identified in the recent Diagnostic and Statistical Manual of Mental Disorders as sharing similar symptoms and treatment methods with substance-use disorders. Similarly, the Substance Abuse and Mental Health Services Administration has indicated that screening is important because few seek treatment directly for gambling disorder, and they instead seek treatment for other problems such as depression. Without proactively asking gambling disorder questions as part of screening to help detect gambling disorder, DOD and the Coast Guard risk not identifying affected servicemembers and providing assistance for the disorder. DOD and Coast Guard Medical Personnel State That They Use Current Diagnostic Standards to Diagnose Gambling Disorder and They Treat It Using Established Substance-Use Addiction Treatment Programs According to Defense Health Agency and service medical officials, both DOD and Coast Guard medical personnel use the Diagnostic and Statistical Manual of Mental Disorders criteria to diagnose servicemembers with gambling disorders, and they employ the same evidence-based practices, such as cognitive behavioral therapy, to treat the disorder. In addition to mental-health treatment, clinicians with whom we spoke stated that financial counseling is also an important part of gambling disorder treatment. DOD health officials stated that this instruction “implicitly” covers gambling disorder; however, it refers only to problematic substance use and does not reference gambling disorder. The Coast Guard, which DOD Instruction 1010.04 does not cover, has three documents that provide guidance and policy to both medical and nonmedical personnel on substance abuse, but Coast Guard officials stated that they do not have any policy that specifically discusses gambling disorder. Absent explicit guidance, OSD, the DOD military services, and the Coast Guard risk not being able to identify and provide appropriate treatment and counseling to DOD and Coast Guard servicemembers afflicted by gambling disorder and mitigate or prevent individual readiness issues. However, DOD did not concur with our recommendation to incorporate medical screening questions specific to gambling disorder as part of a systematic screening process across DOD, such as in DOD’s annual Periodic Health Assessment for behavioral and mental-health issues. To evaluate the extent to which DOD and Coast Guard guidance address gambling disorder in a manner similar to substance-use disorder, we compared DOD’s and the Coast Guard’s respective policies on substance use against GAO’s Standards for Internal Control in the Federal Government.

Why GAO Did This Study The American Psychiatric Association's 2013 edition of the Diagnostic and Statistical Manual of Mental Disorders defines gambling disorder as persistent and recurrent problematic gambling behavior leading to clinically significant impairment or distress. Public Law 114-92 included a provision for GAO to review gambling among members of the armed forces. This report (1) describes what is known about the prevalence of gambling disorder among servicemembers in DOD and the CG; (2) assesses DOD's and the CG's approaches to screening, diagnosing, and treating servicemembers for gambling disorder; and (3) evaluates the extent to which DOD and CG guidance address gambling disorder in a manner similar to substance-use disorders. GAO analyzed DOD's most recent data related to gambling disorder prevalence (fiscal years 2011–2015) and DOD and CG policies. What GAO Found Department of Defense (DOD) data show 514 DOD and Coast Guard (CG) active-duty servicemembers and 72 Reserve Component servicemembers—less than 0.03 percent of the average number of servicemembers in each year—were diagnosed with gambling disorder or were seen for problem gambling in fiscal years 2011 through 2015 in the Military Health System (MHS). The MHS provides health services to beneficiaries across a range of care venues, such as military treatment facilities and civilian facilities through TRICARE. DOD bases this prevalence of gambling disorder and problem gambling on MHS data and does not include other sources of information, such as DOD-wide surveys and records of treatment provided outside of the MHS. The Defense Health Agency compiles these data in the MHS Data Repository, which includes data on clinical interactions between servicemembers and health-care professionals. The MHS Data Repository does not include data on DOD and CG servicemembers who received treatment or counseling for gambling disorder or problem gambling outside of the MHS. DOD and the CG do not systematically screen for gambling disorder and, according to medical officials, both DOD and the CG use the 2013 Diagnostic and Statistical Manual of Mental Disorders criteria to diagnose servicemembers with gambling disorders, and they employ the same evidence-based treatments. Clinicians who GAO interviewed stated that financial counseling is also an important part of gambling disorder treatment. However, DOD's and CG's medical professionals do not incorporate medical screening questions specific to gambling disorder as they do for other similar medically determined addictive disorders, such as substance use. DOD officials stated they do not screen for gambling disorder because they focus on mental-health disorders that are high risk to overall readiness, high volume, and have validated measures for assessment. While gambling disorder is not a frequently diagnosed condition, the preoccupation with gambling, financial hardship, and increased risk of suicide can pose a risk to individual readiness. In addition, the Substance Abuse and Mental Health Services Administration has indicated that screening is important because few seek treatment directly for gambling disorder. Without proactively asking gambling disorder questions as part of screening to help detect gambling disorder, DOD and the CG risk not identifying affected servicemembers and providing treatment or counseling. DOD and CG nonmedical personnel do not have clear guidance addressing gambling disorder. Neither DOD's nor CG's guidance for substance-use disorders explicitly includes gambling disorder. DOD health officials stated that their substance-use instruction “implicitly” covers gambling disorder; however, it refers only to problematic substance use. The Coast Guard has three documents that provide guidance and policy to both medical and nonmedical personnel on substance abuse, but these documents do not specifically discuss gambling disorder as an addiction. Without explicitly including gambling disorder in DOD and CG guidance on substance use, DOD and the CG may not being able to identify and provide appropriate treatment and counseling to DOD and CG servicemembers afflicted by gambling disorder and mitigate or prevent individual readiness issues. What GAO Recommends GAO makes eight recommendations, including that DOD incorporate gambling disorder questions in a systematic screening process and DOD and the CG update guidance to include gambling disorder. DOD concurred with five recommendations focused on updating guidance, but did not concur with incorporating gambling questions into a screening process due to the disorder's low prevalence. GAO maintains that this recommendation is still valid because, among other things, DOD's prevalence data are limited. The CG concurred with the two recommendations focused on updating guidance.

gao_GGD-99-128

gao_GGD-99-128_0

EEOC will be implementing changes to the complaint process beginning in November 1999. We found that agencies’ complaint inventories, and even more so, EEOC’s hearings and appeals inventories, had increased since fiscal year 1991; as the size of inventories grew, so did the average length of time that cases had been in inventory as well as the proportion of cases remaining in inventory longer than allowed by regulations; the size of the inventories and the age of cases in them increased as agencies and EEOC did not keep up with the influx of new cases; with the increased caseloads, EEOC and, to some extent, agencies, took longer on average to process complaints, contributing to the size and age of inventories; and the implications of these trends were that inventories of cases pending would grow even larger in the future, particularly at EEOC, and that cases would take even longer to process. Overall, from fiscal year 1991 to fiscal year 1998, complaint inventories at federal agencies rose by about 114 percent. During this period, however, the number of new complaints at the Postal Service increased slightly, from 14,326 to 14,397 (see app. The long-term outlook is uncertain. Only when EEOC and agencies are able to process and close more cases than they receive will progress be made toward reducing backlogs. Over 5 years, with no change in the number of new cases filed each year or resources to process them, EEOC’s appeals inventory could increase by 3,975, while adding about 186 days to the average processing time. The struggle of nonpostal agencies was especially evident in that their inventories rose by almost 8 percent in fiscal year 1998 despite a 6 percent decline in new complaints. At the same time, EEOC’s inventory of hearing requests rose by almost 20 percent, about twice the rate of increase in new hearing requests that the agency received. Future trends and, therefore, agencies’ and EEOC’s resource needs, are likely to be affected by the revisions to the complaint process. However, EEOC has not developed estimates of the extent to which revisions to complaint process regulations and procedures may affect the flow of cases into and through the process. Recommendations To provide Congress with a clear picture of future caseload trends and the resources that are needed to deal with current backlogs, as well as the volume of cases expected in the future, we recommend that the EEOC Chairwoman take steps to (1) develop estimates of the effects of the forthcoming changes in program regulations and procedures on agencies’ and EEOC’s caseloads and (2) complete development of measures and indicators to track and assess the impact of these revisions on caseload trends. We updated (1) trends in the size of inventories and the age of cases in inventory at the various stages of the equal employment opportunity (EEO) complaint process and (2) trends in the number of complaints filed by federal employees and the time taken by agencies and EEOC to process them to include fiscal years 1991 through 1998. Table III.5: Total and Postal Workers’ Complaints, Hearing Requests, and Appeals and Postal Workers as a Percentage of Total Complaints, Hearing Requests, and Appeals for Fiscal Years 1991-1998 Selected Federal Sector EEO Complaint Data for Fiscal Years 1991 to 1998 The following figures show the trends in (1) inventories of unresolved equal employment opportunity (EEO) complaints at federal agencies and the Equal Employment Opportunity Commission (EEOC); (2) the age of cases in the inventories; (3) the number of complaints, hearing requests, and appeals filed; and (4) processing times for complaints, hearings, and appeals. A recorded menu will provide information on how to obtain these lists.

Why GAO Did This Study Pursuant to a congressional request, GAO provided information on the Equal Employment Opportunity Commission's (EEOC) complaint caseload, focusing on: (1) trends in the size of inventories and the age of cases in inventory at various stages of the EEO complaint process; (2) trends in the number of complaints filed by federal employees and the time taken by agencies and EEOC to process them; and (3) implications of these trends and how future caseloads may be affected by EEOC's regulatory changes to the complaint process. What GAO Found GAO noted that: (1) inventories of unresolved federal sector discrimination cases at agencies and EEOC have continued to grow; (2) overall, from fiscal year (FY) 1991 to FY 1998, complaint inventories at federal agencies rose by about 114 percent, to 36,333; (3) at EEOC, during the same period, the hearings inventory rose by 280 percent, to 11,967, while the appeals inventory went up by 648 percent, to 10,966; (4) as inventories grew, the average age of cases in agencies' inventories (446 days) and EEOC's hearings (320 days) and appeals (293 days) inventories also reached new levels; (5) the size of the inventories and the age of cases in them continued their upward trend during FY 1998 as neither the agencies nor EEOC kept up with the influx of new cases; (6) agencies' inventories grew by 6 percent in FY 1998 despite a 2.8 percent decline in the number of new complaints; (7) the growth in EEOC's inventory of hearing requests during this period--19.5 percent--was greater than the increase in the number of new hearing requests, which rose by about 9.2 percent; (8) at the same time, EEOC's appeals inventory increased by 9.9 percent, even though the number of new appeals filed remained almost unchanged; (9) the average time to process a complaint at agencies showed a small decline in FY 1998, from 391 to 384 days, but there were sharp increases in the average time EEOC took to process hearing requests (rising from 277 to 320 days) and appeals (rising from 375 to 473 days); (10) a case travelling the entire complaint process could be expected to take 1,186 days to process, based on FY 1998 data; (11) this was 91 days longer than in FY 1997; (12) the logjams at EEOC and agencies are likely to persist, at least in the short run, as long as agencies and EEOC receive more new cases than they process and close; (13) the long-term outlook, however, is unclear; (14) substantive revisions to complaint program regulations and procedures are to be implemented beginning in November 1999; (15) these revisions are intended to reduce the volume of cases flowing through the complaint process; (16) the revisions include a requirement that agencies offer alternative dispute resolution, as well as other rules to reduce the opportunities for multiple complaints by the same complainant; and (17) however, EEOC has not yet developed estimates of how the revisions to program regulations will affect caseload trends and resource needs, nor has the agency completed development of measures and indicators to track the effects of these revisions once they are implemented.

gao_GAO-01-548T

gao_GAO-01-548T_0

Eliminating the exemption enjoyed by the nonprofit contractors would strengthen this tool. The enforcement program appears to be a useful and important tool for ensuring safe nuclear practices. H.R. Therefore, depending on the interpretation of the term “discretionary fee” as discussed above, limiting payment to the amount of the incentive fee could exempt these two contractors from paying any penalty for violating nuclear safety requirements. In contrast, these same contractors could have only a portion of their fee (the “discretionary fee”) at risk for violations of nuclear safety requirements. If a nonprofit contractor’s entire fee was subject to the civil penalty, the Secretary has discretion that should ensure that no nonprofit contractor’s assets are at risk because of having to pay the civil penalty. Under the existing law, in addition to the seven contractors exempted by name in the statute, the Secretary was given the authority to exempt nonprofit educational institutions. H.R. 723, however, Brookhaven Science Associates would be able to limit its payments for civil penalties.

Why GAO Did This Study This testimony discusses GAO's views on H.R. 723, a bill that would modify the Atomic Energy Act of 1954 by changing how the Department of Energy (DOE) treats nonprofit contractors who violate DOE's nuclear safety requirements. Currently, nonprofit contractors are exempted from paying civil penalties that DOE assesses under the act. H.R. 723 would remove that exemption. GAO supports eliminating the exemption because the primary reason for instituting it no longer exists. The exemption was enacted in 1988 at the same time the civil monetary penalty was established. The purpose of the exemption was to ensure that the nonprofit contractors operating DOE laboratories who were being reimbursed only for their costs, would not have their assets at risk for violating nuclear safety requirements. However, virtually all of DOE's nonprofit contractors have an opportunity to earn a fee in addition to payments for allowable costs. This fee could be used to pay the civil monetary penalties. What GAO Found GAO found that DOE's nuclear safety enforcement program appears to be a useful and important tool for ensuring safe nuclear practices.

gao_GAO-12-645

gao_GAO-12-645_0

FRPP data elements as performance measures: utilization, condition index, annual operating costs, and mission dependency. In June 2010, the President directed federal civilian agencies to achieve $3 billion in savings by the end of fiscal year 2012 through reducing annual operating costs, generating income through disposing of assets, using existing real property more effectively by consolidating existing space, expanding telework, and other space realignment efforts. Excess and Underutilized Property Data Are Inconsistent and Inaccurate because of Lack of Sound Data Collection Practices FRPC has not followed sound data collection practices, and, as a result, FRPP data do not describe excess and underutilized properties consistently and accurately. Although Some Progress Has Been Made, Federal Property Management Is Still Challenging and Efforts Lack a National Strategy The federal government has taken some steps to address excess and underutilized property management problems by developing the FRPP database, among other things. However, these efforts have not led to proven cost savings associated with the management of these properties. Cost savings goals set by the previous administration were discontinued. For example, all five agencies we reviewed have taken steps to use property more efficiently, as follows: Identifying underutilized assets to meet space needs. Reducing employee work space. Even with long-standing efforts to improve the management of excess and underutilized properties and save costs, federal agencies continue to face many of the same challenges that we have reported for over a decade. We recommend that the Director of OMB require the OMB Deputy Director for Management, as chair of FRPC, in collaboration and consultation with FRPC member agencies, to develop and publish a national strategy for managing federal excess and underutilized real property that includes, but is not limited to, the following characteristics: a statement of purpose, scope, and methodology; problem definition and risk assessment; goals, subordinate objectives, activities, and performance measures, including the milestones and time frames for achieving objectives; resources, investments, and risk management; organizational roles, responsibilities, and coordination; and integration and implementation plans. OMB agreed that challenges remain in the management of the federal government's excess and underutilized properties; however, OMB raised concerns with some of the phrasing in our report and offered further context and clarification regarding the administration’s overall efforts on real property reform. Appendix I: Objectives, Scope, and Methodology Our objectives were to determine to what extent (1) the Federal Real Property Profile (FRPP) database consistently and accurately describes the nature, use, and extent of excess and underutilized federal real property, and (2) progress is being made toward more effectively managing excess and underutilized federal real property. To determine to what extent the FRPP database described the nature, use, and extent of excess and underutilized federal real property, we obtained and analyzed FRPP data submissions and other real property data from the five selected agencies; interviewed real property officers at these agencies; visited sites where the agencies had reported excess or underutilized properties; interviewed Office of Management and Budget (OMB) staff; and reviewed FRPC guidance and other documents related to the agencies’ real property data and the FRPP database. Disposed. Appendix IV: Comments from the General Services Administration GAO Comments 1. GSA has agreed with this recommendation and has taken action to begin correcting the problems we identified. In reference to our findings on problems with cost savings associated with the June 2010 presidential memorandum, VA stated that it disagreed with findings in a previous GAO report (GAO-12-305) that we referenced.

Why GAO Did This Study The federal government has made some progress addressing previously identified issues with managing federal real property. This includes establishing FRPC—chaired by the Office of Management and Budget (OMB)—which created the FRPP database managed by GSA. GAO was asked to determine the extent to which (1) the FRPP database accurately describes the nature, use, and extent of excess and underutilized federal real property, and (2) progress is being made toward more effective management of these properties. GAO analyzed the data collection process and agency data, visited 26 sites containing excess and underutilized buildings from five civilian federal real property holding agencies with significant portfolios, and interviewed officials from these five agencies and OMB staff about how they collect FRPP data and manage excess and underutilized properties. What GAO Found The Federal Real Property Council (FRPC) has not followed sound data collection practices in designing and maintaining the Federal Real Property Profile (FRPP) database, raising concern that the database is not a useful tool for describing the nature, use, and extent of excess and underutilized federal real property. For example, FRPC has not ensured that key data elements—including buildings' utilization, condition, annual operating costs, mission dependency, and value—are defined and reported consistently and accurately. GAO identified inconsistencies and inaccuracies at 23 of the 26 locations visited related to these data elements (see the fig. for an example). As a result, FRPC cannot ensure that FRPP data are sufficiently reliable to support sound management and decision making about excess and underutilized property. The federal government has undertaken efforts to achieve cost savings associated with better management of excess and underutilized properties. However, some of these efforts have been discontinued and potential savings for others are unclear. For example, in response to requirements set forth in a June 2010 presidential memorandum for agencies to achieve $3 billion in savings by the end of fiscal year 2012, the General Services Administration (GSA) reported approximately $118 million in lease cost savings resulting from four new construction projects. However, GSA has yet to occupy any of these buildings and the agency’s cost savings analysis projected these savings would occur over a 30-year period—far beyond the time frame of the memorandum. The five federal agencies that GAO reviewed have taken some actions to dispose of and better manage excess and underutilized property, including using these properties to meet space needs by consolidating offices and reducing employee work space to use space more efficiently. However, they still face long-standing challenges to managing these properties, including the high cost of property disposal, legal requirements prior to disposal, stakeholder resistance, and remote property locations. A comprehensive, long-term national strategy would support better management of excess and underutilized property by, among other things, defining the scope of the problem; clearly addressing achievement goals; addressing costs, resources, and investments needed; and clearly outlining roles and coordination mechanisms across agencies. What GAO Recommends GAO recommends that, in consultation with FRPC, GSA develop a plan to improve the FRPP and that OMB develop a national strategy for managing federal excess and underutilized real property. GSA agreed with GAO’s recommendation and agreed with the report’s findings, in part. OMB agreed that real property challenges remain but raised concerns about how GAO characterized its findings on FRPP accuracy and other statements. GAO believes its findings are properly presented. The details of agencies’ comments and GAO’s response are addressed more fully within the report.

gao_T-AIMD-98-73

gao_T-AIMD-98-73_0

The Year 2000 Poses a Serious Problem for Banks The Federal Deposit Insurance Corporation is the deposit insurer of approximately 11,000 banks and saving institutions. Together, these institutions are responsible for about $6 trillion in assets and have insured deposits totaling upwards of $2.7 trillion. The letter, which included a statement from the interagency Federal Financial Institutions Examination Council, described the Year 2000 problem and highlighted concerns about the industry’s Year 2000 readiness. In May 1997, FDIC issued a more detailed awareness letter that described the five-phase approach to planning and managing an effective highlighted external issues requiring management attention, such as reliance on vendors, risks posed by exchanging data with external parties, and the potential effect of Year 2000 noncompliance on corporate borrowers; discussed operational issues that should be considered in Year 2000 planning, such as whether to replace or repair systems; related its plans to facilitate Year 2000 evaluations by using uniform directed banks to (1) inventory core computer functions and set priorities for Year 2000 goals by September 30, 1997, and (2) to complete programming changes and to have testing of mission-critical systems underway by December 31, 1998. Concerns With FDIC’s Efforts to Ensure Banks Are Year 2000 Ready The primary challenge facing FDIC, and indeed all the banking regulators, in providing a level of assurance that the banking industry will successfully address the Year 2000 problem is time. FDIC’s late start in developing an industry assessment is further compounded by two other factors: (1) its initial assessment and the follow-on assessment to be completed in June 1998 are not collecting all the data required to be definitive about the status of individual banks and (2) key guidance—being developed under the auspices of FFIEC—needed by banks to complete their own preparations is also late which, in turn, could potentially hamper individual banks’ abilities to address Year 2000 issues. While this guidance is needed, it would have been more appropriate to make it available before banks began completing their assessment phase efforts. Guidance Late for Bank Interaction With Vendors Regulators have found that some financial institutions, relying on third-party data processing servicers or purchased applications software, have not taken a proactive approach in ensuring Year 2000 compliance by their vendors. In its May 1997 letter, the regulators also recommended that banks begin developing processes to periodically assess large corporate customer Year 2000 efforts and to consider writing Year 2000 compliance into their loan documentation, and FDIC later informed its institutions that the Year 2000 risks associated with corporate customers and reliance on vendors would be included in FDIC’s follow-up assessments. Concerns With FDIC’s Efforts to Correct Its Internal Systems FDIC internal systems are critical to the day-to-day operation of the corporation. Specifically, FDIC has yet to fully assess its 40 mission-critical systems. Compounding this problem is the fact that FDIC has yet to develop contingency plans for its mission-critical systems and core business processes. In addition, FDIC had not yet prepared a contingency plan to ensure continuity of its core business processes. In conclusion, Mr. Chairman, we believe that FDIC has a good appreciation for the Year 2000 problem and has made significant progress since last year.

Why GAO Did This Study Pursuant to a congressional request, GAO discussed the progress being made by the Federal Deposit Insurance Corporation (FDIC) in ensuring that the thousands of banks it oversees are ready to handle the year 2000 computer conversion challenge. What GAO Found GAO noted that: (1) the year 2000 problem poses a serious dilemma for banks due to their heavy reliance on information systems; (2) it also poses a challenge for FDIC and the other bank regulators who are responsible for ensuring bank industry readiness; (3) regulators have a monumental task in making sure that financial institutions have adequate guidance in preparing for the year 2000 and in providing a level of assurance that such guidance is being followed; (4) further, regulators will likely face some tough decisions on the readiness of individual institutions as the millennium approaches; (5) GAO found that FDIC is taking the problem very seriously and is devoting considerable effort and resources to ensure that the banks it oversees mitigate year 2000 risks; (6) FDIC has been very emphatic in alerting banks to the year 2000 problem and has conducted a high-level assessment of the industry's year 2000 readiness; (7) despite aggressive efforts, FDIC still faces significant challenges in providing a high level of assurance that individual banks will be ready; (8) FDIC--as were the other regulators--was late in addressing the problem; (9) consequently, it is behind the year 2000 schedule recommended by both GAO and the Office of Management and Budget (OMB); (10) compounding this problem is that critical guidance, although under development, has not been released by the Federal Financial Institutions Examination Council (FFIEC) for banks and other financial institutions on contingency planning, assessing risks caused by corporate customers (borrowers), and assessing risks associated with third-party automated system service providers; (11) this guidance should have been provided earlier so that banks would have had more time to factor the guidance into their own assessments and plans; (12) additionally, FDIC's ability to report on individual banks' status in preparing for the year 2000 is limited by insufficient information being reported by bank examiners; (13) FDIC also needs to correct its internal systems used to support agency functions and has initiated efforts to do this; (14) FDIC is behind in assessing whether these systems are year 2000 compliant; and (15) although OMB guidance states that the assessment phase should have been completed in mid-1997, FDIC has not yet fully assessed its mission critical systems or established contingency plans in case systems repairs and replacements are not in place on time or do not work as intended.

gao_GAO-10-465

gao_GAO-10-465_0

Both CENTCOM and the services have issued predeployment training requirements. Some of CENTCOM’s Training Requirements Do Not Clearly Define Conditions and Standards, and Confusion Exists over to Whom the Requirements Apply CENTCOM has issued a list of training tasks that all individuals assigned to its area of responsibility, including support unit personnel, must complete before deploying in support of ongoing operations in Iraq and Afghanistan. The Services Are Providing Training on Most of CENTCOM’s Required Tasks, but Have Not Included Certain Tasks While the Army and Marine Corps have provided most of the CENTCOM required training, in some cases, they have not provided training on the specific tasks called for by CENTCOM. However, without visibility over the completion of remediation, Army and Marine Corps support forces may not successfully complete all CENTCOM or service required training tasks prior to deploying. CENTCOM and the Services Lack Complete Information on Servicemembers’ Completion of Required Combat Skills Training The Army and Marine Corps take steps to document the completion of required combat skills training tasks, but face inconsistencies in the way the services track completion of training. While the Army issued guidance requiring tracking of training completion through a servicewide system, the system has not been fully utilized. The Marine Corps also uses inconsistent approaches to track completion of required training and relies instead on paper rosters and stand-alone spreadsheets for tracking. There is no clearly defined process for waiving these training requirements, and there is no clear or established method for the services to report to CENTCOM that some servicemembers are not completing CENTCOM’s required training. The Army and Marine Corps Have Made Significant Changes to Combat Skills Training as a Result of Lessons Learned, but Information Concerning These Changes Is Not Being Consistently Shared The Army and Marine Corps have made significant changes to their combat skills training for support forces as a result of lessons learned, but the services have not uniformly applied lessons learned. Army and Marine Corps doctrine require the formal collection of lessons learned and designate after action reports as the primary vehicle for this formal collecting of lessons learned information. While the services have formal and informal means to facilitate the sharing of lessons learned information, trainers at the various training sites are not consistently sharing information about the changes they have made to their training programs. As a result, servicemembers are trained inconsistently and units that are deploying for similar missions sometimes receive different types and amounts of training. Conclusions U.S. forces deployed to CENTCOM’s area of responsibility, including support forces, are operating in an environment that lacks clear distinctions between the front lines and rear support areas. As a result, support units such as military police, engineers, and medical personnel may be exposed to hostile fire and other battlefield conditions. clearly outline the conditions under which CENTCOM’s mandatory training requirements are to be accomplished and the standards to which the tasks should be trained. To improve commanders’ visibility over the extent to which support forces are completing required combat skills training, we recommend that the Secretary of Defense direct the Secretary of the Army to fully implement the service’s system of record for tracking training completion—the Digital Training Management System by (1) developing a schedule for fully implementing the system, including the work to be performed and the resources to be used, and (2) including the actual start and completion dates of work activities performed so that the impact of deviations on future work can be proactively addressed. Appendix I: Scope and Methodology To assess the extent to which Army and Marine Corps support forces are completing required combat skills training, we reviewed combatant commander and service individual and unit predeployment training requirements, including CENTCOM’s Theater Entry Requirements, the U.S. Army Forces Command’s Predeployment Training Guidance for Follow-on Forces Deploying In Support of Southwest Asia, and Marine Corps Order 3502.6, Marine Corps Force Generation Process. We reviewed the means these organizations use to document the extent to which servicemembers were completing required training—paper records, automated spreadsheets, and databases.

Why GAO Did This Study In conventional warfare, support forces such as military police, engineers, and medical personnel normally operate behind the front lines of a battlefield. But in Iraq and Afghanistan--both in U.S. Central Command's (CENTCOM) area of responsibility--there is no clear distinction between front lines and rear areas, and support forces are sometimes exposed to hostile fire without help from combat arms units. The House report to the National Defense Authorization Act for fiscal year 2010 directed GAO to report on combat skills training for support forces. GAO assessed the extent to which (1) Army and Marine Corps support forces are completing required combat skills training; (2) the services and CENTCOM have information to validate completion of required training; and (3) the services have used lessons learned to adjust combat skills training for support forces. To do so, GAO analyzed current training requirements, documentation of training completion, and lessons learned guidance; observed support force training; and interviewed headquarters officials, trainers, and trainees between August 2009 and February 2010. What GAO Found Army and Marine Corps support forces undergo significant combat skills training, but additional actions could help clarify CENTCOM's training requirements, ensure the services fully incorporate those requirements into their training requirements, and improve the consistency of training that is being conducted. CENTCOM has issued a list of training tasks to be completed, in addition to the services' training requirements, before deploying to its area of operations. However, there is confusion over which forces the CENTCOM requirements apply to, the conditions under which the tasks are to be trained, and the standards for successfully completing the training. As a result, interpretations of the requirements vary and some trainees receive detailed, hands-on training for a particular task while others simply observe a demonstration of the task. In addition, while the Army and Marine Corps are training their forces on most of CENTCOM's required tasks, servicemembers are not being trained on some required tasks prior to deploying. While units collect information on the completion of training tasks, additional actions would help higher level decision-makers assess the readiness of deploying units and servicemembers. Currently, both CENTCOM and the services lack complete information on the extent to which Army and Marine Corps support forces are completing required combat skills training. The Army has recently designated the Digital Training Management System as its system of record for tracking the completion of required training, but guidance concerning system implementation is unclear and the system lacks some needed capabilities. As a result, support forces are not fully utilizing the system, and are inconsistently tracking completion of individual and unit training using paper records, stand-alone spreadsheets, and other automated systems. The Marine Corps also uses inconsistent approaches to document training completion. Furthermore, as GAO reported in May 2008, CENTCOM does not have a clearly defined waiver process to provide visibility over the extent to which personnel are deploying to its area of operations without having completed its required training tasks. As a result, CENTCOM and the services have limited visibility over the extent to which servicemembers have or have not completed all required training. While trainers at Army and Marine Corps training sites have applied lessons learned information and made significant changes to the combat skills training they provide support forces, the changes to training have varied across sites. Army and Marine Corps doctrine requires the collection of after action reports, the primary formal vehicle for collecting lessons learned. Lessons are also shared informally, such as through communication between deployed forces and units training to replace them. While the services have these formal and informal means to facilitate the sharing of lessons learned information, trainers at the various training sites are not consistently sharing information about the changes they have made to their training programs. As a result, servicemembers are trained inconsistently and units that are deploying for similar missions sometimes receive different types and amounts of training.

gao_GAO-12-619

gao_GAO-12-619_0

According to DOD officials, more than 43 million gallons of fuel, on average, were supplied each month to support U.S. forces in Afghanistan in 2011. DOD Has Taken Steps to Establish an Approach for Fuel Demand Management, but Is Still Developing Comprehensive Guidance DOD has taken steps since our 2009 report to establish an approach for managing overall fuel demand, but is still developing comprehensive guidance to address fuel demand management. As such, we recommended that DOD develop requirements for managing fuel demand at forward-deployed locations, and DOD concurred with this recommendation. Since that time, DOD has taken several steps to increase its visibility and accountability for fuel demand management, and is developing comprehensive guidance on how DOD will incorporate energy efficiency considerations into operations, planning, and training decisions for current and future military operations. Progress in Establishing Visibility and Accountability for Overall DOD Fuel Demand Management DOD has made progress in establishing visibility and accountability for fuel demand management since our 2009 report by making organizational changes and issuing an Operational Energy Strategy (operational energy strategy) and related Operational Energy Strategy Implementation Plan (implementation plan) to provide direction for DOD’s overall fuel demand management efforts, including efforts at forward-deployed locations in Afghanistan. DOD’s Operational Energy Strategy Implementation Plan also acknowledges the need for additional comprehensive guidance and directs the Joint Staff and military departments to report to the Defense Operational Energy Board by the fourth quarter of fiscal year 2012 on how the strategy’s goals will be reflected in policy, doctrine, and professional military education. 3). 5). DOD has Efforts Underway to Promote Fuel Efficiency, Coordination, and Collaboration but Opportunities Exist to Enhance Efforts to Identify and Track All Fuel Demand Management Initiatives DOD has several ongoing initiatives to promote fuel efficiency at forward- deployed locations in Afghanistan and has established various methods to facilitate some coordination and collaboration among the services. However, it is still in the process of developing a systematic approach to identify and track the numerous fuel demand management initiatives that have been fielded, or are in the research and development phase throughout DOD. Without a systematic approach, DOD may be limited in its ability to provide full visibility over all of its fuel demand management initiatives, achieve efficiencies, and avoid unintended duplication or overlap of activities. DOD Has Measured the Results of Some Fuel Demand Management Initiatives, and Is Developing Baseline Data to Assess Progress Toward Achieving Operational Energy Goals DOD has measured the results of some of the fuel demand management initiatives used in Afghanistan, but only recently has focused on collecting and assessing the data needed to develop a comprehensive baseline measure of its current fuel consumption at forward-deployed locations. Recognizing the need for information to manage fuel demand effectively, DOD has tasked the services with establishing baselines for operational energy consumption in all activities (air, sea, land) in its March 2012 implementation plan and provided funding for this purpose. The Army and Marine Corps have begun collecting information on fuel consumption at their forward-deployed locations in Afghanistan. Recommendation for Executive Action To further enhance DOD’s approach for managing fuel demand, including at forward deployed locations such as those in Afghanistan, we recommend that the Secretary of Defense direct the Assistant Secretary of Defense for Operational Energy Plans and Programs, in consultation with the Joint Staff, combatant commanders, and military service components, to finalize and implement a systematic approach that includes establishing a mechanism to identify and track fuel demand management initiatives that have been fielded, or are in the research and development phase to ensure information concerning these efforts is effectively shared across the services. GAO staff who made key contributions to this report are listed in appendix V. Appendix I: Scope and Methodology Our objectives were to assess the extent to which DOD has (1) established an approach to provide visibility and accountability for fuel demand management at forward-deployed locations, (2) initiatives underway to promote fuel efficiency across the services in Afghanistan and has facilitated coordination and collaboration among the services on the development and fielding of these initiatives, and (3) measured the results of its fuel demand management initiatives at forward-deployed locations. These elements include: (1) establishing visibility and accountability for achieving fuel reduction by assigning roles and responsibilities, establishing metrics, and monitoring performance; (2) issuing guidance and policies that address fuel demand at forward-deployed locations; and (3) establishing incentives and a viable funding mechanism to support the implementation of fuel demand reduction projects. We also conducted interviews with DOD and service officials to obtain information regarding DOD’s progress in collecting fuel data on fuel demand management initiatives and establishing a baseline on fuel demand at forward-deployed locations in Afghanistan.

