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United States Government Accountability Office: 
GAO: 

Testimony: 

Before the Committee on Homeland Security and Governmental Affairs,
U.S. Senate: 

For Release on Delivery: 
Expected at 10:00 a.m. EDT:
Wednesday, March 21, 2012: 

Government Efficiency and Effectiveness: Opportunities for Improvement 
and Considerations for Restructuring: 

Statement of Patricia A. Dalton:
Chief Operating Officer: 

GAO-12-454T: 

Mr. Chairman, Ranking Member Collins, and Members of the Committee: 

Thank you for the opportunity to discuss the need to reexamine the 
structures and operations of the federal government. You also asked 
that we address the "Reforming and Consolidating Government Act of 
2012" (S. 2129), first proposed by the President and introduced in the 
Senate by Chairman Lieberman and Senator Warner. We also present our 
recent work highlighting the existence of duplication, overlap, and 
fragmentation across the federal government.[Footnote 1] 

The federal government faces an array of challenges and opportunities 
to enhance performance, ensure accountability, and position the nation 
for the future. A number of overarching trends, such as fiscal 
sustainability and debt challenges, demographic and societal changes, 
developments in science and technology, diffuse security threats, 
global interdependence, and the rapid expansion of collaborative 
networks, underscore the need for a fundamental reconsideration of the 
role, operations, and structure of the federal government for the 21st 
century. 

My testimony today is based on our work on government reorganization, 
transformation, and management issues as well as our recently issued 
reports that identify additional opportunities and progress made to 
improve the efficiency and effectiveness of government. Specifically, 
it addresses: 

* issues related to reexamining the structure of the federal 
government and its operations, including the President's request that 
Congress grant authority to reorganize the executive branch agencies; 

* federal programs or functional areas where unnecessary duplication, 
overlap, or fragmentation exists as well as opportunities for 
potential cost savings or enhanced revenues identified in our 2012 
annual report; and: 

* the status of actions taken by Congress and the executive branch to 
address the issues we identified in 2011. 

We conducted our work in accordance with generally accepted government 
auditing standards or with our quality assurance framework, as 
appropriate. 

Reexamining Federal Government Structures and Operations: 

Reforming and Consolidating Government Act of 2012 (S. 2129) Would 
Renew and Expand President's Authority to Propose Restructurings: 

On February 17th, Chairman Lieberman and Senator Warner introduced S. 
2129, entitled "Reforming and Consolidating Government Act of 2012", a 
bill renewing the Presidential authority to propose government 
organizational changes and obtain congressional approval through an 
expedited process. From 1932 to 1984, Congress provided the President 
with some form of reorganization authority.[Footnote 2] S. 2129 renews 
most of the statutory framework[Footnote 3] as it existed before the 
authority lapsed in 1984. However, S. 2129 proposes noteworthy 
changes, both in terms of eliminating restrictions on the scope of a 
President's plan and placing additional requirements on such plans. 

Unlike the 1984 version of the law, under S. 2129, the President would 
be permitted to propose the creation of a new department (or renaming 
of an existing department), the abolishment or transfer of an 
executive department, or the consolidation of two or more departments. 
There are currently fifteen departments, including the Department of 
State and the Department of Homeland Security.[Footnote 4] 
Additionally, the President would be permitted to propose the creation 
of a new agency, a restriction which was included by the 1984 
amendment of this authority.[Footnote 5] 

The reorganization authority proposed under this bill would permit the 
President, as in the 1984 version of the law, to prepare and submit to 
Congress reorganization plans that call for the (1) transfer of an 
agency or some of its functions to another agency,[Footnote 6] (2) 
abolishment of all or some functions of an agency, (3) consolidation 
of an agency or its functions or parts of an agency or some of its 
functions with another agency or part of another agency, (4) 
consolidation of part of an agency or some of its functions with 
another part of the same agency, or (5) authorization of an officer to 
delegate his or her functions. 

The bill also renews most of the restrictions which have been imposed 
over time on the President's authority to reorganize. Such 
restrictions prohibit plans which (1) abolish or transfer an 
independent regulatory agency or all its functions, (2) consolidate 
two or more independent regulatory agencies or all their functions, 
(3) continue an agency or function beyond the period authorized by 
law, (4) authorize an agency to exercise a function not expressly 
authorized by law, (5) increase the term of an office beyond the 
period authorized by law, (6) deal with more than one logically 
consistent subject matter, or (7) abolish enforcement functions or 
programs established by statute. A President's submission of plans is 
restricted to no more than three plans pending before Congress at any 
time. Finally, the authority imposes a limit on the duration of the 
authority, which in this case is two years from enactment. 

S. 2129 would impose an additional requirement that any plan permitted 
to go into effect must be an efficiency-enhancing plan as determined 
by the Office of Management and Budget (OMB). In order for a plan to 
be considered an efficiency-enhancing plan, the Director of OMB must 
determine that such plan will result in, or is likely to result in, 
either a decrease in the number of agencies or cost savings in 
performing the functions that are the subject of the plan. Therefore, 
this provision would allow for a consolidation that decreases the 
number of agencies by, for example, combining two agencies into one, 
but does not require that the consolidation result in cost savings. 

Also consistent with prior law, under S. 2129 the President's 
submission of a reorganization plan to Congress must include an 
estimate of any reduction or increase in expenditures realized as a 
result of the reorganizations included in the plan as well as an 
implementation section that describes in detail (1) actions necessary 
or planned to complete the reorganization, (2) the anticipated nature 
and substance of any orders, directives, and other administrative and 
operational actions which are expected to be required, (3) preliminary 
actions which have been taken in the implementation process, and (4) a 
projected timetable for completion of the implementation process. 

Finally, S. 2129 renews the expedited congressional approval process 
as that process was modified in 1984. The 1984 amendments to the 
reorganization authority eliminated the procedure that allowed a 
President's plan to go into effect unless either house acted by 
passing a motion of disapproval within a fixed period of time. Under 
the 1984 amendments, a plan could become effective only if approved by 
both houses of Congress through a joint resolution (approved by the 
President) within 90 days after the plan is submitted to Congress. 
[Footnote 7] This change addressed constitutional concerns with the 
one-house legislative veto,[Footnote 8] and set a higher bar for 
success and in essence gave Congress a stronger role than under past 
reorganization authorities. 

Under this expedited process, recommendations from the Senate 
Committee on Homeland Security and Governmental Affairs and the House 
Committee on Oversight and Government Reform to the full Senate and 
House must be made within 75 days and consideration of the resolution 
in both houses must be within 90 days from submission of the 
plan.[Footnote 9] Consideration is limited to an up or down vote, no 
amendment to a plan may be considered. The President is permitted to 
amend or modify the plan at anytime within the first 60 days after 
submission. Any such change to a plan during this period does not 
impact the deadlines for congressional consideration. The authority to 
modify a plan allows the President to address any problems identified 
or concerns expressed during the pendency of a plan before Congress 
since a plan cannot be changed by Congress through a joint resolution. 

Use of Prior Reorganization Authorities: 

Presidents have used reorganization authorities to submit more than 
100 plans to Congress, proposing a variety of changes from minor 
reorganizations to major ones.[Footnote 10] Examples of approved 
Presidential plans include: 

* creation of the Department of Health, Education, and Welfare, 
proposed by President Eisenhower in 1953 to improve the administration 
of health, education, and social security functions by elevating these 
functions to the departmental level; 

* creation of the Office of Management and Budget, proposed by 
President Nixon in 1970, in part, to place greater emphasis on the 
evaluation of program performance, particularly in programs that cross 
agency lines, and to expand efforts to improve interagency cooperation; 

* creation of the Environmental Protection Agency, proposed by 
President Nixon in 1970 to consolidate the federal government's 
environment-related activities in order to ensure the effective 
protection, development, and enhancement of the environment; and: 

* creation of the Federal Emergency Management Agency, proposed by 
President Carter in 1978 to improve federal emergency management and 
assistance by consolidating federal emergency preparedness, 
mitigation, and response activities. 

President Carter was the last President to use this general grant of 
reorganization authority. During the Reagan Administration, the 
reorganization authority was only in place briefly at the beginning of 
his first term until it lapsed, and then was reauthorized for less 
than two months in 1984 at the end of his first term. The authority 
has not been granted since then.[Footnote 11] Although there was 
expressed interest during the 108th Congress in renewing this 
authority, from both the Administration and members of Congress, no 
such reauthorization was forthcoming.[Footnote 12] 

Balancing the Role of Congress and the Executive Branch in Developing 
Restructuring Proposals: 

A major issue for consideration for today's hearing is the question of 
whether and how to change Congress' normal deliberative process for 
reviewing and shaping executive branch reorganization proposals. 
Expedited reorganization authority can enable the President to propose 
reorganizations that are intended to increase the efficiency and 
effectiveness with which the government can meet existing and emerging 
challenges. However, all key players should be engaged in discussions 
about reorganizing government: the President, Congress, and other 
parties with vested interests, including state and local governments, 
the private sector, and citizens. It is important to ensure a 
consensus on identified problems and needs, and to be sure that the 
solutions our government legislates and implements can effectively 
remedy the problems we face in a timely manner. Fixing the wrong 
problems, or even worse, fixing the right problems poorly, could cause 
more harm than good. 

It is imperative that Congress and the administration form an 
effective working relationship on restructuring initiatives. Any 
systemic changes to federal structures and functions must be approved 
by Congress and implemented by the executive branch, so each has a 
stake in the outcome. In this regard, an administration seeking 
expedited approval of complex government reorganization proposals 
could enhance its prospects for success by reaching out to Congress 
beforehand to ensure that congressional concerns are identified, 
solutions are developed, and general agreement is reached. The normal 
legislative process, which by design takes time to encourage thorough 
debate, helps to ensure that any related actions are carefully 
considered and have broad support. Therefore, Congress may wish to 
consider whether 90 days is a sufficient amount of time for Congress 
to review proposals and conduct its due diligence. 

Even more importantly, all segments of the public that must regularly 
deal with their government--individuals, private sector organizations, 
states, and local governments--must be confident that the changes that 
are put in place have been thoroughly considered and that the 
decisions made today will make sense tomorrow. Excluding any key 
player increases the risk of sub-optimization or failure. 
Congressional deliberative processes serve the vital function of both 
gaining input from a variety of clientèle and stakeholders affected by 
any changes and providing an important constitutional check and 
counterbalance to the executive branch. 

Only Congress can decide whether it wishes to limit its powers and 
role in government reorganizations. In certain circumstances, Congress 
may deem limitations appropriate; however, care should be taken 
regarding the nature, timing, and scope of any related changes. 
Lessons can be learned from prior approaches to granting 
reorganization authority to the President. As discussed below, prior 
successful reorganization initiatives reinforce the importance of 
maintaining a balance between executive and legislative roles in 
undertaking significant organizational changes. Safeguards are needed 
to ensure congressional input and concurrence on the goals as well as 
overall reorganization proposals. 

Successful Government Reorganizations Balanced Executive and 
Legislative Roles: 

Throughout the 20th century, efforts to structure the federal 
government to address the economic and political concerns of the time 
met with varying degrees of success. The first Hoover Commission, 
[Footnote 13] which lasted from 1947 to 1949, is considered by many to 
have been the most successful of government restructuring efforts. The 
membership was bipartisan, including members of the administration and 
both houses of Congress. Half its members were from outside 
government. The commission had a clear vision, making reorganization 
proposals that promoted what they referred to as "greater rationality" 
in the organization and operation of government agencies and enhanced 
the president's role as the manager of the government--principles that 
were understood and accepted by both the White House and 
Congress.[Footnote 14] Former President Hoover himself guided the 
creation of a citizens' committee to build public support for the 
commission's work. More than 70 percent of the first Hoover 
Commission's recommendations were implemented, including 26 out of 35 
reorganization plans. According to a 1982 history of the Hoover 
Commissions "the ease with which most of the reorganization plans 
became effective reflected two factors: the existence of a consensus 
that the President ought to be given deference and assistance by 
Congress in meeting his managerial responsibilities and the fact that 
most of the reorganization plans were pretty straightforward proposals 
of an organizational character."[Footnote 15] 

By contrast, the second Hoover Commission, referred to as Hoover II, 
which lasted from 1953 to 1954, examined policy areas with the goal of 
cutting government programs. However, Hoover II lacked the support of 
the President, who preferred to use his own advisory group[Footnote 
16] in managing the government. It also lacked the support of Congress 
and the public, neither of which, according to CRS, cared to cut the 
government at a time when federally run programs were generally held 
in high esteem and considered efficient and beneficial.[Footnote 17] 
More than 60 percent of Hoover II's recommendations were implemented, 
but these were mostly drawn from the commission's technical 
recommendations rather than from its major ones (such as changing the 
government's policies on lending, subsidies, and water resources) that 
would have substantively cut federal programs.[Footnote 18] 

The lesson of the two Hoover Commissions is clear: if plans to 
reorganize government are to move from recommendation to reality, 
creating a consensus for them is essential to the task. In this 
regard, both the process employed and the players involved in making 
any specific reorganization proposals are of critical importance. The 
success of the first Hoover Commission can be tied to the involvement 
and commitment of both Congress and the President. Both the 
legislative branch and executive branches agreed to the goals. With 
this agreement, a process was established that provided for wide 
spread involvement, including citizens, and transparency so that 
meaningful results could be achieved. 

That lesson shows up again in the experience of the Ash Council, which 
convened in 1969-70. Like the first Hoover Commission, the Ash Council 
aimed its recommendations at structural changes to enhance the 
effectiveness of the President as manager of the government. The Ash 
Council proposed organizing government around broad national purposes 
by integrating similar functions under major departments. It proposed 
that four super departments be created economic affairs, community 
development, natural resources, and human services--with State, 
Defense, Treasury, and Justice remaining in place. But the Ash Council 
could not gain the support of Congress. Its recommendations would have 
drastically altered jurisdictions within Congress and the 
relationships between committees and the agencies for which they had 
oversight responsibilities. Congress was not thoroughly clear on the 
implications of the four super departments, was not readily willing to 
change its own structure to parallel the structure proposed by the 
council, and was not eager to substantially strengthen the authority 
of the presidency. 

Complexity of Government Reorganizations Require Clear Goals and 
Careful Implementation Planning: 

No matter what plans are made to reorganize the government, fulfilling 
the promise of these plans will depend on their effective 
implementation. The creation of a new organization may vary in terms 
of size and complexity. However, building an effective organization 
requires consistent and sustained leadership from top management to 
ensure the needed transformation of disparate agencies, programs, 
functions, and activities into an integrated organization. To achieve 
success, the end result should not simply be a collection of component 
units, but the transformation to an integrated, high-performance 
organization. The implementation of a new organization is an extremely 
complex task that can take years to accomplish. 

In 2002, we convened a forum to identify and discuss useful practices 
and lessons learned from major private and public sector 
organizational mergers, acquisitions, and transformations that federal 
agencies could implement to successfully transform their cultures and 
a new Department of Homeland Security could use to merge its various 
originating components into a unified department.[Footnote 19] The 
invited participants were experienced in managing or studying large-
scale organizational mergers, acquisitions, and transformations. The 
lessons learned and key practices gleaned from the forum provide a 
useful roadmap for planning the implementation of any large scale 
restructuring. We subsequently issued a report on the specific steps 
organizations can take to implement those key practices.[Footnote 20] 

The research suggests that the failure to adequately address--and 
often even consider--a wide variety of people and cultural issues is 
at the heart of unsuccessful mergers, acquisitions, and 
transformations. But this does not have to be the case. While there is 
no one right way to manage a successful merger, acquisition, or 
transformation, the experiences of both successful and unsuccessful 
efforts suggest that practices that are key to their success include 
the following. 

