This is the accessible text file for GAO report number GAO-04-276R entitled 'Department of State (State) and United Nations relief and Works Agency (UNRWA) Actions to Implement Section 301(c) of the Foreign Assistance Act of 1961' which was released on November 17, 2003. This text file was formatted by the U.S. General Accounting Office (GAO) to be accessible to users with visual impairments, as part of a longer term project to improve GAO products' accessibility. Every attempt has been made to maintain the structural and data integrity of the original printed product. Accessibility features, such as text descriptions of tables, consecutively numbered footnotes placed at the end of the file, and the text of agency comment letters, are provided but may not exactly duplicate the presentation or format of the printed version. The portable document format (PDF) file is an exact electronic replica of the printed version. We welcome your feedback. Please E-mail your comments regarding the contents or accessibility features of this document to Webmaster@gao.gov. This is a work of the U.S. government and is not subject to copyright protection in the United States. It may be reproduced and distributed in its entirety without further permission from GAO. Because this work may contain copyrighted images or other material, permission from the copyright holder may be necessary if you wish to reproduce this material separately. United States General Accounting Office: Washington, DC 20548: November 17, 2003: The Honorable Mitch McConnell: Chairman: The Honorable Patrick Leahy: Ranking Member: Subcommittee on Foreign Operations: Committee on Appropriations: United States Senate: The Honorable Jim Kolbe: Chairman: The Honorable Nita M. Lowey: Ranking Member: Subcommittee on Foreign Operations, Export Financing, and Related Programs: Committee on Appropriations: United States House of Representatives: Subject: Department of State (State) and United Nations Relief and Works Agency (UNRWA) Actions to Implement Section 301(c) of the Foreign Assistance Act of 1961: Established in 1949 by the United Nations, UNRWA provides assistance to Palestinian refugees in the Middle East. UNRWA assistance is primarily education, health, and relief and social services. More than 4 million Palestinian refugees are eligible to receive these services in UNRWA's five areas of operation--Jordan, Lebanon, Syria, the West Bank, and Gaza. In section 301(c) of the 1961 Foreign Assistance Act (PL 87-195) as amended, Congress has directed that "No contributions by the United States shall be made to [UNRWA] except on the condition that [UNRWA] take all possible measures to assure that no part of the United States contribution shall be used to furnish assistance to any refugee who is receiving military training as a member of the so-called Palestine Liberation Army or any other guerrilla type organization or who has engaged in any act of terrorism.": In 2003, Congress approved the Consolidated Appropriations Resolution, 2003 (PL 108-7), section 580, which required the General Accounting Office (GAO) to report to the appropriations committees on State Department compliance with section 301(c) of the 1961 Foreign Assistance Act and the implementation of procedures established to meet State standards for section 301(c). To fulfill this mandate, we: are reporting on State Department actions and UNRWA's implementation of procedures to address section 301(c). As agreed, we briefed your staff on our findings on November 6, 2003[Footnote 1]. Enclosure I documents the information we presented to your staff. UNRWA and the Department of State provided technical comments on a draft of this briefing, which we incorporated as appropriate. Background: UNRWA employs more than 24,000 staff. More than 90 percent of its staff are Palestinian refugees. UNRWA's mission does not involve administering or policing refugee camps. Relevant civil authorities in each area of operations are responsible for camp administration and security. Approximately 1.3 million refugees live in such camps, while almost 2.8 million refugees do not live in camps. In calendar 2000-2002, UNRWA spent about $1 billion. During this period, the United States provided about $332 million to UNRWA. The State Department provided about $300 million during this period, while the U.S. Agency for International Development (USAID) granted UNRWA another $32 million. Summary: State has taken actions to implement section 301(c). For example, State requires UNRWA to certify that in accepting each contribution from the United States, UNRWA is taking all possible measures to assure that U.S funds do not benefit terrorists or refugees receiving military training from guerrilla groups. State has also acted to improve monitoring by (1) placing a Refugee Coordinator in Amman, Jordan, whose main duty is to monitor UNRWA; (2) funding additional UNRWA international staff to inspect facilities; and (3) requesting that UNRWA report regularly on 301(c) compliance. State has also urged UNRWA to adopt a more formal monitoring program. However, State has not defined key terms used in section 301(c). UNRWA's implementation of procedures to address section 301(c) is constrained by several factors. First, while it relies on host governments to review local job applicants for UNRWA employment in Jordan, Syria, and Lebanon, it does not have similar arrangements with authorities in the West Bank and Gaza, where UNRWA also lacks access to data on arrests of its local staff. Second, UNRWA uses international staff to inspect its facilities and requires non-UNRWA groups to obtain permission before using those facilities, but it has not been able to prevent armed incursions. Finally, UNRWA is constrained in determining if its beneficiaries meet section 301(c) criteria, owing to concerns for its staff's safety and its inability to verify beneficiary responses. Scope and Methodology: To describe State Department actions, we reviewed State and USAID records for fiscal 1999-2003 and met with State and USAID officials in Washington, D.C.; Jerusalem; Tel Aviv, Israel; and Amman, Jordan. To describe UNRWA's implementation of procedures, we reviewed UNRWA, State, and USAID documents. We also met with United States officials in Washington, Amman, and Jerusalem. We met with UNRWA management (including the directors of each of its five operating areas), staff, and beneficiaries in Jerusalem; in Bethlehem and Ramallah, in the Israeli-occupied West Bank; and in Amman, Jordan. In addition, we met with Israeli officials in Washington and Jerusalem and with Jordanian officials in Amman. We performed our review from April 2003 through October 2003 in accordance with generally accepted government auditing standards. We are sending copies of this report to the Honorable Colin Powell, Secretary of State, and to interested congressional committees. Copies will be made available to others upon request. In addition, this report will be available at no charge on our Web site at http://www.gao.gov. If you or your staff have any further questions regarding this assessment, please contact me at (202) 512-3149. Cheryl Goodman, Pierre Toureille, and Ella Mann also made key contributions to this report. David B. Gootnick: Director, International Affairs and Trade: Signed by David B. Gootnick: Enclosure: [See PDF for images] [End of figure] FOOTNOTES  Section 580 required GAO to report to the committees by November 1, 2003. Although we were prepared to present our findings by that date, we agreed to your staff's request that we defer our briefing to accommodate congressional deliberations on the supplemental appropriations bill.