Why GAO Did This Study According to DOD, the U.S. military’s dependence on liquid fuel in countries like Afghanistan creates an enormous logistics burden that exposes forces to enemy attack and diverts operational resources from other mission areas to support delivery of this critical resource. In 2011, DOD consumed almost 5 billion gallons of fuel in military operations worldwide, at a cost of approximately $17.3 billion. GAO was asked to (1) assess DOD’s approach for fuel demand management, including at forward-deployed locations in Afghanistan, (2) determine the extent to which DOD has initiatives to promote fuel efficiency at forward-deployed locations in Afghanistan and efforts to coordinate and collaborate on such initiatives, and (3) assess efforts to measure the results of its fuel demand management initiatives and establish a baseline measure of fuel consumption in Afghanistan. To conduct this review, GAO analyzed DOD and service guidance and strategies related to fuel demand management and fuel demand management initiatives, visited locations in Afghanistan, and met with DOD officials. What GAO Found The Department of Defense (DOD) has taken steps to establish an approach for managing DOD’s overall fuel demand, but is still developing comprehensive guidance to address fuel demand management, including at forward-deployed locations in countries such as Afghanistan. In 2009, GAO reported that DOD lacked (1) visibility and accountability for achieving fuel reduction, (2) incentives and a viable funding mechanism to invest in the implementation of fuel demand reduction projects, and (3) guidance and policies that addressed fuel demand at forward-deployed locations. In response to GAO recommendations, DOD has taken steps since 2009 to increase its visibility and accountability for fuel demand management at forward-deployed locations, including those located in Afghanistan. In addition, with an increased focus on fuel demand management, DOD has also provided funding and incentives to implement fuel demand management projects. Further, DOD has issued some guidance on fuel demand management at forward-deployed locations since 2009 and is developing more comprehensive guidance on how DOD will incorporate energy efficiency considerations into operations, planning, and training decisions for current military operations in Afghanistan and for future military operations. DOD’s 2012 Operational Energy Strategy Implementation Plan acknowledges the need for additional comprehensive guidance and directs the Joint Staff and military departments to report, by the end of fiscal year 2012, on how operational energy considerations will be reflected in policy, doctrine, and professional military education. The Duncan Hunter National Defense Authorization Act for Fiscal Year 2009 requires DOD to report to Congress annually on its progress in implementing its operational energy strategy. DOD has yet to submit its first report. Multiple DOD organizations are developing initiatives to decrease fuel demand at forward-deployed locations, including in Afghanistan, and the department has worked to facilitate some coordination and collaboration among the services on fuel demand management efforts. However, it is still developing an approach to systematically identify and track all of the fuel demand management initiatives that have been fielded, or are in the research and development phase throughout DOD. GAO’s prior work found that utilizing a mechanism such as a database can help organizations enhance their visibility and oversight of DOD programs. Until DOD finalizes its approach to systematically identify and track fuel demand management initiatives, it may be limited in its ability to foster collaboration, achieve efficiencies, and avoid unintended duplication or overlap of activities. DOD has started to measure the results of some of the fuel demand management initiatives used in Afghanistan, but is still in the process of collecting and assessing comprehensive baseline data needed to measure current fuel consumption at forward-deployed locations. The Army and Marine Corps have begun collecting data on the amount of fuel consumed by their current assets in Afghanistan. Recognizing the need for additional information, DOD’s 2012 Implementation Plan has tasked the services with developing and refining their fuel consumption baselines by mid-2012 and DOD has provided funding for this purpose. Once collected, these data should enhance DOD’s planning, programming, and operational decisions and help DOD assess progress toward meeting its operational energy goals. What GAO Recommends GAO recommends that DOD finalize and implement a systematic approach that includes establishing a mechanism to identify and track fuel demand management initiatives that have been fielded, or are in the research and development phase. DOD partially concurred with GAO’s recommendation, citing ongoing efforts to identify and track initiatives. Until fully implemented, GAO is unable to assess whether these efforts fully address the recommendation

gao_GAO-13-371

gao_GAO-13-371_0

Background Eligibility Criteria for School Participation in the Title IV Program In order for students attending a school to receive Title IV funds, a school must be: 1. licensed or otherwise legally authorized to provide higher education in the state in which it is located, 2. accredited by an agency recognized for that purpose by the Secretary 3. deemed eligible and certified to participate in federal student aid programs by Education. Past and Ongoing Initiatives to Examine Schools’ Federal Regulatory Burden Over the last two decades, there have been several efforts to examine the federal regulatory burden faced by schools (see table 1). Experts Cited a Range of Requirements as Burdensome Although the 18 experts we interviewed offered varied opinions on which Title IV requirements are the most burdensome, 16 said that federal requirements impose burden on postsecondary schools. While no single requirement was cited as most burdensome by a majority of experts, 11 cited various consumer disclosures schools must provide or make available to the public, students, and staff (see table 2). Beyond consumer disclosures, 4 experts stated that schools are burdened by requirements related to the return of unearned Title IV funds to the federal government when a student receiving financial aid withdraws from school. According to 2 experts, schools find it particularly difficult both to calculate the precise amount of funds that should be returned and to determine the date on which a student withdrew. Experts also described some of the benefits associated with Title IV requirements. For example, participants in four groups said the requirement that schools receiving Title IV funds post a net price calculator on their websites—an application that provides consumers with estimates of the costs of attending a school—has proven costly or complicated, noting challenges such as those associated with the web application, obtaining the necessary data, or providing information that may not fit the schools’ circumstances. School officials from six discussion groups also noted that complying with requirements related to the Return of Title IV Funds can be costly because of the time required to calculate how much money should be returned to the federal government (see Appendix III for information on selected comments on specific federal requirements school officials described as burdensome). Participants in three discussion groups found the complexity of Return of Title IV requirements made it difficult to complete returns within the required time frame. As shown in table 4, the department publishes notices in the Federal Register, on its website, and through a listserv to make the public aware of opportunities to provide feedback on burden.Department officials also said they receive some feedback from school officials through informal channels such as training sessions and open forums at conferences. For example, Education said it received no comments in response to its request for public comment on burden estimates included in its 2010 “Program Integrity” Notices of Proposed Rulemaking, which proposed multiple regulatory changes with increased burden estimates. shows that fewer than one-fourth (65 of 353) received public comments, of which 25 included comments that addressed burden faced by schools (see fig 1). For example, 2 ICRs received input on the difficulties of providing data requested by the department. Concluding Observations Notwithstanding the benefits of Title IV requirements, school officials believe that the burden created by federal requirements diverts time and resources from their primary mission of educating students. Education also suggested we report more on its efforts to balance burden and benefits when designing information collections. To determine the types of burdens and benefits that schools say federal requirements create, we conducted eight discussion groups at two national conferences with a nongeneralizable sample of officials from 51 schools. To determine how Education solicits feedback from stakeholders on burden, we conducted interviews with Education officials and reviewed documentation, such as agency web pages and listserv postings used by Education to inform schools and other interested parties about negotiated rulemaking and information collections. All references to “statute” or “regulations” are references to the Higher Education Act of 1965 (HEA), as amended, and Education’s implementing regulations.

Why GAO Did This Study Postsecondary schools must comply with a variety of federal requirements to participate in student financial aid programs authorized under Title IV. While these requirements offer potential benefits to schools, students, and taxpayers, questions have been raised as to whether they may also distract schools from their primary mission of educating students. GAO examined (1) which requirements, if any, experts say create burden, (2) the types of burdens and benefits schools say requirements create, and (3) how Education solicits feedback from stakeholders on regulatory burden. GAO reviewed relevant federal regulatory and statutory requirements, and past and ongoing efforts examining postsecondary regulatory burden; interviewed Education officials and 18 experts, including officials from associations that represent postsecondary schools; and conducted eight discussion groups at two national conferences with a nongeneralizable sample of 51 school officials from public, nonprofit, and for-profit sectors. GAO also reviewed documentation associated with Education's requests for public comment on burden for proposed postsecondary information collections and its retrospective analysis of regulations. What GAO Found Experts GAO interviewed offered varied opinions on which student financial aid requirements under Title IV of the Higher Education Act of 1965, as amended, are the most burdensome. While no single requirement was cited as burdensome by a majority of the 18 experts, 11 cited various consumer disclosure requirements--such as those pertaining to campus safety--primarily due to the time and difficulty needed to gather the information. Beyond consumer disclosures, 4 experts cited "Return of Title IV Funds"--which requires schools to calculate and return unearned financial aid to the federal government when a recipient withdraws from school--as burdensome because schools find it difficult to calculate the precise amount of funds that should be returned. More broadly, 6 experts said that the cumulative burden of multiple requirements is a substantial challenge. Experts also noted some benefits. For example, an expert said required loan disclosures help students understand their repayment responsibilities. School officials who participated in each of the eight discussion groups GAO conducted expressed similar views about the types of burdens and benefits associated with Title IV requirements. Participants in all groups said requirements for consumer disclosures and Return of Title IV Funds are costly and complicated. Regarding consumer disclosures, participants questioned the value of disclosing data that cannot be readily compared across schools, like data on graduates' employment, which may be calculated using different methodologies. Participants in four groups found Return of Title IV Funds requirements difficult to complete within the required time frame. Participants also cited some benefits, such as how consumer disclosures can help applicants choose the right school and unearned Title IV funds can be redirected to other students. Education seeks feedback from schools on regulatory burden mainly through formal channels, such as announcements posted in the Federal Register, on its website, and on a department listserv. However, Education officials said they have received a limited number of comments about burden in response to these announcements. GAO reviewed Education's notices soliciting public comments on burden estimates for its postsecondary information collections--which require the public, including schools, to submit or publish specified data--and found that 65 of 353 notices (18 percent) received comments, of which 25 received comments related to burden. For example, 2 notices received input on the difficulties of providing data requested by the department. What GAO Recommends GAO makes no recommendations in this report. In its comments, Education sought clarification regarding types of federal requirements and additional information on its efforts to balance burden and benefits. We provided clarifications and additional information, as appropriate.

gao_GAO-09-842T

gao_GAO-09-842T_0

Consultations with Trade Advisory Committees Have Generally Improved Our 2002 survey of trade advisory committee members found high levels of satisfaction with many aspects of committee operations and effectiveness, yet more than a quarter of respondents indicated that the system had not realized its potential to contribute to U.S. trade policy. In particular, we received comments about the timeliness, quality, and accountability of consultations. For example, the law requires the executive branch to inform committees of “significant departures” from committee advice. However, many committee members reported that agency officials informed committees less than half of the time when their agencies pursued strategies that differed from committee input. Changes Made to Improve Committee Logistics Have Not Been Fully Tested In 2002, we found that slow administrative procedures disrupted committee operations, and the resources devoted to committee management were out of step with required tasks. In several instances, for example, committees ceased to meet and thus could not provide advice, in part because the agencies had not appointed members. However, the length of time required to obtain a security clearance contributed to delays in member appointment. To address these concerns, we recommended the agencies upgrade system management; and in response, they began to grant new advisors interim security clearances so that they could actively participate in the committee while the full clearance is conducted. Despite these actions, however, trade advisory committee chairs we contacted in 2007 told us certain logistics such as delays in rechartering committees and appointment of members still made it difficult for some committees to function effectively. We found several committees had not been able to meet for periods of time, either because agencies allowed their charters to lapse or had not started the process of soliciting and appointing members soon enough to ensure committees could meet once they were rechartered. The Labor Advisory Committee, for example, did not meet for over 2 years from September 2003 until November 2005 due in part to delays in the member appointment process. These types of process delays further reduced a committee’s ability to give timely, official advice before the committee was terminated, and the rechartering process had to begin again. This was particularly true in the case of the Labor Advisory Committee, which, at the time of our 2007 report, still had a 2- year charter. Representation of Key Stakeholders Remains Important for Any Review of Trade Advisory Committee System In addition to the need to improve certain committee logistics, we also found that representation of stakeholders is a key component of the trade advisory committee system that warrants consideration in any review of the system. In particular, as the U.S. economy and trade policy have shifted, the trade advisory committee system has needed adjustments to remain in alignment with them, including both a revision of committee coverage as well as committee composition.

Why GAO Did This Study This testimony provides a summary of key findings from the comprehensive report on the trade advisory system that we provided to the Congress in 2002, as well as from our more recent report in 2007 on the Congressional and private sector consultations under Trade Promotion Authority. In particular, this testimony highlights our recommendations in three key areas--committee consultations, logistics, and overall system structure--as well as the changes that have been made by the U.S. agencies since those reports were published. What GAO Found Our 2002 survey of trade advisory committee members found high levels of satisfaction with many aspects of committee operations and effectiveness, yet more than a quarter of respondents indicated that the system had not realized its potential to contribute to U.S. trade policy. In particular, we received comments about the timeliness, quality, and accountability of consultations. For example, the law requires the executive branch to inform committees of "significant departures" from committee advice. However, many committee members reported that agency officials informed committees less than half of the time when their agencies pursued strategies that differed from committee input. In 2002, we found that slow administrative procedures disrupted committee operations, and the resources devoted to committee management were out of step with required tasks. In several instances, for example, committees ceased to meet and thus could not provide advice, in part because the agencies had not appointed members. However, the length of time required to obtain a security clearance contributed to delays in member appointment. To address these concerns, we recommended the agencies upgrade system management; and in response, they began to grant new advisors interim security clearances so that they could actively participate in the committee while the full clearance is conducted. Despite these actions, however, trade advisory committee chairs we contacted in 2007 told us certain logistics such as delays in rechartering committees and appointment of members still made it difficult for some committees to function effectively. We found several committees had not been able to meet for periods of time, either because agencies allowed their charters to lapse or had not started the process of soliciting and appointing members soon enough to ensure committees could meet once they were rechartered. The Labor Advisory Committee, for example, did not meet for over 2 years from September 2003 until November 2005 due in part to delays in the member appointment process. These types of process delays further reduced a committee's ability to give timely, official advice before the committee was terminated, and the rechartering process had to begin again. This was particularly true in the case of the Labor Advisory Committee, which, at the time of our 2007 report, still had a 2-year charter. In addition to the need to improve certain committee logistics, we also found that representation of stakeholders is a key component of the trade advisory committee system that warrants consideration in any review of the system. In particular, as the U.S. economy and trade policy have shifted, the trade advisory committee system has needed adjustments to remain in alignment with them, including both a revision of committee coverage as well as committee composition.

gao_GAO-07-51

gao_GAO-07-51_0

This type of contract is commonly referred to as “seat management.” Generally speaking, under seat management, contractor-owned desktop and other computing hardware, software, and related services are bundled and provided on the basis of a fixed price per unit (or seat). However, the Navy did not implement this plan, choosing instead to focus on defining and measuring contractually specified SLAs. Without effective performance management, the Navy is increasing the risk that the program will continue to fall short of its goals and expected results. However, the Navy has not implemented its 2000 performance management plan. Customer satisfaction survey: The target was to have 85 percent of NMCI end users satisfied. Specifically, the information superiority and innovation goals that were used to justify the program have yet to be attained. Contractor Has Largely Met Many but Has Not Met Other SLAs Our analysis of Navy contractor performance data since September 2004 shows that the extent to which the site-specific agreements have been met for all operational seats (regardless of site) varies widely by individual agreement, with some always being met but others having varied performance over time and by seat type. Our analysis also showed that, although the contractor has met most of the enterprisewide agreements during this time period, it has not met a few. 5). 9). NMCI Customer Groups’ Satisfaction Levels Vary, but Overall Customer Satisfaction Is Low The Navy’s three groups of NMCI customers—end users, organizational commanders, and network operators—vary in the extent to which they are satisfied with the program, but collectively these customers are generally not satisfied. End User Surveys Show Dissatisfaction with NMCI Despite reported improvements in end user satisfaction levels since 2002, end user responses to quarterly satisfaction surveys have been consistently at the low end of the range of scores that the Navy defines the term “satisfied” to mean, and the percentage of end users that Navy counts as being “satisfied” have consistently been below the Navy’s satisfaction target level. Exacerbating this long-standing shortfall in meeting end user satisfaction expectations is the fact that the Navy considers a “satisfied” end user to include users that are at best marginally satisfied and arguably somewhat dissatisfied. Customer Satisfaction Improvement Efforts Are Not Being Guided by Effective Planning The NMCI program office reports that improving customer satisfaction is a program priority. Expanded network services. Given that the Navy reports that it has already invested about 6 years and $3.7 billion in NMCI, the time to develop a comprehensive understanding of the program’s performance to date, and its prospects for the future, is long overdue. Recommendations for Executive Action To improve NMCI performance management and better inform investment decision making, we recommend that the Secretary of Defense direct the Secretary of the Navy to ensure that the NMCI program adopts robust performance management practices that, at a minimum, include (1) evaluating and appropriately adjusting the original plan for measuring achievement of strategic program goals and provides for its implementation in a manner that treats such measurement as a program priority; (2) expanding its range of activities to measure and understand service level agreement performance to provide increased visibility into performance relative to each agreement; (3) sharing the NMCI performance results with DOD, Office of Management and Budget, and congressional decision makers as part of the program’s annual budget submissions; and (4) reexamining the focus, scope, and transparency of its customer satisfaction activities to ensure that areas of dissatisfaction described in this report are regularly disclosed to the aforementioned decision makers and that customer satisfaction improvement efforts are effectively planned and managed. Key contributors to this report are listed in appendix V. Objectives, Scope, and Methodology Our objectives were to review (1) whether the Navy Marine Corps Intranet (NMCI) is meeting its strategic goals, (2) the extent to which the contractor is meeting its service level agreements (SLA), (3) whether customers are satisfied with the program, and (4) what is being done to improve customer satisfaction. To determine whether NMCI is meeting its strategic goals, we reviewed documents provided by Department of the Navy describing the mission need for NMCI, strategic goals, performance measures, and data gathered on actual performance, conducted interviews with officials from the offices of the Department of Defense Chief Information Officer (CIO), Department of the Navy CIO, and Assistant Secretary of the Navy for Research, Development, and Acquisition, including officials in the NMCI program office, identified the NMCI strategic goals, related performance categories, associated performance targets, and actual performance data through document reviews and interviews, developed an analysis showing NMCI’s performance relative to the strategic goals, performance categories, and targets based upon available actual performance data, and shared our analysis with program officials and adjusted the analysis based on comments and additional data they provided.

Why GAO Did This Study The Navy Marine Corps Intranet (NMCI) is a 10-year, $9.3 billion information technology services program. Through a performance-based contract, the Navy is buying network (intranet), application, and other hardware and software services at a fixed price per unit (or "seat") to support about 550 sites. GAO prepared this report under the Comptroller General's authority as part of a continued effort to assist Congress and reviewed (1) whether the program is meeting its strategic goals, (2) the extent to which the contractor is meeting service level agreements, (3) whether customers are satisfied with the program, and (4) what is being done to improve customer satisfaction. To accomplish this, GAO reviewed key program and contract performance management-related plans, measures, and data and interviewed NMCI program and contractor officials, as well as NMCI customers at shipyards and air depots. What GAO Found NMCI has not met its two strategic goals--to provide information superiority and to foster innovation via interoperability and shared services. Navy developed a performance plan in 2000 to measure and report progress towards these goals, but did not implement it because the program was more focused on deploying seats and measuring contractor performance against contractually specified incentives than determining whether the strategic mission outcomes used to justify the program were met. GAO's analysis of available performance data, however, showed that the Navy had met only 3 of 20 performance targets (15 percent) associated with the program's goals and nine related performance categories. By not implementing its performance plan, the Navy has invested, and risks continuing to invest heavily, in a program that is not subject to effective performance management and has yet to produce expected results. GAO's analysis also showed that the contractor's satisfaction of NMCI service level agreements (contractually specified performance expectations) has been mixed. Since September 2004, while a significant percentage of agreements have been met for all types of seats, others have not consistently been met, and still others have generally not been met. Navy measurement of agreement satisfaction shows that performance needed to receive contractual incentive payments for the most recent 5-month period was attained for about 55 to 59 percent of all eligible seats, which represents a significant drop from the previous 9-month period. GAO's analysis and the Navy's measurement of agreement satisfaction illustrate the need for effective performance management, to include examining agreement satisfaction from multiple perspectives to target needed corrective actions and program changes. GAO analysis further showed that NMCI's three customer groups (end users, commanders, and network operators) vary in their satisfaction with the program. More specifically, end user satisfaction surveys indicated that the percent of end users that met the Navy's definition of a satisfied user has remained consistently below the target of 85 percent (latest survey results categorize 74 percent as satisfied). Given that the Navy's definition of the term "satisfied" includes many marginally satisfied and arguably somewhat dissatisfied users, this percentage represents the best case depiction of end user satisfaction. Survey responses from the other two customer groups show that both were not satisfied. GAO interviews with customers at shipyards and air depots also revealed dissatisfaction with NMCI. Without satisfied customers, the Navy will be challenged in meeting program goals. To improve customer satisfaction, the Navy identified various initiatives that it described as completed, under way, or planned. However, the initiatives are not being guided by a documented plan(s), thus limiting their potential effectiveness. This means that after investing about 6 years and $3.7 billion, NMCI has yet to meet expectations, and whether it will is still unclear.

gao_NSIAD-98-66

gao_NSIAD-98-66_0

In September 1995, after three U.S. servicemen raped an Okinawan schoolgirl, Japan and the United States formed the Special Action Committee on Okinawa (SACO) to find ways to limit the impact of the U.S. military presence on Okinawa. Objectives, Scope, and Methodology In response to Representative Duncan Hunter’s concerns about the impact of implementing SACO’s recommendations on U.S. force readiness, we describe (1) the benefit or necessity of retaining U.S. forces in Japan and on Okinawa and (2) SACO’s report recommendations and identify the impact of implementation on U.S. operations, training, and costs. The report also identifies two environmental issues that may remain after the SACO recommendations have been implemented. Finally, the cost of the U.S. presence in Japan is shared by the government of Japan, which also provides bases and other infrastructure used by U.S. forces on Okinawa. According to the Office of the Secretary of Defense, Pacific Command, and USFJ, a withdrawal of U.S. forces from the region could be interpreted by countries in the region as a weakening of the U.S. commitment to peace and stability in Asia-Pacific and could undercut the deterrent value of the forward deployment. Some SACO Recommendations Carry Risk That Must Be Overcome to Maintain U.S. Operational Capability The SACO Final Report calls for the United States to (1) return land at 11 U.S. bases on Okinawa and replace MCAS Futenma with a sea-based facility, (2) change 3 operational procedures, (3) implement 5 noise abatement procedures, and (4) implement 7 Status of Forces Agreement changes. At the time of this report, the United States and Japan were discussing having Japan pay for maintenance on the sea-based facility. Marine Corps Bases, Japan estimated the construction cost to be about $300 million, which Japan is scheduled to pay. The current estimated cost to the United States to implement the recommendations related to the return of land is about $193.5 million over about 10 years. This arrangement could reduce U.S. costs below the current estimate of $193.5 million. Recommendations We recommend that the Secretary of Defense decide on the means to monitor the design, engineering, and construction of the sea-based facility; work with Japan to include a risk-reduction phase in the acquisition schedule to establish that the designed sea-based facility will be affordable and operationally suitable; take steps to ensure that all U.S. concerns, especially the costs of operations and maintenance on the sea-based facility and operational concerns, have been satisfactorily addressed before Japan begins to build the sea-based facility; and request the Japanese government to allocate funds for those projects at Futenma that were cancelled by Japan due to the planned closure of Futenma and are deemed essential to continued operations of the station and the 1st Marine Air Wing until completion of the replacement facility. The first concerns the potential for environmental contamination on U.S. bases scheduled for closure. The second concerns the potential adverse impact on the environment from construction and operation of the sea-based facility. If the United States agrees to this request, land return under the SACO process could be affected.

Why GAO Did This Study Pursuant to a congressional request, GAO reviewed the contents of the Final Report of the Special Action Committee on Okinawa (SACO), focusing on: (1) the impact on readiness of U.S. forces based on Okinawa after implementation of the report recommendations; (2) the U.S. cost of implementing the recommendations; and (3) the benefit or necessity of having U.S. Marine Corps forces on Okinawa. What GAO Found GAO noted that: (1) the Department of Defense (DOD) believes that Marine Corps forces along with other U.S. forces on Okinawa satisfy the U.S. national security strategy by visibly demonstrating the U.S. commitment to security in the region; (2) these forces are thought to deter aggression, provide a crisis response capability should deterrence fail, and avoid the risk that U.S. allies may interpret the withdrawal of forces as a lessening of U.S. commitment to peace and stability in the region; (3) Okinawa's proximity to potential regional trouble spots promotes the early arrival of U.S. military forces due to shorter transit times and reduces potential problems that could arise due to late arrival; (4) the cost of this presence is shared by the government of Japan, which provides bases and other infrastructure on Okinawa rent-free and pays part of the annual cost of Okinawa-based Marine Corps forces; (5) the SACO Final Report calls on the United States to: (a) return land that includes one base and portions of camps, sites, and training areas on Okinawa to Japan; (b) implement changes to three operational procedures; and (c) implement changes to five noise abatement procedures; (6) the United States has established requirements that Japan must meet as it designs, builds, and pays for the sea-based facility before the Marine Corps Air Station Futenma is closed and operations are moved to the sea-based facility; (7) such a facility has never been built and operated; (8) annual operations and maintenance costs for the sea-based facility were initially estimated at $200 million; (9) the United States requested that the Japanese government pay the cost to maintain the new sea-based facility, but as of the date of this report, it had not agreed to do so; (10) excluding the cost to operate the sea-based facility, the current estimated cost to the United States to implement the SACO land return recommendations is about $193.5 million over about 10 years; (11) the United States and Japan are negotiating an arrangement under which Japan would assume some SACO-related responsibilities consistent with their domestic laws; (12) this arrangement could result in reduced U.S. costs; (13) while final implementation of the SACO recommendations is intended to reduce the burden of U.S. forces' presence in Okinawa, two environmental issues could arise; (14) the first issue concerns the potential for environmental contamination being found on military facilities returned to Japan and responsibility for cleanup of those facilities; and (15) the second issue concerns the potential adverse effects that the construction and operation of the sea-based facility could have on the environment.

gao_GAO-09-422T

gao_GAO-09-422T_0

Air carriers and freight forwarders are responsible for implementing TSA security requirements. TSA Has Made Progress in Meeting the Screening Mandate as It Applies to Domestic Cargo; However, TSA Cannot Yet Verify Whether the Mandated Level Is Being Met TSA Has Made Progress in Meeting the 50 Percent and 100 Percent Mandated Screening Levels as They Apply to Domestic Cargo TSA has taken several key steps to meet the 9/11 Commission Act air cargo screening mandate as it applies to domestic cargo. Narrow-body flights transport about 26 percent of all cargo on domestic passenger flights. Furthermore, effective February 2009, TSA revised or eliminated most of its screening exemptions for domestic cargo. TSA also created a program, known as the CCSP, to allow screening to take place earlier in the shipping process and at various points in the air cargo supply chain. In this program, air cargo industry stakeholders—such as freight forwarders and shippers—voluntarily apply to become Certified Cargo Screening Facilities (CCSF). TSA Cannot Yet Verify that Screening Is Being Conducted Domestically at the Mandated Level, and TSA’s Current Approach Could Result in Variable Percentages of Screened Cargo TSA estimates that it achieved the mandate for screening 50 percent of domestic cargo transported on passenger aircraft by February 2009, based on feedback from air cargo industry stakeholders responsible for conducting screening. The agency is working to establish a system to collect data from screening entities to verify that requisite screening levels for domestic cargo are being met. TSA Faces Participation, Technology, Oversight, and Inbound Cargo Challenges in Meeting the Screening Mandate It Is Unclear Whether TSA Will Be Able to Attract the Voluntary Participants Needed to Meet the 100 Percent Screening Mandate Although industry participation in the CCSP is vital to TSA’s approach to spread screening responsibilities across the supply chain, it is unclear whether the number and types of facilities needed to meet TSA’s screening estimates will join the CCSP. TSA Has Taken Some Steps to Develop and Test Technologies for Screening Air Cargo, but Has Not Yet Completed Assessments to Ensure Their Effectiveness TSA has taken some steps to develop and test technologies for screening and securing air cargo, but has not yet completed assessments of the technologies it plans to allow air carriers and program participants to use in meeting the August 2010 screening mandate. We will continue to assess this issue as part of our ongoing review of TSA’s efforts to meet the mandate to screen 100 percent of cargo transported on passenger aircraft. Limited Staffing Resources May Hamper TSA’s Ability to Effectively Oversee the Thousands of Additional Entities Involved in Meeting the Air Cargo Screening Mandate Although the actual number of cargo TSIs increased each fiscal year from 2005 to 2009, TSA still faces challenges overseeing compliance with the CCSP due to the size of its current TSI workforce. TSA Has Taken Some Steps to Meet the Screening Mandate as It Applies to Inbound Cargo but Does Not Expect to Achieve 100 Percent Screening of Inbound Cargo by the August 2010 Deadline To meet the 9/11 Commission Act screening mandate as it applies to inbound cargo, TSA revised its requirements for foreign and U.S.-based air carrier security programs and began harmonization of security standards with other nations.