Key Practices Found in Successful Mergers and Organizational 
Transformations: 

* Ensure top leadership drives the transformation. Leadership must set 
the direction, pace, and tone and provide a clear, consistent 
rationale that brings everyone together behind a single mission; 

* Establish a clear mission and integrated strategic goals to guide 
the transformation. Together, these define the culture and serve as a 
vehicle for employees to unite and rally around; 

* Focus on a key set of principles and priorities at the outset of the 
transformation. A clear set of principles and priorities serves as a 
framework to help the organization create a new culture and drive 
employee behaviors; 

* Set implementation goals and a timeline to build momentum and show 
progress from day one. Goals and a timeline are essential because the 
transformation could take years to complete; 

* Dedicate an implementation team to manage the transformation 
process. A strong and stable team is important to ensure that the 
transformation receives the needed attention to be sustained and 
successful; 

* Use the performance management system to define responsibility and 
assure accountability for change. A "line of sight" shows how team, 
unit, and individual performance can contribute to overall 
organizational results; 

* Establish a communication strategy to create shared expectations and 
report related progress. The strategy must reach out to employees, 
customers, and stakeholders and engage them in a two-way exchange; 

* Involve employees to obtain their ideas and gain their ownership for 
the transformation. Employee involvement strengthens the process and 
allows them to share their experiences and shape policies; 

* Build a world-class organization. Building on a vision of improved 
performance, the organization adopts the most efficient, effective, 
and economical personnel, system, and process changes and continually 
seeks to implement best practices. 

Source: GAO, Highlights of a GAO Forum: Mergers and Transformation: 
Lessons Learned for a Department of Homeland Security and Other 
Federal Agencies, GAO-03-293SP (Washington, D.C.: Nov. 14, 2002). 

[End of table] 

The Department of Homeland Security's (DHS) ongoing efforts to build a 
single, unified department illustrate the complexity and challenges of 
reorganizing government agencies. DHS now has more than 200,000 
employees and almost $60 billion in budget authority, and completing 
its transformation into a cohesive department is critical to achieving 
its homeland security missions. DHS has updated and strengthened its 
plans to resolve the department's management challenges, and has 
demonstrated strong leadership commitment to make improvements in 
these areas. However, much work remains for DHS to implement these 
plans and show sustained progress. We designated the implementation 
and transformation of DHS as high risk because, among other things, 
DHS had to combine 22 agencies, while ensuring no serious consequences 
for U.S. national and economic security. This high-risk area includes 
challenges in DHS's management functions--financial management, human 
capital, IT, and acquisitions; the effect of those challenges on 
implementing DHS's missions; and integrating the functions. Since the 
department's creation in 2003, we have issued over 1,200 products on 
DHS's operations in such areas as transportation security and 
emergency management, among others. These management challenges have 
had a direct impact on DHS's ability to satisfy its missions, such as 
delivering major acquisitions aimed at delivering important mission 
capabilities on time and within budget. We have made over 1,600 
recommendations to DHS since its creation designed to strengthen the 
department's management and operations. DHS has implemented many of 
these recommendations and is in the process of implementing others. 
Furthermore, our 2011 and 2012 reports on overlapping and duplicative 
programs discussed later in this statement, identified additional 
areas where action could be taken to reduce overlap and potential 
unnecessary duplication. 

In addition to integrating and strengthening the management of the 
components combined to form DHS, our work across the department has 
identified a number of additional observations that could be useful in 
informing deliberations on other government reorganizations. These 
include ensuring adequate and long-term transition support, 
identifying and addressing legacy issues that existed prior to the 
reorganization, and building and emphasizing partnerships and 
coordination mechanisms both internal and external to the new 
organization, among others. 

Reorganization Authority Calls For a Description of Intended 
Performance Improvements, Estimated Savings, and an Implementation 
Plan: 

Given the complex challenges associated with government 
restructurings, it is important to note that S. 2129 would renew the 
requirement that the President submit as part of a reorganization plan 
a description of what it intends to achieve and a plan for 
implementation. Specifically, the President must estimate any 
reduction or increase in expenditures (itemized so far as 
practicable), and describe any improvements in management, delivery of 
federal services, execution of the laws, and increases in efficiency 
of government operations, which it is expected will be realized as a 
result of the reorganizations included in the plan. The implementation 
section must describe in detail the actions necessary or planned to 
complete the reorganization, the anticipated nature and substance of 
any orders, directives, and other administrative and operational 
actions which are expected to be required for completing or 
implementing the reorganization, and any preliminary actions which 
have been taken in the implementation process. It must also contain a 
projected timetable for completion of the implementation process. 
These requirements are broadly consistent with some of the 
aforementioned practices key to successful organizational 
transformations. The required implementation plan will be most useful 
to the extent that it covers all of the key practices in at least a 
preliminary form. 

This provision, if implemented properly, could provide useful 
benchmarks for Congress to use in deciding whether the plan is 
feasible, whether the Administration has carefully considered the 
complex implementation issues, and if it will produce sufficient 
benefits to merit the changes being proposed. 

Oversight of Implementation: 

Congressional involvement is needed not just in the initial design of 
the organization, but in what can turn out to be a lengthy period of 
implementation. Congress has an important role to play--both in its 
legislative and oversight capacities--in establishing, monitoring, and 
maintaining progress to attain the goals envisioned by government 
transformation and reorganization efforts. Sustained oversight by 
Congress is needed to ensure the reorganization is accomplishing its 
goals and to determine whether it needs further refinement. Assessing 
progress is important to ensuring implementation is moving in the 
right direction. 

To ensure effective implementation, along with efficient and effective 
oversight, Congress may need to consider realigning its own structure. 
For example, the legislation which established DHS instructed both 
houses of Congress to review their committee structures in light of 
the reorganization of homeland security responsibilities within the 
executive branch. This led to an expansion of the responsibilities of 
this committee in the Senate, and the formation of the Committee on 
Homeland Security in the House. However, these committees share 
oversight of DHS with many other congressional committees and 
subcommittees. 

GPRA Modernization Act Provides Another Tool to Reexamine Government 
Programs and Improve Coordination: 

Many federal efforts, including those related to protecting food and 
agriculture, providing homeland security, and ensuring a well trained 
and educated workforce, transcend more than one agency, yet agencies 
face a range of challenges and barriers when they attempt to work 
collaboratively. Both Congress and the executive branch have 
recognized this, and in January 2011, the GPRA Modernization Act of 
2010 (the Act) was enacted, updating the almost two-decades-old 
Government Performance and Results Act. The Act establishes a new 
framework aimed at taking a more crosscutting and integrated approach 
to focusing on results and improving government performance. Effective 
implementation of the Act could play an important role in clarifying 
desired outcomes, addressing program performance spanning multiple 
organizations, and facilitating future actions to reduce unnecessary 
duplication, overlap, and fragmentation. 

The Act requires OMB to coordinate with agencies to establish outcome-
oriented goals covering a limited number of crosscutting policy areas 
as well as goals to improve management across the federal government, 
and to develop a government-wide performance plan for making progress 
toward achieving those goals. The performance plan is to, among other 
things, identify the agencies and federal activities--including 
spending programs, tax expenditures, and regulations--that contribute 
to each goal, and establish performance indicators to measure overall 
progress toward these goals as well as the individual contribution of 
the underlying agencies and federal activities. The President's budget 
for fiscal year 2013 includes 14 such crosscutting goals, including 
Science, Technology, Engineering, and Math Education, Entrepreneurship 
and Small Businesses, Job Training, Cybersecurity, Information 
Technology Management, Procurement and Acquisition Management, and 
Real Property Management. The Act also requires similar information at 
the agency level. Each agency is to identify the various federal 
organizations and activities--both within and external to the agency--
that contribute to its goals, and describe how the agency is working 
with other agencies to achieve its goals as well as any relevant 
crosscutting goals. 

Reducing Duplication, Overlap, and Fragmentation Can Improve 
Government Efficiency and Effectiveness: 

In our series of reports on the topic to date, we have identified a 
number of areas of potential duplication, overlap, or fragmentation, 
as well as opportunities for agencies or Congress to consider taking 
action that could either reduce the cost of government operations or 
enhance revenue collections for the Treasury. For example, our 2012 
annual report presents 51 areas where programs may be able to achieve 
greater efficiencies or become more effective in providing government 
services.[Footnote 21] We have also continued to monitor developments 
in the 81 areas that we identified a year ago in the first report we 
issued in this series.[Footnote 22] Our 2011 follow-up report 
describes the extent to which progress has been made to address these 
areas.[Footnote 23] Appendix I presents a summary of our assessment of 
the overall progress made in each of the 81 areas. Collectively, our 
2011 and 2012 annual reports show that, if the actions are 
implemented, the government could potentially save tens of billions of 
dollars annually. 

2012 Annual Report Identified 51 Opportunity Areas: 

In our 2012 annual report, we identified a total of 51 areas, 
including 32 areas of potential duplication, overlap, or 
fragmentation, as well as 19 opportunities for agencies or Congress to 
consider taking action that could either reduce the cost of government 
operations or enhance revenue collections for the Treasury. These 
areas involve a wide range of government missions including 
agriculture, defense, economic development, education, energy, general 
government, health, homeland security, international affairs, science 
and the environment, and social services. Within and across these 
missions, the 2012 annual report touches on virtually all major 
federal departments and agencies. We expanded the scope of our work 
for this year's report to focus on areas where a mix of federal 
approaches is used, such as tax expenditures, direct spending, and 
federal grant or loan programs. 

We summarized 32 areas where government missions are fragmented across 
multiple agencies or programs; agencies, offices, or initiatives may 
have similar or overlapping objectives or may provide similar services 
to similar populations or target similar users; and when two or more 
agencies or programs are engaged in the same activities or provide the 
same services to the same beneficiaries (see table 1). We found 
instances where multiple government programs or activities have led to 
inefficiencies, and we determined that greater efficiencies or 
effectiveness might be achievable. 

Table 1: Duplication, Overlap, and Fragmentation Areas Identified: 

Mission: Agriculture; 

Areas identified: 

1. Protection of Food and Agriculture: Centrally coordinated oversight 
is needed to ensure nine federal agencies effectively and efficiently 
implement the nation's fragmented policy to defend the food and 
agriculture systems against potential terrorist attacks and major 
disasters. 

2. Electronic Warfare: Identifying opportunities to consolidate 
Department of Defense airborne electronic attack programs could reduce 
overlap in the department's multiple efforts to develop new 
capabilities and improve the department's return on its multibillion-
dollar acquisition investments. 

3. Unmanned Aircraft Systems: Ineffective acquisition practices and 
collaboration efforts in the Department of Defense unmanned aircraft 
systems portfolio creates overlap and the potential for duplication 
among a number of current programs and systems. 

4. Counter-Improvised Explosive Device Efforts: The Department of 
Defense continues to risk duplication in its multibillion-dollar 
counter-improvised explosive device efforts because it does not have a 
comprehensive database of its projects and initiatives. 

5. Defense Language and Culture Training: The Department of Defense 
needs a more integrated approach to reduce fragmentation in training 
approaches and overlap in the content of training products acquired by 
the military services and other organizations. 

6. Stabilization, Reconstruction, and Humanitarian Assistance Efforts: 
Improving the Department of Defense's evaluations of stabilization, 
reconstruction, and humanitarian assistance efforts, and addressing 
coordination challenges with the Department of State and the U.S. 
Agency for International Development, could reduce overlapping efforts 
and result in the more efficient use of taxpayer dollars. 

Mission: Economic development; 

Areas identified: 

7. Support for Entrepreneurs: Overlap and fragmentation among the 
economic development programs that support entrepreneurial efforts 
require the Office of Management and Budget and other agencies to 
better evaluate the programs and explore opportunities for program 
restructuring, which may include consolidation, within and across 
agencies. 

8. Surface Freight Transportation: Fragmented federal programs and 
funding structures are not maximizing the efficient movement of 
freight. 

Mission: Energy; 

Areas identified: 

9. Department of Energy Contractor Support Costs: The Department of 
Energy should assess whether further opportunities could be taken to 
streamline support functions, estimated to cost over $5 billion, at 
its contractor-managed laboratory and nuclear production and testing 
sites, in light of contractors' historically fragmented approach to 
providing these functions. 

10. Nuclear Nonproliferation: Comprehensive review needed to address 
strategic planning limitations and potential fragmentation and overlap 
concerns among programs combating nuclear smuggling overseas. 

Mission: General government; 

Areas identified: 

11. Personnel Background Investigations: The Office of Management and 
Budget should take action to prevent agencies from making potentially 
duplicative investments in electronic case management and adjudication 
systems. 

12. Cybersecurity Human Capital: Governmentwide initiatives to enhance 
the cybersecurity workforce in the federal government need better 
structure, planning, guidance, and coordination to reduce duplication. 

13. Spectrum Management: Enhanced coordination of federal agencies' 
efforts to manage radio frequency spectrum and an examination of 
incentive mechanisms to foster more efficient spectrum use may aid 
regulators' attempts to jointly respond to competing demands for 
spectrum while identifying valuable spectrum that could be auctioned 
for commercial use, thereby generating revenues for the U.S. Treasury. 

Mission: Health; 

Areas identified: 

14. Health Research Funding: The National Institutes of Health, 
Department of Defense, and Department of Veterans Affairs can improve 
sharing of information to help avoid the potential for unnecessary 
duplication. 

15. Military and Veterans Health Care: The Departments of Defense and 
Veterans Affairs need to improve integration across care coordination 
and case management programs to reduce duplication and better assist 
servicemembers, veterans, and their families. 

Mission: Homeland security/Law enforcement; 

Areas identified: 

16. Department of Justice Grants: The Department of Justice could 
improve how it targets nearly $3.9 billion to reduce the risk of 
potential unnecessary duplication across the more than 11,000 grant 
awards it makes annually. 

17. Homeland Security Grants: The Department of Homeland Security 
needs better project information and coordination among four 
overlapping grant programs. 

18. Federal Facility Risk Assessments: Agencies are making duplicate 
payments for facility risk assessments by completing their own 
assessments, while also paying the Department of Homeland Security for 
assessments that the department is not performing. 

Mission: Information technology; 

Areas identified: 

19. Information Technology Investment Management: The Office of 
Management and Budget, and the Departments of Defense and Energy need 
to address potentially duplicative information technology investments 
to avoid investing in unnecessary systems. 

Mission: International affairs; 

Areas identified: 

20. Overseas Administrative Services: U.S. government agencies could 
lower the administrative cost of their operations overseas by 
increasing participation in the International Cooperative 
Administrative Support Services system and by reducing reliance on 
American officials overseas to provide these services. 

21. Training to Identify Fraudulent Travel Documents: Establishing a 
formal coordination mechanism could help reduce duplicative activities 
among seven different entities that are involved in training foreign 
officials to identify fraudulent travel documents. 

Mission: Science and the environment; 

Areas identified: 

22. Coordination of Space System Organizations: Fragmented leadership 
has led to program challenges and potential duplication in developing 
multibillion-dollar space systems. 

23. Space Launch Contract Costs: Increased collaboration between the 
Department of Defense and the National Aeronautics and Space 
Administration could reduce launch contracting duplication. 

24. Diesel Emissions: Fourteen grant and loan programs at the 
Department of Energy, Department of Transportation, and the 
Environmental Protection Agency, and three tax expenditures fund 
activities that have the effect of reducing mobile source diesel 
emissions; enhanced collaboration and performance measurement could 
improve these fragmented and overlapping programs. 