Why GAO Did This Study The Implementing Recommendations of the 9/11 Commission Act of 2007 mandates the Department of Homeland Security (DHS) to establish a system to physically screen 50 percent of cargo transported on passenger aircraft by February 2009 and 100 percent of such cargo by August 2010. This testimony provides preliminary observations on the Transportation Security Administration's (TSA) progress in meeting the mandate to screen cargo on passenger aircraft and the challenges TSA and industry stakeholders may face in screening such cargo. GAO's testimony is based on products issued from October 2005 through August 2008, and its ongoing review of air cargo security. GAO reviewed TSA's air cargo security programs, interviewed program officials and industry representatives, and visited two large U.S. airports. What GAO Found TSA has made progress in meeting the air cargo screening mandate as it applies to domestic cargo. TSA has taken steps that will allow screening responsibilities to be shared across the air cargo supply chain--including TSA, air carriers, freight forwarders (which consolidate cargo from shippers and take it to air carriers for transport), and shippers--although air carriers have the ultimate responsibility for ensuring that they transport cargo screened at the requisite levels. TSA has taken several key steps to meet the mandate, including establishing a new requirement for 100 percent screening of cargo transported on narrow-body aircraft; revising or eliminating most screening exemptions for domestic cargo; creating the Certified Cargo Screening Program (CCSP) to allow screening to take place at various points in the air cargo supply chain; and establishing a screening technology pilot. Although TSA estimates that it achieved the mandated 50 percent screening level by February 2009 as it applies to domestic cargo, the agency cannot yet verify that the requisite levels of cargo are being screened. It is working to establish a system to do so by April 2009. Also, TSA's screening approach could result in variable percentages of screened cargo on passenger flights. TSA and industry stakeholders may face a number of challenges in meeting the screening mandate, including attracting participants to the CCSP, and technology, oversight, and inbound cargo challenges. TSA's approach relies on the voluntary participation of shippers and freight forwarders, but it is unclear whether the facilities needed to meet TSA's screening estimates will join the CCSP. In addition, TSA has taken some steps to develop and test technologies for screening air cargo, but the agency has not yet completed assessments of these technologies and cannot be assured that they are effective in the cargo environment. TSA's limited inspection resources may also hamper its ability to oversee the thousands of additional entities that it expects to participate in the CCSP. Finally, TSA does not expect to meet the mandated 100 percent screening deadline as it applies to inbound air cargo, in part due to existing inbound screening exemptions and challenges it faces in harmonizing security standards with other nations.

gao_HEHS-98-196

gao_HEHS-98-196_0

Mandatory Coverage Would Benefit the Social Security Program SSA estimates that extending mandatory Social Security coverage to all newly hired state and local employees would reduce the trust funds’ 75-year actuarial deficit by about 10 percent. Figure 1 shows that SSA’s analysis indicates that extending mandatory coverage to new state and local employees would extend the trust funds’ solvency by about 2 years, from 2032 to 2034. Extending mandatory Social Security coverage to all newly hired state and local employees would also simplify program administration by eliminating, over time, the need to administer and enforce special rules for noncovered state and local employees. Effect of Mandatory Coverage for Employers, Employees, and Their Public Pension Plans Would Vary If Social Security becomes mandatory, all newly hired state and local employees would be provided with the minimum income protection afforded by Social Security. States and localities could examine other pension plans that are already coordinated with Social Security and provide newly hired employees with similar benefits. This response would also likely result in an increase in total retirement costs and some additional family and other benefits for newly hired employees. Since Social Security benefits are weighted in favor of families and lower income employees—and because Social Security benefits are fully indexed for inflation, while many pension plans provide limited or no cost-of-living protection—total lifetime benefits for some new employees would be greater than those provided to current employees. The study also found that the magnitude of the cost increase would depend on the pension plan’s current benefits. Level Retirement Spending Would Mean Reduced Benefits Several employer, employee, and pension plan representatives with whom we spoke stated that spending increases necessary to maintain level retirement income and other benefits would be difficult to achieve. Legal and Other Considerations Mandatory coverage presents several legal and administrative issues, and states and localities with noncovered employees would require several years to design, legislate, and implement changes to current pension plans. Legal Issues Although mandating Social Security coverage for state and local employees could elicit a constitutional challenge, mandatory coverage is likely to be upheld under current U.S. Supreme Court decisions. On one hand, the Social Security program would benefit from the decision. However, the implications of mandatory coverage for public employers, employees, and pension plans are mixed.

Why GAO Did This Study Pursuant to a congressional request, GAO examined the implications of extending mandatory social security coverage to all newly hired state and local employees, focusing on: (1) the implications of mandatory coverage for the Social Security Program and for public employers, employees, and pension plans; and (2) potential legal or administrative problems associated with implementing mandatory coverage. What GAO Found GAO noted that: (1) the Social Security Administration (SSA) estimates that extending mandatory social security coverage to all newly hired state and local government employees would reduce the program's long-term actuarial deficit by about 10 percent and would extend the trust funds' solvency by about 2 years; (2) in addition to helping to some extent resolve the solvency problem, mandatory coverage would broaden participation in an important national program and simplify program administration; (3) the impact on public employers, employees, and pension plans would depend on how state and local governments with noncovered employees responded to the additional costs and benefits associated with social security coverage; (4) social security retirement benefits are fully protected from inflation and are weighted in favor of families and low-income employees; (5) many public pension plans, on the other hand, permit employees to retire earlier and provide a higher retirement income benefit than social security; (6) those states and localities that decide to maintain benefit levels for new employees consistent with the earlier retirement age and enhanced retirement income benefit would experience increased costs; (7) however, those employees would also have the additional family and other protection provided by social security; (8) alternatively, states and localities that choose to maintain level retirement spending might need to reduce some retirement benefits for newly hired employees; (9) several employer, employee, and plan representatives stated that mandating social security coverage for all new state and local government employees would raise constitutional issues and would be challenged in court; (10) however, GAO believes that mandatory coverage is likely to be upheld under current Supreme Court decisions; (11) mandatory coverage would also present administrative issues for implementing state and local governments; and (12) up to 4 years could be required for states and localities to develop, legislate, and implement pension plans that are coordinated with social security.

gao_GAO-15-424

gao_GAO-15-424_0

Generally, state and local governments are responsible for the remaining share of disaster costs. Selected States Had Budget Mechanisms to Cover Disaster Costs for the Current Fiscal Year, but Did Not Maintain Reserves for Future Disasters Selected States Used a Range of Budget Mechanisms to Cover Unforeseen Disaster Costs during the Course of the Fiscal Year All 10 states in our review used a range of mechanisms to ensure the availability of funds for unforeseen disaster costs during the fiscal year or current budget cycle. While each state had its own set of budget mechanisms, all of the selected states provided disaster funds at the start of the fiscal year and as needed during the course of the fiscal year. Statewide disaster accounts provided funding for disaster expenditures across state agencies or for localities. All 10 states funded these statewide accounts through general fund revenues and 6 states— Alaska, California, Florida, Indiana, North Dakota, and Vermont—used other revenue sources in addition to general fund revenues to cover unforeseen costs that arose during the fiscal year. The states in our review based initial funding levels for statewide disaster accounts on a range of considerations, such as estimates of disaster costs based on past events and emergency response costs for unforeseen disasters. Nine of the 10 selected states also covered a portion of unforeseen disaster costs through the operating budgets of state agencies with missions relevant to disaster response and recovery, For example, in West Virginia, such as public safety and transportation.the state’s Division of Homeland Security and Emergency Management within the Department of Military Affairs and Public Safety used its regular operating budget to cover disaster response costs. For example, Florida’s Department of Environmental Protection established a disaster contingency account funded through user fees on Florida’s state parks. Supplemental appropriations. Eight of the 10 states in our review made use of supplemental appropriations when the funds appropriated to statewide accounts or agency budgets at the beginning of the fiscal year were insufficient. Statewide multipurpose reserve accounts, such as budget stabilization funds (also referred to as rainy day funds), could also be tapped in the event that funds were not available through other means. Funding transfers. In addition, nine states in our review had mechanisms to allow designated officials (e.g., the governor, budget director, or a special committee) to transfer funds within or between agencies or from statewide reserve accounts after the start of the fiscal year. Costs associated with past disasters included the state’s share of federal disaster assistance and disaster costs the state would cover in the absence of a federal declaration.for the costs of past disasters, all 10 states determined their budgets based on cost estimates for the upcoming fiscal year, even though each disaster declaration could span several budget cycles. Some state officials reported that they could cover disaster costs without dedicated disaster reserves because they generally relied on the federal government to fund most of the costs associated with disaster response and recovery. Although Some States Increased Oversight and Availability of Funds, State Approaches to Budgeting for Disasters Remained Largely Unchanged during the 10-Year Period under Review Some Selected States Took Steps to Increase the Availability and Oversight of Disaster Funds, but Did Not Make Major Changes to Budgeting Approaches Overall, states did not make major changes to their approaches to budgeting for disaster costs between fiscal years 2004 and 2013. Three states in our review—Alaska, Indiana, and North Dakota—changed their budgeting approaches to further ensure the availability of disaster funding prior to a disaster rather than after a disaster. However, if the legislature was out of Legislatures in three of our review states— North Dakota, Missouri, and West Virginia—took steps to increase their oversight of disaster spending. The Department of Homeland Security generally agreed with our findings and provided technical comments, which we incorporated as appropriate. Appendix I: Objectives, Scope, and Methodology The objectives of our review were to determine (1) the approaches selected states use to budget for and fund state-level disaster costs; and (2) how, if at all, state disaster budgeting approaches have changed over time, including the factors influencing those changes and any challenges states encountered in budgeting for state-level disaster costs.

Why GAO Did This Study In recent years, natural and human-made disasters have increased in the United States in terms of both numbers and severity. For presidentially declared disasters, the federal government generally pays 75 percent of disaster costs and states cover the rest. As a result of this trend, governments at all levels have incurred increased costs for disaster response and recovery. An understanding of the approaches states take to budget for disaster costs can help inform congressional consideration of the balance between federal and state roles in funding disaster assistance. GAO was asked to examine how states typically budget for costs associated with disasters and any changes to those budget approaches during the past decade. This report reviewed (1) the approaches selected states use to budget for and fund state-level disaster costs; and (2) how, if at all, state disaster budgeting approaches have changed over time. For this review, GAO selected 10 states based on criteria such as the number of major disaster declarations and denials for each state from fiscal years 2004 to 2013. GAO reviewed state statutes, budgets, and other documents explaining states' approaches to budgeting for disaster costs and interviewed state officials. Although GAO's findings are not generalizable, they are indicative of the variation in budget mechanisms among the states. GAO is not making recommendations. GAO received and incorporated, as appropriate, technical comments from the Department of Homeland Security and the 10 selected states. What GAO Found The 10 selected states in GAO's review—Alaska, California, Florida, Indiana, Missouri, New York, North Dakota, Oklahoma, Vermont, and West Virginia—had established budget mechanisms to ensure the availability of funding for the immediate costs of unforeseen disasters and the ongoing costs of past disasters. All 10 states provided disaster funds at the start of the fiscal year and then as needed during the course of the fiscal year. Each of the selected states had its own combination of budget mechanisms that generally fell into four categories: Statewide disaster accounts . These accounts provided the 10 states with the flexibility to fund disaster expenses across state entities or for local governments. States typically funded these accounts through general fund revenue. Six states also used other sources, such as revenues from oil and gas taxes and fees on homeowner's and commercial insurance. The amounts appropriated to these accounts at the start of the fiscal year were based on a range of considerations, such as estimates of disaster costs based on past events and emergency response costs for unforeseen disasters. State agency budgets . Nine of the 10 states also covered a portion of unforeseen disaster costs through the operating or contingency budgets of state agencies with missions relevant to disaster response and recovery. For example, West Virginia's Division of Homeland Security and Emergency Management used its operating budget to cover disaster response costs. Florida's Department of Environmental Protection had a disaster contingency account funded through user fees on state parks. Supplemental appropriations . When advance funding proved insufficient to cover disaster costs, eight of the 10 states provided supplemental funding to pay for the remaining costs. While reserve accounts such as rainy day funds could be used to provide this funding if general funds were unavailable, budget officials said their state rarely tapped these funds. Transfer authority . All 10 states in our review allowed designated officials (i.e., the governor, budget director, or a special committee) to transfer funds within or between agencies or from statewide reserve accounts after the start of the fiscal year. None of the 10 states in GAO's review maintained reserves dedicated solely for future disasters. Some state officials reported that they could cover disaster costs without dedicated disaster reserves because they generally relied on the federal government to fund most of the costs associated with disaster response and recovery. While some states have increased the oversight and availability of disaster funds, all 10 states' approaches to budgeting for disasters have remained largely unchanged during fiscal years 2004 through 2013. Specifically, three states—Alaska, Indiana, and North Dakota—changed their budgeting processes to ensure that funding for disasters was appropriated before rather than after a disaster occurred. In addition, legislatures in three states—Missouri, North Dakota and West Virginia—took steps to increase their oversight of disaster spending.

gao_T-AIMD-96-80

gao_T-AIMD-96-80_0

Budget Process: Ideas for Improvement Today there is widespread frustration with the budget process. Therefore, it is important for the budget to provide a long-term framework and be grounded in a linkage of fiscal policy with the long-term economic outlook. Appropriations subcommittees provide funding by department and agency in appropriations accounts that do not distinguish between investment and consumption spending. Financial Reporting and Management: The Basis for Future Progress The budget should be formulated using accurate and reliable financial data on actual spending and program performance. Ideally, we should expect such reports to address (1) the full costs of achieving program results, (2) the value of what the government owns and what it owes to others, (3) the government’s ability to satisfy future commitments if current policies were continued, and (4) the government’s ability to detect and correct problems in its financial systems and controls. That act also mandated an annual consolidated set of governmentwide financial statements—to be audited by GAO—starting for fiscal year 1997. It established a CFO structure in 24 major agencies and the Office of Management and Budget (OMB) to provide the necessary leadership and focus. Based on FASAB’s standards, OMB is making efforts to design new financial reports that contain performance measures and budget data to provide a much needed, additional perspective on the government’s actual performance and its long-term financial prospects. As the federal government continues to improve its accountability and reporting of costs and performance, the more useful and reliable data need to be used to influence decisions. For this to happen, the financial data must be understood and used by program managers and budget decisionmakers. Improving the linkages between accounting and budgeting also calls for considering certain changes in budgeting such as realigned account structures and the selective use of accrual concepts. The Selective Use of Accrual Concepts in the Budget In addition to providing a new, full cost perspective for programs and activities, financial reporting has prompted improved ways of thinking about costs in the budget.

Why GAO Did This Study GAO discussed how the federal government could improve its financial management and budgets. What GAO Found GAO noted that: (1) over the last 6 years, the government has established a solid framework for improving its financial management through legislative mandates, an accounting standards advisory board, and budget process improvements; (2) the budget process should provide a long-term perspective and link fiscal policy to the long-term economic outlook; (3) the Administration and Congress need to make explicit decisions about investment and consumption spending and identify them within the budget; (4) budget enforcement, accountability, and transparency need to be enhanced, possibly through a look-back procedure and particularly in the areas of deficit and mandatory spending; (5) to enhance budget decisionmaking, agency and governmentwide financial statements audits should provide accurate and reliable financial data on actual spending and program performance; (6) the advisory board has approved eight government accounting standards addressing such areas as budget integrity, operating performance, and systems and control and will complete a stewardship standard by the spring of 1996; (7) the Office of Management and Budget is designing new financial reports to increase information on actual performance and long-term financial prospects; and (8) realigning account structures and selective use of accrual concepts in the budget would link accounting and budgeting and improve budget and management decisionmaking by disclosing the full cost of programs and operations.

gao_GAO-12-45

gao_GAO-12-45_0

Since 1972, Congress has authorized $100 million annually in contract authority for the Emergency Relief Program to be paid from the Highway Trust Fund. Additionally, obligations to a single state resulting from a single natural disaster or a single catastrophic failure may not exceed $100 million. Supplemental Appropriations Comprise Most Emergency Relief Funding Provided to States, and a Backlog of Funding Requests Remains From Fiscal Years 2007 through 2010, Congress Provided More than $2.3 Billion for Emergency Relief Events and to Address a Backlog of Unfunded Requests From fiscal years 2007 through 2010, Congress provided more than $2.3 billion to the Emergency Relief Program, including more than $1.9 billion in three supplemental appropriations from general revenues and about $400 million in contract authority paid from the Highway Trust Fund (see fig. FHWA allocated the remaining 41 percent ($988 million) for events that occurred from fiscal years 2001 through 2006. Emergency Relief Faces Risk from Escalating Costs of Events Occurring in Past Years In recent years, Congress has provided significant supplemental funding to the Emergency Relief Program, but as of June 2011, a $485 million backlog of funding requests from states remained. This backlog did not include funding requests for August 2011 damages from Hurricane Irene. In 2007 we recommended that FHWA revise its regulations to tighten program eligibility criteria, which could include limitations on the use of emergency relief funds to fully finance projects that grew in scope and cost as a result of environmental and community concerns. Since 2007, FHWA has In fiscal years 2010 and 2011, FHWA division offices coordinated with states to identify and withdraw unused allocations representing approximately $367 million in emergency relief funds from a total of 25 states and 2 territories. However, at least $63 million of the unobligated balance is for older allocations, provided prior to fiscal year 2007. Without clear time frames for states to close out completed emergency relief projects, FHWA lacks important information on the status of projects and whether unexpended project funds are no longer needed and may be deobligated to be made available for other emergency relief projects. Prior Concerns about Project Eligibility Have Yet to Be Addressed FHWA has yet to address our longstanding concern about, and our 2007 recommendation for addressing, the use of emergency relief funds to finance projects that have grown in scope beyond the original intent of the program, which is to restore damaged facilities to predisaster conditions. Incomplete Information in Emergency Relief Project Files in Three States Raises Concerns about FHWA’s Eligibility Decisions and Program Oversight Documentation for Many Project Files We Reviewed Was Missing, Incomplete, or Inconsistent In our review of 83 selected emergency relief project files in three FHWA division offices, we found that many of the project files reviewed did not contain documentation called for in the Emergency Relief Manual to support FHWA decisions that projects met program eligibility requirements. We found that about half of the projects in our sample (42 of 83) did not include repair cost estimates. See 23 U.S.C. Recommendations for Executive Action To improve the accountability of federal funds, ensure that FHWA’s eligibility decisions are applied consistently, and enhance oversight of the Emergency Relief Program, we recommend that the Secretary of Transportation direct the FHWA Administrator to take the following four actions: Establish specific time frames to limit states’ ability to request emergency relief funds years after an event’s occurrence, so that FHWA can better manage the financial risk of reimbursing states for projects that have grown in scope and cost. Establish standardized procedures for FHWA division offices to follow in reviewing emergency relief documentation and making eligibility decisions. Such standardized procedures should include: clear requirements that FHWA approve and retain detailed damage inspection reports for each project and include detailed repair cost estimates; a requirement that division offices verify and document the completion of emergency repairs within 180 days of an event to ensure that only emergency work completed within that time frame receives 100 percent federal funding; and consistent standards for approving betterments, including guidance on what information the benefit-cost analyses should include to demonstrate that the proposed betterment will result in a savings to the Emergency Relief Program, and a requirement that FHWA approval of funding for betterments be clearly documented. DOT officials provided technical comments by email which we incorporated into the report, as appropriate. In response to our finding that the Emergency Relief Program lacks a time limit for states to submit emergency relief funding requests, and our recommendation to establish specific time frames to limit states’ ability to request emergency relief funds years after an event’s occurrence, DOT noted that the program does include general time frames for states to submit an application and have work approved. To determine the extent to which selected emergency relief projects were awarded in compliance with program eligibility requirements, we reviewed federal statutes and regulations, and FHWA guidance on emergency relief eligibility requirements. These states were selected based on several criteria: 1. 2. We judgmentally selected New York, Texas, and Washington state to reflect a geographic dispersion of states. 3.

Why GAO Did This Study The Federal Highway Administration (FHWA), within the U.S. Department of Transportation (DOT), administers the Emergency Relief Program to provide funds to states to repair roads damaged by natural disasters and catastrophic failures. In 2007, GAO reported that in recent years states' annual demand for emergency relief funds often exceeded the program's $100 million annual authorization from the Highway Trust Fund and required supplemental appropriations from general revenues to address a backlog of funding requests from states. GAO recommended that FHWA tighten eligibility standards and coordinate with states to withdraw unneeded emergency relief funds, among other actions. For this report, GAO reviewed (1) Emergency Relief Program funding trends since 2007, (2) key program changes made in response to GAO's 2007 report, and (3) the extent to which selected emergency relief projects were approved in compliance with program eligibility requirements. GAO reviewed projects in New York, Texas, and Washington state, states selected based on the amount and frequency of funding allocations since 2007, among other factors. What GAO Found From fiscal years 2007 through 2010, the Emergency Relief Program received about $2.3 billion, of which $1.9 billion came from three supplemental appropriations compared with about $400 million authorized from the Highway Trust Fund. FHWA allocated this funding to 42 states and 3 territories to reduce the backlog of funding requests, with $485 million in unfunded requests remaining as of June 2011. This backlog list did not include funding requests for August 2011 damages from Hurricane Irene. Because the program lacks time frames to limit states from requesting funds years after events occur, the June 2011 backlog list includes about $90 million for events that occurred prior to fiscal year 1994. Without time limits for emergency relief funding requests, FHWA's ability to anticipate and manage future program costs is hindered. In response to GAO's 2007 report, FHWA withdrew about $367 million of unobligated emergency relief funds from states and redistributed most of this funding for other emergency relief needs. However, additional funding remains unused, including (1) at least $63 million allocated to states before fiscal year 2007 that has yet to be obligated to projects and (2) $341 million obligated between fiscal years 2001 and 2006 that remains unexpended. Due to a lack of time frames for states to close-out completed projects, FHWA lacks project status information to determine whether unexpended funding is no longer needed and could be deobligated. FHWA has not addressed GAO's 2007 recommendation to revise its regulations to limit the use of emergency relief to fully fund projects that have grown in scope and cost as a result of environmental or community concerns. The Emergency Relief Program faces the continued risk of escalating costs due to projects that have grown in scope beyond the program's goal of restoring damaged facilities to predisaster conditions. GAO's review of 83 emergency relief project files in three FHWA state offices found many instances of missing or incomplete documentation--as such, GAO was unable to determine the basis by which FHWA made many eligibility determinations. For example, about half of the project files did not include required repair cost estimates, and 39 of 58 (67 percent) emergency repair projects approved for 100 percent federal funding did not contain documentation of completion within 180 days--a requirement for states to receive 100 percent federal funding. FHWA lacks clear requirements for how states submit and FHWA approves key project documentation, which has resulted in FHWA state offices applying eligibility guidelines differently. Establishing standardized procedures for reviewing emergency relief documentation and making eligibility decisions would provide greater assurance that projects are in fact eligible and that FHWA makes eligibility determinations consistently and transparently. What GAO Recommends GAO makes several recommendations including that FHWA establish (1) time frames to limit states' requests for emergency relief funds and to close completed projects and (2) standardized procedures for reviewing emergency relief documentation and making eligibility decisions. DOT provided technical comments on project time frames and costs which GAO incorporated as appropriate.

gao_GAO-08-556T

gao_GAO-08-556T_0

DOE’s Budget Authority for Renewable, Fossil, and Nuclear Energy R&D Has Substantially Declined in Real Terms Since 1978 DOE’s budget authority for renewable, fossil, and nuclear energy R&D dropped by 92 percent from $6 billion in fiscal year 1978 to $505 million in fiscal year 1998 (in inflation-adjusted terms) before bouncing back to $1.4 billion in fiscal year 2008. As shown in figure 2, R&D budget authority in renewable, fossil, and nuclear energy peaked in the late 1970s and fell sharply in the 1980s. A comparison of DOE’s fiscal year 2009 budget request with the fiscal year 2008 appropriation shows that renewable energy R&D would decline slightly, while fossil energy R&D and nuclear energy R&D would increase by 34 percent and 44 percent, respectively (see app. Because the Office of Science funds basic research in materials sciences, for example, many of its R&D programs may have useful applications for energy R&D. The Office of Science also funds fundamental research in such areas as high energy physics, nuclear physics, and fusion energy. DOE Faces Key Challenges in Developing Advanced Energy Technologies for Deployment There are key technical, cost, and environmental challenges in developing advanced renewable, fossil, and nuclear energy technologies to address future energy challenges. Investors’ concerns about high up-front capital costs are among the most significant challenges in deploying photovoltaic or concentrating solar energy technologies. DOE’s R&D Challenges for Advanced Fossil Energy Technologies Since fiscal year 2006, DOE has proposed eliminating its R&D in oil and natural gas and, in January 2008, announced a restructuring of its coal R&D program. Natural gas technologies. For new power plant applications, DOE is developing and demonstrating advanced integrated gasification combined cycle (IGCC) technologies. Concluding Observations In the current wake of higher energy costs and the growing recognition that fossil energy consumption is contributing to global climate change, the nation is once again assessing how best to stimulate the deployment of advanced energy technologies. However, despite DOE’s energy R&D funding of $57.5 billion over the last 30 years, the nation’s energy portfolio remains heavily reliant on fossil fuels. Our December 2006 report suggested that the Congress consider further stimulating the development and deployment of a diversified energy portfolio by focusing R&D funding on advanced energy technologies. However, because it is unlikely that DOE’s energy R&D funding alone will be sufficient to significantly diversify the nation’s energy portfolio, coordinating energy R&D with other federal programs, policies, incentives, standards, and mandates that can impact the nation’s energy portfolio will be important for targeting any desired goals to change the nation’s energy portfolio. In addition, state and local governments and other nations, along with a worldwide private sector, will play a role in developing and deploying advanced energy technologies both here and throughout the global energy market. 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 For decades, the nation has benefited from relatively inexpensive energy, in the process growing heavily reliant on conventional fossil fuels--oil, natural gas, and coal. However, in the current wake of higher energy costs and environmental concerns about fossil fuel emissions, renewed attention is turning to the development of advanced energy technologies as alternatives. In the United States, the Department of Energy (DOE) has long conducted research, development, and demonstration (R&D) on advanced renewable, fossil, and nuclear energy technologies. DOE's Office of Science has also funded basic energy-related research. This testimony addresses (1) funding trends for DOE's renewable, fossil, and nuclear energy R&D programs and its Office of Science and (2) key challenges in developing and deploying advanced energy technologies. It is based on GAO's December 2006 report entitled Department of Energy: Key Challenges Remain for Developing and Deploying Advanced Energy Technologies to Meet Future Needs (GAO-07-106). In doing that work, GAO reviewed DOE's R&D budget data and strategic plans and obtained the views of experts in DOE, industry, and academia, as well as state and foreign government officials. What GAO Found Between fiscal years 1978 and 1998, DOE's budget authority for renewable, fossil, and nuclear energy R&D fell 92 percent when adjusted for inflation (from its $6 billion peak in fiscal year 1978 to $505 million in fiscal year 1998). It has since rebounded to $1.4 billion in fiscal year 2008. Energy R&D funding in the late 1970s was robust in response to the 1973 energy crisis caused by constricted oil supplies. However, R&D funding plunged in the 1980s as oil prices returned to their historic levels. DOE's fiscal year 2009 budget, as compared with 2008, requests slightly less budget authority for renewable energy R&D, while seeking increases of 34 percent for fossil energy R&D and 44 percent for nuclear energy R&D. In addition, DOE is requesting $4.7 billion for basic research under its Office of Science. The development and deployment of advanced energy technologies present key technical, cost, and environmental challenges. DOE's energy R&D program has focused on reducing high up-front capital costs; improving the operating efficiency of advanced energy technologies to enable them to better compete with conventional energy technologies; and reducing emissions of carbon dioxide, a greenhouse gas linked to global warming, and pollutants that adversely affect public health and the environment. However, while DOE has spent $57.5 billion over the past 30 years for R&D on these technologies, the nation's energy portfolio has not dramatically changed--fossil energy today provides 85 percent of the nation's energy compared to 93 percent in 1973. Because DOE's energy R&D funding alone will not be sufficient to deploy advanced energy technologies, coordinating energy R&D with other federal energy-related programs and policies will be important. In addition, other governments and the private sector will play a key role in developing and deploying advanced energy technologies that can change the nation's energy portfolio.

gao_GAO-06-541

gao_GAO-06-541_0

To provide a basis for future decisions regarding legislation on Puerto Rican economic issues, this report explains how the U.S. federal tax treatment of individuals and businesses in Puerto Rico and of the insular government differs relative to the treatment of governments, businesses, and individuals in the states and the other U.S. insular areas; compares trends in Puerto Rico’s principal economic indicators since the early 1980s with similar indicators at the national level for the United States and provides what is known about capital flows between Puerto Rico and the United States and between Puerto Rico and foreign countries; reports on changes in the activities and tax status of the corporations that have claimed the possessions tax credit since 1993; provides information on the distribution of private-sector economic activity in Puerto Rico by type of business entity; describes the total amount of tax paid by individuals and businesses in the states and the U.S. insular areas and shows percentage breakdowns by type of tax; and describes how the principal U.S. federal social programs apply to Puerto Rican residents, relative to residents of the states and the other U.S. insular areas. Puerto Rican residents are required to pay local income taxes on income earned from Puerto Rican sources, but not federal income taxes. Its work will evaluate legislative options concerning Puerto Rico. Scope and Methodology The Chairman and Ranking Minority Member of the U.S. Senate Committee on Finance asked us to study fiscal relations between the federal government and Puerto Rico and trends in the Commonwealth’s economy with a particular focus on the activities of possessions corporations operating there. These limitations are noted in the report. In 1996, the possessions tax credit was fully repealed for taxable years beginning after 2005. GNP differs from GDP by this amount. Those data indicate that much of the decline in activity of possessions corporations in the manufacturing sector was offset by the growth in other corporations, so that some measures of aggregate activity remained close to their 1997 levels. For example, value added in manufacturing remained fairly constant between 1997 and 2002. The Pharmaceutical Industry Has Dominated the Use of the Possessions Tax Credit in Puerto Rico Most of the possessions tax credit and income earned by possessions corporations in Puerto Rico has been earned by corporations in the pharmaceutical industry. A little less than two-thirds of the CFCs’ value added and half of their employment is attributable to CFCs incorporated outside of Puerto Rico. Taxes Per Capita in Puerto Rico Are Lower Than in the States but Are about the Same Share of Income The taxes paid to all levels of government (federal, Commonwealth, and local) in Puerto Rico in 2002 were $3,071 per capita—considerably less than the per capita taxes of $9,426 paid in the states. Puerto Rico’s outstanding government debt in 2002 was much higher than that of state and local governments as a share of personal income, partly because the Commonwealth government has a wider range of responsibilities.