25. Environmental Laboratories: The Environmental Protection Agency 
needs to revise its overall approach to managing its 37 laboratories 
to address potential overlap and fragmentation and more fully leverage 
its limited resources. 

26. Green Building: To evaluate the potential for overlap or 
fragmentation among federal green building initiatives, the Department 
of Housing and Urban Development, the Department of Energy, and the 
Environmental Protection Agency should lead other federal agencies in 
collaborating on assessing their investments in more than 90 
initiatives to foster green building in the nonfederal sector. 

Mission: Social services; 

Areas identified: 

27. Social Security Benefit Coordination: Benefit offsets for related 
programs help reduce the potential for overlapping payments but pose 
administrative challenges. 

28. Housing Assistance: Examining the benefits and costs of housing 
programs and tax expenditures that address the same or similar 
populations or areas, and potentially consolidating them, could help 
mitigate overlap and fragmentation and decrease costs. 

Mission: Training, employment, and education; 

Areas identified: 

29. Early Learning and Child Care: The Departments of Education and 
Health and Human Services should extend their coordination efforts to 
other federal agencies with early learning and child care programs to 
mitigate the effects of program fragmentation, simplify children's 
access to these services, collect the data necessary to coordinate 
operation of these programs, and identify and minimize any unwarranted 
overlap and potential duplication. 

30. Employment for People with Disabilities: Better coordination among 
50 programs in nine federal agencies that support employment for 
people with disabilities could help mitigate program fragmentation and 
overlap, and reduce the potential for duplication or other 
inefficiencies. 

31. Science, Technology, Engineering, and Mathematics Education: 
Strategic planning is needed to better manage overlapping programs 
across multiple agencies. 

32. Financial Literacy: Overlap among financial literacy activities 
makes coordination and clarification of roles and responsibilities 
essential, and suggests potential benefits of consolidation. 

Source: GAO-12-342SP. 

[End of table] 

Overlap and fragmentation among government programs or activities can 
be harbingers of unnecessary duplication. In many cases, the existence 
of unnecessary duplication, overlap, or fragmentation can be difficult 
to determine with precision due to a lack of data on programs and 
activities. Where information has not been available that would 
provide conclusive evidence of duplication, overlap, or fragmentation, 
we often refer to "potential duplication" and, where appropriate, we 
suggest actions that agencies or Congress could take to either reduce 
that potential or to make programmatic data more reliable or 
transparent. In some instances of duplication, overlap, or 
fragmentation, it may be appropriate for multiple agencies or entities 
to be involved in the same programmatic or policy area due to the 
nature or magnitude of the federal effort. For issues where 
information is being reported on for the first time in the 2012 annual 
report, we sought comments from the agencies involved, and 
incorporated those comments as appropriate. 

Among the 32 areas highlighted in our 2012 annual report are the 
following examples of opportunities for agencies or Congress to 
consider taking action to reduce unnecessary duplication, overlap, or 
fragmentation. 

* Unmanned Aircraft Systems: The Department of Defense (DOD) estimates 
that the cost of current Unmanned Aircraft Systems (UAS) acquisition 
programs and related systems will exceed $37.5 billion in fiscal years 
2012 through 2016. The elements of DOD's planned UAS portfolio include 
unmanned aircraft, payloads (subsystems and equipment on a UAS 
configured to accomplish specific missions), and ground control 
stations (equipment used to handle multiple mission aspects such as 
system command and control). We have found that ineffective 
acquisition practices and collaboration efforts in DOD's UAS portfolio 
creates overlap and the potential for duplication among a number of 
current programs and systems. We have also highlighted the need for 
DOD to consider commonality in UAS--using the same or interchangeable 
subsystems and components in more than one subsystem to improve 
interoperability of systems--to reduce the likelihood of redundancies 
in UAS capabilities. 

Military service-driven requirements--rather than an effective 
departmentwide strategy--have led to overlap in DOD's UAS 
capabilities, resulting in many programs and systems being pursued 
that have similar flight characteristics and mission requirements. 
Illustrative of the overlap, the Department of the Navy (Navy) plans 
to spend more than $3 billion to develop the Broad Area Maritime 
Surveillance UAS, rather than the already fielded Air Force Global 
Hawk system on which it was based. According to the Navy, its unique 
requirements necessitate modifications to the Global Hawk airframe, 
payload interfaces, and ground control station. However, the Navy 
program office was not able to provide quantitative analysis to 
justify the variant. According to program officials, no analysis was 
conducted to determine the cost effectiveness of developing the Broad 
Area Maritime Surveillance UAS to meet the Navy's requirements versus 
buying more Global Hawks. 

The potential for overlap also exists among UAS subsystems and 
components, such as sensor payloads and ground control stations. DOD 
expects to spend about $9 billion to buy 42 UAS sensor payloads 
through fiscal year 2016. While the fact that some multiservice 
payloads are being developed shows the potential for collaboration, 
the service-centric requirements process still creates the potential 
for overlap, including 29 sensors in our review. Further, we 
identified overlap and potential duplication among 10 of 13 ground 
control stations that DOD plans to acquire at a cost of about $3 
billion through fiscal year 2016. According to a cognizant DOD 
official, the associated software is about 90 percent duplicative 
because similar software is developed for each ground control station. 
DOD has created a UAS control segment working group, which is 
chartered to increase interoperability and enable software re-use and 
open systems. This could allow for greater efficiency, less 
redundancy, and lower costs, while potentially reducing levels of 
contractor proprietary data that cannot be shared across UAS programs. 
However, existing ground control stations already have their own 
architecture and migration to a new service-oriented architecture will 
not happen until at least 2015, almost 6 years after it began. 

DOD plans to significantly expand the UAS portfolio through 2040, 
including five new systems in the planning stages that are expected to 
become formal programs in the near future. While DOD has acknowledged 
that many UAS systems were acquired inefficiently and has begun to 
take steps to improve outcomes as it expands these capabilities over 
the next several years, the department faces challenges in its ability 
to improve efficiency and reduce the potential for overlap and 
duplication as it buys UAS capabilities. For example, the Army and 
Navy are planning to spend approximately $1.6 billion to acquire 
separate systems that are likely to have similar capabilities to meet 
upcoming cargo and surveillance requirements. DOD officials state that 
current requirements do not preclude a joint program to meet these 
needs, but the Army and Navy have not yet determined whether such an 
approach will be used. 

To reduce the likelihood of overlap and potential duplication in its 
UAS portfolio, we have made several prior recommendations to DOD which 
have not been fully implemented. While DOD generally agreed with our 
recommendations, the overlap in current UAS programs, as well as the 
continued potential in future programs, shows that DOD must still do 
more to implement them. In particular, we have recommended that DOD 
(1) re-evaluate whether a single entity would be better positioned to 
integrate all crosscutting efforts to improve the management and 
operation of UAS; (2) consider an objective, independent examination 
of current UAS portfolio requirements and the methods for acquiring 
future unmanned aircraft; and (3) direct the military services to 
identify specific areas where commonality can be achieved. We believe 
the potential for savings is significant and with DOD's renewed 
commitment to UAS for meeting new strategic requirements, all the more 
imperative. 

* Housing assistance: In fiscal year 2010, the federal government 
incurred about $170 billion in obligations for housing-related 
programs and estimated revenue forgone for tax expenditures of which 
tax expenditures represent $132 billion (about 78 percent). Support 
for homeownership in the current economic climate has expanded 
dramatically with nearly all mortgage originations having direct or 
indirect federal assistance. The Department of the Treasury (Treasury) 
and the Board of Governors of the Federal Reserve System together 
invested more than $1.67 trillion in Fannie Mae and Freddie Mac, the 
government-sponsored enterprises, which issue and guarantee mortgage-
backed securities. Examining the benefits and costs of housing 
programs and tax expenditures that address the same or similar 
populations or areas, and potentially consolidating them, could help 
mitigate overlap and fragmentation and decrease costs. 

We identified 20 different entities that administer 160 programs, tax 
expenditures, and other tools that supported homeownership and rental 
housing in fiscal year 2010. In addition, we identified 39 programs, 
tax expenditures, and other tools that provide assistance for buying, 
selling, or financing a home and eight programs and tax expenditures 
that provide assistance to rental property owners. We found overlap in 
products offered and markets served by the Department of Agriculture's 
(USDA) Rural Housing Service (RHS) and the Department of Housing and 
Urban Development's (HUD) Federal Housing Administration (FHA), among 
others. In September 2000 and again as part of our ongoing work, we 
questioned the need for maintaining separate programs for rural areas. 
In September 2000, we recommended that Congress consider requiring 
USDA and HUD to examine the benefits and costs of merging programs, 
such as USDA's and HUD's single-family guaranteed loan and multifamily 
portfolio management programs.[Footnote 24] 

While USDA and HUD have raised concerns about merging programs, our 
recent work has shown increased evidence of overlap and that some RHS 
and FHA programs can be consolidated. For example, the two agencies 
overlap in products offered (mortgage credit and rental assistance), 
functions performed (portfolio management and preservation), and 
geographic areas served. Specifically, RHS and HUD guarantee single-
family and multifamily loans, as well as offer rental subsidies using 
similar income eligibility criteria. And, both agencies have been 
working to maintain and preserve existing multifamily portfolios. 
Although RHS may offer its products only in rural areas, it is not 
always the insurer of choice in those areas. For example, in fiscal 
year 2009 FHA insured over eight times as many single-family loans in 
economically distressed rural counties as RHS guaranteed. And, many 
RHS loan guarantees financed properties near urban areas--56 percent 
of single-family guarantees made in fiscal year 2009 were in 
metropolitan counties. 

Regarding consolidation, we found that RHS relies on more in-house 
staff to oversee its single-family and multifamily loan portfolio of 
about $93 billion than HUD relies on to manage its single-family and 
multifamily loan portfolio of more than $1 trillion, largely because 
of differences in how the programs are administered. RHS has a 
decentralized structure of about 500 field offices that was set up to 
interact directly with borrowers. RHS relies on over 1,600 full-time 
equivalent staff to process and service its direct single-family loans 
and grants. While RHS limits its direct loans to low income households 
and its guaranteed loans to moderate income households, FHA has no 
income limits and does not offer a comparable direct loan program. HUD 
operates about 80 field offices and primarily interacts through 
lenders, nonprofits, and other intermediaries. RHS and FHA programs 
both utilize FHA-approved lenders and underwriting processes based on 
FHA's scorecard--an automated tool that evaluates new mortgage loans. 
RHS has about 530 full-time equivalent staff to process its single-
family guaranteed loans. FHA relies on lenders to process its loans. 
Although FHA insures far more mortgages than RHS guarantees, FHA has 
just over 1,000 full-time equivalent staff to oversee lenders and 
appraisers and contractors that manage foreclosed properties. While 
the number of RHS field offices decreased by about 40 percent since 
2000, its decentralized field structure continues to reflect the era 
in which it was established--the 1930s, when geography and technology 
greatly limited communication and transportation. These limitations 
have diminished and HUD programs can be used in all areas of the 
country. 

We first recommended in September 2000 --and have followed up since 
then--that Congress consider requiring USDA and HUD to examine the 
benefits and costs of merging those programs that serve similar 
markets and provide similar products, and require these same agencies 
to explore merging their single family insured lending and multifamily 
portfolio management programs. At that time, USDA stated that some of 
the suggestions made in our report to improve the effectiveness of 
current programs may better serve rural areas. However, USDA also 
stated that the gap in housing affordability between rural and urban 
areas, as well as the importance of rural housing programs to the 
Department's broader Rural Development mission area, would make 
merging RHS's programs with HUD's programs unfeasible and detrimental 
to rural America. HUD also stated that it believes any opportunity to 
improve the delivery of rural housing services should be explored, but 
stated that the differences between RHS's and FHA's single-family 
programs are sizable and that without legislative changes to product 
terms, efforts to merge the programs would likely result in a more 
cumbersome rather than a more efficient delivery system. HUD added 
that it had been working with USDA in a mutual exchange of information 
on best practices and would explore possible avenues of coordination. 

The agencies have been working to align certain requirements of the 
various multifamily housing programs. In addition, in February 2011, 
the Administration reported to Congress that it would establish a task 
force to evaluate the potential for coordinating or consolidating the 
housing loan programs of HUD, USDA, and the Department of Veterans 
Affairs (VA). According to HUD, a benchmarking effort associated with 
the task force was recently begun. Our ongoing work considers options 
for consolidating these programs and we expect to make additional 
related recommendations. 

Furthermore, Treasury and the Internal Revenue Service (IRS) provide 
numerous types of housing assistance through tax expenditures. 
Although often necessary to meet federal priorities, some tax 
expenditures can contribute to mission fragmentation and program 
overlap that, in turn, can create service gaps, additional costs, and 
the potential for duplication. For example, to qualify for a historic 
preservation tax credit, rehabilitation must preserve historic 
character, which may conflict with states' efforts to produce energy-
efficient, low-income properties with tax credits, and could increase 
project costs. 

We recommended in September 2005 and reiterated in March 2011 that 
coordinated reviews of tax expenditures with related spending programs 
could help policymakers reduce overlap and inconsistencies and direct 
scarce resources to the most-effective or least-costly methods to 
deliver federal support.[Footnote 25] Specifically, we recommended 
that the Director of OMB, in consultation with the Secretary of the 
Treasury, develop and implement a framework for conducting performance 
reviews of tax expenditures. OMB, citing methodological and conceptual 
issues, disagreed with our 2005 recommendations. To date, OMB had not 
used its budget and performance review processes to systematically 
review tax expenditures and promote integrated reviews of related tax 
and spending programs. However, in its fiscal year 2012 budget 
guidance, OMB instructed agencies, where appropriate, to analyze how 
to better integrate tax and spending policies with similar objectives 
and goals. The GPRA Modernization Act of 2010 also envisions such an 
approach for selected cross-cutting areas. Such an analysis could help 
identify redundancies. 

* Military and veterans health care: We found that DOD and VA need to 
improve integration across care coordination and case management 
programs to reduce duplication and better assist servicemembers, 
veterans, and their families. DOD and VA have care coordination 
[Footnote 26] and case management[Footnote 27] programs that are 
intended to provide continuity of care for wounded, ill, and injured 
servicemembers and veterans. DOD and VA established the Wounded, Ill, 
and Injured Senior Oversight Committee (Senior Oversight Committee) to 
address identified problems in providing care to wounded, ill, and 
injured servicemembers as well as veterans. Under the purview of this 
committee, the departments developed the Federal Recovery Coordination 
Program (FRCP), a joint program administered by VA that was designed 
to coordinate clinical and nonclinical services for "severely" 
wounded, ill, and injured servicemembers--who are most likely to be 
medically separated from the military--across DOD, VA, other federal 
agencies, states, and the private sector. Separately, the Recovery 
Coordination Program (RCP) was established in response to the National 
Defense Authorization Act for Fiscal Year 2008 to improve the care, 
management, and transition of recovering servicemembers. It is a DOD-
specific program that was designed to provide nonclinical care 
coordination to "seriously" wounded, ill, and injured servicemembers, 
who may return to active duty unlike those categorized as "severely" 
wounded, ill, or injured. The RCP is implemented separately by each of 
the military services, most of which have implemented the RCP within 
their existing wounded warrior programs.[Footnote 28] 

As a result of these multiple efforts, many recovering servicemembers 
and veterans are enrolled in more than one care coordination or case 
management program, and they may have multiple care coordinators and 
case managers, potentially duplicating agencies' efforts and reducing 
the effectiveness and efficiency of the assistance they provide. For 
example, recovering servicemembers and veterans who have a care 
coordinator also may be enrolled in one or more of the multiple DOD or 
VA programs that provide case management services to "seriously" and 
"severely" wounded, ill, and injured servicemembers, veterans, and 
their families. These programs include the military services' wounded 
warrior programs and VA's Operation Enduring Freedom/Operation Iraqi 
Freedom Care Management Program, among others. 

We found that inadequate information exchange and poor coordination 
between these programs have resulted in not only duplication of 
effort, but confusion and frustration for enrollees, particularly when 
case managers and care coordinators duplicate or contradict one 
another's efforts. For example, an FRCP coordinator told us that in 
one instance there were five case managers working on the same life 
insurance issue for an individual. In another example, an FRCP 
coordinator and an RCP coordinator were not aware the other was 
involved in coordinating care for the same servicemember and had 
unknowingly established conflicting recovery goals for this 
individual. In this case, a servicemember with multiple amputations 
was advised by his FRCP coordinator to separate from the military in 
order to receive needed services from VA, whereas his RCP coordinator 
set a goal of remaining on active duty. These conflicting goals caused 
considerable confusion for this servicemember and his family. 

DOD and VA have been unsuccessful in jointly developing options for 
improved collaboration and potential integration of the FRCP and RCP 
care coordination programs, although they have made a number of 
attempts to do so. Despite the identification of various options, no 
final decisions to revamp, merge, or eliminate programs have been 
agreed upon. 

The need for better collaboration and integration extends beyond the 
FRCP and RCP to also encompass other DOD and VA case management 
programs, such as DOD's wounded warrior programs that also serve 
seriously and severely wounded, ill, and injured servicemembers and 
veterans. In October 2011, we recommended that the Secretaries of 
Defense and Veterans Affairs direct the co-chairs of the Senior 
Oversight Committee to expeditiously develop and implement a plan to 
strengthen functional integration across all DOD and VA care 
coordination and case management programs that serve recovering 
servicemembers, veterans, and their families, including--but not 
limited to--the FRCP and RCP.[Footnote 29] DOD and VA provided 
technical comments on the report, but neither specifically commented 
on our recommendation. We plan to track the extent to which progress 
has been made to address our recommendation. 

* Information technology investment management: OMB reported that in 
fiscal year 2011, there were approximately 7,200 information 
technology (IT) investments totaling at least $79 billion. OMB 
provides guidance to agencies on how to report on their IT investments 
and requires agencies to identify each investment by a single 
functional category and sub-category. These categorizations are 
intended to enable OMB and others to analyze investments with similar 
functions, as well as identify and analyze potentially duplicative 
investments across agencies. We found that DOD and the Department of 
Energy (DOE) need to address potentially duplicative IT investments to 
avoid investing in unnecessary systems. 

In February 2012, we completed a review that examined the 3 largest 
categories of IT investments within DOD, DOE, and the Department of 
Homeland Security (DHS) and found that although the departments use 
various investment review processes to identify duplicative 
investments, 37 of our sample of 810 investments were potentially 
duplicative at DOD and DOE.[Footnote 30] These investments account for 
about $1.2 billion in IT spending for fiscal years 2007 through 2012 
for these two agencies. We found that DOD and DOE had recently 
initiated specific plans to address potential duplication in many of 
the investments we identified--such as plans to consolidate or 
eliminate systems--but these initiatives had not yet led to the 
consolidation or elimination of duplicative investments or 
functionality. 

In addition, while we did not identify any potentially duplicative 
investments at DHS within our sample, DHS officials have independently 
identified several duplicative investments and systems. DHS has plans 
to further consolidate systems within these investments by 2014, which 
it expects to produce approximately $41 million in cost savings. DHS 
officials have also identified 38 additional systems that they have 
determined to be duplicative. 

Further complicating agencies' ability to identify and eliminate 
duplicative investments is that investments are, in certain cases, 
misclassified by function. For example, one of DHS's Federal Emergency 
Management Agency (FEMA) investments was initially categorized within 
the Employee Performance Management sub-function, but DHS agreed that 
this investment should be assigned to the Human Resources Development 
sub-function. Proper categorization is necessary in order to analyze 
and identify duplicative IT investments, both within and across 
agencies. 

In February 2012, we recommended that the Secretaries of DOD and DOE 
direct their Chief Information Officers to utilize existing 
transparency mechanisms to report on the results of their efforts to 
identify and eliminate, where appropriate, each potentially 
duplicative investment that we identified, as well as any other 
duplicative investments. The agencies agreed with our recommendation. 
We also recommended that DOD, DOE, and DHS correct the 
miscategorizations of the investments we identified and ensure that 
investments are correctly categorized in agency submissions, which 
would enhance the agencies' ability to identify opportunities to 
consolidate or eliminate duplicative investments. DOD and DHS agreed 
with our recommendation, but DOE disagreed that two of the four 
investments we identified were miscategorized, explaining that its 
categorizations reflect funding considerations. However, OMB guidance 
indicates that investments should be classified according to their 
intended purpose. Consequently, we believe the recommendation is 
warranted. 

* Department of Homeland Security grants: From fiscal years 2002 
through 2011, FEMA, under DHS, allocated about $20.3 billion to grant 
recipients through four specific programs (the State Homeland Security 
Program, Urban Areas Security Initiative, Port Security Grant Program, 
and Transit Security Grant Program) to enhance the capacity of states, 
localities, and other entities, such as ports or transit agencies, to 
prevent, respond to, and recover from a terrorism incident. We found 
that DHS needs better project information and coordination to identify 
and mitigate potential unnecessary duplication among four overlapping 
grant programs. 

In February 2012, we identified multiple factors that contributed to 
the risk of FEMA potentially funding unnecessarily duplicative 
projects across these four grant programs. These factors include 
overlap among grant recipients, goals, and geographic locations, 
combined with differing levels of information that FEMA had available 
regarding grant projects and recipients.[Footnote 31] We also reported 
that FEMA lacked a process to coordinate application reviews across 
the four grant programs and grant applications were reviewed 
separately by program and were not compared across each other to 
determine where possible unnecessary duplication may occur. 
Specifically, FEMA's Homeland Security Grant Program branch 
administered the Urban Areas Security Initiative and State Homeland 
Security Program while the Transportation Infrastructure Security 
branch administered the Port Security Grant Program and Transit 
Security Grant Program. We and the DHS Inspector General have 
concluded that coordinating the review of grant projects internally 
would give FEMA more complete information about applications across 
the four grant programs, which could help FEMA identify and mitigate 
the risk of unnecessary duplication across grant applications. 
[Footnote 32] 

We also identified actions FEMA could take to identify and mitigate 
any unnecessary duplication in these programs, such as collecting more 
complete project information as well as exploring opportunities to 
enhance FEMA's internal coordination and administration of the 
programs. We suggested that Congress may wish to consider requiring 
DHS to report on the results of its efforts to identify and prevent 
duplication within and across the four grant programs, and consider 
these results when making future funding decisions for these programs. 

* Science, Technology, Engineering, and Math education programs: 
Federal agencies obligated $3.1 billion in fiscal year 2010 on 
Science, Technology, Engineering, and Mathematics (STEM) education 
programs. These programs can serve an important role both by helping 
to prepare students and teachers for careers in STEM fields and by 
enhancing the nation's global competitiveness. In addition to the 
federal effort, state and local governments, universities and 
colleges, and the private sector have also developed programs that 
provide opportunities for students to pursue STEM education and 
occupations. Recently, both Congress and the administration have 
called for a more strategic and effective approach to the federal 
government's investment in STEM education. For example, Congress 
directed the Office of Science and Technology Policy, within the 
Executive Office of the President, to establish a committee under its 
component National Science and Technology Council to, among other 
things, develop a 5-year governmentwide STEM education strategic plan 
and identify areas of duplication among federal programs.[Footnote 33] 
We found that strategic planning is needed to better manage 
overlapping programs across multiple agencies. 

In January 2012, we reported that 173 of the 209 (83 percent) STEM 
education programs administered by 13 federal agencies overlapped to 
some degree with at least 1 other program in that they offered similar 
services to target groups--such as K-12 students, postsecondary 
students, K-12 teachers, and college faculty and staff--to achieve 
similar objectives.[Footnote 34] These overlapping programs largely 
resulted from federal efforts to both create and expand programs 
across many agencies in an effort to improve STEM education and 
increase the number of students going into related fields. Overlapping 
programs can lead to individuals and institutions being eligible for 
similar services in similar STEM fields offered through multiple 
programs. For example, 177 of the 209 programs (85 percent) were 
primarily intended to serve two or more target groups. Overlap can 
frustrate federal officials' efforts to administer programs in a 
comprehensive manner, limit the ability of decision makers to 
determine which programs are most cost-effective, and ultimately 
increase program administrative costs. 

Even when programs overlap, the services they provide and the 
populations they serve may differ in meaningful ways and would 
therefore not necessarily be duplicative. There may be important 
differences between the specific STEM field of focus and the program's 
stated goals. For example, we identified 31 programs that provided 
scholarships or fellowships to doctoral students in the field of 
physics. However, one program's goal was to increase environmental 
literacy related to estuaries and coastal watersheds while another 
program focused on supporting education in nuclear science, 
engineering, and related trades. In addition, programs may be 
primarily intended to serve different specific populations within a 
given target group. Of the 34 programs providing services to K-12 
students in the field of technology, 10 are primarily intended to 
serve specific underrepresented, minority, or disadvantaged groups and 
2 are limited geographically to individual cities or universities. 

However, little is known about the effectiveness of federal STEM 
education programs. Since 2005, when we first reported on this issue, 
we have found that the majority of programs have not conducted 
comprehensive evaluations of how well their programs are working. 
Agency and program officials would benefit from guidance and 
information sharing within and across agencies about what is working 
and how to best evaluate programs. This would not only help to improve 
individual program performance, but could also inform agency-and 
governmentwide decisions about which programs should continue to be 
funded. Furthermore, although the National Science and Technology 
Council is in the process of developing a governmentwide strategic 
plan for STEM education, we found that agencies have not used outcome 
measures for STEM programs in a way that is clearly reflected in their 
own performance plans and performance reports--key strategic planning 
documents. The absence of clear links between the programs and 
agencies' planning documents may hinder decision makers' ability to 
assess how agencies' STEM efforts contribute to agencywide performance 
goals and the overall federal STEM effort. 

We reported in January 2012 that numerous opportunities exist to 
improve the planning for STEM programs. For example, we recommended 
that the National Science and Technology Council develop guidance for 
how agencies can better incorporate governmentwide STEM education 
strategic plan goals and their STEM education efforts into their 
respective performance plans and reports, as well as determining the 
types of evaluations that may be feasible and appropriate for 
different types of STEM education programs. We also recommended that 
the National Science and Technology Council work with agencies, 
through the strategic planning process, to identify STEM education 
programs that might be candidates for consolidation or elimination. 
OMB stated that our recommendations are critical to improving the 
provision of STEM education across the federal government. In separate 
comments, the Office of Science and Technology Policy said its own 
analysis of STEM education programs identified no duplicative programs 
and where it identified overlapping programs it found that some 
program characteristics differed. As an illustration, the Office of 
Science and Technology Policy explained that there could be two STEM 
education programs, one that worked with inner city children in New 
York City and another with rural children in North Dakota. We agree 
that it may be important to serve both of these populations, but it is 
not clear that two separate administrative structures are necessary to 
ensure both populations are served. The Office of Science and 
Technology Policy said it would address our recommendations in the 5-
year Federal STEM Education Strategic Plan, which will be released in 
spring 2012. Furthermore, the President's Fiscal Year 2013 budget 
established STEM education programs as one of fourteen cross-agency 
priority goals. These goals are intended to enhance progress in areas 
needing more cross-government collaboration. 

* Coordination of space system organizations: U.S. government space 
systems--such as the Global Positioning System (GPS) and space-based 
weather systems--provide a wide range of capabilities to a large 
number of users, including the federal government, U.S. businesses and 
citizens, and other countries. Space systems are usually very 
expensive, often costing billions of dollars to acquire. More than $25 
billion a year is appropriated to agencies for developing space 
systems. These systems typically take a long time to develop, and 
often consist of multiple components, including satellites, ground 
control stations, terminals, and user equipment. Moreover, the 
nation's satellites are put into orbit by rockets that can cost more 
than $100 million per launch. We have found that costs of space 
programs tend to increase significantly from initial cost estimates. A 
variety of agencies, such as the Federal Aviation Administration, the 
National Oceanic and Atmospheric Administration, and DHS rely on 
government space systems to execute their missions, but 
responsibilities for acquiring space systems are diffused across 
various DOD organizations as well as the intelligence community and 
the National Aeronautics and Space Administration. Fragmented 
leadership has led to program challenges and potential duplication in 
developing multi-billion dollar space systems. In some cases, problems 
with these systems have been so severe that acquisitions were either 
canceled or the needed capabilities were severely delayed. 

Fragmented leadership and lack of a single authority in overseeing the 
acquisition of space programs have created challenges for optimally 
acquiring, developing, and deploying new space systems. This 
fragmentation is problematic not only because of a lack of 
coordination that has led to delays in fielding systems, but also 
because no one person or organization is held accountable for 
balancing governmentwide needs against wants, resolving conflicts and 
ensuring coordination among the many organizations involved with space 
acquisitions, and ensuring that resources are directed where they are 
most needed. For example, we reported in April 2009 that the 
coordination of GPS satellites and user equipment segments is not 
adequately synchronized due to funding shifts and diffuse leadership 
in the program, likely leading to numerous years of missed 
opportunities to utilize new capabilities.[Footnote 35] DOD has taken 
some steps to better coordinate the GPS segments by creating the Space 
and Intelligence Office within the Office of the Under Secretary of 
Defense for Acquisition, Technology, and Logistics and conducting 
enterprise level reviews of the GPS program. However, DOD has not yet 
established a single authority responsible for ensuring that all GPS 
segments, including user equipment, are synchronized to the maximum 
extent practicable. 

DOD has also undertaken a number of initiatives to improve leadership 
over defense space acquisitions, but these actions have not been in 
place long enough to determine whether acquisition outcomes will 
improve. Moreover, the initiatives do not extend to the space 
activities across the government. We and others, including the 
Commission to Assess United States National Security Space Management 
and Organization, have previously recommended a number of changes to 
the leadership of the space community and have consistently reported 
that a lack of strong, centralized leadership has led to 
inefficiencies and other problems. But the question as to what office 
or leadership structure above the department level would be effective 
and appropriate for coordinating all U.S. government space programs 
and setting priorities has not been addressed. 

We have suggested that OMB work with the National Security Council to 
assess whether a governmentwide oversight body for space acquisitions 
is needed. OMB agreed that coordinating space activities across the 
U.S. government has been and continues to be a major challenge, but is 
concerned that our recommendation would add an extra layer of space 
bureaucracy on top of ongoing coordination efforts as well as 
additional costs and possible confusion regarding roles and 
authorities among the existing mechanisms. We believe that the 
recommendation is sufficiently flexible to allow for an implementation 
approach that would address these concerns. 

* Defense Language and Culture Training: DOD has emphasized the 
importance of developing language skills and knowledge of foreign 
cultures within its forces to meet the needs of current and future 
military operations and it has invested millions of dollars to provide 
language and culture training to thousands of servicemembers, 
including those deploying to ongoing operations. For example, we 
estimated that DOD invested about $266 million for fiscal years 2005 
through 2011 to provide general purpose forces with training support, 
such as classroom instruction, computer-based training, and training 
aids. We found that DOD has not developed an integrated approach to 
reduce fragmentation in the military services' language and culture 
training approaches and overlap in the content of training products 
acquired by the military services and other organizations. 