Why GAO Did This Study The federal possessions tax credit, which was designed to encourage U.S. corporate investment in Puerto Rico and other insular areas, expires this year. Proponents of continued federal economic assistance to Puerto Rico have presented a variety of proposals for congressional consideration. In response to a request from the U.S. Senate Committee on Finance, this study compares trends in Puerto Rico's principal economic indicators with those for the United States; reports on changes in the activities and tax status of the corporations that have claimed the possessions tax credit; explains how fiscal relations between the federal government and Puerto Rico differs from the federal government's relations with the states and other insular areas; and compares the taxes paid to all levels of government by residents of Puerto Rico, the states, and other insular areas. GAO used the latest data available from multiple federal and Puerto Rican government agencies. Data limitations are noted where relevant. Key findings are based on multiple measures from different sources. GAO is not making any recommendations in this report. In comments on this report the Governor of Puerto Rico said the report will be useful for evaluating policy options. What GAO Found Puerto Rico's per capita gross domestic product (GDP, a broad measure of income earned within the Commonwealth) in 2005 was a little over half of that for the United States. Puerto Rico's per capita gross national product (GNP, which covers income earned only by residents of the Commonwealth) was even lower relative to the United States. Concerns about Puerto Rico's official price indexes make it difficult to say whether the per capita GNP of Puerto Rican residents has grown more rapidly than that of U.S. residents; however, the absolute gap between the two has increased. U.S. corporations claiming the possessions tax credit dominated Puerto Rico's manufacturing sector into the late 1990s. After the tax credit was repealed in 1996 beginning a 10-year phaseout period, the activity of these corporations decreased significantly. Between 1997 and 2002 (the latest data available) valued added in these corporations decreased by about two-thirds. A variety of data indicates that much of this decline was offset by growth in other corporations, so that some measures of aggregate activity remained close to their 1997 levels. For example, value added in manufacturing remained fairly constant between 1997 and 2002. Most of the offsetting growth was in the pharmaceutical industry. Residents of Puerto Rico pay considerably less total tax per capita than U.S. residents. However, because of lower incomes they pay about the same percentage of their personal income in taxes. The composition of taxes differed between Puerto Rico and the states with federal taxes being a larger share of the total in the states. This difference reflects the facts that (1) residents of Puerto Rico generally do not pay federal income tax on income they earn in the Commonwealth and (2) the Commonwealth government has a wider range of responsibilities than do U.S. state and local governments.

gao_GAO-04-106

gao_GAO-04-106_0

The virus causes a chronic infection in 85 percent of cases. Thousands of Veterans Identified as At Risk Remain Untested for Hepatitis C Despite VA Exceeding Its Testing Goal Even though VA’s fiscal year 2002 performance measurement results show that it tested 62 percent of veterans identified to be at risk for hepatitis C, exceeding its national goal of 55 percent, thousands of veterans in the sample who were identified as at risk were not tested. For example, when we excluded veterans from the sample who were tested for hepatitis C prior to fiscal year 2002, and included in the performance measurement sample only those veterans who were seen by VA in fiscal year 2002 and needed to be tested for hepatitis C, we found Network 5 tested 38 percent of these veterans as compared to Network 5’s cumulative performance measurement result of 60 percent. Several Factors Impeded One Network’s Efforts to Test Veterans Identified as At Risk We identified three factors that impeded the process used by our case study network, VA’s Network 5 (Baltimore), for testing veterans identified as at risk for hepatitis C. The factors were tests not being ordered by the provider, ordered tests not being completed, and providers being unaware that needed tests had not been ordered or completed. Moreover, veterans in need of hepatitis C testing had not been tested because providers did not always recognize during subsequent clinic visits that the hepatitis C testing process had not been completed. One reason that laboratory staff did not obtain blood samples for tests was because more than two-thirds of the veterans’ test orders had expired by the time they visited the laboratory. Officials in two networks modified VA’s required hepatitis C testing clinical reminder, which is satisfied when a hepatitis C test is ordered, to continue to alert the provider until a hepatitis C test result is in the medical record. Some Facilities Developed a Safety Net for Veterans Identified as At Risk Who Have Not Been Tested Officials at two facilities in our review searched all records in their facilities’ computerized medical record systems and found several thousand untested veterans identified as at risk for hepatitis C. The process, referred to as a “look back,” involves searching all medical records to identify veterans who have risk factors for hepatitis C but have not been tested either because the providers did not order the tests or ordered tests were not completed. As a result, many veterans identified as at risk did not know if they have hepatitis C. These undiagnosed veterans risk unknowingly transmitting the disease as well as potentially developing complications resulting from delayed treatment. Such a system appears to have merit, but neither the networks nor VA has evaluated its effectiveness. Appendix I: Scope and Methodology To follow up on the Department of Veterans Affairs’ (VA) implementation of performance measures for hepatitis C we (1) reviewed VA’s fiscal year 2002 performance measurement results of testing veterans it identified as at risk for hepatitis C, (2) identified factors that impede VA’s efforts to test veterans for hepatitis C in one VA health care network, and (3) identified actions taken by VA networks and medical facilities intended to improve the testing rate of veterans identified as at risk for hepatitis C. We reviewed VA’s fiscal year 2002 hepatitis C testing performance results, the most recently available data at the time we conducted our work, for a sample of 8,501 veterans identified as at risk and compared VA’s national and network results for fiscal year 2002 against VA’s performance goal for hepatitis C testing.

Why GAO Did This Study Hepatitis C is a chronic disease caused by a blood-borne virus that can lead to potentially fatal liverrelated conditions. In 2001, GAO reported that the VA missed opportunities to test about 50 percent of veterans identified as at risk for hepatitis C. GAO was asked to (1) review VA's fiscal year 2002 performance measurement results in testing veterans at risk for hepatitis C, (2) identify factors that impede VA's efforts to test veterans for hepatitis C, and (3) identify actions taken by VA networks and medical facilities to improve the testing rate of veterans at risk for hepatitis C. GAO reviewed VA's fiscal year 2002 hepatitis C performance results and compared them against VA's national performance goals, interviewed headquarters and field officials in three networks, and conducted a case study in one network. What GAO Found VA's performance measurement result shows that it tested, in fiscal year 2002 or earlier, 5,232 (62 percent) of the 8,501 veterans identified as at risk for hepatitis C in VA's performance measurement sample, exceeding its fiscal year 2002 national goal of 55 percent. Thousands of veterans (about one-third) of those identified as at risk for hepatitis C infection in VA's performance measurement sample were not tested. VA's hepatitis C testing result is a cumulative measure of performance over time and does not only reflect current fiscal year performance. GAO found Network 5 (Baltimore) tested 38 percent of veterans in fiscal year 2002 as compared to Network 5's cumulative performance result of 60 percent. In its case study of Network 5, which was one of the networks to exceed VA's fiscal year 2002 performance goal, GAO identified several factors that impeded the hepatitis C testing process. These factors were tests not being ordered by the provider, ordered tests not being completed, and providers being unaware that needed tests had not been ordered or completed. For more than two-thirds of the veterans identified as at risk but not tested for hepatitis C, the testing process failed because hepatitis C tests were not ordered, mostly due to poor communication between clinicians. For the remaining veterans, the testing process was not completed because orders had expired by the time veterans visited the laboratory or test orders were overlooked because laboratory staff had to scroll back and forth through daily lists, a cumbersome process, to identify active orders. Moreover, during subsequent primary care visits by these untested veterans, providers often did not recognize that hepatitis C tests had not been ordered nor had their results been obtained. Consequently, undiagnosed veterans risk unknowingly transmitting the disease as well as potential complications resulting from delayed treatment. The three networks GAO looked at--5 (Baltimore), 2 (Albany), and 9 (Nashville)--have taken steps intended to improve the testing rate of veterans identified as at risk for hepatitis C. To do this, in two networks officials modified clinical reminders in the computerized medical record to alert providers that for ordered hepatitis C tests, results were unavailable. Officials at two facilities developed a "look back" method to search computerized medical records to identify all at-risk veterans who had not yet been tested and identified approximately 3,500 untested veterans. The look back serves as a safety net for veterans identified as at risk for hepatitis C who have not been tested. The modified clinical reminder and look back method of searching medical records appear promising, but neither the networks nor VA has evaluated their effectiveness.

gao_GAO-16-552

gao_GAO-16-552_0

“hat no funds appropriated herein or hereafter shall be available for salaries or administrative expenses in connection with consolidating or centralizing, within the Department of Justice, the records, or any portion thereof, of acquisition and disposition of firearms maintained by Federal firearms licensees.” ATF Has 16 Data Systems That Contain Retail Firearms Purchaser Data; Selected Systems Are Involved in Tracing Process ATF Has 16 Systems with Retail Purchaser Data ATF collects and maintains data from the firearms industry to carry out its criminal and regulatory enforcement responsibilities, and has established 25 national ATF data systems relating to firearms to maintain the data it collects. Of these 25 data systems, the following 16 data systems contain retail firearms purchaser information: 1. Access 2000 (A2K) 2. Multiple Sales (MS) 10. Out-of-Business Records Imaging System (OBRIS) 15. This includes all acquisition and disposition logbooks, firearms transactions records—such as Form 4473 that contains purchaser information—and other required records. The other two data systems did not always comply with the restriction, although ATF addressed the compliance issues during the course of our review. Specifically: OBRIS complies with the appropriations act restriction and adheres to ATF policies. Further, FRNP generally adheres to ATF policies, but a technical defect allows ATF agents to view and print FRNP data beyond what ATF policy permits. FFLs are specifically required to submit records to ATF when going out of business, and the system limits the accessibility of key firearms records information, such as retail purchaser data. A2K for Out-of-Business Records Did Not Comply with the Appropriations Act Restriction, and ATF Could Provide Clearer Guidance Beginning in 2000, ATF maintained A2K disposition data from out-of- business industry members on a single partitioned server within NTC, and removed the records from the server in March 2016. A Past ATF Regional Program Did Not Comply with the Appropriations Act Restriction An ATF regional program conducted from 2007 through 2009 to enter firearms into FRNP—the Southwest Border Secondary Market Weapons of Choice (SWBWOC) Program—did not comply with the appropriations act restriction on consolidating or centralizing FFLs’ firearms records, because the individual firearms were not suspected of being involved in criminal activity associated with an ATF criminal investigation. MS Complies with the Appropriations Act Restriction, but ATF Continues to Inconsistently Adhere to ATF Policy When Deleting Records MS complies with the appropriations act restriction; however, ATF lacks consistency among its MS deletion policy, system design, and policy implementation timing. As discussed, FFLs are required to maintain certain firearms records at their places of business. ATF’s Long-Standing Struggle to Implement Its MS Deletion Policy Persists Although not required by statute, ATF policy requires that firearms purchaser names be deleted from MS 2 years after the date of the reports, if the firearm has not been connected to a firearms trace. Conclusions ATF has an important role in combatting the illegal use of firearms, and must balance this with protecting the privacy rights of law-abiding firearms owners. Specifically, providing guidance to industry members participating in A2K for how to submit their records when they go out of business would help ensure they submit required records to ATF. In addition, aligning eTrace system capability with ATF policy to limit access to firearms purchaser information in FRNP would ensure that such information is only provided to those with a need to know. Recommendations for Executive Action In order to help ensure that ATF adheres to its policies and facilitates industry compliance with requirements, we recommend that the Deputy Director of ATF take the following three actions: provide guidance to FFLs participating in A2K for provision of out-of- business records to ATF, so that FFLs can better ensure that they are in compliance with statutory and regulatory requirements; develop and implement short-term and long-term mechanisms to align the eTrace system capability with existing ATF policy to limit access to FRNP purchaser information for ATF agents; and align the MS deletion policy, MS system design, and the timeliness of deletion practices to improve ATF’s compliance with the policy. 2. Determine whether selected ATF data systems comply with the appropriations act restriction on consolidation or centralization of firearms records and ATF policies. Appendix IV: Firearm Recovery Notification Program Submission Form Appendix V: Multiple Sales Submission Form for Multiple Sales Reports Appendix VI: Multiple Sales Submission Form for Demand Letter 3 Reports Appendix VII: Legal Analysis of Compliance with the Restriction on Consolidation or Centralization of Firearms Records A provision in the fiscal year 2012 appropriation for the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) prohibits the use of the appropriation to consolidate or centralize records on the acquisition and disposition of firearms maintained by federal firearms licensees (FFL). Through this program, ATF records information— manufacturer, serial number, and type—about firearms that have not yet been recovered by other law enforcement authorities, but are suspected of being involved in criminal activity and are associated with an ATF criminal investigation. ATF deleted the related data from FRNP in March 2016. § 923(g)(3)(A), an FFL is required to report sales or other dispositions of two or more pistols or revolvers to a non-FFL at one time or during 5 consecutive business days.

Why GAO Did This Study ATF is responsible for enforcing certain criminal statutes related to firearms, and must balance its role in combatting the illegal use of firearms with protecting the privacy rights of law-abiding gun owners. As part of this balance, FFLs are required to maintain firearms transaction records, while ATF has the statutory authority to obtain these records under certain circumstances. ATF must also comply with an appropriations act provision that restricts the agency from using appropriated funds to consolidate or centralize FFL records. GAO was asked to review ATF's compliance with this restriction. This report (1) identifies the ATF data systems that contain retail firearms purchaser data and (2) determines whether selected ATF data systems comply with the appropriations act restriction and adhere to ATF policies. GAO reviewed ATF policy and program documents, observed use of data systems at NTC, reviewed a generalizable sample of one system's records, and interviewed ATF officials at headquarters and NTC. What GAO Found To carry out its criminal and regulatory enforcement responsibilities, the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) has 25 firearms-related data systems, 16 of which contain retail firearms purchaser information from a federal firearms licensee (FFL)—such as firearms importers and retailers. GAO selected 4 systems for review that are used in the firearms tracing process, based on factors such as the inclusion of retail purchaser information and original data. The Out-of-Business Records Imaging System (OBRIS) stores nonsearchable images of firearms records from out-of-business FFLs. Such FFLs are required by law to provide their records to ATF. Access 2000 (A2K) provides servers for National Tracing Center (NTC) personnel to electronically search participating FFLs' records at their premises for firearms disposition information during a trace. The Firearm Recovery Notification Program (FRNP) maintains information on firearms that have not yet been recovered by law enforcement, but are suspected of being involved in criminal activity and are associated with an ATF criminal investigation. Multiple Sales (MS) includes firearms information from multiple sales reports. FFLs are required by law to report to ATF sales of two or more revolvers or pistols during 5 consecutive business days. ATF policy requires that certain information in MS be deleted after 2 years if the firearm has not been connected to a trace. Of the 4 data systems, 2 fully comply and 2 did not always comply with the appropriations act restriction prohibiting consolidation or centralization of FFL records. ATF addressed these compliance issues during the course of GAO's review. ATF also does not consistently adhere to its policies. Specifically: OBRIS complies with the restriction and adheres to policy. A2K for in-business FFL records complies with the restriction. A2K for out-of-business FFL records did not comply with the restriction because ATF maintained these data on a single server at ATF. Thus, ATF deleted the records in March 2016. In addition, ATF policy does not specify how, if at all, FFLs may use A2K records to meet out-of-business record submission requirements. Such guidance would help ensure they submit such records. FRNP generally complies with the restriction. However, a 2007 through 2009 program using FRNP did not comply. ATF cancelled this program in 2009 and deleted the related data in March 2016. Also, a technical defect allows ATF agents to access FRNP data—including purchaser data—beyond what ATF policy permits. Aligning system capability with ATF policy would ensure that firearms purchaser data are only provided to those with a need to know. MS complies with the restriction, but ATF inconsistently adheres to its policy when deleting MS records. Specifically, until May 2016, MS contained over 10,000 names that were not consistently deleted within the required 2 years. Aligning the MS deletion policy with the timing of deletions could help ATF maintain only useful MS purchaser data and safeguard privacy. What GAO Recommends GAO recommends that ATF provide guidance to FFLs participating in A2K on the provision of records to ATF when they go out of business; align system capability with ATF policy to limit access to FRNP firearms purchaser information for ATF agents; and align timing and ATF policy for deleting MS records. ATF concurred with our recommendations.

gao_GAO-12-144T

gao_GAO-12-144T_0

Agencies Have Improved Sharing as They Build the ISE, but a Better Roadmap and System of Accountability Could Guide Future Development ISE Has Improved Sharing By Advancing Goals and Priority Programs In our July 2011 report, we noted that the Program Manager for the ISE and key security agencies have continued to make progress in addressing issues that keep terrorism-related information sharing on our high-risk list. The Program Manager and the Office of Management and Budget generally agreed and are taking steps to address the intent of this recommendation. Federal Agencies Are Helping Fusion Centers Build Capabilities, but Have More Work to Help Them Sustain Operations and Measure Their Value Federal Agencies Have Provided Resources to Develop a National Fusion Center Network, but Centers Are Concerned about Sustaining Operations The federal government recognizes that fusion centers represent a critical source of local information about potential threats, including homegrown terrorism, and a means to disseminate terrorism-related information and intelligence from federal sources. Federal Agencies Plan to Assess Centers’ Capabilities and Develop Performance Metrics to Determine Centers’ Value to the ISE Consistent with efforts to develop this national network of fusion centers, federal agencies have also issued a series of guidance documents, including the baseline capabilities, to support fusion centers in establishing their operations. According to these officials, such performance measures are to be in place by the end of 2011. We reported in September 2010 that consistent with federal requirements, DHS and DOJ have provided technical assistance and training to help centers develop privacy and civil liberties policies and protections. Continuous assessment and monitoring are key steps to help ensure that fusion centers are implementing privacy and civil liberties protections and that DHS, and other federal agencies, are supporting them in their efforts. In December 2010, we reported that I&A had initiatives underway to identify state and local information needs, developing intelligence products to meet these needs, and obtaining more detailed feedback on the timeliness and usefulness of these products, among other things. I&A also provided a number of services to its state and local partners— primarily through fusion centers—that were generally well received by the state and local officials we contacted. However, I&A had not yet defined how it plans to meet its state and local information-sharing mission by identifying and documenting the specific programs and activities that are most important for executing this mission. For example, the personnel measure did not provide information related to the effectiveness of the I&A personnel or the value they provide to their customers, such as enhanced information sharing, analytic capabilities, and operational support. To help I&A strengthen its efforts to share information with state and local partners, we recommended, among other things, that I&A (1) identify and document priority programs and activities related to its state and local mission, and (2) take actions to develop additional performance measures that gauge the results that I&A’s information-sharing efforts have achieved and how they have enhanced homeland security. DHS agreed with these recommendations and expects to address them as part of new strategic planning efforts. This work is assessing (1) the actions the federal government has taken since the attempted attack to strengthen the watchlist nominations process, as well as any resulting challenges and impacts; (2) how the composition of the TSDB changed as a result of agency actions; and (3) how screening agencies are addressing vulnerabilities exposed by the attempted attack, the outcomes of related screening, and the extent to which federal agencies assessing the impacts of this screening. Our preliminary observations show that federal agencies have made progress in implementing corrective actions to address problems in watchlist-related processes that were exposed by the December 2009 attempted attack. These actions are intended to address problems in the way agencies share and use information to nominate individuals to the TSDB, and use the watchlist to prevent persons of concern from boarding planes to the United States or entering the United States at a port of entry. It will be important for agencies to monitor and address these impacts as appropriate moving forward. We plan to issue a report with the final results or our work later this year. Related GAO Products Department of Homeland Security: Progress Made and Work Remaining in Implementing Homeland Security Missions 10 Years after 9/11. Information Sharing Environment: Better Road Map Needed to Guide Implementation and Investments. Terrorist Watch List Screening: Efforts to Help Reduce Adverse Effects on the Public.

Why GAO Did This Study A breakdown in information sharing was a major factor contributing to the failure to prevent the September 11, 2001, terrorist attacks. Since then, federal, state, and local governments have taken steps to improve sharing. This statement focuses on government efforts to (1) establish the Information Sharing Environment (ISE), a government-wide approach that facilitates the sharing of terrorism-related information; (2) support fusion centers, where states collaborate with federal agencies to improve sharing; (3) provide other support to state and local agencies to enhance sharing; and (4) strengthen use of the terrorist watchlist. GAO's comments are based on products issued from September 2010 through July 2011 and selected updates in September 2011. For the updates, GAO reviewed reports on the status of Department of Homeland Security (DHS) efforts to support fusion centers, and interviewed DHS officials regarding these efforts. This statement also includes preliminary observations based on GAO's ongoing watchlist work. For this work, GAO is analyzing the guidance used by agencies to nominate individuals to the watchlist and agency procedures for screening individuals against the list, and is interviewing relevant officials from law enforcement and intelligence agencies, among other things.. What GAO Found The government continues to make progress in sharing terrorism-related information among its many security partners, but does not yet have a fully-functioning ISE in place. In prior reports, GAO recommended that agencies take steps to develop an overall plan or roadmap to guide ISE implementation and establish measures to help gauge progress. These measures would help determine what information sharing capabilities have been accomplished and are left to develop, as well as what difference these capabilities have made to improve sharing and homeland security. Accomplishing these steps, as well as ensuring agencies have the necessary resources and leadership commitment, should help strengthen sharing and address issues GAO has identified that make information sharing a high-risk area. Federal agencies are helping fusion centers build analytical and operational capabilities, but have more work to complete to help these centers sustain their operations and measure their homeland security value. For example, DHS has provided resources, including personnel and grant funding, to develop a national network of centers. However, centers are concerned about their ability to sustain and expand their operations over the long term, negatively impacting their ability to function as part of the network. Federal agencies have provided guidance to centers and plan to conduct annual assessments of centers' capabilities and develop performance metrics by the end of 2011 to determine centers' value to the ISE. DHS and the Department of Justice are providing technical assistance and training to help centers develop privacy and civil liberties policies and protections, but continuous assessment and monitoring policy implementation will be important to help ensure the policies provide effective protections. In response to its mission to share information with state and local partners, DHS's Office of Intelligence and Analysis (I&A) has taken steps to identify these partner's information needs, develop related intelligence products, and obtain more feedback on its products. I&A also provides a number of services to its state and local partners that were generally well received by the state and local officials we contacted. However, I&A has not yet defined how it plans to meet its state and local mission by identifying and documenting the specific programs and activities that are most important for executing this mission. The office also has not developed performance measures that would allow I&A to demonstrate the expected outcomes and effectiveness of state and local programs and activities. In December 2010, GAO recommended that I&A address these issues, which could help it make resource decisions and provide accountability over its efforts. GAO's preliminary observations indicate that federal agencies have made progress in implementing corrective actions to address problems in watchlist-related processes that were exposed by the December 25, 2009, attempted airline bombing. These actions are intended to address problems in the way agencies share and use information to nominate individuals to the watchlist, and use the list to prevent persons of concern from boarding planes to the United States or entering the country, among other things. These actions can also have impacts on agency resources and the public, such as traveler delays and other inconvenience. GAO plans to report the results of this work later this year. What GAO Recommends GAO is not making new recommendations, but has made recommendations in prior reports to federal agencies to enhance information sharing. The agencies generally agreed and are making progress, but full implementation of these recommendations is needed.

gao_GAO-03-253

gao_GAO-03-253_0

In November 2001, it passed the Aviation and Transportation Security Act, which transferred aviation security from FAA to the newly created TSA and directed TSA to take over responsibility for airport screening. Under their proposals, travelers who voluntarily provide personal information and clear a background check would be enrolled as registered travelers. Because they would have been prescreened, they would be entitled to different security screening procedures at the airport. Our literature review and supporters of the program whom we interviewed identified two primary purposes for such a program—improving the quality and efficiency of airport security and reducing the inconvenience that some travelers have experienced by reducing uncertainties about the length of delay and the level of scrutiny they are likely to encounter. Many Stakeholders We Contacted Indicated That a Registered Traveler Program Could Potentially Improve Aviation Security and More Effectively Target Resources Many of the 22 stakeholders we contacted and much of the literature we reviewed identified the improvement of aviation security as a key purpose for implementing a registered traveler program. Such a program would allow officials to target security resources at those travelers who pose a greater security risk or about whom little is known. Some Believe That a Registered Traveler Program Could Potentially Reduce the Inconvenience of Security Screening Procedures According to the literature we reviewed and our discussions with several stakeholders, reducing the inconvenience of security screening procedures implemented after September 11, 2001, constitutes another major purpose of a registered traveler program, in addition to potentially improving security. Key Policy and Implementation Issues Associated with a Registered Traveler Program Our literature review and discussions with stakeholders identified a number of policy and implementation issues that might need to be addressed if a registered traveler program is to be implemented. Stakeholders we spoke with held a wide range of opinions on such key policy issues as determining (1) who should be eligible to apply to the program; (2) the type and the extent of background checks needed to certify that applicants can enroll in the program, and who should perform them; (3) the security screening procedures that should apply to registered travelers, and how these would differ from those applied to other travelers; and (4) the extent to which equity, privacy, and liability issues would impede program implementation. According to TSA officials, the agency is willing to consider some differentiated security procedures for program participants. Concluding Observations A registered traveler program is one possible approach for managing some of the security vulnerabilities in our nation’s aviation and broader transportation systems. These issues also include programmatic and administrative questions, such as how much such a program would cost and what entities would provide its financing. This literature search also identified key stakeholders regarding designing and implementing a registered traveler program. Completed. There are no fees associated with the CANPASS system.

Why GAO Did This Study The aviation industry and business traveler groups have proposed the registered traveler concept as a way to reduce long waits in airport security lines caused by heightened security screening measures implemented after the September 11 terrorist attacks. In addition, aviation security experts have advocated this concept as a way to better target security resources to those travelers who might pose greater security risks. The Aviation and Transportation Security Act of November 2001 allows the Transportation Security Administration (TSA) to consider developing a registered traveler program as a way to address these two issues. GAO completed this review to inform Congress and TSA of policy and implementation issues related to the concept of a registered traveler program. What GAO Found Under a variety of approaches related to the concept of a registered traveler program proposed by industry stakeholders, individuals who voluntarily provide personal background information and who clear background checks would be enrolled as registered travelers. Because these individuals would have been pre-screened through the program enrollment process, they would be entitled to expedited security screening procedures at the airport. Through a detailed literature review and interviews with stakeholders, GAO found that a registered traveler program is intended to reduce the inconvenience many travelers have experienced since September 11 and improve the quality and efficiency of airport security screening. Although GAO found support for this program among many stakeholders, GAO also found concerns that such a program could create new aviation security vulnerabilities. GAO also identified a series of key policy and program implementation issues that affect the program, including (1) Criteria for program eligibility; (2) Level of background check required for participation; (3) Security-screening procedures for registered travelers; (4) Technology options, including the use of biometrics to verify participants; (5) Program scope, including the numbers of participants and airports; and (5) Program cost and financing options. Stakeholders offered many different options on how best to resolve these issues. Finally, GAO identified several best practices that Congress and TSA may wish to consider in designing and implementing a registered traveler program. GAO concluded that a registered traveler program is one possible approach for managing some of the security vulnerabilities in our nation's aviation systems. However, decisions concerning key issues are needed before developing and implementing such a program. TSA felt that GAO's report offered a good overview of the potential and the challenges of a registered traveler program. The agency affirmed that there are no easy answers to some of the issues that GAO raised and that these issues need more study.

gao_GAO-10-530T

gao_GAO-10-530T_0

VA also uses STAR data to estimate improper compensation and pension benefit payments. VA Has Implemented Procedures to Address Deficiencies Identified with the STAR Program, but Continues to Face Challenges in Improving Accuracy Over the past decade, VBA has taken several actions to improve its STAR program and to address deficiencies identified by both GAO and VA’s OIG. For example, in March 1999, we found that STAR review staff lacked sufficient organizational independence because they were also responsible for making claims decisions and reported to regional office managers responsible for claims processing. In response to our findings, VBA took steps to address this by utilizing reviewers who do not process claims and who do not report to managers responsible for claims processing. More recently, in February 2008, we found that STAR was not sampling enough initial pension claims to ensure the accuracy of pension claims decisions. In a September 2008 report, we noted that VA lacked sufficient and specific performance measures for assessing the accuracy of decisions on BDD claims and recommended that VA consider options for separately estimating the accuracy of such claims decisions. In its March 2009 report, VA’s OIG also identified several deficiencies in the STAR program and recommended corrective actions. Further, the OIG found that VBA did not have minimum training requirements for STAR reviewers. As of March 2010, VBA had taken actions to respond to all of the OIG’s recommendations related to STAR, including (1) implementing procedures to follow up on cases not submitted by regional offices; (2) adding a mechanism to the STAR database to remind reviewers of key decision points; (3) requiring a second-level review of STAR reviewers’ work; and (4) establishing a requirement that STAR reviewers receive 80 hours of training per year. In fiscal year 2008, VBA more than doubled the size of the quality assurance staff, allowing it to increase the scope of quality assurance reviews. Although VBA has taken steps to address deficiencies in the STAR program, the accuracy of its benefit entitlement decisions has not improved. The accuracy rate was 86 percent in fiscal year 2008 and 84 percent in fiscal year 2009, well short of VBA’s fiscal year 2009 goal of 90 percent. VA Has Taken Actions to Strengthen Efforts to Monitor Consistency of Claims Decisions VA has taken actions to address deficiencies identified with its consistency review programs, but it is still too early to determine whether these actions will be effective. In prior work, we reported that VBA did not systematically assess the consistency of decision making for any specific impairments included in veterans’ disability claims. Based on our recommendation, VBA’s quality assurance staff began conducting studies to monitor the extent to which veterans with similar disabilities receive consistent ratings across regional offices and individual raters. VBA began these studies in fiscal year 2008. The OIG recommended that VBA (1) develop an annual rating consistency review schedule and complete all planned reviews as scheduled; (2) dedicate sufficient staff to conduct consistency reviews in order to complete planned workload and reviews; and (3) include inter- rater reliability reviews as a permanent component of its consistency review program. Because VBA has only recently implemented these initiatives, it is too early to determine their impact on the consistency of claims decisions. Making accurate, consistent, and timely disability decisions is not easy, but it is important. Veterans’ Benefits: Improved Management Would Enhance VA’s Pension Program. Veterans’ Benefits: Quality Assurance for Disability Claims Processing.

Why GAO Did This Study For years, in addition to experiencing challenges in making disability claims decisions more quickly and reducing its claims backlog, the Department of Veterans Affairs (VA) has faced challenges in improving the accuracy and consistency of its decisions. GAO was asked to discuss issues surrounding VA's Systematic Technical Accuracy Review (STAR) program, a disability compensation and pension quality assurance program, and possible ways, if any, this program could be improved. This statement focuses on actions VA has taken; including those in response to past GAO recommendations, to (1) address identified weaknesses with STAR and (2) improve efforts to monitor the consistency of claims decisions. This statement is based on GAO's prior work, which examined several aspects of STAR, as well as VA's consistency review activities, and on updated information GAO obtained from VA on quality assurance issues that GAO and VA's Office of Inspector General (OIG) have identified. GAO also reviewed VA's OIG March 2009 report on STAR. GAO is not making any new recommendations. What GAO Found Over the past several years, GAO has identified several deficiencies with the Veterans Benefit Administration's (VBA) STAR program, and although VBA has taken actions to address these issues, it continues to face challenges in improving claims accuracy. For example, GAO found that STAR reviewers lacked organizational independence, a basic internal control principle. In response to our finding, VA began utilizing organizationally independent reviewers that do not make claims decisions. GAO also found that sample sizes for pension claims were insufficient to provide assurance about decision accuracy. In response to GAO's recommendation, in fiscal year 2009, VA began increasing the number of pension claims decisions it reviews annually at each of its offices that process pension decisions. VA has also taken a number of other steps to address weaknesses that VA's OIG found in the STAR program, including (1) establishing minimum annual training requirements for reviewers and (2) requiring additional supervisory review of STAR reviewers' work. Although it has made or has started making these improvements, VBA remains challenged to improve its decision accuracy for disability compensation decisions, and it has not met its stated accuracy goal of 90 percent. VBA's performance has remained about the same over the past several fiscal years. In addition, VA has taken steps to address deficiencies that GAO and the VA's OIG have identified with consistency reviews--assessments of the extent to which individual raters make consistent decisions on the same claims. For example, in prior work, GAO reported that VA did not conduct systematic studies of impairments that it had identified as having potentially inconsistent decisions. In response to GAO's recommendation, in fiscal year 2008, VBA's quality assurance staff began conducting studies to monitor the extent to which veterans with similar disabilities receive consistent ratings across regional offices and individual raters. However, last year, VA's OIG reported that VA had not followed through on its plans to conduct such reviews. In response to this and other OIG findings and recommendations, VA took a number of actions, including developing an annual consistency review schedule and hiring additional quality assurance staff. However, VBA has only recently begun these programs to improve consistency, and it is too early to assess the effectiveness of their actions.

gao_GAO-14-586

gao_GAO-14-586_0

Swap-construct exchanges can involve swapping property and constructed assets or construction services that are of equal value or can include cash to compensate for a difference in value between the federal property and the asset or services to be received by the government. However, these officials noted their lack of experience with swap-construct exchanges at the time. After reviewing responses to these six proposals, GSA is actively pursuing three, including: (1) a potential exchange of undeveloped federal land in Denver with the City of Lakewood for construction services at the Denver Federal Center; (2) a potential exchange of the existing FBI headquarters building for a new FBI headquarters building; and (3) a potential exchange of two federal buildings in the Federal Triangle South area of Washington, D.C., for construction services to accommodate federal workers elsewhere in the city. For example, 4 of 9 respondents expressed concerns about the lack of detail regarding what GSA would expect in return for the federal property and 4 of 9 respondents expressed concerns about the amount of investment needed in the federal properties to make the exchange profitable for the property’s recipient. 5). Swap-Construct Can Help Address GSA’s Needs, but Level of Detail in GSA’s Solicitations and Market Interest May Affect Future Use Swap-Construct Can Help Facilitate New Construction and Developer Access to Federal Properties, but at Potentially Greater Cost to Some Stakeholders Than the Traditional Disposal Approach GSA officials told us that swap-construct exchanges can help GSA facilitate construction projects given a growing need to modernize and replace federal properties, shrinking federal budgets, and challenges getting funding appropriated from the FBF. GSA Does Not Always Clearly Identify Its Needs in Its Solicitations for Market Interest in Swap- Construct Exchanges Swap-construct exchanges require developers to make potentially large investments in federal construction projects prior to receiving title to federal property used in the exchanges. While GSA has guidance for determining if it should continue to pursue an exchange that has already been proposed, it does not have criteria to help determine when the agency should solicit interest in a swap- construct exchange. Both OMB and GAO guidance emphasize the importance of using criteria to make capital-planning decisions. The agency’s intent may be to provide greater details at later stages of the proposal process, but this approach may limit the ability of respondents to provide meaningful input and lead to missed swap-construct opportunities for GSA. Recommendations In order to identify potentially successful swap-construct exchanges during GSA’s review of its federal real property portfolio and reduce uncertainty for those responding to GSA’s solicitations for possible swap- construct exchanges, we recommend that the Administrator of GSA take the following two actions: 1. include, to the extent possible, details on what GSA is seeking in exchange for federal property in its solicitations, including requests for information, for potential swap-construct exchanges and 2. develop criteria for determining when to solicit market interest in a swap-construct exchange. Appendix I: Objectives, Scope, and Methodology Our objectives were to determine (1) GSA’s experiences with completed swap-construct exchanges; (2) the status of GSA’s proposed swap- construct exchanges; and (3) the potential benefits of swap-construct exchanges and the factors that can influence their future use. To identify the potential benefits of swap-construct exchanges and factors that can influence GSA’s future use these exchanges, we evaluated GSA’s approach to identifying potentially successful swap-construct exchanges to propose against the OMB Capital Programming Guide and the GAO Executive Guide on Leading Practices in Capital Decision- Making, and interviewed GSA officials; nonfederal participants in completed swap-construct exchanges (HEBSPC and Emory University Hospital Midtown); stakeholders in federal property acquisition and disposal processes (the National Capital Planning Commission and the National Law Center for Homelessness and Poverty, respectively); and nongovernmental organizations familiar with GSA’s swap-construct exchanges (the National Council for Public-Private Partnerships and the Urban Land Institute).

Why GAO Did This Study To help address challenges in federal real-property management, including the growing need to replace and modernize federal buildings, GSA has proposed expanding its use of swap-construct exchanges. GSA has proposed this approach for some potentially large projects, including replacing the FBI's headquarters. GAO was asked to review issues related to these exchanges. This report addresses: (1) GSA's experience with completed swap-construct exchanges; (2) the status of GSA's proposed swap-construct exchanges; and (3) the potential benefits of these exchanges and factors that can influence their future use. GAO reviewed documents, including GSA's solicitations for swap-construct exchanges, appraisals of completed exchanges, and OMB and GAO guidance. GAO conducted site visits to the completed swap-construct sites and three proposed swap-construct sites, selected based on location, number of responses to GSA's solicitation, and stage in the swap-construct process, and interviewed GSA officials and nonfederal participants in the exchanges. What GAO Found Since 2000, the General Services Administration (GSA) has completed two “swap-construct” exchanges—transactions in which the agency exchanges title to federal property for constructed assets or construction services, such as renovation work—in response to private sector interest in specific federal properties. In both completed exchanges, GSA used the value of federal properties it determined were underutilized to acquire new parking garages. The recipients of the federal properties told us that the exchanges took longer than expected (about 3 years for one of the exchanges and 5 years for the other). In response, GSA noted its lack of experience with swap-construct exchanges at the time. Since 2012, GSA has proposed six swap-construct exchanges. After reviewing responses to its solicitations, GSA is actively pursuing three, including a potential exchange of the existing Federal Bureau of Investigation's (FBI) headquarters for construction of a new FBI headquarters building. Respondents to the three solicitations that GSA is not actively pursuing noted concerns, including the amount of investment needed in the federal properties and the lack of detail regarding GSA's construction needs in an exchange. Swap-construct can result in an exchange of equally valued assets or services or can result in the government or a property recipient paying for a difference in value. The swap-construct approach can help GSA address the challenges of disposing of unneeded property and modernizing or replacing federal buildings, but various factors could affect future use of the approach. For example, swap-construct can require developers to spend large sums on GSA's construction needs before receiving title to the federal property used in the exchanges. GSA's solicitations have not always specified these construction needs. Consequently, developers may be unable to provide meaningful input, and GSA could miss swap-construct opportunities. Further, the viability of swap-construct exchanges may be affected by specific market factors, such as the availability of alternative properties. However, GSA lacks criteria to help determine if the agency should solicit interest in a swap-construct exchange. As a result, GSA could miss opportunities to use swap-construct or select properties and construction projects better suited to traditional disposal and funding processes. Office of Management and Budget (OMB) and GAO guidance emphasize the importance of criteria in making capital-planning decisions and providing clarity on construction needs. What GAO Recommends GAO recommends that GSA (1) include, to the extent possible, details on what GSA is seeking in exchange for federal property in these solicitations and (2) develop criteria for determining when to solicit market interest in swap-construct exchanges. GSA agreed with GAO's recommendations.

gao_GAO-10-133T

gao_GAO-10-133T_0

OJJDP Established the Girls Study Group to Assess the Effectiveness of Girls’ Delinquency Programs With an overall goal of developing research that communities need to make sound decisions about how best to prevent and reduce girls’ delinquency, OJJDP established the Girls Study Group (Study Group) in 2004 under a $2.6 million multiyear cooperative agreement with a research institute. OJJDP’s objectives for the group, among others, included identifying effective or promising programs, program elements, and implementation principles (i.e., guidelines for developing programs). Objectives also included developing program models to help inform communities of what works in preventing or reducing girls’ delinquency, identifying gaps in girls’ delinquency research and developing recommendations for future research, and disseminating findings to the girls’ delinquency field about effective or promising programs. These included criminological and feminist explanations for girls’ delinquency, patterns of delinquency, and the justice system’s response to girls’ delinquency. As a result, the group identified 61 programs that specifically targeted preventing or responding to girls’ delinquency. OJJDP Efforts to Assess Program Effectiveness Were Consistent with Social Science Practices and Standards, and OJJDP Has Taken Action to Enhance Communication about the Study Group with External Stakeholders OJJDP’s effort to assess girls’ delinquency programs through the use of a study group and the group’s methods for assessing studies were consistent with generally accepted social science research practices and standards. In addition, OJJDP’s efforts to involve practitioners in Study Group activities and disseminate findings were also consistent with the internal control standard to communicate with external stakeholders, such as practitioners operating programs. According to OJJDP research and program officials, they acted to address this issue by adding a second practitioner as a member and involving two other practitioners in study group activities. The Study Group Found No Evidence of Effective Girls’ Delinquency Programs; in Response OJJDP Plans to Assist Programs in Preparing for Evaluations but Could Strengthen Its Plans for Supporting Such Evaluations The Study Group found that few girls’ delinquency programs had been studied and that the available studies lacked conclusive evidence of effective programs; as a result, OJJDP plans to provide technical assistance to help programs be better prepared for evaluations of their effectiveness. However, OJJDP could better address its girls’ delinquency goals by more fully developing plans for supporting such evaluations. Based on the results of this review, the Study Group reported that among other things, there is a need for additional, methodologically rigorous evaluations of girls’ delinquency programs; training and technical assistance to help programs prepare for evaluations; and funding to support girls’ delinquency programs found to be promising. OJJDP has also reported that the Study Group’s findings are to provide a foundation for moving ahead on a comprehensive program related to girls’ delinquency. In our July report, we recommended that to help ensure that OJJDP meets its goals to identify effective or promising girls’ delinquency programs and supports the development of program models, the Administrator of OJJDP develop and document a plan that (1) articulates how the office intends to respond to the findings of the Study Group, (2) includes time frames and specific funding requirements and commitments, and (3) is shared with key stakeholders.

Why GAO Did This Study This testimony discusses issues related to girls' delinquency--a topic that has attracted the attention of federal, state, and local policymakers for more than a decade as girls have increasingly become involved in the juvenile justice system. For example, from 1995 through 2005, delinquency caseloads for girls in juvenile justice courts nationwide increased 15 percent while boys' caseloads decreased by 12 percent. More recently, in 2007, 29 percent of juvenile arrests--about 641,000 arrests--involved girls, who accounted for 17 percent of juvenile violent crime arrests and 35 percent of juvenile property crime arrests. Further, research on girls has highlighted that delinquent girls have higher rates of mental health problems than delinquent boys, receive fewer special services, and are more likely to abandon treatment programs. The Office of Juvenile Justice and Delinquency Prevention (OJJDP) is the Department of Justice (DOJ) office charged with providing national leadership, coordination, and resources to prevent and respond to juvenile delinquency and victimization. OJJDP supports states and communities in their efforts to develop and implement effective programs to, among other things, prevent delinquency and intervene after a juvenile has offended. For example, from fiscal years 2007 through 2009, Congress provided OJJDP almost $1.1 billion to use for grants to states, localities, and organizations for a variety of juvenile justice programs, including programs for girls. Also, in support of this mission, the office funds research and program evaluations related to a variety of juvenile justice issues. As programs have been developed at the state and local levels in recent years that specifically target preventing girls' delinquency or intervening after girls have become involved in the juvenile justice system, it is important that agencies providing grants and practitioners operating the programs have information about which of these programs are effective. In this way, agencies can help to ensure that limited federal, state, and local funds are well spent. In general, effectiveness is determined through program evaluations, which are systematic studies conducted to assess how well a program is working--that is, whether a program produced its intended effects. To help ensure that grant funds are being used effectively, you asked us to review OJJDP's efforts related to studying and promoting effective girls' delinquency programs. We issued a report on the results of that review on July 24, 2009. This testimony highlights findings from that report and addresses (1) efforts OJJDP has made to assess the effectiveness of girls' delinquency programs, (2) the extent to which these efforts are consistent with generally accepted social science standards and federal standards to communicate with stakeholders, and (3) the findings from OJJDP's efforts and how the office plans to address the findings. This statement is based on our July report and selected updates made in October 2009. What GAO Found With an overall goal of developing research that communities need to make sound decisions about how best to prevent and reduce girls' delinquency, OJJDP established the Girls Study Group (Study Group) in 2004 under a $2.6 million multiyear cooperative agreement with a research institute. OJJDP's objectives for the group, among others, included identifying effective or promising programs, program elements, and implementation principles (i.e., guidelines for developing programs). Objectives also included developing program models to help inform communities of what works in preventing or reducing girls' delinquency, identifying gaps in girls' delinquency research and developing recommendations for future research, and disseminating findings to the girls' delinquency field about effective or promising programs. OJJDP's effort to assess girls' delinquency programs through the use of a study group and the group's methods for assessing studies were consistent with generally accepted social science research practices and standards. In addition, OJJDP's efforts to involve practitioners in Study Group activities and disseminate findings were also consistent with the internal control standard to communicate with external stakeholders, such as practitioners operating programs. The Study Group found that few girls' delinquency programs had been studied and that the available studies lacked conclusive evidence of effective programs; as a result, OJJDP plans to provide technical assistance to help programs be better prepared for evaluations of their effectiveness. However, OJJDP could better address its girls' delinquency goals by more fully developing plans for supporting such evaluations.

gao_GAO-07-491T

gao_GAO-07-491T_0

In addition to providing their annual reports to the Attorney General, agencies are to make them available to the public in electronic form. For example, the public continued to submit more requests for information from the federal government through FOIA, but many agencies, despite increasing the numbers of requests processed, did not keep pace with this increased volume. As a result, the number of pending requests carried over from year to year has been steadily increasing. However, our ability to make generalizations about processing time is limited by the type of statistic reported (that is, the median). Thus, although using medians provides representative numbers that are not skewed by a few outliers, they cannot be summed. As a result, with only medians it is not statistically possible to combine results from different agencies to develop broader generalizations, such as a governmentwide statistic based on all agency reports, statistics from sets of comparable agencies, or an agencywide statistic based on separate reports from all components of the agency. Agency Improvement Plans Generally Included Areas of Improvement Emphasized by the Executive Order As required by the Executive Order, all the 25 agencies submitted improvement plans based on the results of reviews of their respective FOIA operations, as well as on the areas emphasized by the order. The plans generally addressed these four areas, with 20 of 25 plans addressing all four. In some cases, agencies did not set goals for a given area because they determined that they were already strong in that area. Most Agencies Plan to Increase Public Dissemination of Records through Web Sites The Executive Order calls for “increased reliance on the dissemination of records that can be made available to the public” without the necessity of a FOIA request, such as through posting on Web sites. Annual Reporting and Selected Improvement Plans Could Be Further Enhanced The annual FOIA reports continue to provide valuable information about citizens’ use of this important tool for obtaining information about government operation and decisions. Given that processing times are an important gauge of government responsiveness to citizen inquiries, this limitation impedes the development of broader pictures of FOIA operations, which could be useful in monitoring efforts to improve processing and reduce the increasing backlog of requests, as intended by the Executive Order. Nonetheless, all the plans show a commendable focus on making measurable improvements and form a reasonable basis for carrying out the order’s goals. Attachment I: Scope and Methodology For the draft report on which this testimony is based, we gauged agencies’ progress in processing requests by analyzing the workload data (from fiscal year 2002 through 2005) included in the 25 agencies’ annual FOIA reports to assess trends in volume of requests received and processed, median processing times, and the number of pending cases. To determine to what extent the agency improvement plans contain the elements emphasized by the order, we first analyzed the Executive Order to determine how it described the contents of the improvement plans. We determined that the order emphasized the following areas to be addressed by the plans: (1) reducing the backlog of FOIA requests, (2) increasing reliance on public dissemination of records (affirmative and proactive) including through Web sites, (3) improving communications with FOIA requesters about the status of their requests, and (4) increasing public awareness of FOIA processing including updating an agency’s FOIA Reference Guide.

Why GAO Did This Study The Freedom of Information Act (FOIA) establishes that federal agencies must provide the public with access to government information, enabling them to learn about government operations and decisions. To help ensure proper implementation, the act requires that agencies annually report specific information about their FOIA operations, such as numbers of requests received and processed and median processing times. In addition, a recent Executive Order directs agencies to develop plans to improve their FOIA operations, including decreasing backlogs. GAO was asked to testify on the results of its study on FOIA processing and agencies' improvement plans. The draft report on the study is currently out for comment at the agencies involved (and is thus subject to change). For the study, GAO reviewed status and trends of FOIA processing at 25 major agencies as reflected in annual reports, as well as the extent to which improvement plans contain the elements emphasized by the Executive Order. To do so, GAO analyzed the 25 agencies' annual reports and improvement plans. What GAO Found Based on data in annual reports from 2002 to 2005, the public continued to submit more requests for information from the federal government through FOIA. Despite increasing the numbers of requests processed, many agencies did not keep pace with the volume of requests that they received. As a result, the number of pending requests carried over from year to year has been steadily increasing. Agency reports also show great variations in the median times to process requests (less than 10 days for some agency components to more than 100 days at others). However, the ability to determine trends in processing times is limited by the form in which these times are reported: that is, in medians only, without averages (that is, arithmetical means) or ranges. Although medians have the advantage of providing representative numbers that are not skewed by a few outliers, it is not statistically possible to combine several medians to develop broader generalizations (as can be done with arithmetical means). This limitation on aggregating data impedes the development of broader pictures of FOIA operations, which could be useful in monitoring efforts to improve processing and reduce the increasing backlog of requests, as intended by the Executive Order. The improvement plans submitted by the 25 agencies mostly included goals and timetables addressing the four areas of improvement emphasized by the Executive Order: eliminating or reducing any backlog of FOIA requests; increasing reliance on dissemination of records that can be made available to the public without the need for a FOIA request, such as through posting on Web sites; improving communications with requesters about the status of their requests; and increasing public awareness of FOIA processing. Most of the plans (20 of 25) provided goals and timetables in all four areas; some agencies omitted goals in areas where they considered they were already strong. Although details of a few plans could be improved (for example, one agency did not explicitly address areas of improvement other than backlog), all the plans focus on making measurable improvements and form a reasonable basis for carrying out the goals of the Executive Order.

gao_GAO-15-299

gao_GAO-15-299_0

Under the safe-harbor provisions, most counterparties that entered into a qualifying transaction with the debtor may exercise certain contractual rights even if doing so otherwise would violate the automatic stay. This regulatory resolution authority allows for FDIC to be appointed receiver for a financial company if the Secretary of the Treasury, in consultation with the President, determines, upon the recommendation of two-thirds of the Board of Governors of the Federal Reserve and (depending on the nature of the financial firm) FDIC, SEC, or the Director of the Federal Insurance Office, among other things, that the firm’s failure and its resolution under applicable law, including bankruptcy, would have serious adverse effects on U.S. financial stability and no viable private-sector alternative is available to prevent the default. Based on the UNCITRAL model law, Chapter 15 contains a public policy exception that allows a U.S. court to refuse cooperation and coordination if doing so would be “manifestly contrary to the public policy of the United States.” No Changes Have Been Made to the Bankruptcy Code but Proposals Were Introduced in the Previous Congress Two Proposals Would Have Made Broad Changes Relating to Complex Financial Institutions Since we last reported on financial company bankruptcies in July 2013, no changes have been made to Chapters 7, 11, or 15 of the Bankruptcy Code relating to large financial companies, although two bills were introduced in the 113th Congress that would have attempted to address challenges associated with the reorganization of large financial firms as governed by Chapter 11 of the Code. The Taxpayer Protection and Responsible Resolution Act (S. 1861) also would have changed the treatment of QFCs in bankruptcy. A second bankruptcy reform proposal, the Financial Institution Bankruptcy Act of 2014 (H.R. 5421) would not have repealed Title II of the Dodd-Frank Act. For example, each of the bankruptcy reform bills and FDIC’s SPOE strategy under OLA would have allowed for the creation of a bridge company, in which assets, financial contracts, and some legal entities of the holding company would have been transferred, allowing certain subsidiaries to have maintained operations. In addition, OLA, like the bills, included a temporary stay for QFCs. The 21st Century Glass-Steagall Act of 2013 (S. 1282 in the Senate and H.R. This legislative proposal was neither signed into law nor re-introduced in the current Congress, as of March 12, 2015. Recent Efforts to Enhance International Coordination to Resolve Failing Financial Companies under Bankruptcy In the United States the presumptive mechanism to resolve a failed cross- border large financial company continues to be through the judicial bankruptcy process, though no statutory changes have been made to Chapter 15 of the Code or the U.S. judicial bankruptcy process to address impediments to an orderly resolution of a large, multinational financial institution. However, while some structural challenges discussed earlier remain, others, such as conflicting regulatory regimes and the treatment of cross-border derivatives, are being addressed through various efforts. In 2014, FDIC and the Federal Reserve sent letters to a number of large financial companies identifying specific shortcomings with the resolution plans that those firms will need to address in their 2015 submissions, due on or before July 1, 2015, for the first group of filers. In October 2011, the Financial Stability Board (FSB)—an international body that monitors and makes recommendations about the global financial system—issued a set of principles to guide the development of resolution regimes for financial firms active in multiple countries. These stays are intended to give resolution authorities and insolvency administrators time to facilitate an orderly resolution of a troubled financial firm. We received technical comments from the Department of the Treasury, FDIC, Federal Reserve, and SEC, which we incorporated as appropriate. Appendix II: Objectives, Scope, and Methodology Section 202(e) of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd Frank Act) mandated that we report on the orderliness and efficiency of financial company bankruptcies every year for 3 years after passage of the act, in the fifth year, and every 5 years thereafter. This report, the fourth in the series, examines (1) recent changes to the U.S. Bankruptcy Code (Code) and (2) efforts to improve cross-border coordination to facilitate the liquidation and reorganization of failed large financial companies under bankruptcy. For each of our objectives, we reviewed relevant regulations and laws, including the Code and the Dodd-Frank Act as well as GAO reports that addressed bankruptcy issues and financial institution failures. We interviewed officials from the following federal agencies due to their role in financial regulation and bankruptcy proceedings: AOUSC; the Commodity Futures Trading Commission (CFTC); Federal Deposit Insurance Corporation (FDIC); Department of Justice; Department of the Treasury (Treasury), including officials who support the Financial Stability Oversight Council (FSOC); Federal Reserve; and Securities and Exchange Commission (SEC). We also reviewed academic literature on financial company bankruptcies and regulatory resolution, transcripts of congressional hearings on bankruptcy reform, and transcripts from expert roundtables on bankruptcy reform that were hosted by GAO in 2013. To address our second objective, we reviewed Chapter 15 of the Bankruptcy Code, which relates to coordination between U.S. and foreign jurisdictions in bankruptcy cases in which the debtor is a company with foreign operations, for any changes.

Why GAO Did This Study The challenges associated with the bankruptcies of large financial companies during the 2007-2009 financial crisis raised questions about the effectiveness of the U.S. Bankruptcy Code and international coordination for resolving complex financial institutions with cross-border activities. The Dodd-Frank Act mandates that GAO report on an ongoing basis on ways to make the U.S. Bankruptcy Code more effective in resolving certain failed financial companies. GAO has issued three reports on this issue. This fourth report addresses (1) recent changes to the U.S. Bankruptcy Code and (2) efforts to improve cross-border coordination to facilitate the liquidation or reorganization of failed large financial companies under bankruptcy. GAO reviewed laws, court documents, regulations, prior GAO reports, and academic literature on financial company bankruptcies and regulatory resolution. GAO also reviewed documentation from foreign financial regulators and international bodies such as the Financial Stability Board. GAO interviewed officials from the Administrative Office of the United States Courts, Department of Justice, Department of the Treasury, and financial regulators with a role in bankruptcy proceedings. GAO makes no recommendations in this report. The Department of the Treasury, Federal Reserve, FDIC, and the Securities and Exchange Commission provided technical comments on a draft of the report that GAO incorporated as appropriate. What GAO Found The U.S. Bankruptcy Code (Code) chapters dealing with the liquidation or reorganization of a financial company have not been changed since GAO last reported on financial company bankruptcies in July 2013. However, bills introduced in the previous Congress would, if re-introduced and passed, make broad changes to the Code relevant to financial company bankruptcies. The Financial Institution Bankruptcy Act of 2014 (H.R. 5421) and Taxpayer Protection and Responsible Resolution Act (S.1861) would have expanded to varying degrees the powers of the Board of Governors of the Federal Reserve System (Federal Reserve) and Federal Deposit Insurance Corporation (FDIC) and would have imposed a temporary stay on financial derivatives (securities whose value is based on one or more underlying assets) that are exempt from the automatic stay under the Code. That stay would prohibit a creditor from seizing or taking other action to collect what the creditor is owed under the financial derivative. The bills also would have added to the Code processes for the resolution of large, complex financial companies similar in some ways to provisions currently in the Orderly Liquidation Authority (OLA) in Title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act), which grants FDIC the authority to resolve failed systemically important financial institutions under its receivership. For example, each bill would have allowed for the creation of a bridge company, in which certain assets and financial contracts of the holding-company would be transferred, allowing certain subsidiaries to continue their operations. The 21st Century Glass-Steagall Act of 2013—a bill introduced in the House of Representatives (H.R. 3711) and the Senate (S. 1282)—would have repealed safe-harbor provisions that allow most counterparties in a qualifying transaction with the debtor to exercise certain contractual rights even if doing so would otherwise violate the automatic stay. As of March 12, 2015, these legislative proposals had not been re-introduced in Congress. In the United States, the presumptive mechanism to resolve a failed large financial company with cross-border operations is through the judicial bankruptcy process. Since GAO's 2013 report, no changes have been made to the chapter of the Code that relates to coordination between U.S. and foreign jurisdictions in bankruptcy cases in which the debtor has foreign operations. Some structural challenges remain, such as conflicting regulatory regimes related to the treatment of financial contracts between parties in different countries when a firm enters bankruptcy, but efforts are underway to address them. Regulators have implemented a Dodd-Frank Act provision that requires certain large financial firms to submit a resolution plan to assist with an orderly bankruptcy process, which regulators expect to help address potential problems with international cooperation, among others. However, in 2014, FDIC and the Federal Reserve identified shortcomings with the plans for a number of large financial companies that those firms are to address in their 2015 submissions. Further, international bodies, such as the Financial Stability Board—an international body that monitors and makes recommendations about the global financial system—have focused on having countries adopt a regulatory approach to resolutions. Other recent actions include a January 2015 stay protocol for derivatives contracts developed by the International Swaps and Derivatives Association that is intended to give regulators time to facilitate an orderly resolution of a troubled firm.

gao_GAO-01-596

gao_GAO-01-596_0

Some Advanced Technologies Are Available; Others Are Being Developed Manufacturers have installed some of the advanced technologies that will be needed to comply with the advanced air bag rule in certain vehicles that are on the market today. However, no vehicles currently on the market have air bag systems with all the features manufacturers believe are needed to fulfill the requirements of the advanced air bag rule. The sensors are not capable of identifying what type of occupant is in the passenger seat. The advanced air bag systems envisioned by manufacturers for meeting the rule’s requirements include new technologies that have not previously been installed in vehicles as well as significant improvements in existing technologies. Occupant Sensing Is the Primary Challenge in Meeting the Advanced Air Bag Rule’s Requirements According to representatives of vehicle manufacturers and air bag suppliers, the primary challenge in meeting the requirements of the advanced air bag rule is developing occupant classification sensors for the passenger side that are accurate, durable, and suitable for mass production before September 2003. The aggregated information from the four manufacturers shows that their expenditures increased by about 275 percent from 1998 to 2000 and are anticipated to increase overall by nearly 375 percent from 1998 through 2003. These expenditures are estimated to decrease after advanced air bag systems have been installed in vehicles. We verified with auto manufacturers that they have not installed occupant classification sensors that can distinguish among various sizes of occupants and are still developing such sensors for frontal air bag systems that are intended to meet the requirements of the advanced air bag rule. Anticipated improvements: In order to enhance the ability of their vehicles to comply with the requirements in the advanced air bag rule, manufacturers plan to improve the ability of their crash sensing systems to distinguish among levels of crash severity as well as identify the type of crash, such as a frontal rigid barrier crash, a pole crash, or an offset deformable barrier crash.