In May 2011, we reported that language and culture training within DOD 
is not provided through a single department-or servicewide program, 
but rather multiple DOD organizations oversee the development and 
acquisition of language and culture training and related products and 
deliver training.[Footnote 36] We recommended that the Office of the 
Under Secretary of Defense for Personnel and Readiness establish 
internal mechanisms to assist the department in reaching consensus 
with the military services and other DOD entities on training 
priorities, synchronize the development of service-and departmentwide 
plans with the budget process, and guide efforts to monitor progress. 
DOD agreed with our recommendation. 

We also found that the military services have not fully coordinated 
efforts to develop and acquire language and culture training products. 
As a result, the services have acquired overlapping and potentially 
duplicative products, such as reference materials containing country-
or region-specific cultural information and computer software or web-
based training programs that can be used within a distributed learning 
training environment. To illustrate, we analyzed 18 DOD language and 
culture training products and found that the content overlapped to 
some extent with at least one other training product. For Afghan 
languages, DOD invested in at least five products that were intended 
to build basic foreign language skills or specific language skills 
needed to perform military tasks. 

We suggested that the Office of the Under Secretary of Defense for 
Personnel and Readiness and the military services designate 
organizational responsibility and a supporting process to inventory 
and evaluate existing language and culture products and plans for 
additional investments, eliminate any unnecessary overlap and 
duplication, and adjust resources accordingly, as well as take steps 
to develop and contract for new products that can be used by more than 
one military service. DOD agreed that departmentwide coordination 
efforts could be improved and noted that our analysis would be useful 
in targeting specific areas for improvement. 

* Federal facility risk assessments: Federal facilities continue to be 
vulnerable to terrorist attacks and other acts of violence, as 
evidenced by the 2010 attacks on the IRS building in Austin, Texas, 
and the federal courthouse in Las Vegas, Nevada, which resulted in 
loss of life. DHS's Federal Protective Service (FPS) is the primary 
federal agency responsible for providing physical security and law 
enforcement services--including conducting risk assessments--for the 
approximately 9,000 federal facilities under the control and custody 
of the General Services Administration. We found that agencies are 
making duplicate payments for facility risk assessments by completing 
their own assessments, while also paying DHS for assessments that the 
department is not performing. 

We reported in June 2008 and also have recently found that multiple 
federal agencies are expending additional resources to assess their 
own facilities; although, according to an FPS official, the agency 
received $236 million from federal agencies for risk assessments and 
other security services in fiscal year 2011.[Footnote 37] For example, 
an IRS official stated that IRS completed risk assessments based on 
concerns about risks unique to its mission for approximately 65 
facilities that it also paid FPS to assess. Additionally, 
Environmental Protection Agency officials said that the agency has 
conducted its own assessments based on concerns with the quality and 
thoroughness of FPS's assessments. These assessments are conducted by 
teams of contractors and agency employees, cost an estimated $6,000, 
and can take a few days to a week to complete. 

FPS's planned risk assessment tool is intended to provide FPS with the 
capability to assess risks at federal facilities based on threat, 
vulnerability, and consequence; and track countermeasures to mitigate 
those risks, but it is unclear if the tool will help minimize 
duplication. According to an official, FPS planned to use its Risk 
Assessment and Management Program to complete assessments of about 700 
federal facilities in fiscal year 2010 and 2,500 facilities in fiscal 
year 2011. However, as we reported in July 2011, FPS experienced cost 
overruns, schedule delays, and operational issues with developing this 
program and as a result the agency could not use it to complete risk 
assessments.[Footnote 38] We found that since November 2009, the 
agency has only completed four risk assessments using its Risk 
Assessment and Management Program. 

We identified several steps that DHS could take to address duplication 
in FPS's risk assessments. For example, in July 2011 we recommended 
that DHS develop interim solutions for completing risk assessments 
while addressing challenges with the Risk Assessment and Management 
Program. In addition, in February 2012, we suggested DHS work with 
federal agencies to determine their reasons for duplicating the 
activities included in FPS's risk assessments and identify measures to 
reduce this duplication. DHS agreed with our July 2011 recommendation 
and has begun taking action to address it, but did not comment on the 
action we identified in February 2012. 

Our 2012 annual report also summarized 19 areas--beyond those directly 
related to duplication, overlap, or fragmentation--describing other 
opportunities for agencies or Congress to consider taking action that 
could either reduce the cost of government operations or enhance 
revenue collection for the Treasury. These cost saving and revenue-
enhancing opportunities also span a wide range of federal government 
agencies and mission areas (see table 2). 

Table 2: Cost-Saving or Revenue-Enhancing Opportunities Identified: 

Mission: Defense; 

Areas identified: 

33. Air Force Food Service: The Air Force has opportunities to achieve 
millions of dollars in cost savings annually by reviewing and 
renegotiating food service contracts, where appropriate, to better 
align with the needs of installations. 

34. Defense Headquarters: The Department of Defense should review and 
identify further opportunities for consolidating or reducing the size 
of headquarters organizations. 

35. Defense Real Property: Ensuring the receipt of fair market value 
for leasing underused real property and monitoring administrative 
costs could help the military services' enhanced use lease programs 
realize intended financial benefits. 

36. Military Health Care Costs: To help achieve significant projected 
cost savings and other performance goals, DOD needs to complete, 
implement, and monitor detailed plans for each of its approved health 
care initiatives. 

37. Overseas Defense Posture: The Department of Defense could reduce 
costs of its Pacific region presence by developing comprehensive cost 
information and re-examining alternatives to planned initiatives. 

38. Navy's Information Technology Enterprise Network: Better informed 
decisions are needed to ensure a more cost-effective acquisition 
approach for the Navy's Next Generation Enterprise Network. 

Mission: Economic development; 

Areas identified: 

39. Auto Recovery Office: Unless the Secretary of Labor can 
demonstrate how the Auto Recovery Office has uniquely assisted auto 
communities, Congress may wish to consider prohibiting the Department 
of Labor from spending any of its appropriations on the Auto Recovery 
Office and instead require that the department direct the funds to 
other federal programs that provide funding directly to affected 
communities. 

Mission: Energy; 

Areas identified: 

40. Excess Uranium Inventories: Marketing the Department of Energy's 
excess uranium could provide billions in revenue for the government. 

Mission: General government; 

Areas identified: 

41. General Services Administration Schedules Contracts Fee Rates: Re-
evaluating fee rates on the General Services Administration's Multiple 
Award Schedules contracts could result in significant cost savings 
governmentwide. 

42. U.S. Currency: Legislation replacing the $1 note with a $1 coin 
would provide a significant financial benefit to the government over 
time. 

43. Federal User Fees: Regularly reviewing federal user fees and 
charges can help Congress and federal agencies identify opportunities 
to address inconsistent federal funding approaches and enhance user 
financing, thereby reducing reliance on general fund appropriations. 

44. Internal Revenue Service Enforcement Efforts: Enhancing the 
Internal Revenue Service's enforcement and service capabilities can 
help reduce the gap between taxes owed and paid by collecting billions 
in tax revenue and facilitating voluntary compliance. 

Mission: Health; 

Areas identified: 

45. Medicare Advantage Payment: The Centers for Medicare and Medicaid 
Services could achieve billions of dollars in additional savings by 
better adjusting for differences between Medicare Advantage plans and 
traditional Medicare providers in the reporting of beneficiary 
diagnoses. 

46. Medicare and Medicaid Fraud Detection Systems: The Centers for 
Medicare and Medicaid Services needs to ensure widespread use of 
technology to help detect and recover billions of dollars of improper 
payments of claims and better position itself to determine and measure 
financial and other benefits of its systems. 

Mission: Homeland security/Law enforcement; 

Areas identified: 

47. Border Security: Delaying proposed investments for future 
acquisitions of border surveillance technology until the Department of 
Homeland Security better defines and measures benefits and estimates 
life-cycle costs could help ensure the most effective use of future 
program funding. 

48. Passenger Aviation Security Fees: Options for adjusting the 
passenger aviation security fee could further offset billions of 
dollars in civil aviation security costs. 

49. Immigration Inspection Fee: The air passenger immigration 
inspection user fee should be reviewed and adjusted to fully recover 
the cost of the air passenger immigration inspection activities 
conducted by Department of Homeland Security's U.S. Immigration and 
Customs Enforcement and U.S. Customs and Border Protection rather than 
using general fund appropriations. 

Mission: International affairs; 

Areas identified: 

50. Iraq Security Funding: When considering new funding requests to 
train and equip Iraqi security forces, Congress should consider the 
government of Iraq's financial resources, which afford it the ability 
to contribute more toward the cost of Iraq's security. 

Mission: Social services; 

Areas identified: 

51. Domestic Disaster Assistance: The Federal Emergency Management 
Agency could reduce the costs to the federal government related to 
major disasters declared by the President by updating the principal 
indicator on which disaster funding decisions are based and better 
measuring a state's capacity to respond without federal assistance. 

Source: GAO-12-342SP. 

[End of table] 

Examples of opportunities for agencies or Congress to consider taking 
action that could either reduce the cost of government operations or 
enhance revenue collections include: 

* Air Force food service: According to Air Force officials, most Air 
Force installations have their own individual contracts for food 
service, with a total cost of approximately $150 million per year for 
all Air Force installations. We found that the Air Force has 
opportunities to reduce its overall food service costs by millions of 
dollars annually by reviewing food service contracts and adjusting 
them, when appropriate, to better meet the needs of its installations, 
including aligning labor needs with the actual number of meals served 
by the dining facilities. 

The Air Force recently undertook an initiative to improve food service 
at six pilot installations, with intentions to eventually expand this 
initiative to more Air Force installations. Among other intended 
outcomes, Air Force officials stated that the first group of pilot 
installations achieved cost savings when compared to their previous 
contracts while also increasing hours of operation in the dining 
facilities and serving an additional 500,000 meals per year. We 
compared the estimated amount of food service labor at the six pilot 
installations under prior contracts to the projected work schedules 
under the initiative and found that by adjusting staffing levels for 
contractor staff at dining facilities, the contractor reduced the 
total number of labor hours at five of the six pilot installations by 
53 percent. For example, at one installation, the number of estimated 
labor hours decreased from approximately 2,042 hours per week to 920. 
For the sixth installation where the labor hours did not decrease, the 
Air Force Audit Agency had recently conducted a review that found that 
the number of food service personnel did not align with workload 
estimates. As a result, the Air Force renegotiated its workload 
estimates and pay rates, resulting in savings of approximately $77,000 
annually. 

During our review, we discussed the potential opportunity for 
achieving additional savings by reviewing staffing levels at other 
installations outside of the initiative with Air Force officials. As a 
result, the Air Force issued a memorandum directing a review of 
existing food service contracts to determine if the contracts meet 
current mission needs. The memorandum indicated that special attention 
must be given to whether the food service contract workload estimates 
were properly aligned with the actual number of meals served. In July 
2011, we recommended that the Secretary of the Air Force monitor the 
actions taken in response to the direction to review food service 
contracts, and take actions, as appropriate, to ensure that cost-
savings measures are implemented.[Footnote 39] According to Air Force 
officials, eight installations have recently reviewed and renegotiated 
their food service contracts for a total savings of over $2.5 million 
per year. The potential exists for other installations that rely on 
contracts to meet their food service needs to achieve similar 
financial benefits. For example, the Air Force has requested that each 
of its installations conduct a 100 percent review of existing food 
service contracts to determine if their current contract workload 
estimates meet current mission needs or if the contracts require 
modification. In addition, the Office of the Secretary of Defense 
planned to share the results of the Air Force's review of its food 
service labor costs to achieve cost savings with the other military 
services. 

* Navy information technology network: In 2007, the Navy established 
the Next Generation Enterprise Network program (NGEN) to replace and 
improve the Navy Marine Corps Intranet. According to the President's 
fiscal year 2012 budget request, the NGEN program has spent about $434 
million on work associated with the transition from the Navy Marine 
Corps Intranet. The Navy estimated that NGEN would cost approximately 
$50 billion to develop, operate, and maintain through fiscal year 
2025. We found that better informed decisions were needed to ensure a 
more cost-effective acquisition approach for the Navy's NGEN program. 

We reported in March 2011 that the Navy selected an approach that was 
not considered as part of its analysis of alternatives and that it 
estimated would cost at least $4.7 billion more than any of the four 
assessed alternatives.[Footnote 40] In addition, we reported that the 
Navy's schedule for NGEN also did not provide a reliable basis for 
program execution because it did not adequately satisfy key schedule 
estimating best practices, such as establishing the critical path (the 
sequence of activities that, if delayed, impacts the planned 
completion date of the project) and assigning resources to all work 
activities. We also found that the Navy's acquisition decisions were 
not always performance-or risk-based. In particular, senior executives 
approved the NGEN program's continuing progress in the face of known 
performance shortfalls and risks. 

To address these weaknesses, we recommended in March 2011 that the 
Navy limit further investment in NGEN until it conducts an immediate 
interim review to reconsider the selected acquisition approach. We 
also identified an additional action that the Navy could take to 
facilitate implementation of the approach resulting from this review 
by ensuring that the NGEN schedule reflects key schedule estimating 
practices and future program reviews and decisions fully reflect the 
program's performance and exposure to risk. DOD agreed with our 
recommendation to ensure that future NGEN acquisition reviews and 
decisions fully reflect the state of the program's performance and its 
exposure to risks. The department did not agree with our 
recommendation to reconsider its acquisition approach; however, the 
Navy is currently in the process of reviewing and making changes to 
the NGEN acquisition strategy. We are undertaking work that will 
assess the extent to which the Navy has conducted its interim review 
to reconsider its acquisition approach and evaluate the revised 
strategy. 

* DOD health care costs: DOD spends billions of dollars annually on 
its worldwide healthcare system. Currently, health care costs 
constitute nearly 10 percent of DOD's baseline budget request. For its 
fiscal year 2012 budget, according to DOD documentation, DOD received 
$52.7 billion[Footnote 41] to provide health care to approximately 9.6 
million active duty servicemembers, reservists, retirees, and their 
dependents. DOD recognizes that it must address the rate at which 
health care costs are rising and has stated that it intends to 
continue to develop health care initiatives that will improve the 
quality and standard of care, while reducing growth in overall 
costs.[Footnote 42] Our ongoing work has found that DOD has identified 
11 initiatives intended to slow the rise in its health care costs, but 
it has not fully applied results-oriented management practices to its 
efforts or an overall monitoring process, which limits its 
effectiveness in implementing these initiatives and achieving related 
cost savings goals. 

DOD's initiatives consist primarily of changes to clinical and 
business practices in areas ranging from primary care to psychological 
health to purchased care reimbursement practices. Partly in response 
to our ongoing work assessing DOD's management of its initiatives, the 
department has taken some initial steps toward managing their 
implementation by developing a number of high-level, non-monetary 
metrics and corresponding goals for each strategic initiative, and 
other management tools, such as implementation plans that will include 
key elements such as investment costs and savings estimates. However, 
DOD currently has completed only one implementation plan, which 
contains the one available cost savings estimate among all the 
initiatives. Without completing its plans and incorporating elements 
such as problem definitions, resources needed, goals, performance 
measures, and cost estimates into them, DOD will not be fully aware if 
these initiatives are achieving projected cost savings and other 
performance goals. 