Why GAO Did This Study The National Highway Traffic Safety Administration (NHTSA) has issued a rule requiring vehicle manufacturers to install advanced air bag systems in an increasing number of cars beginning in 2003. This report reviews the development of technologies that vehicle manufacturers plan to use to comply with the advanced air bag rule. What GAO Found GAO found that some advanced air bag technologies are now being installed in vehicles and others are still being developed. The principal advanced technology being installed in some vehicles is an air bag that can inflate with lower or higher levels of power--rather than a single level--depending on the severity of the crash. Although frontal air bag systems with these advanced technologies are an improvement over previous systems, they do not contain all of the features that manufacturers believe are needed to meet the requirements of the advanced air bag rule, such as sensors that can distinguish among different types of occupants. To meet the requirements, manufacturers plan to introduce new technologies as well as continue to make further improvements in current technologies. The key new technologies that manufacturers plan to introduce are occupant classification sensors that can distinguish among infants and children (as well as their safety seats) and adults on the passenger side. The addition of these sensors is necessary to allow the air bag system to provide the appropriate deployment level--such as no deployment, low power, or high power--depending on the type of occupant. The primary challenge in meeting the requirements in the advanced air bag rule is the development of occupant classification sensors that are accurate, durable, and suitable for mass production. Expenditures on advanced air bag research and development by NHTSA and vehicle manufacturers have increased since 1998, when Congress mandated the installation of advanced air bags in future vehicles. The information aggregated from four manufacturers shows that these expenditures rose by about 275 percent from 1998 through 2000 and are anticipated to increase overall by about 375 percent from 1998 through 2003, when the requirements in the advanced air bag rule take effect.

gao_GAO-14-526

gao_GAO-14-526_0

Background GPRAMA requires OMB to coordinate with agencies to develop long- term, outcome-oriented federal government priority goals for a limited number of crosscutting policy areas and management improvement areas every 4 years. Participants engage in rigorous and sustained follow-up on issues identified during reviews. In addition to requiring quarterly reviews, GPRAMA requires that OMB make information available on “a single website” (now known as Performance.gov) for each CAP goal on the results achieved during the most recent quarter, and overall trend data compared to the planned level of performance. OMB and Goal Leaders Established Processes for Reviewing Cross- Agency Priority Goal Progress, but Not All Review Processes Were Consistent with Requirements and Leading Practices OMB Established a Quarterly Process for Reviewing Progress on CAP Goals, but Did Not Consistently Outline Improvement Strategies Where Goal Achievement Was at Risk GPRAMA Requirement for OMB Progress Reviews GPRAMA requires that, not less than quarterly, the Director of OMB, with the support of the PIC, shall review progress on the CAP goals, including progress during the most recent quarter, overall trends, and the likelihood of meeting the planned level of performance. A lack of specific information about the steps being taken to mitigate identified risk areas and improve performance could hinder the ability of OMB leadership—and others—to adequately track the status of efforts to address identified deficiencies or risks and to hold officials accountable for taking necessary actions. Some Goal Leaders Used Review Processes Broadly Consistent with Leading Practices, and Noted Their Positive Effects on Performance, Accountability, and Collaboration Instituting review processes consistent with the leading practices we previously identified can help ensure that reviews include meaningful performance discussions, provide opportunities for oversight and accountability, and drive performance improvement. Leadership Involvement. Other Goal Leaders Did Not Use Review Processes Consistent with the Full Range of Leading Practices for Reviews We found that the processes used by other CAP goal leaders to engage agency officials in the review of progress, which are summarized in appendix IV, did not reflect the full range of leading practices. OMB reported performance information in the quarterly CAP goal status updates it published on Performance.gov. For example, while updates for 8 of the 14 goals included data that indicated performance towards the identified overall planned level of performance, only 3 also contained annual or quarterly targets that allowed for an assessment of interim progress. Updates for the other 6 of the 14 goals did not report on performance towards the goal’s primary performance target because the goal was established without a quantitative target or because goal managers were unable to collect the data needed to track performance. The incomplete picture of progress that many of the updates gave limited the ability of goal leaders and others to ensure accountability for the achievement of targets and milestones. While OMB and CAP goal leaders instituted processes for reviewing progress on the interim CAP goals, if GPRAMA requirements and leading practices for reviews are not consistently followed, it may result in missed opportunities to improve performance, hold officials accountable for achieving identified goals and milestones, and ensure agency officials are coordinating their activities in a way that is directed towards the achievement of shared goals and milestones. To ensure that OMB and CAP goal leaders include all key contributors and can track and report fully on progress being made towards CAP goals overall and each quarter, we recommend that the Director of OMB direct CAP goal leaders to take the following four actions: Identify all key contributors to the achievement of their goals; Identify annual planned levels of performance and quarterly targets for each CAP goal; Develop plans to identify, collect, and report data necessary to demonstrate progress being made towards each CAP goal or develop an alternative approach for tracking and reporting on progress quarterly; and Report the time frames for the completion of milestones; the status of milestones; and how milestones are aligned with strategies or initiatives that support the achievement of the goal. OMB staff generally agreed to consider our recommendations. Due to the timing of our work, we focused on the implementation of the reporting and review requirements for the 14 interim cross-agency priority (CAP) goals established in February 2012.about progress made towards the interim CAP goals; and (2) how, if at all, quarterly progress reflected GPRAMA requirements and leading practices for data-driven reviews, as well as how they contributed to improved cross-agency performance and collaboration. Specifically, this report assesses (1) what is known To address these objectives, we interviewed representatives of 13 of the 14 interim goals. Cybersecurity Officials from National Institute of Standards and Technology, General Services Administration (GSA), DHS, National Security Staff, Office of Management and Budget (OMB) and Performance Improvement Council. Some sub-goal leaders would hold in-person meetings with officials from contributing agencies to, among other things, review progress on identified goals and milestones.

Why GAO Did This Study The federal government faces complex, high-risk challenges, such as protecting our nation's critical information systems. Effectively managing these challenges is essential for national and economic security and public health and safety. However, responsibility for addressing these challenges often rests with multiple agencies. To effectively address them, shared goals and cross-agency collaboration are fundamental. This report responds to GAO's mandate to evaluate the implementation of GPRAMA. It assesses (1) what is known about progress made towards the interim CAP goals; and (2) how, if at all, quarterly progress reviews reflected GPRAMA requirements and leading practices for reviews, as well as how reviews contributed to improved cross-agency performance and collaboration. To address these objectives, GAO analyzed CAP goal status updates and other documents from OMB and CAP goal progress-review meetings, and interviewed OMB staff and CAP goal representatives. GAO compared this information to GPRAMA requirements and to leading practices for performance reviews previously reported on by GAO. What GAO Found CAP Goal Progress. The GPRA Modernization Act of 2010 (GPRAMA) requires the Office of Management and Budget (OMB) to coordinate with agencies to: (1) establish outcome-oriented, federal government priority goals (known as cross-agency priority, or CAP, goals) with annual and quarterly performance targets and milestones; and (2) report quarterly on a single website now known as Performance.gov the results achieved for each CAP goal compared to the targets. In February 2012, OMB identified 14 interim CAP goals and subsequently published five quarterly updates on the status of the interim CAP goals on Performance.gov. While updates for eight of the goals included data that indicated performance towards an overall planned level of performance, only three also contained annual or quarterly targets that allowed for an assessment of interim progress. Updates for the other six goals did not report on progress towards a planned level of performance because the goals lacked either a quantitative target or the data needed to track progress. The updates on Performance.gov also listed planned activities and milestones contributing to each goal, but some did not include relevant information, including time frames for the completion of specific actions and the status of ongoing efforts. The incomplete information in the updates provided a limited basis for ensuring accountability for the achievement of targets and milestones. OMB Quarterly Progress Reviews. GPRAMA also requires that OMB—with the support of the Performance Improvement Council (PIC)—review CAP goal progress quarterly with goal leaders. OMB instituted processes for reviewing progress on the goals each quarter, which involved the collection of data from goal leaders and the development of a memorandum for the OMB Director. However, the information included in these memorandums was not fully consistent with GPRAMA requirements. For example, GPRAMA requires OMB to identify strategies for improving the performance of goals at risk of not being met, but this was not consistently done. Without this information, OMB leadership and others may not be able to adequately track whether corrective actions are being taken, thereby limiting their ability to hold officials accountable for addressing identified risks and improving performance. Leading Practices for Reviews. At the CAP-goal level, goal leaders for two CAP goals and one sub-goal instituted in-person progress reviews with officials from contributing agencies that were broadly consistent with the full range of leading practices for reviews, such as leadership involvement in reviews of progress on identified goals and milestones, and rigorous follow-up on issues identified through these reviews. In these cases, goal managers reported there were positive effects on performance, accountability, and collaboration. In contrast, review processes used by other goal leaders did not consistently reflect the full range of leading practices. Effective review processes consistently engage leaders and agency officials in efforts to identify and address performance deficiencies, and to ensure accountability for commitments. Thus, not using them may result in missed opportunities to hold meaningful performance discussions, ensure accountability and oversight, and drive performance improvement. What GAO Recommends GAO is making seven recommendations to OMB to improve the reporting of performance information for CAP goals and ensure that CAP goal progress reviews meet GPRAMA requirements and reflect leading practices. OMB staff generally agreed to consider GAO's recommendations.

gao_GAO-16-345

gao_GAO-16-345_0

From school years 2000-01 to 2013-14 (most recent data available), both the percentage of K-12 public schools that were high poverty and comprised of mostly Black or Hispanic students (H/PBH) and the students attending these schools grew significantly. Specifically, according to our analysis of Education’s data, the number of schools where 90 to 100 percent of the students were eligible for free or reduced-price lunch and 90 to 100 percent of the students were Black or Hispanic grew by 143 percent from school years 2000-01 to 2013-14. Students in H/PBH schools were held back in 9th grade, suspended (out- of-school), and expelled at disproportionately higher rates than students in L/PBH schools and all other schools. 9 and fig. According to the district superintendent, even if there were openings, many minority students in the district were unable to attend certain magnet schools because doing so would interfere with the ratio of minorities to non-minorities the state was attempting to achieve. Diversity Plan in a School District in the South According to district documents, a school in the district is “diverse” if it meets at least one of the following measures: enrolls multiple racial/ethnic groups, and no single group represents more than 50 percent of the school’s total enrollment; enrolls at least three racial/ethnic groups, and each represents at least 15 percent of the school’s total enrollment; or enrolls at least two racial/ethnic groups, and each represents at least 30 percent of the school’s total enrollment; and at least two of the following measures: percentage of students eligible for free or reduced meals is at least two-thirds the average of other schools, percentage of English Learners is at least two-thirds the average of other schools, or percentage of students with a disability is at least two-thirds the average of other schools. Education and Justice Have Taken a Range of Actions to Address Racial Discrimination against Students, although Better Use of Available Data May Enhance These Efforts Education Addresses Discrimination by Conducting Investigations, Issuing Guidance, and Providing Technical Assistance Education has taken a range of actions to address racial discrimination in schools. For example, its analysis of its Civil Rights Data, which showed disparities across groups of students by race and other factors in students’ access to academic courses (such as algebra and AP courses), helped inform an investigation and resulted in guidance. Federal internal control standards state that agencies should use operational data to ensure effective and efficient use of agency resources. Justice also monitors and enforces open federal school desegregation cases where Justice is a party to the litigation. Justice Does Not Systematically Track Key Data to Inform Actions on Open Desegregation Cases As noted above, Justice is responsible for monitoring and enforcing the 178 open federal desegregation orders to which it is a party—many of which originated 30 or 40 years ago. As a consequence, the potential exists that some cases could unintentionally languish for long periods of time. The court noted that had Justice “been keeping an eye” on relevant information, such as disparities in test scores, it could have brought it to the court’s attention more quickly, allowing the court and district to address the issue in a timely fashion. These standards also state that agencies should use information to help identify specific actions that need to be taken and to allow for effective monitoring of activities. Further, Black and Hispanic students are increasingly attending high-poverty schools where they face multiple disparities, including less access to academic offerings. While the districts we contacted in different areas across the nation have efforts under way to help improve the quality of education for students, the Departments of Education and Justice have roles that are critical because they are responsible for enforcing federal laws that protect students from racial discrimination and ensuring schools and districts provide all students with equitable access. We recommend that the Attorney General of the United States direct the Department of Justice’s Civil Rights Division to systematically track key summary information across its portfolio of open desegregation cases and use this data to inform its monitoring of these cases. Appendix I: Scope and Methodology The objectives of this study were to examine: (1) how the percentage of schools with high percentages of poor and Black or Hispanic students has changed over time and the characteristics of these schools, (2) why and how selected school districts have implemented actions to increase student diversity, and (3) the extent to which the Departments of Education (Education) and Justice (Justice) have taken actions to identify and address issues related to racial discrimination in schools. Analysis of the Civil Rights Data Collection To examine additional characteristics about schools the students attended, we analyzed data from the public use file of Education’s Civil Rights Data Collection (referred to as the Civil Rights Data in this report) for school year 2011-12, which was the most recent year of data available. To select districts, we relied on recommendations from subject matter specialists and a review of available information. We also interviewed representatives of civil rights organizations and academic experts to discuss issues related to racial and socioeconomic diversity in public schools, including actions taken by school districts to increase diversity and federal actions to enforce federal civil rights laws with respect to race in public schools. We present these data by different levels of poverty, Black or Hispanic students, and school type (traditional, charter, and magnet schools).

Why GAO Did This Study Recent literature shows that poor and minority students may not have full access to educational opportunities. GAO was asked to examine poverty and race in schools and efforts by the Departments of Education and Justice, which are responsible for enforcing federal civil rights laws prohibiting racial discrimination against students. This report examined (1) how the percentage of schools with high percentages of poor and Black or Hispanic students has changed over time and the characteristics of these schools, (2) why and how selected school districts have implemented actions to increase student diversity, and (3) the extent to which the Departments of Education and Justice have taken actions to identify and address issues related to racial discrimination in schools. GAO analyzed Education data for school years 2000-01 to 2013-14 (most recent available); reviewed applicable federal laws, regulations, and agency documents; and interviewed federal officials, civil rights and academic subject matter specialists, and school district officials in three states, selected to provide geographic diversity and examples of actions to diversify. What GAO Found The percentage of K-12 public schools in the United States with students who are poor and are mostly Black or Hispanic is growing and these schools share a number of challenging characteristics. From school years 2000-01 to 2013-14 (the most recent data available), the percentage of all K-12 public schools that had high percentages of poor and Black or Hispanic students grew from 9 to 16 percent, according to GAO's analysis of data from the Department of Education (Education). These schools were the most racially and economically concentrated: 75 to 100 percent of the students were Black or Hispanic and eligible for free or reduced-price lunch—a commonly used indicator of poverty. GAO's analysis of Education data also found that compared with other schools, these schools offered disproportionately fewer math, science, and college preparatory courses and had disproportionately higher rates of students who were held back in 9th grade, suspended, or expelled. In the three districts GAO reviewed as case studies, officials reported implementing various actions to increase economic and racial diversity to address racial or other demographic shifts in school composition. For example, in one predominantly low-income, Black and Hispanic school district, the state and district created state-of-the-art magnet schools to attract students from more economically and racially diverse groups. However, these three districts faced challenges. For example, one state devoted funding to magnet schools while the district's traditional schools declined in quality, according to local officials. Further, according to officials, some magnets with openings could not accept minority students because doing so would interfere with the ratio of minority to non-minority students that the district was trying to achieve. The Departments of Education and Justice have taken a range of actions to identify and address racial discrimination against students. Education has investigated schools, analyzed its data by student groups protected under federal civil rights laws, and found discrimination and disparities in some cases. GAO analyzed Education's data among types of schools (charters, magnets, and traditional public schools) by percentage of racial minorities and a proxy for poverty level and found multiple disparities, including in access to academic courses. Education does not routinely analyze its data in this way. Conducting this type of analysis would enhance Education's ability to target technical assistance and identify other disparities by school types and groups. The Department of Justice (Justice) has also investigated discrimination claims, and it monitors and enforces 178 open federal desegregation court cases to which it is a party, many of which originated 30 or 40 years ago to remedy segregation. However, GAO found that Justice does not track key summary case information, such as the last action taken in a case. As a result, some may unintentionally remain dormant for long periods. For example, in one case the court noted there had been a lack of activity and that if Justice had “been keeping an eye” on relevant information, such as test score disparities, the issue could have been addressed in a more timely way. Federal internal control standards state that agencies should use information to help identify specific actions that need to be taken to allow for effective monitoring. Without tracking key information about open cases, Justice's ability toward effectively monitor such cases is hampered. What GAO Recommends GAO recommends that Education more routinely analyze its civil rights data to identify disparities among types and groups of schools and that Justice systematically track key information on open federal school desegregation cases to which it is a party to better inform its monitoring. In response, both agencies are considering actions in line with GAO's recommendations.

gao_GAO-08-146T

gao_GAO-08-146T_0

Background Since the early 1990s, hundreds of residential treatment programs and facilities have been established in the United States by state agencies and private companies. In addition, the programs provide a range of services, either on-site or through links with community programs, including educational, medical, psychiatric, and clinical/mental health services. In addition to the lack of a standard, commonly recognized definition for residential treatment programs, there are no standard definitions for specific types of programs—wilderness therapy programs, boot camps, and boarding schools, for instance. Widespread Allegations of Abuse and Death at Residential Treatment Programs We found thousands of allegations of abuse, some of which involved death, at public and private residential treatment programs across the country between the years 1990 and 2007. We are unable to identify a more concrete number of allegations because we could not locate a single Web site, federal agency, or other entity that collects comprehensive nationwide data related to this issue. According to the most recent NCANDS data, during 2005 alone 33 states reported 1,619 staff members involved in incidents of abuse in residential programs. Because of limited data collection and reporting, we could not determine the numbers of incidents of abuse and death associated with private programs. For example: We identified claims of abuse and death in pending and closed civil or criminal proceedings with dozens of plaintiffs alleging abuse. Cases of Death at Selected Residential Treatment Programs We selected 10 closed cases from private programs to examine in greater detail. Specifically, these cases were focused on the death of a teenager in a private residential treatment program that occurred between 1990 and 2004. We found significant evidence of ineffective management in most of these 10 cases, with many examples of how program leaders neglected the needs of program participants and staff. These ineffective management techniques compounded the negative consequences of (and sometimes directly resulted in) the hiring of untrained staff; a lack of adequate nourishment; and reckless or negligent operating practices, including a lack of adequate equipment. These specific factors played a significant role in most of the deaths we examined. The program closed in 2001.

Why GAO Did This Study Residential treatment programs provide a range of services, including drug and alcohol treatment, confidence building, military-style discipline, and psychological counseling for troubled boys and girls with a variety of addiction, behavioral, and emotional problems. This testimony concerns programs across the country referring to themselves as wilderness therapy programs, boot camps, and academies, among other names. Many cite positive outcomes associated with specific types of residential treatment. There are also allegations regarding the abuse and death of youth enrolled in residential treatment programs. Given concerns about these allegations, particularly in reference to private programs, the Committee asked the General Accountability Office (GAO) to (1) verify whether allegations of abuse and death at residential treatment programs are widespread and (2) examine the facts and circumstances surrounding selected closed cases where a teenager died while enrolled in a private program. To achieve these objectives, GAO conducted numerous interviews and examined documents from closed cases dating as far back as 1990, including police reports, autopsy reports, and state agency oversight reviews and investigations. GAO did not attempt to evaluate the benefits of residential treatment programs or verify the facts regarding the thousands of allegations it reviewed. What GAO Found GAO found thousands of allegations of abuse, some of which involved death, at residential treatment programs across the country and in American-owned and American-operated facilities abroad between the years 1990 and 2007. Allegations included reports of abuse and death recorded by state agencies and the Department of Health and Human Services, allegations detailed in pending civil and criminal trials with hundreds of plaintiffs, and claims of abuse and death that were posted on the Internet. For example, during 2005 alone, 33 states reported 1,619 staff members involved in incidents of abuse in residential programs. GAO could not identify a more concrete number of allegations because it could not locate a single Web site, federal agency, or other entity that collects comprehensive nationwide data. GAO also examined, in greater detail, 10 closed civil or criminal cases from 1990 through 2004 where a teenager died while enrolled in a private program. GAO found significant evidence of ineffective management in most of the 10 cases, with program leaders neglecting the needs of program participants and staff. This ineffective management compounded the negative consequences of (and sometimes directly resulted in) the hiring of untrained staff; a lack of adequate nourishment; and reckless or negligent operating practices, including a lack of adequate equipment. These factors played a significant role in the deaths GAO examined.

gao_GAO-14-394T

gao_GAO-14-394T_0

Interior Continues to Face Challenges Hiring and Retaining Key Oil and Gas Staff, Primarily Because of Higher Industry Salaries and the Lengthy Federal Hiring Process We found that Interior continues to experience problems hiring and retaining sufficient staff to provide oversight and management of oil and gas activities on federal lands and waters. BLM, BOEM, and BSEE office managers we surveyed reported that they continue to find it difficult to fill vacancies for key oil and gas oversight positions, such as petroleum engineers, inspectors, geologists, natural resource specialists, and geophysicists. They also reported that high rates of attrition are a concern because some Interior offices have just one or two employees per position, so a single retirement or resignation can significantly affect office operations and oversight. According to Office of Personnel Management (OPM) data, the fiscal year 2012 attrition rate for petroleum engineers at BLM was over 20 percent, or more than double the average federal attrition rate of 9.1 percent. Interior officials cited two major factors that affect the agency’s ability to hire and retain sufficient staff to oversee oil and gas activities on federal leases: Higher industry salaries. Bureau of Labor Statistics data confirm that there is a wide and growing gap between industry and federal salaries for some positions, particularly petroleum engineers and geologists. However, all hiring times were much longer than 80 calendar days— OPM’s target. According to BLM, BOEM, and BSEE officials, other factors have contributed to difficulties hiring and retaining key oil and gas oversight personnel, such as few qualified applicants in remote areas, or areas with a high cost of living. Interior Has Taken Some Actions to Address Hiring and Retention Challenges Interior and its three bureaus—BLM, BOEM, and BSEE—have taken some steps to address hiring and retention challenges but could do more. Interior has used special salary rates and incentives to increase hiring and retention for key oil and gas positions, but use of these incentives has been limited. Interior has taken some steps to reduce the time it takes to hire oil and gas oversight staff but does not collect data to identify the causes of delays in the hiring process and opportunities for reducing them. BLM, BOEM and BSEE have the authority to pay incentives in the form of recruitment, relocation, and retention awards of up to 25 percent of basic pay, in most circumstances, and for as long as the use of these incentives is justified, in accordance with OPM guidance, such as in the event an employee is likely to leave federal service. BLM awarded two of the four retention incentives in 2012 to help retain petroleum engineers in its North Dakota Field Office. However, neither the department nor the three bureaus have complete and accurate data on hiring times that could help them identify and address the causes of delays in the hiring process. For instance, BSEE and BOEM collect hiring data on a biweekly basis, but officials told us they use the data primarily to track the progress of individual applicants as they move through the hiring process. Likewise, a BLM official stated that the bureau does not systematically analyze data on hiring times. Without reliable data on hiring times, Interior’s bureaus cannot identify how long it takes to complete individual stages in the hiring process or effectively implement changes to expedite the hiring process. Hiring and Retention Challenges Have Made it More Difficult for Interior to Carry Out Some Oversight Activities The BLM, BOEM, and BSEE officials that we interviewed and surveyed reported that hiring and retention challenges have made it more difficult to carry out their oversight activities. These officials stated that position vacancies have resulted in less time for oversight, and vacancies directly affect the number of oversight activities they can carry out—including the number of inspections conducted and the time for reviewing applications to drill. Officials at each of the three bureaus cited steps they have taken to address vacancies in key oil and gas positions; specifically, reassigning staff from lower-priority to higher-priority tasks, borrowing staff from other offices, or increasing overtime. In response to this recommendation, in fiscal year 2011, BLM implemented a risk- based inspection strategy whereby each field office inspects the highest risk wells first. In our January 2014 report, to address the hiring challenges we identified, we recommended that Interior explore its bureaus’ expanded use of recruitment, relocation, retention, and other incentives and systematically collect and analyze hiring data. Interior generally agreed with our recommendations.

Why GAO Did This Study Interior employs a wide range of highly trained specialists and scientists with key skills to oversee oil and gas operations on leased federal lands and waters. GAO and others have reported that Interior has faced challenges hiring and retaining sufficient staff to carry out these responsibilities. In February 2011, GAO added Interior's management of federal oil and gas resources to its list of programs at high risk of fraud, waste, abuse, and mismanagement in part because of Interior's long-standing human capital challenges. This testimony and the January 2014 report on which it is based address (1) the extent to which Interior continues to face challenges hiring and retaining key oil and gas staff and the causes of these challenges, (2) Interior's efforts to address its hiring and retention challenges, and (3) the effects of hiring and retention challenges on Interior's oversight of oil and gas activities. To do this work, GAO surveyed all 44 Interior offices that oversee oil and gas operations, of which 40 responded; analyzed offshore inspection records and other documents; and interviewed agency officials. What GAO Found The Department of the Interior continues to face challenges hiring and retaining staff with key skills needed to manage and oversee oil and gas operations on federal leases. Interior officials noted two major factors that contribute to challenges in hiring and retaining staff: lower salaries and a slow hiring process. In response to GAO's survey, officials from a majority of the offices in the three Interior bureaus that manage oil and gas activities—the Bureau of Land Management (BLM), the Bureau of Ocean Energy Management (BOEM), and the Bureau of Safety and Environmental Enforcement (BSEE)—reported ongoing difficulties filling vacancies, particularly for petroleum engineers and geologists. Many of these officials also reported that retention is an ongoing concern as staff leave for positions in industry. Bureau of Labor Statistics data confirm a wide gap between industry and federal salaries for petroleum engineers and geologists. According to Office of Personnel Management (OPM) data, the fiscal year 2012 attrition rate for petroleum engineers at BLM was over 20 percent, or more than double the average federal attrition rate of 9.1 percent. Field office officials stated that attrition is of concern because some field offices have only a few employees in any given position, and a single separation can significantly affect operations. Additionally, Interior records show that the average time required to hire petroleum engineers and inspectors in recent months generally exceeded 120 calendar days—much longer than OPM's target of 80 calendar days. Interior and the three bureaus—BLM, BOEM, and BSEE—have taken some actions to address their hiring and retention challenges, but they have not fully used their existing authorities to supplement salaries or collect and analyze hiring data to identify the causes of delays in the hiring process. For instance, BLM, BOEM, and BSEE officials said that recruitment, relocation, and retention incentives are key options to help hire and retain staff, but the bureaus' use of these incentives to attract and retain petroleum engineers and inspectors has been limited for various reasons. Moreover, Interior and its bureaus have taken some steps to reduce hiring times, but they do not have complete and accurate data on hiring times. For instance, while BSEE and BOEM collect hiring data on a biweekly basis, the data are used primarily to track the progress of individual applicants as they move through the hiring process. Likewise, a BLM official stated that the bureau does not systematically analyze data on hiring times. Without reliable data on hiring times, Interior's bureaus cannot identify how long it takes to complete individual stages in the hiring process or effectively implement changes to expedite the hiring process. According to BLM, BOEM, and BSEE officials, hiring and retention challenges have made it more difficult to carry out oversight activities in some field offices. For example, many BLM and BSEE officials GAO surveyed reported that vacancies have resulted in a reduction in the number of inspections conducted. As a result of these challenges, bureau officials cited steps they have taken to address vacancies in key positions, such as borrowing staff from other offices or using overtime, but these are not sustainable, long-term solutions. What GAO Recommends In its January 2014 report, GAO recommended that Interior explore its oil and gas management bureaus' expanded use of recruitment, relocation, retention, and other incentives and systematically collect and analyze hiring data. Interior generally agreed with GAO's recommendations. GAO is not making any new recommendations in this testimony.

gao_T-GGD-97-155

gao_T-GGD-97-155_0

IRS Has Some Limited Data on the Use and Misuse of Lien, Levy, and Seizure Authority IRS produces management information reports that provide some basic information on tax collections and the use of collection enforcement authorities, including the number of liens, levies, and seizures filed and, in the case of seizures, the tax delinquency that resulted in the seizure and the tax proceeds achieved. Also, some offices within IRS collect information on the misuse of these collection enforcement authorities, but the information is not complete. However, those data alone are not sufficient to determine the extent of misuse. Moreover, the detailed records kept by these offices do not always include data that would permit a determination about whether an enforcement action was properly used. Further, offices responsible for resolving taxpayer complaints do not always maintain records on the resolution of those complaints that would permit identification of instances of inappropriate use of collections authorities. As noted earlier, the Advocate has some information on complaints about the use of collection enforcement authorities, but those data are incomplete. In any event, Inspection does not keep automated or summary records on the results of its investigations as they relate to appropriateness of lien, levy, or seizure actions. IRS Officials Said That Collecting Data to Assess Enforcement Actions Is Impractical and Unnecessary Because Taxpayers Are Protected Through Checks and Balances We discussed with IRS the feasibility of collecting additional information for monitoring the extent to which IRS may have inappropriately used its collection enforcement authorities, and the characteristics of taxpayers who might be affected by such inappropriate actions. At this time, IRS does not have the data that would permit it or Congress to readily determine the extent to which IRS’ collections enforcement authorities are misused, the causes of those occurrences, the characteristics of the affected taxpayers, or whether the checks and balances that IRS established over the use of collection enforcement authorities are working as intended. found? sources found.

Why GAO Did This Study GAO discussed: (1) the availability of information on the Internal Revenue Service's (IRS) use of its enforcement authorities to collect delinquent taxes; and (2) whether information existed that could be used to determine whether collection enforcement authorities were properly used. What GAO Found GAO found that: (1) while IRS has some limited data about its use, and misuse, of collection enforcement authorities, these data are not sufficient to show: (a) the extent of the improper use of lien, levy, or seizure authority; (b) the causes of improper actions; or (c) the characteristics of taxpayers affected by improper actions; (2) the lack of information exists because IRS' systems--both manual and automated--have not been designed to capture and report comprehensive information on the use and possible misuse of collection authorities; (3) also, much of the data that are recorded on automated systems cannot be aggregated without a significant investment of scarce programming resources; (4) some information is available in manual records, but--because collection enforcement actions can be taken by a number of different IRS offices and records resulting from these actions are not always linked to IRS' automated information systems--this information cannot be readily assembled to assess the use of enforcement actions; (5) also, data are not readily available from other potential sources, such as taxpayer complaints, because, in many circumstances, IRS does not require that information on the resolution of the complaints be recorded; (6) IRS officials told GAO that collecting complete data on the use of enforcement actions that would permit an assessment of the extent and possible causes of misuse of these authorities is unnecessary because they have adequate checks and balances in place to protect taxpayers; and (7) however, IRS does not have the data that would permit it or Congress to readily resolve resonable questions about the extent to which IRS' collections enforcement authorities are misused, the causes of those occurrences, the characteristics of the affected taxpayers, or whether IRS' checks and balances over the use of collection enforcement authorities are working as intended.

gao_GAO-05-326T

gao_GAO-05-326T_0

1.) The SGR system, Medicare’s current system for updating physician fees, was established in the Balanced Budget Act of 1997 (BBA) and was first used to adjust fees in 1999. SGR System Designed to Limit or Reduce Physician Fee Updates in Response to Excess Growth in Volume and Intensity The SGR system establishes spending targets to moderate physician services spending increases caused by excess growth in volume and intensity. If cumulative spending on physician services is in line with SGR’s target, the physician fee schedule update for the next calendar year is set equal to the estimated increase in the average cost of providing physician services as measured by the Medicare Economic Index (MEI). If cumulative spending falls short of the target, the update will exceed the change in MEI. The SGR system places bounds on the extent to which fee updates can deviate from MEI. Continued Volume and Intensity Growth and Legislated Fee Updates Contribute to Projected Decline in Physician Fees The 2004 Medicare Trustees Report announced that the projected physician fee update would be about negative 5 percent for 7 consecutive years beginning in 2006; the result is a cumulative reduction in physician fees of more than 31 percent from 2005 to 2012, while physicians’ costs of providing services, as measured by MEI, are projected to rise by 19 percent. 2.) There are two principal reasons for the projected fee declines: increases in volume and intensity that exceed the SGR’s allowance—partly as a result of spending for Part B prescription drugs—and the minimum fee updates for 2004 and 2005 specified by MMA. In general, the SGR system allows physician fee updates to equal or exceed the MEI as long as spending growth due to volume and intensity increases is no higher than the average growth in real GDP per capita—about 2.3 percent annually. Because MMA did not make corresponding revisions to the SGR system’s spending targets, the SGR system must offset the additional spending by reducing fees beginning in 2006. Alternatives for Updating Physician Fees Would Eliminate Spending Targets or Revise Current SGR System The projected sustained period of declining physician fees and the potential for beneficiaries’ access to physician services to be disrupted have heightened interest in alternatives for the current SGR system. physicians appropriately, it is important to consider how modifications or alterations to the SGR system would affect the long-term sustainability and affordability of the Medicare program. Retain Spending Targets, Modify Current SGR System Another approach for addressing the perceived shortcoming of the current SGR system would retain spending targets but modify one or more elements of the system. The SGR system could be modified in a number of ways: for example, by raising the allowance for increased spending due to volume and intensity growth; resetting the base for the spending targets and not requiring the system to recoup previous excess spending; or removing the prescription drug expenditures that are currently counted in the SGR system. The first approach—eliminating targets—emphasizes fee stability while the second approach—retaining and modifying targets—includes an automatic fiscal brake. As policymakers consider options for updating physician fees, it is important to be mindful of the serious financial challenges facing Medicare and the need to design policies that help ensure the long-term sustainability and affordability of the program.

Why GAO Did This Study Concerns were raised about the system Medicare uses to determine annual changes to physician fees--the sustainable growth rate (SGR) system--when it reduced physician fees by almost 5 percent in 2002. Subsequent administrative and legislative actions modified or overrode the SGR system to avert fee declines in 2003, 2004, and 2005. However, projected fee reductions for 2006 to 2012 have raised new concerns about the SGR system. Policymakers question the appropriateness of the SGR system for updating physician fees and its effect on physicians' continued participation in the Medicare program if fees are permitted to decline. At the same time, there are concerns about the impact of increased spending on the long-term fiscal sustainability of Medicare. GAO was asked to discuss the SGR system. Specifically, this statement addresses the following: (1) how the SGR system is designed to moderate the growth in spending for physician services, (2) why physician fees are projected to decline under the SGR system, and (3) options for revising or replacing the SGR system and their implications for physician fee updates and Medicare spending. This statement is based on GAO's most recent report on the SGR system, Medicare Physician Payments: Concerns about Spending Target System Prompt Interest in Considering Reforms (GAO-05-85). What GAO Found To moderate Medicare spending for physician services, the SGR system sets spending targets and adjusts physician fees based on the extent to which actual spending aligns with specified targets. If growth in the number of services provided to each beneficiary--referred to as volume--and in the average complexity and costliness of services--referred to as intensity--is high enough, spending will exceed the SGR target. While the SGR system allows for some volume and intensity spending growth, this allowance is limited. If such growth exceeds the average growth in the national economy, as measured by the gross domestic product per capita, fee updates are set lower than inflation in the cost of operating a medical practice. A large gap between spending and the target may result in fee reductions. There are two principal reasons why physician fees are projected to decline under the SGR system beginning in 2006. One problem is that projected volume and intensity spending growth exceeds the SGR allowance for such growth. Second, the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA) increased the update for 2004 and 2005--thus increasing spending--but did not raise the spending targets for those years. The SGR system, which is designed to keep spending in line with its targets, must reduce fees beginning in 2006 to offset excess spending attributable to both volume and intensity growth and the MMA provision. In general, proposals to reform Medicare's method for updating physician fees would either (1) eliminate spending targets and establish new considerations for the annual fee updates or (2) retain spending targets, but modify certain aspects of the current system. The first approach emphasizes stable and positive fee updates, while the second approach automatically applies financial brakes whenever spending for physician services exceeds predefined spending targets. Either approach could be complemented by focused efforts to moderate volume and intensity growth directly. As policymakers consider options for updating physician fees, it is important to be mindful of the serious financial challenges facing Medicare and the need to design policies that help ensure the long-term sustainability and affordability of the program.

gao_GAO-10-46

gao_GAO-10-46_0

DOD is responsible for cleaning up its releases of hazardous substances under DERP, in accordance with CERCLA. In addition, the NCP requires that the Corps, as the agency responsible for FUDS cleanup, conduct “5- year reviews” of sites not less than every 5 years after the start of remedial action, when the chosen remedy does not allow for unlimited use and unrestricted exposure. However, using this process has not often led the Corps to re-examine sites after response actions are completed to determine whether emerging contaminants are present or need to be addressed. The Corps Considers New Information on Contaminants in its 5-Year Reviews, but Has Problems with its Review Procedures Our analysis of information on the Corps’ 5-year reviews for FUDS in 4 divisions identified the following problems with the Corps’ review process: (1) the reviews were not completed on time; (2) DOD and the Corps lack accurate, complete information on these reviews; (3) Corps divisions are inconsistent in their approaches to conducting 5-year reviews for sites where they are recommended, but not required; and (4) the reports resulting from these reviews did not always receive the technical review by Corps experts as required by Corps policy. For example, one division official told us that they have only recently begun completing cleanup of HTRW sites, and another division official said that most of the sites that might need a 5-year review have not yet been cleaned up. In responding to such requests, the Corps may review the records or other original information for the property, as well as any additional information provided by EPA, the state, or tribe concerning potential DOD contamination. DOD Proposes Funding for Cleanup at FUDS, Active Sites, and BRAC Sites Based on DERP Goals, and Funding Is Proportional to Site Inventories DOD uses the same method to propose funding for cleanup at FUDS, active sites, and BRAC sites; cleanup funding is based on DERP goals and is generally proportional to the number of sites in each of these categories. The Corps Uses Risk- Based Criteria to Prioritize FUDS for Cleanup, but Also Considers Other Factors The Corps uses risk-based criteria and other factors to prioritize FUDS for cleanup. While the risk levels of sites are a significant factor in determining cleanup priorities, high risk sites are not always addressed before low risk sites. According to DOD and Corps officials, the list of such sites may change from year to year. DOD and Corps officials told us that in addition to considering a site’s risk level, the Corps sets cleanup priorities based on program goals, which have evolved over time. The Corps also recognizes in its FUDS program policy and FUDS program management plan for FY 2009 that the concerns of regulators, the Congress, and the public can influence the Corps’ decisions about which sites to address first and can potentially result in decisions to fund projects that are not high-risk. Table 9 shows the total amount that the Corps obligated for both direct and indirect program management and support costs and Table 10 shows both as a percentage of the total program management and support budget and as a percentage of the overall amount obligated for the FUDS budget from FY 2004 through 2008: In FY 2006, the Deputy Assistant Secretary of the Army for Environmental, Safety and Occupational Health directed the FUDS program to reduce the program management and support costs of the program in order to make more funds available for cleanup projects. Several factors help to ensure that overall program management and support funds are spent only on items the Corps has approved. Recommendations To help ensure that the remedies at FUDS continue to protect human health, safety, and the environment, we are making three recommendations. We recommend that the Secretary of Defense direct the Corps to conduct 5-year reviews for sites where emerging contaminants are present and the cleanup will eventually allow unlimited site use and unrestricted exposure, but will require more than 5 years to complete, consistent with EPA’s guidance that such reviews are appropriate, even if not required; modify its FUDS program information management system to allow districts to more easily track information on 5-year reviews, and take steps to ensure that the districts utilize this system to plan for 5-year reviews and track progress on completing them; and determine why districts have not always completed timely 5-year reviews and provided all 5-year review reports to the Center of Expertise for comment—consistent with Corps guidelines—and develop procedures and controls to address these causes. Appendix II: Scope and Methodology To determine how the U.S. Army Corps of Engineers (Corps) addresses emerging contaminants at formerly used defense sites (FUDS), and the extent to which the Corps reevaluates sites to determine the need to address emerging contaminants, we reviewed key laws, regulations, policy, and guidance for the Department of Defense (DOD), the Department of the Army, the Corps, and the Environmental Protection Agency (EPA).

Why GAO Did This Study The Department of Defense (DOD) estimates that cleaning up known hazards at the over 4,700 formerly used defense sites (FUDS)--sites transferred to other owners before October 1986--will require more than 50 years and cost about $18 billion. This estimate excludes any additional needed cleanup of emerging contaminants--generally, those not yet governed by a health standard. DOD delegated FUDS cleanup responsibility to the U.S. Army Corps of Engineers (Corps). In addition to FUDS, DOD is responsible for cleaning up about 21,500 sites on active bases and 5,400 sites on realigned or closed bases. The House Armed Services Committee directed GAO to examine (1) the extent to which the Corps reevaluates sites to identify emerging contaminants; (2) how DOD allocates cleanup funds; (3) how the Corps prioritizes FUDS for cleanup; and (4) FUDS program overhead costs. GAO analyzed nationwide FUDS property and project data; policies, guidance and budget documents; and interviewed DOD and Corps officials. What GAO Found The Corps has not often re-examined sites after they have been cleaned up to determine whether emerging contaminants are present or need to be addressed. Generally, the Corps reevaluates sites only when requested by states or others, or when reviewing the completed remedy to ensure its continuing protectiveness. Such reviews are required every 5 years for sites where the chosen remedy does not allow for unlimited use and unrestricted exposure. Corps officials said that they had not received many requests to re-examine sites and few FUDS had required 5-year reviews. Reports on the 15 5-year reviews completed as of May 2009 within four Corps divisions indicated that the Corps has not consistently (1) conducted required 5-year reviews on time, (2) conducted reviews when they are not required but may be appropriate, as EPA recommends, and (3) submitted reports on these reviews for technical evaluation, as required by Corps policy. Also, DOD and the Corps lack accurate, complete information on the status of these reviews. Without timely, accurate, and complete reviews, the Corps cannot ensure that remedies continue to protect human health and the environment. DOD proposes funding to clean up defense sites based on the department's environmental restoration goals and obligations are generally proportional to the number of sites in each site category. Funding is directed toward reducing risks to human health and the environment, among other goals. The Army, Navy, Marine Corps, Air Force, and Defense Logistics Agency each determine the funding requirements to clean up sites based on these goals. The Corps prioritizes individual FUDS for cleanup on the basis of risk and other factors. The Corps assigns each site a risk level, considering such factors as the presence of hazards, the potential for human contact, and the concentrations of contaminants and their potential for migrating, among others. According to DOD officials, sites' risk levels are the single most important criterion in determining cleanup priorities. However, the Corps also takes into account specific FUDS program goals, and other factors--such as regulators' and the public's concerns--that can influence the Corps' decisions about which sites to address first. Consequently, high risk sites are not always addressed before low risk sites. Direct program management and support costs for the FUDS program have decreased slightly in recent years, mostly due to structural changes in the program. The Corps' obligations for FUDS direct program management and support costs have declined from 11.0 percent of total program obligations in fiscal year 2004 to 9.0 percent in fiscal year 2008. In addition, to further reduce certain components of these costs to make more funds available for FUDS cleanup, the Corps reduced the number of employees managing the program and the number of districts responsible for FUDS from 22 to 14. Furthermore, Corps officials told GAO that they have implemented a number of controls--such as assigning tracking codes--to ensure that program management and support funds are spent only on approved items.

gao_GAO-06-979

gao_GAO-06-979_0

The increase was greatest for domestic icebreakers, which continue to be used more for homeland security missions than for icebreaking because of their availability during months when no icebreaking is needed. Some newer ATON cutters with greater multi-mission capabilities, however, continue to have a more diverse workload. 3). For example, ATON cutters acquired between 1944 and 1976 performed an average of 4 of the Coast Guard’s 11 missions during fiscal years 2001 through 2005, while the 225-foot seagoing buoy tender, which the Coast Guard completed the acquisition of in 2004, was used in all 11 of the Coast Guard’s missions in fiscal years 2004 through 2005. However, the current measure for asset condition is not clearly linked to mission performance, but the Coast Guard is working on developing a measure that links the two. Performance indicators for the icebreaking and ATON missions likewise show mixed results, with the Coast Guard meeting some performance goals and not meeting others. In part, these mixed results can be explained by the many other factors besides asset condition, such as the severity of weather in any given year. Coast Guard officials said some of this decline was attributable to the condition of ATON cutters and boats for servicing the navigational aids, but they were not able to estimate how much of the decline could be attributed to this cause. To Continue to Achieve the Missions of Its ATON and Domestic Icebreaking Assets, the Coast Guard Has Taken Actions, Made Proposals, and Studied Outsourcing Possibilities The Coast Guard has considered or proposed a wide variety of actions to continue to achieve the missions that its domestic icebreaking and ATON assets perform and is moving ahead with several of them. Additional Proposals to Rehabilitate or Replace Aging Assets Remain Largely Unfunded Despite the new acquisitions, more than half of the assets in the domestic icebreaking and ATON fleet have reached or are nearing the end of their service lives. According to Coast Guard officials, these options were proposed after determining that the age, condition, and cost of operating these assets would diminish the capability of the Coast Guard to carry out ATON and domestic icebreaking missions over time without rehabilitation or replacement of some or all of the assets. Although possibilities for outsourcing were identified, outsourcing also carries potential disadvantages, according to Coast Guard program officials. The Coast Guard is moving to improve the process it uses to set budget priorities through actions such as its new tool to link asset condition and funding decisions to better identify the projects that will provide the most capability with the limited funds that are available. Agency Comments We requested comments on a draft of this report from the Department of Homeland Security and the Coast Guard. The Coast Guard provided technical comments, which we have incorporated into the report as appropriate. GAO staff who made major contributions to this report are listed in appendix V. Appendix I: Objectives, Scope, and Methodology This report examines the time spent by the U.S. Coast Guard’s domestic icebreaking and ATON assets on various missions, the condition of these assets, and the actions the Coast Guard has taken to continue to achieve the missions of these assets. Our work focused on three key questions: (1) What are the recent trends in the amount of time these assets have performed various missions? The Coast Guard maintains information, on a program-by-program basis, about how resources, such as vessels, boats, and aircraft, are used.

Why GAO Did This Study The marine transportation system is a critical part of the nation's infrastructure. To facilitate the safety and efficiency of this system, the Coast Guard maintains aids-to-navigation (ATON), such as buoys and beacons, and conducts domestic icebreaking in the Great Lakes, St. Lawrence Seaway, and northeast coast. To conduct these missions, the Coast Guard has a fleet of more than 200 vessels, ranging from 225-foot seagoing buoy tenders and 140-foot domestic icebreakers to 21-foot boats. After the terrorist attacks of September 11, 2001, many of these assets took on additional responsibilities for security patrols and other homeland security duties. Although some assets have been recently acquired, many others are reaching or have exceeded their design service lives, raising concerns about how well and for how much longer these older assets may be able to carry out their missions. In response, GAO examined (1) recent trends in the amount of time these assets have spent performing missions; (2) asset condition and its effect on mission performance; and (3) the actions taken by the Coast Guard to continue to achieve the missions of these assets. To conduct this work, GAO reviewed Coast Guard documents, interviewed Coast Guard officials, and made site visits to various locations around the country. In commenting on a draft of this report, the Coast Guard provided technical comments, which were incorporated as appropriate. What GAO Found Many ATON vessels and domestic icebreakers have operated more hours in recent years than in previous years, with the increase coming mainly in homeland security missions. Domestic icebreakers are now used more for homeland security than for icebreaking, reflecting their availability at times of the year when no icebreaking is needed. While not designed for homeland security, the assets can perform such duties acceptably, according to the Coast Guard. Most ATON vessels are used primarily for ATON activities. Newer ATON assets receive the greatest use on other missions, reflecting their greater multi-mission capabilities. Trends are mixed with regard to asset condition and mission performance. Available evidence, such as the amount of maintenance conducted, suggests condition is declining for some assets, though not precipitously. Coast Guard officials said some assets, while being operated for more hours, are still largely being operated within planned limits. Against this backdrop, indicators for measuring performance show mixed results: some have declined, while others have not. The current measure for asset condition is not clearly linked to mission performance, but the Coast Guard is working on developing a measure that links the two. Actions the Coast Guard has taken to continue to achieve the missions of these assets include revising maintenance approaches and developing a new analytical tool for deciding which projects provide the most capability for the dollars invested. The Coast Guard continues to acquire some new vessels to replace aging ones, but proposals to rehabilitate or replace other aging vessels have not been implemented, largely because of other funding priorities. The Coast Guard also studied the feasibility of contracting out some activities. While some possibilities for outsourcing were identified in the study, the Coast Guard has identified potential disadvantages to outsourcing these activities.

gao_GAO-05-202

gao_GAO-05-202_0

Observations on the Expenditure Plan Our observations recognize accomplishments to date and address the need for rigorous and disciplined program management practices relating to describing progress against commitments, managing the exit alternatives pilot, managing system capacity, and estimating cost, as well as collaborating with DHS’s Automated Commercial Environment (ACE) program. As of early November 2004, exit alternatives were deployed and operating in only 5 of the 15 ports of entry that were scheduled to be operational by November 1, 2004. According to program implementation officials, this was because of delays in DHS granting security clearances to the civilian employees who would operate the equipment at the ports of entry. The Department of Homeland Security Appropriations Act, 2005,1 states that DHS may not obligate $254 of the $340 million appropriated for the US-VISIT program until the Senate and House Committees on Appropriations receive and approve a plan for expenditure that meets the capital planning and investment control review requirements established by the Office of Management and Budget (OMB), including OMB Circular A-11, part 7;2 complies with DHS’s enterprise architecture; complies with the acquisition rules, requirements, guidelines, and systems acquisition management practices of the federal government; is reviewed and approved by the DHS Investment Review Board, the Secretary of Homeland Security, and OMB; and is reviewed by GAO. The fiscal year 2005 Expenditure Plan does not describe progress against commitments (e.g., capabilities, schedule, cost, and benefits) made in previous plans. The exit capability alternatives evaluation is faced with a compressed time line, missed milestones, and potentially reduced scope. US-VISIT has developed a risk management plan and process for developing, implementing, and institutionalizing a risk management program. The plan satisfies the requirement that it be reviewed by GAO. According to the Deputy Program Manager, US-VISIT provided this information in a briefing to the Subcommittee staff. Observation 1: The program office has acquired the services of a prime integration contractor to augment its ability to complete US-VISIT. For example, in its fiscal year 2004 expenditure plan, US-VISIT committed to, among other things, analyzing, field testing, and initiating deployment of alternative approaches for capturing biometrics during the exit process at air and sea POEs and implementing entry and exit capabilities at the 50 busiest land POEs by December 31, 2004, including delivering the capability to read radio frequency enabled documents at the 50 busiest land POEs for both entry and exit processes. These changing facts and circumstances surrounding the exit pilot introduce additional risk concerning US-VISIT’s delivery of promised capabilities and benefits on time and within budget.

Why GAO Did This Study The Department of Homeland Security (DHS) has established a program--the U.S. Visitor and Immigrant Status Indicator Technology (US-VISIT)--to collect, maintain, and share information, including biometric identifiers, on selected foreign nationals who travel to the United States. By congressional mandate, DHS is to develop and submit for approval an expenditure plan for US-VISIT that satisfies certain conditions, including being reviewed by GAO. Among other things, GAO was asked to determine whether the plan satisfied these conditions and to provide observations on the plan and DHS's program management. What GAO Found DHS's fiscal year 2005 expenditure plan and related documentation at least partially satisfied all conditions established by the Congress, including meeting the capital planning and investment control requirements of the Office of Management and Budget (OMB). For example, DHS has developed a plan and a process for developing, implementing, and institutionalizing a program to manage risk. In its observations about the expenditure plan and DHS's management of the program, GAO recognizes accomplishments to date and addresses the need for rigorous and disciplined program practices. For example, US-VISIT has acquired the services of a prime integration contractor to augment its ability to complete US-VISIT. However, DHS has not employed rigorous, disciplined processes typically associated with successful programs, such as tracking progress against commitments. More specifically, the fiscal year 2005 plan does not describe progress against commitments made in previous plans (e.g., capabilities, schedule, cost, and benefits). According to GAO's analysis, delays have occurred in delivering capability to track the entry and exit of persons entering the United States at air, land, and sea ports of entry. Such information is essential for oversight. Additionally, the effort to pilot alternatives for delivering the capability to track the departure of persons exiting the United States is faced with a compressed time line, missed milestones, and potentially reduced scope. In particular, the pilot evaluation period has been reduced from 3 to 2 months, and as of early November 2004, the alternatives were deployed and operating in only 5 of the 15 ports of entry scheduled to be operational by November 1, 2004. According to US-VISIT officials, this is largely due to delays in DHS granting security clearances to the civilian employees who would operate the equipment at the ports of entry. These changing facts and circumstances surrounding the pilot introduce additional risk concerning US-VISIT's delivery of promised capabilities and benefits on time and within budget.

gao_GAO-02-1003

gao_GAO-02-1003_0

Effect of the Use of Self-Destruct U.S. Land Mines in the Gulf War Is Unknown According to DOD, all the types of land mines in DOD’s arsenal were available and included in U.S. war plans for use if needed in the Gulf War. DOD reported that during the war, U.S. forces used no nonself-destruct land mines. U.S. land mines of all types were available and planned for use by U.S. forces. Services Reported that the United States Used about 118,000 Land Mines The services reported that during the Gulf War, they used about 118,000 land mines from the approximately 2.2 million U.S. land mines that were taken to the Gulf War theater of operations and the millions of land mines available for use from U.S. worldwide stockpiles, which in total contained about 19 million land mines. DOD and service documents detailing when land mines were used did not provide evidence of the effects of that use. See appendix III for the reported numbers of casualties by service and cause. These concerns led to the reluctance of some U.S. commanders to use land mines in areas that U.S. and allied forces might have to traverse.Commanders’ fears arose because of two basic reasons: The first reason involved both the obsolescence of conventional U.S. mines and safety issues with both conventional and scatterable land mines.

What GAO Found The utility of land mines on the modern battlefield has come into question in recent years, largely because of their potential for causing unintended casualties and affecting U.S. forces' maneuverability. These concerns were raised during the Persian Gulf War. U.S. land mines of all types--nonself-destructing and self-destructing, antipersonnel and antitank--were available for use if needed in the Gulf War from U.S. land mine stockpiles, which contained 19 million land mines. U.S. forces sent to the Gulf War theater of operations took with them for potential use over 2.2 million land mines. U.S. war plans included plans for the use of land mines if required by the tactical situation. According to Department of Defense (DOD) documents, no nonself-destructing or "dumb," land mines were used; and the reported number of self-destructing, or "smart," land mines used by the services totaled approximately 118,000. DOD did not provide information on the effect of U.S. land mine use against the enemy. According to U.S. service records, of the 1,364 total U.S. casualties in the Gulf War, 81, or 6 percent, were killed or injured by land mines. Concerns about land mines raised in DOD lessons-learned and other reports included the fear of fratricide and loss of battlefield mobility. These concerns led to the reluctance of some U.S. commanders to use land mines in areas that U.S. and allied forces might have to traverse.

gao_GAO-05-191

gao_GAO-05-191_0

Nothing in these statutes appears to prohibit either agency from entering into research arrangements with nonprofit organizations such as ACC. NIEHS used the authorities granted to NIH’s institutes and centers under sections of the Public Health Service Act, as amended, to enter into its arrangement with ACC (sections 301 and 405). Similarly, ORD relied on broad authorities granted to EPA under sections of the Clean Air Act, as amended; the Clean Water Act, as amended; and the Solid Waste Disposal Act, as amended, to enter into its research arrangement with ACC (sections 103, 104, and 8001, respectively). However, officials at both agencies took steps to manage potential conflicts that might arise during implementation of the arrangements. NIEHS and ORD Did Not Formally Evaluate Potential Conflicts of Interest that Could Result from Research Arrangements with ACC In 2001 and 2003, when they entered into arrangements with ACC, neither NIH nor EPA had specific policies requiring officials to formally evaluate potential conflicts of interest that could result from entering into such collaborative arrangements. Because the research conducted under these arrangements supported the agencies’ existing research agendas, officials believe that the ACC arrangements helped them effectively leverage federal research dollars. NIEHS Generally Complied with NIH’s Gift Acceptance Policy, but the Policy Cannot Provide Assurance that Conflicts of Interest Are Evaluated and Managed When accepting funds from ACC under the research arrangement, NIEHS officials complied with those sections of NIH’s policy that guide the acknowledgement and administration of gifts. However, the policy’s guidance on evaluating and managing potential conflicts is extremely broad, lacking clarity and consistency. Further, the policy does not require officials to document the basis of their decisions. As a result, the gift policy does not provide the public sufficient assurance that potential conflicts of interest between NIH and donor organizations will be appropriately considered. None of the nonprofit partners in the nine research arrangements we found at NIH represents industry in the same direct manner that ACC represents the chemical industry. In addition, we did not identify any partnerships similar to the ACC research arrangement at FDA or at FAA. While these processes were appropriate for managing the arrangements, they were not specifically designed to address conflict-of-interest concerns and therefore cannot be considered adequate substitutes for formal conflict-of-interest evaluations. Consequently, without policies requiring officials at NIH and EPA to formally evaluate and manage potential conflicts of interest when they enter into collaborative arrangements such as those with ACC, neither agency can ensure that similar arrangements in the future will be systematically evaluated and managed for potential conflicts of interest. Objectives, Scope, and Methodology As requested by the Ranking Member of the Subcommittee on Environment, Technology and Standards, House Committee on Science, and the Ranking Member of the Subcommittee on Research, House Committee on Science, we determined the (1) legal authority the National Institutes of Health’s (NIH) National Institute of Environmental Health Sciences (NIEHS) and the Environmental Protection Agency’s (EPA) Office of Research and Development (ORD) used to enter into arrangements with the American Chemistry Council (ACC); (2) extent to which NIEHS and ORD evaluated and managed the possibility that conflicts of interest could result from their arrangements; (3) extent to which NIEHS complied with NIH’s gift acceptance policy when accepting ACC’s funds; and (4) extent to which similar research arrangements exist within other offices and programs within NIH and EPA, as well as other regulatory agencies. The two agencies selected were the Food and Drug Administration (FDA) and the Federal Aviation Administration (FAA) because each agency had a research component to its mission, a corresponding research budget, and a regulatory role.

Why GAO Did This Study An institute at the National Institutes of Health (NIH) and an office in the Environmental Protection Agency (EPA) entered into collaborative arrangements with the American Chemistry Council (ACC) to support research on the health effects of chemical exposures. NIH accepted a gift from ACC to help fund the research. EPA and ACC funded their proposals separately. The arrangements raised concerns about the potential for ACC to influence research that could affect the chemical industry. GAO determined the agencies' legal authorities to enter into the arrangements; the extent to which the agencies evaluated and managed potential conflicts of interest resulting from these arrangements; the extent to which the NIH institute complied with NIH's gift acceptance policy; and the extent to which NIH, EPA, and other agencies have similar arrangements. What GAO Found NIH's National Institute of Environmental Health Sciences (NIEHS) used the authorities granted to NIH's institutes and centers under sections of the Public Health Service Act to enter into its arrangement with ACC. Similarly, EPA's Office of Research and Development (ORD) relied on authorities granted to EPA under sections of the Clean Air Act, the Clean Water Act, and the Solid Waste Disposal Act to enter into its research arrangement. Nothing in these statutes appears to prohibit either agency from entering into research arrangements with nonprofit organizations such as ACC. NIEHS and ORD did not formally evaluate the potential for conflicts of interest with ACC before they entered into the arrangements, but both agencies took steps to manage the potential as the arrangements were implemented. NIH and EPA had no specific policies requiring officials to evaluate or manage potential conflicts of interest when they entered into the ACC arrangements, nor do they currently have such policies. Although no formal evaluation occurred, agency officials managed the arrangements through their existing research management processes. Both agencies believe these actions helped mitigate the potential for undue influence by ACC and adequately protected the integrity of the scientific research conducted under the arrangements. Because the agencies' research management processes were not designed to address conflict of interest issues they are not a substitute for a formal evaluation of such conflicts. Without policies requiring a formal evaluation and management of conflicts, there is no assurance that similar arrangements will be appropriately evaluated and managed for such conflicts in the future. NIEHS officials complied with portions of NIH's gift acceptance policy that guide the acknowledgement and administration of gifts. However, the policy's guidance on evaluating and managing potential conflicts is extremely broad, and it lacks clarity and consistency. As a result, the policy gives officials wide discretion in this area. In addition, the policy does not require the agency to document the basis for its decisions. Consequently, the policy does not provide sufficient assurance that potential conflicts of interest between NIH and donor organizations will be appropriately considered. While some institutes and centers at NIH had arrangements somewhat similar to the ACC arrangements, GAO did not find any similar arrangements at other program offices at EPA or at the Food and Drug Administration and the Federal Aviation Administration--two other agencies with significant research budgets. None of the nine research arrangements GAO found at NIH institutes and centers involve organizations that represent industry in the same direct manner that ACC represents the chemical industry.

gao_GAO-04-279

gao_GAO-04-279_0

Background Distance education is a growing force in postsecondary education, and its rise has implications for the federal student aid programs. Current Federal Restrictions on Distance Education Affect Few Schools’ Ability to Offer Federal Student Aid, but Numbers Could Increase in the Future Although current federal restrictions on the extent to which schools can offer programs by distance education and still qualify to participate in federal student aid programs affect a small number of schools, the growing popularity of distance education could cause the number to increase in the future. We found that 14 schools were either now adversely affected by the restrictions or would be affected in the future; collectively, these schools serve nearly 225,000 students. Eight of the 14 schools are exempt from the restrictions because they have received waivers as participants in Education’s Demonstration Program, under which schools can remain eligible to participate in the student aid programs even if the percentage of distance education courses or the percentage of students involved in distance education rises above the maximums set forth in the law. They vary in a number of respects. All seven agencies had a policy stating that the standards they would apply in assessing a school’s distance education programs would be the same as the standards used for assessing campus- based programs. The three are (1) setting measurable and quantifiable goals for program outcomes, (2) developing strategies for achieving these goals, and (3) disclosing the results of their efforts to the public. The accrediting agencies we reviewed generally recognized the importance of outcomes, but only one of the seven had an approach that required schools to cover all three of these components. At the same time, some form of control is needed to prevent the potential for fraud and abuse. To do so, the Department would need to develop data on the cost to the federal student aid programs of granting waivers to schools. Among other things, measures of the quality of postsecondary education include student-learning outcomes, such as the extent to which students complete programs and/or the extent to which students’ performance improves over time. It could, however, play a pivotal role in encouraging and fostering the use of an outcomes-based model. Appendix I: Scope and Methodology To address the two questions about the extent to which current federal restrictions on distance education affect schools’ ability to offer federal student aid to their students and what the Department of Education’s Distance Education Demonstration Program has revealed with respect to the continued appropriateness of these restrictions, we obtained information from Education staff and other experts on which postsecondary institutions might be affected by these provisions or were close to being affected. To address the two questions related to the work of accrediting agencies: To what extent do accreditation agencies include distance education in their reviews of schools or programs and as they evaluate distance education programs and campus-based programs, to what extent do accreditation agencies assess educational outcomes, we focused on the standards and policies of seven accrediting agencies that collectively are responsible for more than two-thirds of all distance education programs.