In addition, DOD has not completed the implementation of an overall 
monitoring process across its portfolio of initiatives for overseeing 
the initiatives' progress or identified accountable officials and 
their roles and responsibilities for all of its initiatives. DOD's 
2007 Task Force on the Future of Military Health Care noted that the 
current Military Health System does not function as a fully integrated 
health care system.[Footnote 43] For example, while the Assistant 
Secretary of Defense for Health Affairs controls the Defense Health 
Program budget, the services directly supervise their medical 
personnel and manage their military treatment facilities. Therefore, 
as Military Health System leaders develop and implement their plans to 
control rising health care costs, they will need to work across 
multiple authorities and areas of responsibility. Until DOD fully 
implements a military-wide mechanism to monitor progress and identify 
accountable officials, including their roles and responsibilities 
across its portfolio of initiatives, DOD may be hindered in its 
ability to achieve a more cost-efficient military health system. 

In order to enhance its efforts to manage rising health care costs and 
demonstrate sustained leadership commitment for achieving the 
performance goals of the Military Health System's strategic 
initiatives, we plan to recommend as part of our ongoing work that DOD 
complete and fully implement detailed implementation plans for each of 
the approved health care initiatives in a manner consistent with 
results-oriented management practices, such as the inclusion of 
upfront investment costs and cost savings estimates; and complete the 
implementation of an overall monitoring process across its portfolio 
of initiatives for overseeing the initiatives' progress and 
identifying accountable officials and their roles and responsibilities 
for all of its initiatives. We believe that DOD may realize projected 
cost savings and other performance goals by taking these actions to 
help ensure the successful implementation of its cost savings 
initiatives. Given that DOD identified these initiatives as steps to 
slow the rapidly growing costs of its medical program, if implemented 
these initiatives could potentially save DOD millions of dollars. DOD 
generally agreed with our planned recommendations. 

* Excess uranium inventories: DOE maintains large inventories of 
depleted and natural uranium that it no longer requires for nuclear 
weapons or fuel for naval nuclear propulsion reactors. We reported in 
March and April 2008 and again in June 2011 that under certain 
conditions, the federal government could generate billions of dollars 
by marketing inventories of excess uranium to commercial power plants 
to use in their reactors.[Footnote 44] 

Specifically, we identified options that DOE could take to market the 
excess uranium inventories for commercial use. For example, DOE could 
contract to re-enrich inventories of depleted uranium hexafluoride (a 
by-product of the uranium enrichment process), consisting of hundreds 
of thousands of metric tons of material that are stored at DOE's 
uranium enrichment plants. Although DOE would have to pay for 
processing, the resulting re-enriched uranium could be potentially 
sold if the sales price of the uranium exceeded processing costs. DOE 
could also pursue an option of selling the depleted uranium inventory 
"as-is". This approach would require DOE to obtain the appropriate 
statutory authority to sell depleted uranium in its current 
unprocessed form. Firms such as nuclear power utilities and enrichment 
companies might find it cost effective to purchase the uranium and re-
enrich it as a source of nuclear fuel. 

If executed in accordance with federal law, DOE sales of natural 
uranium could generate additional revenue for the government. Natural 
uranium on its own cannot fuel nuclear reactors and weapons. Rather, 
it is shipped to a conversion facility, where it is converted for the 
enrichment process. We reported in September 2011 that in 7 
transactions executed since 2009 DOE has, in effect, sold nearly 1,900 
metric tons of natural uranium into the market, using a contractor as 
a sales agent, to fund environmental cleanup services.[Footnote 45] 
DOE characterized these sales as barter transactions--exchanges of 
services (environmental cleanup work) for materials (uranium). While 
DOE received no cash directly from the transactions, it allowed its 
contractor to keep cash from the sales, which DOE would otherwise have 
owed to the United States Treasury. Because federal law requires an 
official or agent of the government receiving money for the government 
from any source to deposit the money in the Treasury, we found that 
these transactions violated the miscellaneous receipts statute. 

We have reported that congressional action may be needed to overcome 
legal obstacles to the pursuit of certain options for the sale of 
depleted and natural uranium. Specifically, our March 2008 report 
suggested that Congress may wish to explicitly provide direction about 
whether and how DOE may sell or transfer depleted uranium in its 
current form. Our September 2011 report suggested that if Congress 
sees merit in using the proceeds from the barter, transfer, or sale of 
federal uranium assets to pay for environmental cleanup work, it could 
consider providing DOE with explicit authority to barter excess 
uranium and to retain the proceeds from these transactions. We also 
suggested that Congress could direct DOE to sell uranium for cash and 
make those proceeds available by appropriation for environmental 
cleanup work. 

Congress has taken some actions in response to our work. For example, 
the Consolidated Appropriations Act, 2012, among other things, 
requires the Secretary of Energy to provide congressional 
appropriations committees with information on the transfer, sale, 
barter, distribution, or other provision of uranium in any form and an 
estimate of the uranium value along with the expected recipient of the 
material. The Consolidated Appropriations Act, 2012 also requires the 
Secretary to submit a report evaluating the economic feasibility of re-
enriching depleted uranium. 

* Medicare and Medicaid fraud detection systems: We have designated 
Medicare and Medicaid as high-risk programs, in part due to their 
susceptibility to improper payments--estimated to be about $65 billion 
in fiscal year 2011. To integrate data about all types of Medicare and 
Medicaid claims and improve its ability to detect fraud, waste, and 
abuse in these programs, the Centers for Medicare and Medicaid 
Services (CMS) initiated two information technology programs--the 
Integrated Data Repository, which is intended to provide a centralized 
repository of claims data for all Medicare and Medicaid programs, and 
One Program Integrity, a set of tools that enables CMS contractors and 
staff to access and analyze data retrieved from the repository. 
According to CMS officials, the systems are expected to provide 
financial benefits of more than $21 billion by the end of fiscal year 
2015. We found that CMS needs to ensure widespread use of technology 
to help detect and recover billions of dollars of improper payments of 
claims and better position itself to determine and measure financial 
and other benefits of its systems. 

We reported in June 2011 that CMS had developed and begun using both 
systems, but was not yet positioned to identify, measure, or track 
benefits realized from these programs.[Footnote 46] For example, 
although in use since 2006, the Integrated Data Repository did not 
have Medicaid claims data or information from other CMS systems that 
store and process data related to the entry, correction, and 
adjustment of claims due to funding and other technical issues. These 
data are needed to help analysts prevent improper payments. Program 
officials told us that they had begun incorporating these data in 
September 2011 and planned to make them available to program integrity 
analysts in spring 2012. Regarding Medicaid data, agency officials 
stated that they did not account for difficulties associated with 
integrating data from the various types and formats of data stored in 
disparate state systems or develop reliable schedules for its efforts 
to incorporate these data. In particular, program officials did not 
consider certain risks and obstacles, such as technical challenges, as 
they developed schedules for implementing the Integrated Data 
Repository. Lacking reliable schedules, CMS may face additional delays 
in making available all the data that are needed to support enhanced 
program integrity efforts. 

In addition, CMS had not trained its broad community of analysts to 
use the One Program Integrity system because of delays introduced by a 
redesign of initial training plans that were found to be insufficient. 
Specifically, program officials planned for 639 analysts to be using 
the system by the end of fiscal year 2010; however only 41--less than 
7 percent--were actively using it as of October 2010. Because of these 
delays, the initial use of the system was limited to a small number of 
CMS staff and contractors. In updating the status of the training 
efforts in November 2011, although we did not validate these data, CMS 
officials reported that a total of 215 program integrity analysts had 
been trained and were using the system. However, program officials had 
not finalized plans and schedules for training all intended users. 

In June 2011, we recommended that CMS take a number of actions to help 
ensure the program's success toward achieving the billions of dollars 
in financial benefits that program integrity officials projected, such 
as finalizing plans and reliable schedules for incorporating 
additional data into the Integrated Data Repository and conducting 
training for all analysts who are intended to use the One Program 
Integrity system. CMS agreed with our recommendations and identified 
steps the agency is taking to implement them. We plan to conduct 
additional work to determine whether CMS has addressed our 
recommendations and identified financial benefits and progress toward 
meeting agency goals resulting from the implementation of its fraud 
detection systems. 

* Medicare Advantage: In fiscal year 2010, the federal government 
spent about $113 billion on the Medicare Advantage program, a private 
plan alternative to the original Medicare program that covers about a 
quarter of Medicare beneficiaries. CMS, the agency that administers 
Medicare, adjusts payments to Medicare Advantage plans based on the 
health status of each plan's enrollees. The agency could achieve 
billions of dollars in additional savings by better adjusting for 
differences between Medicare Advantage plans and traditional Medicare 
providers in the reporting of beneficiary diagnoses. 

CMS calculates a risk score for every beneficiary--a relative measure 
of health status--which is based on a beneficiary's demographic 
characteristics, such as age and gender, and major medical conditions. 
To obtain information on the medical conditions of beneficiaries in 
traditional Medicare, CMS generally analyzes diagnoses--numerically 
coded by providers into Medicare defined categories--on the claims 
that providers submit for payment. For beneficiaries enrolled in 
Medicare Advantage plans, which do not submit claims, CMS requires 
plans to submit diagnostic codes for each beneficiary. Analysis has 
shown that risk scores are higher for Medicare Advantage beneficiaries 
than for beneficiaries in traditional Medicare with the same 
characteristics. 

Medicare Advantage plans have a financial incentive to ensure that all 
relevant diagnoses are coded, as this can increase beneficiaries' risk 
scores and, ultimately, payments to the plans. Many traditional 
Medicare providers are paid for services rendered, and providers have 
less incentive to code all relevant diagnoses. Policymakers have 
expressed concern that risk scores for Medicare Advantage 
beneficiaries have grown at a faster rate than those for traditional 
Medicare, in part because of differences in coding diagnoses. In 2005, 
Congress directed CMS to analyze and adjust risk scores for 
differences in coding practices, and in 2010, CMS estimated that 3.41 
percent of Medicare Advantage risk scores were due to differences in 
diagnostic coding practices. It reduced the scores by an equal 
percentage, thereby saving $2.7 billion. 

We identified shortcomings in CMS's method for adjusting Medicare 
Advantage payments to reflect differences in diagnostic coding 
practices between Medicare Advantage and traditional Medicare. CMS did 
not use the most recent risk score data for its estimates; account for 
the increasing annual impact of coding differences over time; or 
account for beneficiary characteristics beyond differences in age and 
mortality between the Medicare Advantage and traditional Medicare 
populations, such as sex, Medicaid enrollment status, and beneficiary 
residential location. We estimated that a revised methodology that 
addressed these shortcomings could have saved Medicare between $1.2 
billion and $3.1 billion in 2010 in addition to the $2.7 billion in 
savings that CMS's 3.41 percent adjustment produced. We expect that 
savings in future years will be greater. In January 2012, we 
recommended that CMS take action to help ensure appropriate payments 
to Medicare Advantage plans and improve the accuracy of the adjustment 
made for differences in coding practices over time.[Footnote 47] The 
Department of Health and Human Services characterized our results as 
similar to those obtained by CMS. 

* User fees: User fees assign part or all of the costs of federal 
programs and activities--the cost of providing a benefit that is above 
and beyond what is normally available to the general public--to 
readily identifiable users of those programs and activities. Regularly 
reviewing federal user fees and charges can help Congress and federal 
agencies identify opportunities to address inconsistent federal 
funding approaches and enhance user financing, thereby reducing 
reliance on general fund appropriations. 

The Chief Financial Officers Act of 1990 (CFO Act) requires agencies 
to biennially review their fees and to recommend fee adjustments, as 
appropriate; additionally, OMB Circulars No. A-11 and No. A-25 direct 
agencies to discuss the results of these reviews and any resulting 
proposals, such as adjustments to fee rates, in the CFO annual report 
required by the CFO Act.[Footnote 48] In 2011, we surveyed the 24 
agencies covered by the CFO Act on their review of user fees. Twenty-
one of the 23 agencies that responded reported charging more than 
3,600 fees and collecting nearly $64 billion in fiscal year 2010, but 
agency responses indicated varying levels of adherence to the biennial 
review and reporting requirements. The survey responses indicated that 
for most fees, agencies (1) had not discussed fee review results in 
annual reports, and (2) had not reviewed the fees and were 
inconsistent in their ability to provide fee review documentation. 

We found specific examples where a comprehensive review of user fees 
could lead to cost savings or enhanced revenues for the government. 
For example, reviewing and adjusting as needed the air passenger 
immigration inspection user fee to fully recover the cost of the air 
passenger immigration inspection activities could reduce general fund 
appropriations for those activities. International air passengers 
arriving in the United States are subject to an immigration inspection 
to ensure that they have legal entry and immigration documents. 
International air passengers pay the immigration inspection fee when 
they purchase their airline tickets, but the rate has not been 
adjusted since fiscal year 2002. In recent years, U.S. Immigration and 
Customs Enforcement and U.S. Customs and Border Protection, the 
agencies responsible for conducting inspection activities, have relied 
on general fund appropriations to help fund activities for which these 
agencies have statutory authority to fund with user fees. In fiscal 
year 2010, this amounted to over $120 million for the U.S. Customs and 
Border Protection alone. In September 2007, we recommended that the 
Secretary of Homeland Security report immigration inspection activity 
costs to ensure fees are divided between U.S. Immigration and Customs 
Enforcement and U.S. Customs and Border Protection according to their 
respective immigration inspection activity costs and to develop a 
legislative proposal to adjust the air passenger immigration 
inspection fee if it was found to not recover the costs of inspection 
activities. DHS agreed with our recommendations, but some of the 
recommendations remain unimplemented.[Footnote 49] In February 2012, 
we suggested that Congress may wish to require the Secretary of 
Homeland Security to fully implement these recommendations which would 
serve to help to better align air passenger immigration inspection fee 
revenue with the costs of providing these services and achieve cost 
savings by reducing the reliance on general fund appropriations. 

Similarly, we identified options for adjusting the passenger aviation 
security fee, a uniform fee on passengers of U.S. and foreign air 
carriers originating at airports in the United States. Passenger 
aviation security fees collected offset amounts appropriated to the 
Transportation Security Administration for aviation security. In 
recent years, several options have been considered for increasing the 
passenger aviation security fee. However, the fee has not been 
increased since it was imposed in February 2002. We suggested that 
Congress may wish to consider increasing the passenger security fee. 
Such an increase could further offset the need for appropriated funds 
to support civil aviation security costs from about $2 billion to $10 
billion over 5 years. 

* Tax gap: The financing of the federal government depends largely on 
the IRS's ability to collect federal taxes every year, which totaled 
$2.34 trillion in 2010. For the most part, taxpayers voluntarily 
report and pay their taxes on time. However the size and persistence 
of the tax gap--estimated in 2012 for the 2006 tax year to be a $385 
billion difference between the taxes owed and taxes IRS ultimately 
collected for that year--highlight the need to make progress in 
improving compliance by those taxpayers who do not voluntarily pay 
what they owe. Given that tax noncompliance ranges from simple math 
errors to willful tax evasion, no single approach is likely to fully 
and cost-effectively address the tax gap. A multifaceted approach to 
improving compliance that includes enhancing IRS's enforcement and 
service capabilities can help reduce the tax gap. 

One approach we have identified is the expansion of third-party 
information reporting, which improves taxpayer compliance and enhances 
IRS's enforcement capabilities. The tax gap is due predominantly to 
taxpayer underreporting and underpayment of taxes owed. At the same 
time, taxpayers are much more likely to report their income accurately 
when the income is also reported to IRS by a third party. By matching 
information received from third-party payers with what payees report 
on their tax returns, IRS can detect income underreporting, including 
the failure to file a tax return. Expanding information reporting to 
cover payments for services by all owners of rental real estate and to 
cover payments to corporations for services would improve payee 
compliance. The Joint Committee on Taxation estimated revenue 
increases of $5.9 billion over a 10-year period for just these two 
expansions. 

Status of Actions Taken to Address the Areas Identified in 2011 Annual 
Report: 

In our 2011 annual report, we suggested a wide range of actions for 
Congress and the executive branch to consider such as developing 
strategies to better coordinate fragmented efforts, implementing 
executive initiatives to improve oversight and evaluation of 
overlapping programs, considering enactment of legislation to 
facilitate revenue collection and examining opportunities to eliminate 
potential duplication through streamlining, collocating, or 
consolidating efforts or administrative services. For our 2011 follow-
up report, we assessed the extent to which Congress and the executive 
branch addressed the 81 areas--including a total of 176 actions--to 
reduce or eliminate unnecessary duplication, overlap, or fragmentation 
or achieve other potential financial benefits. 

Our assessment of progress made as of February 10, 2012, found that 4 
(or 5 percent) of the 81 areas GAO identified were addressed; 60 (or 
74 percent) were partially addressed; and 17 (or 21 percent) were not 
addressed. Appendix I presents GAO's assessment of the overall 
progress made in each area. In updating the actions we identified in 
the 2011 annual report, we asked the agencies involved and the Office 
of Management and Budget (OMB) for their review and incorporated 
comments as appropriate. We applied the following criteria in making 
these overall assessments for the 81 areas. We determined that an area 
was: 

* "addressed" if all actions needed in that area were addressed; 

* "partially addressed" if at least one action needed in that area 
showed some progress toward implementation, but not all actions were 
addressed; and: 

* "not addressed" if none of the actions in that area were addressed. 

As of February 10, 2012, the majority of 176 actions needed within the 
81 areas identified by GAO have been partially addressed. 
Specifically, 23 (or 13 percent) were addressed;[Footnote 50] 99 (or 
56 percent) were partially addressed; 54 (or 31 percent) were not 
addressed. We applied the following criteria in making these 
assessments. 

For legislative branch actions: 

* "addressed," means relevant legislation is enacted and addresses all 
aspects of the action needed;[Footnote 51] 

* "partially addressed," means a relevant bill has passed a committee, 
the House or Senate, or relevant legislation has been enacted, but 
only addressed part of the action needed; and: 

* "not addressed," means a bill may have been introduced, but did not 
pass out of a committee, or no relevant legislation has been 
introduced. 

For executive branch actions: 

* "addressed," means implementation of the action needed has been 
completed; 

* "partially addressed," means the action needed is in development; 
started but not yet completed; and: 

* "not addressed," means the administration and/or agencies have made 
minimal or no progress toward implementing the action needed. 

In addition to the actions reported above, Congress has held a number 
of hearings and OMB has provided guidance to executive branch agencies 
on areas that we identified that could benefit from increased 
attention and ongoing oversight. Since the issuance of our March 2011 
report, we have testified numerous times on our first annual report 
and on specific issues highlighted in the report. Further, OMB has 
instructed agencies to consider areas of duplication or overlap 
identified in our 2011 report and by others in their fiscal year 2013 
budget submissions and management plans. The OMB guidance also advised 
agencies to take a number of other steps to enhance efficiency, such 
as identifying and including in their budget submissions cost-saving 
efforts that will improve operational efficiency and taxpayers' rate 
of return, including program integration, reorganizations within and 
between agency components, and resource realignment to improve public 
services. 

In conclusion Mr. Chairman, Ranking Member Collins, and Members of the 
Committee, options exist for Congress and agencies to reexamine the 
federal government's structure and operations in order to improve its 
efficiency and effectives. A number of the issues are difficult to 
address and implementing many of the actions identified will take time 
and sustained leadership. This concludes my prepared statement. I 
would be pleased to answer any questions you may have. Thank you. 

The information in this statement is based upon work conducted for 
completed GAO products and certain ongoing audits, which were 
conducted in accordance with generally accepted government auditing 
standards or with our Quality Assurance Framework as appropriate. For 
further information on this testimony, please contact Janet St. 
Laurent, Managing Director, Defense Capabilities and Management, who 
may be reached at (202) 512-4300, or StLaurentJ@gao.gov; and Zina 
Merritt, Director, Defense Capabilities and Management, who may be 
reached at (202) 512-4300, or MerrittZ@gao.gov. Specific questions 
about individual issues may be directed to the area contact listed at 
the end of each area summary in the reports. Contact points for our 
Congressional Relations and Public Affairs offices may be found on the 
last page of this statement. 

[End of section] 

Appendix I: Overall Progress Made in Each of the 81 Areas Identified 
in GAO's 2011 Annual Report: 

This appendix presents a summary of GAO's assessment of the overall 
progress made in each of the 81 areas that we identified in our March 
2011 report[Footnote 52] in which Congress and the executive branch 
could take actions to reduce or eliminate potential duplication, 
overlap, and fragmentation or achieve other potential financial 
benefits. For each of the 34 areas related to duplication, overlap, or 
fragmentation that GAO identified, table 3 presents GAO's assessment 
of the overall progress made in implementing the actions needed in 
that area. For each of the 47 areas where GAO identified cost saving 
or revenue enhancement opportunities, table 4 presents GAO's 
assessment of the overall progress made in implementing the actions 
GAO identified. 

Table 3: Overall Progress Made in Each of the GAO Identified Areas of 
Potential Duplication, Overlap, and Fragmentation, as of February 10, 
2012: 

Mission: Agriculture; 

Areas identified: 

1. Fragmented food safety system has caused inconsistent oversight, 
ineffective coordination, and inefficient use of resources; 
Assessment: Partially addressed. 

Mission: Defense; 

Areas identified: 

2. Realigning DOD's military medical command structures and 
consolidating common functions could increase efficiency and result in 
projected savings ranging from $281 million to $460 million annually; 
Assessment: Partially addressed. 

3. Opportunities exist for consolidation and increased efficiencies to 
maximize response to warfighter urgent needs; 
Assessment: Partially addressed. 

4. Opportunities exist to avoid unnecessary redundancies and improve 
the coordination of counter-improvised explosive device efforts; 
Assessment: Partially addressed. 

5. Opportunities exist to avoid unnecessary redundancies and maximize 
the efficient use of intelligence, surveillance, and reconnaissance 
capabilities; 
Assessment: Partially addressed. 

6. A departmentwide acquisition strategy could reduce DOD's risk of 
costly duplication in purchasing Tactical Wheeled Vehicles; 
Assessment: Partially addressed. 

7. Improved joint oversight of DOD's prepositioning programs for 
equipment and supplies may reduce unnecessary duplication; 
Assessment: Partially addressed. 

8. DOD's business systems modernization: opportunities exist for 
optimizing business operations and systems; 
Assessment: Partially addressed. 

Mission: Economic development; 

Areas identified: 

9. The efficiency and effectiveness of fragmented economic development 
programs are unclear; 
Assessment: Partially addressed. 

10. The federal approach to surface transportation is fragmented, 
lacks clear goals, and is not accountable for results; 
Assessment: Partially addressed. 

11. Fragmented federal efforts to meet water needs in the U.S.-Mexico 
border region have resulted in an administrative burden, redundant 
activities, and an overall inefficient use of resources; 
Assessment: Not addressed. 

Mission: Energy; 

Areas identified: 

12. Resolving conflicting requirements could more effectively achieve 
federal fleet energy goals; 
Assessment: Not addressed. 

13. Addressing duplicative federal efforts directed at increasing 
domestic ethanol production could reduce revenue losses by more than 
$5.7 billion annually; 
Assessment: Addressed. 

Mission: General government; 

Areas identified: 

14. Enterprise architectures: key mechanisms for identifying potential 
overlap and duplication; 
Assessment: Partially addressed. 

15. Consolidating federal data centers provides opportunity to improve 
government efficiency; 
Assessment: Partially addressed. 

16. Collecting improved data on interagency contracting to minimize 
duplication could help the government leverage its vast buying power; 
Assessment: Partially addressed. 

17. Periodic reviews could help identify ineffective tax expenditures 
and redundancies in related tax and spending programs, potentially 
reducing revenue losses by billions of dollars; 
Assessment: Not addressed. 

Mission: Health; 

Areas identified: 

18. Opportunities exist for DOD and VA to jointly modernize their 
electronic health record systems; 
Assessment: Partially addressed. 

19. VA and DOD need to control drug costs and increase joint 
contracting wherever it is cost-effective; 
Assessment: Partially addressed. 

20. The Department of Health and Human Services needs an overall 
strategy to better integrate nationwide public health information 
systems; 
Assessment: Not addressed. 

Mission: Homeland security/Law enforcement; 

Areas identified: 

21. Strategic oversight mechanisms could help integrate fragmented 
interagency efforts to defend against biological threats; 
Assessment: Partially addressed. 

22. DHS oversight could help eliminate potential duplicating efforts 
of interagency forums in securing the northern border; 
Assessment: Not addressed. 

23. The Department of Justice plans actions to reduce overlap in 
explosives investigations, but monitoring is needed to ensure 
successful implementation; 
Assessment: Addressed. 

24. The Transportation Security Administration's (TSA) security 
assessments on commercial trucking companies overlap with those of 
another agency, but efforts are under way to address the overlap; 
Assessment: Partially addressed. 

25. DHS could streamline mechanisms for sharing security-related 
information with public transit agencies to help address overlapping 
information; 
Assessment: Partially addressed. 

26. FEMA needs to improve its oversight of grants and establish a 
framework for assessing capabilities to identify gaps and prioritize 
investments; 
Assessment: Partially addressed. 

Mission: International affairs; 

Areas identified: 

27. Lack of information sharing could create the potential for 
duplication of efforts between U.S. agencies involved in development 
efforts in Afghanistan; 
Assessment: Partially addressed. 

28. Despite restructuring, overlapping roles and functions still exist 
at the Department of State's Arms Control and Nonproliferation Bureaus; 
Assessment: Addressed. 

Mission: Social services; 

Areas identified: 

29. Actions needed to reduce administrative overlap among domestic 
food assistance programs; 
Assessment: Not addressed. 

30. Better coordination of federal homelessness programs may minimize 
fragmentation and overlap; 
Assessment: Partially addressed. 

31. Further steps needed to improve cost-effectiveness and enhance 
services for transportation-disadvantaged persons; 
Assessment: Partially addressed. 

Mission: Training, employment, and education; 

Areas identified: 

32. Multiple employment and training programs: providing information 
on collocating services and consolidating administrative structures 
could promote efficiencies; 
Assessment: Partially addressed. 

33. Teacher quality: proliferation of programs complicates federal 
efforts to invest dollars effectively; 
Assessment: Partially addressed. 

34. Fragmentation of financial literacy efforts makes coordination 
essential; 
Assessment: Partially addressed. 

Legend: 

Addressed, meaning all actions needed in that area were addressed. 

Partially addressed, meaning at least one action needed in that area 
showed some progress toward implementation, but not all actions were 
addressed. 

Not addressed, meaning none of the actions needed in that area were 
addressed. 

Source: GAO analysis. 

[End of table] 

As noted above, table 4 presents GAO's assessment of the overall 
progress made in addressing the 47 cost-saving and revenue-enhancing 
areas. 

Table 4: Overall Progress Made to Address GAO-Identified Cost-Saving 
and Revenue-Enhancing Areas, as of February 10, 2012: 

Mission: Agriculture; 

Areas identified: 

35. Reducing some farm program payments could result in savings from 
$800 million over 10 years to up to $5 billion annually; 
Assessment: Not addressed. 

Mission: Defense; 

Areas identified: 

36. DOD should assess costs and benefits of overseas military presence 
options before committing to costly personnel realignments and 
construction plans, thereby possibly saving billions of dollars; 
Assessment: Partially addressed. 

37. Total compensation approach is needed to manage significant growth 
in military personnel costs; 
Assessment: Partially addressed. 

38. Employing best management practices could help DOD save money on 
its weapon systems acquisition programs; 
Assessment: Partially addressed. 

39. More efficient management could limit future costs of DOD's spare 
parts inventory; 
Assessment: Partially addressed. 

40. More comprehensive and complete cost data can help DOD improve the 
cost-effectiveness of sustaining weapon systems; 
Assessment: Partially addressed. 

41. Improved corrosion prevention and control practices could help DOD 
avoid billions in unnecessary costs over time; 
Assessment: Partially addressed. 

Mission: Economic development; 

Areas identified: 

42. Revising the essential air service program could improve 
efficiency; 
Assessment: Partially addressed. 

43. Improved design and management of the universal service fund as it 
expands to support broadband could help avoid cost increases for 
consumers; 
Assessment: Partially addressed. 

44. The Corps of Engineers should provide Congress with project-level 
information on unobligated balances; 
Assessment: Partially addressed. 

Mission: Energy; 

Areas identified: 

45. Improved management of federal oil and gas resources could result 
in approximately $1.8 billion over 10 years[A]; 
Assessment: Partially addressed. 

Mission: General government; 

Areas identified: 

46. Efforts to address governmentwide improper payments could result 
in significant cost savings; 
Assessment: Partially addressed. 

47. Promoting competition for the over $500 billion in federal 
contracts could potentially save billions of dollars over time; 
Assessment: Partially addressed. 

48. Applying strategic sourcing best practices throughout the federal 
procurement system could saves billions of dollars annually; 
Assessment: Partially addressed. 

49. Adherence to new guidance on award fee contracts could improve 
agencies' use of award fees to produce savings; 
Assessment: Partially addressed. 

50. Agencies could realize cost savings of at least $3 billion by 
continued disposal of unneeded federal real property; 
Assessment: Partially addressed. 

51. Improved cost analyses used for making federal facility ownership 
and leasing decisions could save tens of millions of dollars; 
Assessment: Partially addressed. 

52. OMB's IT Dashboard reportedly has already resulted in $3 billion 
in savings and can further help identify opportunities to invest more 
efficiently in information technology; : [Empty]. 

53. Increasing electronic filing of individual income tax returns 
could reduce IRS's processing costs and increase revenues by hundreds 
of millions of dollars; 
Assessment: Partially addressed. 

54. Using return on investment information to better target IRS 
enforcement could reduce the tax gap; for example, a 1 percent 
reduction would increase tax revenues by $3.8 billion[B]; 
Assessment: Partially addressed. 

55. Better management of tax debt collection may resolve cases faster 
with lower IRS costs and increase debt collected; 
Assessment: Partially addressed. 

56. Broadening IRS's authority to correct simple tax return errors 
could facilitate correct tax payments and help IRS avoid costly, 
burdensome audits; 
Assessment: Not addressed. 

57. Enhancing mortgage interest information reporting could improve 
tax compliance; 
Assessment: Not addressed. 

58. More information on the types and uses of canceled debt could help 
IRS limit revenue losses of forgiven mortgage debt; 
Assessment: Partially addressed. 

59. Better information and outreach could help increase revenues by 
tens or hundreds of millions of dollars annually by addressing 
overstated real estate tax deductions; 
Assessment: Partially addressed. 

60. Revisions to content and use of Form 1098-T could help IRS enforce 
higher education requirements and increase revenues; 
Assessment: Partially addressed. 

61. Many options could improve the tax compliance of sole proprietors 
and begin to reduce their $68 billion portion of the tax gap; 
Assessment: Not addressed. 

62. IRS could find additional businesses not filing tax returns by 
using third-party data, which show such businesses have billions of 
dollars in sales; 
Assessment: Partially addressed. 

63. Congress and IRS can help S corporations and their shareholders be 
more tax compliant, potentially increasing tax revenues by hundreds of 
millions of dollars each year; 
Assessment: Partially addressed. 

64. IRS needs an agencywide approach for addressing tax evasion among 
the at least 1 million networks of businesses and related entities; 
Assessment: Partially addressed. 