Why GAO Did This Study Distance education--that is, offering courses by Internet, video, or other forms outside the classroom--has changed considerably in recent years and is a growing force in postsecondary education. More than a decade ago, concerns about fraud and abuse by some correspondence schools led to federal restrictions on, among other things, the percentage of courses a school could provide by distance education and still qualify for federal student aid. Given the recent changes in distance education, GAO was asked to review the extent to which the restrictions affect schools' ability to offer federal student aid and the Department of Education's assessment of the continued appropriateness of the restrictions. Additionally, GAO was asked to look at the extent to which accrediting agencies evaluate distance education programs, including their approach for assessing student outcomes. What GAO Found While federal restrictions on the size of distance education programs affect only a small number of schools' ability to offer federal student aid, the growing popularity of distance education could cause the number to increase in the future. GAO found that 14 schools were either now adversely affected by the restrictions or would be affected in the future; collectively, these schools serve nearly 225,000 students. Eight of these schools, however, will remain eligible to offer federal student aid because they have been granted waivers from the restrictions by Education. Education granted the waivers as part of a program aimed at assessing the continued appropriateness of the restrictions given the changing face of distance education. In considering the appropriateness of the restrictions, there are several policy options for amending the restrictions; however, amending the restrictions to improve access would likely increase the cost of the federal student aid programs. One way to further understand the effect of amending the restrictions would be to study data on the cost of granting the waivers to schools, but Education has yet to develop this information. The seven accrediting agencies GAO reviewed varied in the extent to which they included distance education programs in their reviews of postsecondary institutions. All seven agencies had developed policies for reviewing these programs; however, there were differences in how and when they reviewed the programs. Agencies also differed in the extent to which they included an assessment of student outcomes in their reviews. GAO's work in examining how organizations successfully focus on outcomes shows that they do so by (1) setting measurable goals for program outcomes, (2) developing strategies for meeting these goals, and (3) disclosing the results of their efforts to the public. Measured against this approach, only one of the seven accrediting agencies we reviewed had policies that require schools to satisfy all three components. As the key federal link to the accreditation community, Education could play a pivotal role in encouraging an outcomes-based model.

gao_GAO-11-708

gao_GAO-11-708_0

FDIC identifies, monitors, and addresses risks to the Deposit Insurance Fund when a bank or thrift institution fails. Opportunities Exist for FDIC to Improve Information Security Controls Although FDIC had implemented numerous controls over its systems, it had not always implemented access and other controls to protect the confidentiality, integrity, and availability of its financial systems and information. Although these weaknesses did not individually or collectively constitute a material weakness or significant deficiency in 2010, they still increase the risk that financial and other sensitive information could be disclosed or modified without authorization. For example, it had implemented controls to effectively detect and change default vendor-supplied user accounts and passwords in installed software and had ensured that passwords for privileged accounts on certain servers were changed in accordance with its policy. FDIC had implemented controls to restrict user access to certain resources. However, FDIC had not always ensured that sensitive financial information transmitted over and stored on its network was adequately encrypted. However, FDIC’s audit and monitoring of security- relevant events on key financial systems was not always sufficient. FDIC Had Not Always Implemented Key Activities of its Information Security Program An underlying reason for the information security weaknesses noted in the previous section is that, while FDIC has developed and documented a comprehensive corporate information security program, including documenting an information security risk management policy, developing security policies and procedures, documenting system security plans, and periodically testing information security controls, the corporation had not fully implemented its information security program. FISMA requires each agency to develop, document, and implement an information security program that, among other things, includes  periodic assessments of the risk and magnitude of harm that could result from the unauthorized access, use, disclosure, disruption, modification, or destruction of information and information systems;  policies and procedures that (1) are based on risk assessments, (2) cost effectively reduce information security risks to an acceptable level, (3) ensure that information security is addressed throughout the life cycle of each system, and (4) ensure compliance with applicable requirements;  plans for providing adequate information security for networks, facilities, and systems;  periodic testing and evaluation of the effectiveness of information security policies, procedures, and practices, to be performed with a frequency depending on risk, but no less than annually, and that includes testing of management, operational, and technical controls for every system identified in the agency’s required inventory of major information systems; and  a process for planning, implementing, evaluating, and documenting remedial actions to address any deficiencies in its information security policies, procedures, or practices. Conclusions FDIC has made significant progress in correcting or mitigating previously reported information security weaknesses, but other control weaknesses continue to unnecessarily put FDIC’s systems at an increased risk from internal and external threats. FDIC had made improvements in its information security controls and had mitigated the potential effect of its remaining weaknesses on financial reporting by implementing compensating management and reconciliation controls during 2010, enabling us to conclude that FDIC had resolved the significant deficiency over information systems that we had reported in our 2009 audit. Appendix I: Objective, Scope, and Methodology The objective of our audit was to determine the effectiveness of the Federal Deposit Insurance Corporation’s (FDIC) controls protecting the confidentiality, integrity, and availability of its financial systems and information. To determine whether controls over key financial systems were effective, we considered the results of our evaluation of FDIC’s actions to mitigate previously reported weaknesses and performed new audit work at FDIC facilities in Arlington, Virginia, and Washington, D.C. We concentrated our evaluation primarily on the controls for financial applications and enterprise database applications associated with the New Financial Environment; the Assessment Information Management System; the Communication, Capability, Challenge, and Control System (4C) application; the programs, data, and systems supporting the preparation of the estimates of losses and costs due to loss-sharing agreements, and the general support systems.

Why GAO Did This Study The Federal Deposit Insurance Corporation (FDIC) has a demanding responsibility enforcing banking laws, regulating financial institutions, and protecting depositors. Because of the importance of FDIC's work, effective information security controls are essential to ensure that the corporation's systems and information are adequately protected from inadvertent misuse, fraudulent use, or improper disclosure. As part of its audits of the 2010 financial statements of the Deposit Insurance Fund and the Federal Savings & Loan Insurance Corporation Resolution Fund administrated by FDIC, GAO assessed the effectiveness of the corporation's controls in protecting the confidentiality, integrity, and availability of its financial systems and information. To perform the audit, GAO examined security policies, procedures, reports, and other documents; tested controls over key financial applications; and interviewed key FDIC personnel. What GAO Found Although FDIC had implemented numerous controls in its systems, it had not always implemented access and other controls to protect the confidentiality, integrity, and availability of its financial systems and information. FDIC has implemented controls to detect and change default user accounts and passwords in vendor-supplied software, restricted access to network management servers, developed and tested contingency plans for major systems, and improved mainframe logging controls. However, the corporation had not always (1) required strong passwords on financial systems and databases; (2) reviewed user access to financial information in its document sharing system in accordance with policy; (3) encrypted financial information transmitted over and stored on its network; and (4) protected powerful database accounts and privileges from unauthorized use. In addition, other weaknesses existed in FDIC's controls that were intended to appropriately segregate incompatible duties, manage system configurations, and implement patches. An underlying reason for the information security weaknesses is that FDIC had not always implemented key information security program activities. To its credit, FDIC had developed and documented a security program and had completed actions to correct or mitigate 26 of the 33 information security weaknesses that were previously identified by GAO. However, the corporation had not assessed risks, documented security controls, or performed periodic testing on the programs and data used to support the estimates of losses and costs associated with the servicing and disposal of the assets of failed institutions. Additionally, FDIC had not always implemented its policies for restricting user access or for monitoring the progress of security patch installation. Because FDIC had made progress in correcting or mitigating previously reported weaknesses and had implemented compensating management and reconciliation controls during 2010, GAO concluded that FDIC had resolved the significant deficiency in internal control over financial reporting related to information security reported in GAO's 2009 audit, and that the remaining unresolved issues and the new issues identified did not individually or collectively constitute a material weakness or significant deficiency in 2010. However, if left unaddressed, these issues will continue to increase FDIC's risk that its sensitive and financial information will be subject to unauthorized disclosure, modification, or destruction. What GAO Recommends GAO recommends that FDIC take two actions to enhance its comprehensive information security program. In commenting on a draft of this report, FDIC discussed actions that it has taken or plans to take to address these recommendations.

gao_GAO-13-334

gao_GAO-13-334_0

Medicare Disproportionate Share Hospitals The Medicare disproportionate share hospital (DSH) adjustment generally provides supplemental payments to hospitals that treat a disproportionate number of low-income patients. Numerous Statutory Provisions Have Resulted in Increased Medicare Payments to Certain Hospitals We identified 16 statutory provisions enacted between 1997 and 2012 that modified Medicare payment for inpatient services in a way that benefitted a subset of hospitals. Provisions Modifying Classification Criteria for IPPS Supplemental Payments or Other Types of Special Treatment We identified five statutory provisions that have affected the number of hospitals that qualify for IPPS supplemental payments or other types of special treatment. Most of these provisions modified the classification criteria for payment adjustments, thereby expanding the number of hospitals that qualify for higher payments. Provisions Creating and Modifying Qualifying Criteria for CAHs In 1997, Congress established the Critical Access Hospital (CAH) program, under which qualifying small rural hospitals are excluded from the IPPS and receive Medicare payment based on the reasonable costs of providing services. First, the provision changed the inpatient length of stay requirement from a maximum of 4 days to an annual average of 4 days. The CAH program has grown to a total of 1,328 hospitals as of 2012. IPPS Payment Adjustments or Exclusions Affected Nearly All Hospitals We found that, in 2012, payment adjustments to, or exclusions from, the IPPS affected nearly all of the 4,783 hospitals in our review. Of these hospitals—IPPS hospitals and CAHs—91 percent were subject to a payment adjustment under the IPPS or were excluded from the IPPS entirely. Specifically, 3,039 hospitals, or over 63 percent, qualified for at least one of the following four types of payment adjustments under the IPPS: a DSH adjustment, an IME adjustment, a wage index adjustment, or a rural provider type adjustment for an RRC, SCH, or MDH designation; 1,328 hospitals, or about 28 percent, qualified as CAHs, excluding them from the IPPS; and 416 hospitals, or about 9 percent, received IPPS payments that were unadjusted for the modifications included in our review. Two percent of IPPS hospitals qualified for four forms of adjustments, but no state had more than 10 hospitals qualifying for four forms of increased payment. Concluding Observations The IPPS streamlines how Medicare pays hospitals and gives hospitals an incentive to economize by paying a fixed amount, set in advance. Over time, however, numerous statutory provisions have been enacted that provide, grandfather, or extend additional payments to IPPS hospitals or exclude a substantial number of hospitals from the IPPS altogether. In fact, over 90 percent of hospitals were subject to either IPPS payment adjustments or exemptions in 2012. Taken together, these findings and recommendations suggest that, 30 years after the IPPS was implemented, the way Medicare currently pays hospitals may no longer ensure that the goals of the payment system— cost control, efficiency, and access—are being met. Agency Comments HHS reviewed a draft of this report and did not have any general comments. The agency provided technical comments, which we incorporated where appropriate. We will send copies of this report to the Secretary of Health and Human Services.

Why GAO Did This Study To help control the growth of hospital spending, give hospitals an incentive to provide care efficiently, and ensure beneficiary access, Congress created the IPPS in 1983. Yet, Congress can enhance Medicare payments to certain hospitals by changing the qualifying criteria for IPPS payment categories, creating and extending exceptions to IPPS rules, or by exempting certain types of hospitals from the IPPS. The Institute of Medicine and the Medicare Payment Advisory Commission have stated that such practices undermine the integrity of the IPPS. GAO was asked to review legislation that altered payments to certain hospitals. In this report, GAO (1) identified provisions of law that enhanced Medicare payments for only a subset of hospitals and (2) examined the extent to which hospitals qualified for adjustments to the IPPS or exemptions from the IPPS in 2012. To conduct this work, GAO reviewed provisions enacted from 1997 to 2012 to identify those that adjusted payments to a subset of IPPS hospitals or exempted hospitals from the IPPS. GAO analyzed data to learn the number, location, and size of hospitals affected by these provisions and budgetary estimates for the first year of implementation, where available. GAO also analyzed 2012 data on 4,783 general hospitals to determine the number and types of adjustments they received, the extent to which they qualified for multiple adjustments, and the number exempted from the IPPS. The Department of Health and Human Services reviewed a draft of this report, and provided technical comments, which we incorporated as appropriate. What GAO Found Over time, Congress has modified how Medicare reimburses certain hospitals under the inpatient prospective payment system (IPPS), which pays hospitals a flat fee per stay, set in advance, with different amounts for each type of condition. GAO identified numerous statutory provisions that individually increased Medicare payments to a subset of hospitals. Seven provisions enabled hospitals to be paid under a different geographic wage index, which is used to address variation in labor costs. Five provisions modified the classification criteria allowing IPPS hospitals to qualify for supplemental payments through the Medicare disproportionate share hospital (DSH) program or other types of special treatment. Three provisions created and modified criteria for classifying small rural providers as Critical Access Hospitals (CAH), which are exempt from IPPS and instead are paid under an alternative methodology. In general, while such provisions were designed to affect only a subset of hospitals, nearly all of the 4,783 hospitals in GAO's review qualified for an adjustment or exemption from the IPPS in 2012. About 91 percent were subject to an IPPS payment adjustment or were excluded from the IPPS entirely. Most hospitals, over 63 percent, qualified for at least one of four categories of increased payment, with DSH payments being the most common. Under the CAH program, 28 percent of hospitals were exempt from the IPPS. The remaining hospitals, 9 percent, received IPPS payments that were unadjusted for the modifications included in GAO's review. Moreover, many IPPS hospitals qualified for multiple categories of payment adjustments. These findings suggest that the way Medicare currently pays hospitals may no longer ensure that the goals of the IPPS--cost control, efficiency, and access--are being met.

gao_GAO-13-263

gao_GAO-13-263_0

The AMP process establishes criteria for qualifying for new courthouse construction, such as requiring that an existing courthouse have a chamber for each judge and needing two or more additional courtrooms. AMP Process Partially Aligns with Several Leading Practices but Does Not Provide Needed Information to Decision Makers AMP Process Partially Aligns with Several Leading Practices in Capital Planning The AMP process, which the judiciary has applied to about 67 percent of its courthouses, represents progress by the judiciary in aligning its capital- planning process with leading capital-planning practices, but the document the judiciary uses to request courthouse construction projects lacks transparency and key information. Figure 2 summarizes leading capital-planning practices and our assessment of the extent to which the AMP process aligns with those practices. Alternatives Evaluation. Specifically, it lists about $1.1 billion in estimated costs, which are the funds needed for that specific 5-year period. As a result, there is a risk that funding decisions could be made without complete and accurate information. Specifically, transparency about future priorities could allow decision makers to weigh current-year budget decisions within the context of projects’ expected future costs. Additionally, transparency regarding future capital costs would put the judiciary’s priorities in context with federal spending. Most Courthouse Projects Were Not Evaluated under AMP Process and Do Not Meet AMP Criterion for New Construction Judiciary Has Not Evaluated Most 5-Year Plan Projects under the AMP Process The judiciary has not applied the AMP process to 10 of the 12 construction projects on the current 5-year plan dated September 2012. Judiciary officials said that they did not want to delay the projects or force them to undergo a second capital- planning process review because the judiciary had already approved the projects. The change in the rankings of the 4 projects calls into question the extent to which the projects remaining on the 5-year plan represent the judiciary’s most urgent projects and whether proceeding with these projects while hundreds of AMP reviews remain to be done represents the most fiscally responsible path. We recognize that conducting AMP reviews of the 10 projects on the 5-year plan would involve additional costs; however, not conducting AMP reviews on these projects could involve spending billions of dollars over the next 20 years on courthouses that may not be the most urgent projects. 2. Specifically, two projects on a previous 5-year plan that were assessed under the AMP process were removed from the list and now rank well down the judiciary’s list of priorities. To what extent were the courthouse projects recommended for funding in fiscal years 2014 to 2018 assessed under the judiciary’s current capital-planning process? To assess recent courthouse projects recommended for funding under the judiciary’s current capital-planning process, we reviewed the judiciary’s documents detailing the projects recommended for funding for fiscal years 2009 through 2018, called 5-year plans, and other documents on: congressional authorizations and funding appropriations for courthouse projects; judiciary information on courts and courthouses; and GSA information on federal buildings, existing and planned federal courthouses, courthouse design, and federal historic property. 2. 3. As a result, GSA addresses building maintenance issues regardless of the status of the courthouse construction program. 12. Specifically, the judiciary established the criterion that courthouses need to have a shortage of two or more courtrooms to qualify for a new courthouse construction project. 20.

Why GAO Did This Study Rising costs and fiscal challenges have slowed the multibillion-dollar courthouse construction program of the judiciary and the General Services Administration (GSA). In 2006, the judiciary developed AMP to address increasing costs and incorporate best practices and has evaluated about 67 percent of its courthouses under the new system. As requested, GAO assessed changes introduced with AMP. GAO examined: (1) the extent to which the AMP process aligns with leading practices and provides information needed for informed decision making and (2) the extent to which courthouse projects recommended for funding in fiscal years 2014 to 2018 were assessed under the AMP process. GAO compared the judiciary's capitalplanning practices with leading practices, analyzed courthouseplanning documents, and interviewed officials from the judiciary and GSA. GAO visited three courthouses selected because they were highly ranked by the judiciary for replacement, although observations from these site visits cannot be generalized. What GAO Found The Asset Management Planning (AMP) process represents progress by the federal judiciary (judiciary) in better aligning its capital-planning process with leading capitalplanning practices, but its 5-year plan for fiscal years 2014 to 2018--the document the judiciary uses to request courthouse construction projects--lacks transparency and key information on how projects qualify for new construction, alternatives the judiciary considered, and their cost. For example, the plan lists costs for the next phase of the 12 recommended courthouse projects, which have several phases, but does not list previous funding or ongoing annual costs for the projects. As a result, the plan lists about $1 billion in costs for the 12 projects, but the projects would actually cost the federal government an estimated $3.2 billion over the next 20 years. Congress has appropriated a small share of the money needed for the projects, and most will need design changes before construction can begin. As a result, there is a risk that congressional funding decisions could be made without complete and accurate information. However, with this information, decision makers could weigh current-year budget decisions within the context of projects' expected future costs, spur discussion and debate about actions to address them, and put the judiciary's requests in context with other federal spending. Ten of the 12 recommended projects were not evaluated under the AMP process. Judiciary officials said that they did not want to delay the current projects or force them to undergo a second capital-planning process after they had already been approved. Two courthouse projects from a previous 5-year plan that were assessed under AMP were removed from the list and are now ranked behind more than 100 other courthouse construction projects. Furthermore, 10 of the 12 recommended construction projects do not qualify for a new courthouse under the AMP criterion, which requires that new courthouses need two or more additional courtrooms. These conditions call into question the extent to which the projects remaining on the 5-year plan represent the judiciary's most urgent projects and whether proceeding with these projects represents the most fiscally responsible proposal. While 10 additional AMP evaluations would involve some additional costs, not conducting those evaluations could involve spending $3.2 billion over the next 20 years on courthouses that may not be the most urgent projects.

gao_GAO-03-971

gao_GAO-03-971_0

Section 43 Requirements Section 43 imposes requirements on depository institutions lacking federal deposit insurance and private deposit insurers and assigns FTC with the responsibility for enforcing compliance with these provisions. Since being charged with the responsibility to enforce and implement these requirements, FTC has requested Congress to prohibit it from enforcing these provisions. As a result, depositors at some privately insured credit unions may not be adequately informed that deposits at these institutions are not federally insured. Although FTC, NCUA, and FDIC officials generally agreed that consumers should receive proper notification about the insured status of their deposits, they maintained that their respective agencies should not be charged with responsibility for implementing and enforcing section 43. The staff asserted that other federal agencies are more qualified to carry out the section. NAFCU officials believe that members of privately insured credit unions should be adequately informed that deposits in these institutions are not federally insured. Clarifying FTC’s Authority and Providing Some Flexibility Could Ensure Effective Enforcement of Section 43 While we found that FTC was the best candidate to enforce section 43 provisions, clarifying FTC’s authority and providing additional flexibility in administering the section could help address some of the Commission’s concerns about its authority and ability to enforce the provision without undermining its objectives. The fact that many privately insured credit unions we visited did not conspicuously disclose that the institution was not federally insured, raises concerns that the congressional interest in this regard is not being fully satisfied. In evaluating which federal agency should enforce these provisions, we found the responsibilities outlined in these provisions did not fall ideally within any single agency’s jurisdiction. This would be inconsistent with a central purpose of the provision. Other major contributors are acknowledged in appendix V. Appendix I: Objectives, Scope, and Methodology To respond to a mandate in the Conference Report to accompany the House Joint Resolution 2, for the Fiscal Year 2003 Consolidated Appropriations Act—which directed us to study the enforcement of section 43 of the Federal Deposit Insurance Act—we (1) determined the current status of enforcement of these requirements; (2) determined the extent of compliance with each requirement and the potential impact on consumers if these requirements were not enforced, and (3) evaluated which federal agency could most effectively enforce section 43. To determine the extent to which privately insured credit unions met federal disclosure requirements, we identified and analyzed federal consumer disclosure provisions in section 43 of the Federal Deposit Insurance Act, as amended, and conducted unannounced site visits to 57 privately insured credit unions (49 main and 8 branch locations) in Alabama, California, Illinois, Indiana, and Ohio.

Why GAO Did This Study This mandated report responds to Congressional concerns that provisions in section 43 of the Federal Deposit Insurance Act (FDI Act) are not being enforced. Since 1991, section 43 has required, among other things, depository institutions lacking federal deposit insurance to conspicuously disclose that deposits in these institutions are not federally insured. GAO's objectives were to (1) determine the current status of the enforcement of provisions in section 43; (2) determine the extent of compliance with each provision and the potential impact on consumers if the provisions were not enforced; and (3) evaluate which federal agency could most effectively enforce the provisions. What GAO Found The Federal Trade Commission (FTC) is responsible for enforcing compliance with the provisions in section 43 of the FDI Act. However, due to a variety of concerns, FTC has requested and appropriators have agreed to prohibit FTC from enforcing these provisions. The National Credit Union Administration (NCUA) and state regulators have imposed some related requirements on credit unions and private deposit insurers. While these requirements are not the same as those in section 43 provisions, they provide some assurances that certain actions contemplated by section 43 are being satisfied. Some privately insured credit unions GAO visited did not adequately disclose that these institutions were not federally insured; as a result, depositors at these institutions may not be fully informed that their deposits are not federally insured. For example, in unannounced site visits to 57 privately insured credit unions in Alabama, California, Illinois, Indiana, and Ohio, GAO found that required notices were not posted in 37 percent of the locations. No federal agency is ideally suited to carry out the responsibilities outlined in section 43. Although FTC, NCUA, and the Federal Deposit Insurance Corporation (FDIC) officials generally agreed that consumers should receive information about the insured status of their deposits, they strongly maintained that their respective agencies should not enforce these provisions. NCUA and FDIC officials objected to enforcing these provisions because their agencies have no direct interest in uninsured institutions and their involvement in the enforcement of these requirements could undermine the purposes of the provision. FTC staff raised jurisdictional concerns and asserted that its mission, resources, and practices were ill suited for such a role. GAO believes that clarifying FTC's authority and providing it with additional flexibility in administering these provisions represents the best option to enforce the provisions.

gao_GAO-11-608

gao_GAO-11-608_0

The Recovery Act provided $6 billion for EPA’s Clean Water and Drinking Water SRF programs. In addition to increasing funds, the Recovery Act included some new requirements for the SRF programs. All Recovery Act SRF Program Funds Have Been Awarded and Obligated, and with Some Exceptions, States Reported Supporting Major Infrastructure Projects and Helping Economically Disadvantaged Communities Nationwide, the 50 states have awarded and obligated the almost $6 billion in Clean Water and Drinking Water SRF program funds provided under the Recovery Act and reported using the majority of these funds for sewage treatment infrastructure and drinking water treatment and distribution systems, according to EPA data. In the nine states we reviewed, the states used these funds to pay for infrastructure projects that help to address major water quality problems, although state officials said that in some cases, Recovery Act requirements changed their priorities or the projects selected for funding. Requirement to Award Recovery Act Funds to Projects under Contract within 1 Year As we reported in May 2010, EPA indicated that all 50 states met the Recovery Act requirement to award Recovery Act funds to projects under contract by February 17, 2010, 1 year after the enactment of the Recovery Act. 2). In the nine states we reviewed, officials said that Recovery Act priorities— including the requirements for projects to be ready to proceed to contract 1 year after the passage of the Recovery Act or for green projects—either changed their priorities for ranking and funding projects or changed the projects they funded. States Supported Economically Disadvantaged Communities, in Part by Using Additional Subsidies Authorized under the Act, although Officials Cited Continuing Difficulty in Helping These Communities Although the Recovery Act did not require states to target Clean and Drinking Water SRF program funds to economically disadvantaged communities, six of the nine states that we reviewed distributed more than $123 million in clean water funds, and eight of the nine states distributed almost $78 million in drinking water funds under the SRF Recovery Act programs to these communities. Number of FTEs Have Declined as Most Recovery Act Funds Are Spent For the quarter ending December 2009 through the quarter ending June 2010, the number of FTEs paid for with Recovery Act SRF program funds increased each reporting quarter, from about 6,000 to 15,000 FTEs for planning, designing, and building water projects (see fig. As projects were completed and funds spent, the number of FTEs funded had declined to about 6,000 for the quarter ending March 2011. EPA’s Monitoring Found That States Largely Complied with Recovery Act Requirements Since the Recovery Act was enacted, EPA officials have reviewed all 50 states’ Recovery Act Clean and Drinking Water SRF programs at least once and have found that states are largely complying with the act’s requirements. EPA updated its oversight plan for Recovery Act funds, in part, as a response to our recommendation. We compared EPA’s data on awards and funds drawn down by states with data reported by states on Recovery.gov and found only a few minor inconsistencies in the data. Nine States Checked Quality of Recovery Act Data Quarterly, but Minor FTE Discrepancies Occurred Officials in the nine states we reviewed indicated that the quality of recipient data has remained relatively stable, although we found that the states differed in how they reported state agencies’ FTE data and did not report some subrecipients’ FTE data. The effort to support green projects was included in EPA’s fiscal year 2010 and 2011 appropriations for the base Clean and Drinking Water SRF programs. Officials in four other states said that while they all met the 20 percent green project goal, it was difficult to achieve, leading one official to suggest that green projects be encouraged without setting a fixed percentage of program funds. Providing additional subsidies. State officials pointed out that when monies are not repaid into the revolving fund, the reuse of funds is reduced and the purpose of the revolving SRF program changes from primarily providing loans for investments in water infrastructure to providing grants. Agency Comments and Our Evaluation We provided a draft of the report to the Environmental Protection Agency for review and comment. In addition, this report is available at no charge on the GAO Web site at http://www.gao.gov. Appendix I: Objectives, Scope, and Methodology The objectives of this review were to examine the (1) status and use of American Recovery and Reinvestment Act of 2009 (Recovery Act) Clean and Drinking Water State Revolving Funds (SRF) program funds nationwide and in selected states; (2) actions taken by federal, state, and other agencies to monitor and ensure accountability of these program funds; (3) approaches federal agencies and selected states have taken to ensure data quality, including data for jobs reported by recipients of these program funds; and (4) challenges, if any, that states have faced in implementing Recovery Act requirements for the Clean and Drinking Water SRF programs. In the nine states that we reviewed in this report, program officials described their site visits to projects and the use of the EPA inspection checklist (or state equivalent), according to EPA’s oversight plan.

Why GAO Did This Study The American Recovery and Reinvestment Act of 2009 (Recovery Act) provided $4 billion for the Environmental Protection Agency's (EPA) Clean Water State Revolving Fund (SRF) and $2 billion for the agency's Drinking Water SRF. The Recovery Act requires GAO to review funds made available under the act and comment on recipients' reports of jobs created and retained. These jobs are reported as full-time equivalent (FTE) positions on a Web site created for the Recovery Act on www.Recovery.gov . GAO examined the (1) status and use of Recovery Act SRF program funds nationwide and in nine states; (2) EPA and state actions to monitor the act's SRF program funds; (3) EPA and selected states' approaches to ensure data quality, including for jobs reported by recipients of the act's funds; and (4) challenges, if any, that states have faced in implementing the act's requirements. For this work, GAO, among other things, obtained and analyzed EPA nationwide data on the status of Recovery Act clean and drinking water funds and projects and information from a nonprobability sample of nine states that represent all but 1 of EPA's 10 regions. GAO also interviewed EPA and state officials on their experiences with the Recovery Act SRF program funds. What GAO Found The 50 states have awarded and obligated the almost $6 billion in Clean Water and Drinking Water SRF program funds provided under the Recovery Act, and EPA indicated that all 50 states met the act's requirement to award funds to projects under contract 1 year after the act's passage. States used the funds to support more than 3,000 water quality projects, and according to EPA data, the majority of the funds were used for sewage treatment infrastructure and drinking water treatment and distribution systems. Since the act was passed, states have drawn down almost 80 percent of the SRF program funds provided under the act. According to EPA data, states met the act's requirements that at least (1) 20 percent of the funds be used to support "green" projects and (2) 50 percent of the funds be provided as additional subsidies. In the nine states GAO reviewed, the act's funds paid for 419 infrastructure projects that helped address major water quality problems, but state officials said in some cases the act's requirements changed their priorities for ranking projects or the projects selected. In addition, although not required by the act, the nine states used about a quarter of the funds they received to pay for projects in economically disadvantaged communities, most in additional subsidies. EPA, states, and state or private auditors took actions to monitor Recovery Act SRF program funds. For example, EPA officials reviewed all 50 states' Recovery Act SRF programs at least once and found that states were largely complying with the act's requirements. Also, in part as a response to a GAO recommendation, in June 2010 EPA updated--and is largely following--its oversight plan, which describes monitoring actions for the SRF programs. Furthermore, state officials visited sites to monitor Recovery Act projects, as indicated in the plan, and found few problems. Officials at EPA and in the nine states have also regularly checked the quality of data on Recovery.gov and stated that the quality has remained relatively stable, although GAO identified minor inconsistencies in the FTE data that states reported. Overall, the 50 states reported that the Recovery Act SRF programs funded an increasing number of FTE positions for the quarter ending December 2009 through the quarter ending June 2010, from about 6,000 FTEs to 15,000 FTEs. As projects were completed and funds spent, these FTEs had declined to about 6,000 FTEs for the quarter ending March 2011. Some state officials GAO interviewed identified challenges in implementing the Recovery Act's Clean and Drinking Water SRF requirements for green projects and additional subsidies, both of which were continued with some variation, in the fiscal year 2010 and 2011 appropriations for the SRF programs. Officials in four states said achieving the green-funding goal was difficult, with one suggesting that the 20 percent target be changed. In addition, officials in two of the four states, as well as in two other states, noted that when monies are not repaid into revolving funds to generate future revenue for these funds, the SRF program purpose changes from primarily providing loans for investments in water infrastructure to providing grants. What GAO Recommends GAO is making no recommendations in this report, which was provided to EPA for its review and comment. EPA did not comment on the report.