65. Opportunities exist to improve the targeting of the $6 billion 
research tax credit and reduce forgone revenue; 
Assessment: Not addressed. 

66. Converting the new markets tax credit to a grant program may 
increase program efficiency and significantly reduce the $3.8 billion 
5-year revenue cost of the program; 
Assessment: Not addressed. 

67. Limiting the tax-exempt status of certain governmental bonds could 
yield revenue; 
Assessment: Not addressed. 

68. Adjusting civil tax penalties for inflation potentially could 
increase revenues by tens of millions of dollars per year, not 
counting any revenues that may result from maintaining the penalties' 
deterrent effect; 
Assessment: Partially addressed. 

69. IRS may be able to systematically identify nonresident aliens 
reporting unallowed tax deductions or credits; 
Assessment: Addressed. 

70. Tracking undisbursed balances in expired grant accounts could 
facilitate the reallocation of scarce resources or the return of 
funding to the Treasury; 
Assessment: Not addressed. 

Mission: Health; 

Areas identified: 

71. Preventing billions in Medicaid improper payments requires 
sustained attention and action by CMS; 
Assessment: Partially addressed. 

72. Federal oversight over Medicaid supplemental payments needs 
improvement, which could lead to substantial cost savings; 
Assessment: Not addressed. 

73. Better targeting of Medicare's claims review could reduce improper 
payments; 
Assessment: Partially addressed. 

74. Potential savings in Medicare's payment for health care; 
Assessment: Partially addressed. 

Mission: Homeland security/Law enforcement; 

Areas identified: 

75. DHS's management of acquisitions could be strengthened to reduce 
cost overruns and schedule and performance shortfalls; 
Assessment: Partially addressed. 

76. Improvements in managing research and development could help 
reduce inefficiencies and costs for homeland security; 
Assessment: Partially addressed. 

77. Validation of TSA's behavior-based screening program is needed to 
justify funding or expansion; 
Assessment: Partially addressed. 

78. More efficient baggage screening systems could result in about 
$470 million in reduced TSA personnel costs over the next 5 years; 
Assessment: Partially addressed. 

79. Clarifying availability of certain customs fee collections could 
produce a one-time savings of $640 million; 
Assessment: Partially addressed. 

Mission: Income security; 

Areas identified: 

80. Social Security needs data on pensions from noncovered earnings to 
better enforce offsets and ensure benefit fairness, estimated to 
result in $2.4-$2.9 billion savings over 10 years;
Assessment: Not addressed. 

Mission: International affairs; 

Areas identified: 

81. Congress could pursue several options to improve collection of 
antidumping and countervailing duties; 
Assessment: Not addressed. 

Legend: 

Addressed, meaning all actions needed in that area were addressed. 

Partially addressed, meaning at least one action needed in that area 
showed some progress toward implementation, but not all actions were 
addressed. 

Not addressed, meaning none of the actions needed in that area were 
addressed. 

Source: GAO analysis. 

[A] The Department of the Interior, Bureau of Land Management, updated 
the anticipated revenues from $1.75 billion to $1.8 billion in its 
fiscal year 2012 budget justification. 

[B] The net tax gap was updated in 2012 and estimated to be $385 
billion for the 2006 tax year. Thus, a 1 percent reduction would 
increase tax revenues by $3.8 billion. 

[End of table] 

[End of section] 

Footnotes: 

[1] See GAO, 2012 Annual Report: Opportunities to Reduce Duplication, 
Overlap and Fragmentation, Achieve Savings, and Enhance Revenue, 
[hyperlink, http://www.gao.gov/products/GAO-12-342SP] (Washington, 
D.C.: Feb. 28, 2012) and Follow-up on 2011 Report: Status of Actions 
Taken to Reduce Duplication, Overlap, and Fragmentation, Save Tax 
Dollars, and Enhance Revenue, [hyperlink, 
http://www.gao.gov/products/GAO-12-453SP] (Washington, D.C.: Feb. 28, 
2012). 

[2] Ronald C. Moe, Congressional Research Service, The President's 
Reorganization Authority: Review and Analysis (Washington, D.C.: Mar. 
8, 2001). 

[3] The Presidential reorganization authority is codified at chapter 9 
of title 5 of the United States Code. 

[4] See 5 U.S.C. § 101 for a list of all executive departments. 

[5] Reorganization Act Amendments of 1984, Pub. L. No. 98-614, 98 
Stat. 3192 (Nov. 8, 1984). 

[6] As commonly understood, an "agency" can be a component of a 
department or a free-standing entity (for example, the National 
Aeronautics and Space Administration). 

[7] Days are calculated by calendar days of continuous session of 
Congress. 

[8] Immigration and Naturalization Service v. Chadha, 462 U.S. 919 
(1983), holding the one-house legislative veto unconstitutional. 

[9] This 75 day period begins once a resolution of approval has been 
introduced in the House and the Senate. A resolution must be 
introduced the first day of session following submission of a plan. 

[10] Henry B. Hogue, Congressional Research Service, Executive Branch 
Reorganization Initiatives During the 112th Congress: A Brief Overview 
(Washington, D.C.: Feb. 13, 2012). 

[11] In 1995, the President was authorized to prepare and transmit to 
congress a reorganization plan pursuant to this reorganization 
authority for reorganizing the surface transportation activities of 
the Department of Transportation and the relationship of the Saint 
Lawrence Seaway Development Corporation to the Department. Pub. L. No. 
104-50, § 335, 109 Stat. 436 (Nov. 15, 1995). 

[12] Toward a Logical Governing Structure: Restoring Executive 
Reorganization Authority; Hearing Before House Committee on Government 
Reform, 108TH Cong. (2003). Moreover, during consideration of the 
reform of the intelligence community, the House passed version of the 
bill included a reauthorization of the Presidential reorganization 
authority which was limited to reorganization plans involving 
enumerated intelligence units. See, 9/11 Recommendations 
Implementation Act, H.R. 10, 108TH Cong. § 5021 (2003). This provision 
was not enacted. 

[13] The commission's formal name was the Commission on Organization 
of the Executive Branch. Its membership: Former President Herbert 
Hoover, Dean Acheson, Sen. George Aiken, Rep. Clarence Brown, Arthur 
Flemming, James A. Forrestal, Joseph P. Kennedy, Rep. Carter Manasco, 
Sen. John L. McClellan, George Mead, James K. Pollock, and James Rowe. 

[14] Ronald C. Moe, The Hoover Commissions Revisited (Boulder, 
Colorado: Westview Press, 1982), 2. 

[15] Ronald C. Moe, Congressional Research Service, The President's 
Reorganization Authority: Review and Analysis (Washington, D.C.: Mar. 
8, 2001). 

[16] Called PACGO (the President's Advisory Council on Government 
Organization), it was chaired by Nelson Rockefeller from 1953-1958. 
PACGO drafted 14 reorganization plans that were presented to the 
President and accepted by Congress. Ronald C. Moe, Reorganizinq the 
Executive Branch in the Twentieth Century: Landmark Commissions 
(Washington, D.C.: Congressional Research Service, Mar. 19, 1992), 34. 

[17] Moe, 105. 

[18] Summary of the Objectives, Operations, and Results of the 
Commissions on Organization of the Executive Branch of the Government 
(First and Second Hoover Commissions), House Committee on Government 
Operations (Washington, D.C.: May 1963), 31-33. 

[19] GAO, Highlights of a GAO Forum: Mergers and Transformation: 
Lessons Learned for a Department of Homeland Security and Other 
Federal Agencies, [hyperlink, 
http://www.gao.gov/products/GAO-03-293SP] (Washington, D.C.: Nov. 14, 
2002). 

[20] GAO, Results-Oriented Cultures: Implementation Steps to Assist 
Mergers and Organizational Transformations, [hyperlink, 
http://www.gao.gov/products/GAO-03-669] (Washington, D.C. July 2, 
2003) provides additional information on how to implement 
transformational change. 

[21] GAO, 2012 Annual Report: Opportunities to Reduce Duplication, 
Overlap and Fragmentation, Achieve Savings, and Enhance Revenue, 
[hyperlink, http://www.gao.gov/products/GAO-12-342SP] (Washington, 
D.C.: Feb. 28, 2012). 

[22] GAO, Opportunities to Reduce Potential Duplication in Government 
Programs, Save Tax Dollars, and Enhance Revenue, [hyperlink, 
http://www.gao.gov/products/GAO-11-318SP] (Washington, D.C.: Mar. 1, 
2011). 

[23] GAO, Follow-up on 2011 Report: Status of Actions Taken to Reduce 
Duplication, Overlap, and Fragmentation, Save Tax Dollars, and Enhance 
Revenue, [hyperlink, http://www.gao.gov/products/GAO-12-453SP] 
(Washington, D.C.: Feb. 28, 2012). 

[24] GAO, Rural Housing: Options for Optimizing the Federal Role in 
Rural Housing Development, [hyperlink, 
http://www.gao.gov/products/GAO/RCED-00-241] (Washington, D.C.: Sept. 
15, 2000). 

[25] See GAO, Government Performance and Accountability: Tax 
Expenditures Represent a Substantial Federal Commitment and Need to Be 
Reexamined, [hyperlink, http://www.gao.gov/products/GAO-05-690] 
(Washington, D.C.: Sept. 23, 2005) and [hyperlink, 
http://www.gao.gov/products/GAO-11-318SP]. 

[26] According to the National Coalition on Care Coordination, care 
coordination is a client-centered, assessment-based interdisciplinary 
approach to integrating health care and social support services in 
which an individual's needs and preferences are assessed, a 
comprehensive care plan is developed, and services are managed and 
monitored by an identified care coordinator. 

[27] According to the Case Management Society of America, case 
management is defined as a collaborative process of assessment, 
planning, facilitation, and advocacy for options and services to meet 
an individual's health needs through communication and available 
resources to promote quality, cost-effective outcomes. 

[28] The Navy, Air Force, and Marine Corps have all implemented the 
RCP within their existing wounded warrior programs. The Army and the 
U.S. Special Operations Command provide services that meet the 
requirements of the RCP, although they did not specifically implement 
this program. 

[29] GAO, DOD and VA Health Care: Action Needed to Strengthen 
Integration across Care Coordination and Case Management Programs, 
[hyperlink, http://www.gao.gov/products/GAO-12-129T] (Washington, 
D.C.: Oct. 6, 2011). 

[30] GAO, Information Technology: Departments of Defense and Energy 
Need to Address Potentially Duplicative Investments, [hyperlink, 
http://www.gao.gov/products/GAO-12-241] (Washington, D.C.: Feb. 17, 
2012). 

[31] GAO, Homeland Security: DHS Needs Better Project Information and 
Coordination among Four Overlapping Grant Programs, [hyperlink, 
http://www.gao.gov/products/GAO-12-303] (Washington, D.C.: Feb. 28, 
2012). 

[32] Department of Homeland Security Office of Inspector General, 
Efficacy of DHS Grant Programs, OIG-1069 (Washington, D.C.: Mar. 22, 
2010). 

[33] Pub. L. No. 111-358, § 101, 124 Stat. 3982, 3984 (2011). 

[34] GAO, Science, Technology, Engineering, and Mathematics Education: 
Strategic Planning Needed to Better Manage Overlapping Programs across 
Multiple Agencies, [hyperlink, http://www.gao.gov/products/GAO-12-108] 
(Washington, D.C.: Jan. 20, 2012). 

[35] GAO, Global Positioning System: Significant Challenges in 
Sustaining and Upgrading Widely Used Capabilities, [hyperlink, 
http://www.gao.gov/products/GAO-09-325] (Washington, D.C.: Apr. 30, 
2009). 

[36] GAO, Military Training: Additional Actions Needed to Improve 
Planning and Coordination of Army and Marine Corps Language and 
Culture Training, [hyperlink, http://www.gao.gov/products/GAO-11-456] 
(Washington, D.C.: May 26, 2011). 

[37] GAO, Homeland Security: The Federal Protective Service Faces 
Several Challenges That Hamper Its Ability to Protect Federal 
Facilities, [hyperlink, http://www.gao.gov/products/GAO-08-683] 
(Washington, D.C.: June 11, 2008). 

[38] GAO, Federal Protective Service: Actions Needed to Resolve Delays 
and Inadequate Oversight Issues with FPS's Risk Assessment and 
Management Program, [hyperlink, 
http://www.gao.gov/products/GAO-11-705R] (Washington, D.C.: July 15, 
2011). 

[39] GAO, Defense Management: Actions Needed to Improve Management of 
Air Force's Food Transformation Initiative, [hyperlink, 
http://www.gao.gov/products/GAO-11-676] (Washington, D.C.: July 26, 
2011). 

[40] GAO, Information Technology: Better Informed Decision Making 
Needed on Navy's Next Generation Enterprise Network Acquisition, 
[hyperlink, http://www.gao.gov/products/GAO-11-150] (Washington, D.C.: 
Mar. 11, 2011). 

[41] DOD's fiscal year 2012 budget of $52.7 billion for its Unified 
Medical Budget includes $32.5 billion for the Defense Health Program, 
$8.3 billion for military personnel, $1.1 billion for military 
construction, and $10.8 billion for the Medicare Eligible Retiree 
Health Care Fund. The total excludes overseas contingency operations 
funds and other transfers. 

[42] DOD, Quadrennial Defense Review Report, February 2010. 

[43] Defense Health Board, Task Force on the Future of Military Health 
Care (December 2007). 

[44] See GAO, Nuclear Material: DOE Has Several Potential Options for 
Dealing with Depleted Uranium Tails, Each of Which Could Benefit the 
Government, [hyperlink, http://www.gao.gov/products/GAO-08-606R] 
(Washington, D.C.: Mar. 31, 2008); Nuclear Material: Several Potential 
Options for Dealing with DOE's Depleted Uranium Tails Could Benefit 
the Government, [hyperlink, http://www.gao.gov/products/GAO-08-613T] 
(Washington, D.C.: Apr. 3, 2008); and Nuclear Material: DOE's Depleted 
Uranium Tails Could Be a Source of Revenue for the Government, 
[hyperlink, http://www.gao.gov/products/GAO-11-752T] (Washington, 
D.C.: June 13, 2011). 

[45] GAO, Excess Uranium Inventories: Clarifying DOE's Disposition 
Options Could Help Avoid Further Legal Violations, [hyperlink, 
http://www.gao.gov/products/GAO-11-846] (Washington, D.C.: Sept. 26, 
2011). 

[46] GAO, Fraud Detection Systems: Centers for Medicare and Medicaid 
Services Needs to Ensure More Widespread Use, [hyperlink, 
http://www.gao.gov/products/GAO-11-475] (Washington, D.C.: June 30, 
2011). 

[47] GAO, Medicare Advantage: CMS Should Improve the Accuracy of Risk 
Score Adjustments for Diagnostic Coding Practices, [hyperlink, 
http://www.gao.gov/products/GAO-12-51] (Washington, D.C.: Jan. 12, 
2012). 

[48] Pub. L. No. 101-576 (1990). 

[49] GAO, Federal User Fees: Key Aspects of International Air 
Passenger Inspection Fees Should Be Addressed Regardless of Whether 
Fees Are Consolidated, [hyperlink, 
http://www.gao.gov/products/GAO-07-1131] (Washington, D.C.: Sept. 24, 
2007). 

[50] In one instance, the legislative action needed required Congress 
to consider several options, including allowing a tax credit to 
expire. Thus, because Congress did not renew the provision, the action 
was considered addressed. 

[51] In situations where the action we identified as needed suggested 
that Congress should let a provision expire, we classified it as 
"addressed" if Congress permitted such expiration to happen. 

[52] GAO, Opportunities to Reduce Potential Duplication in Government 
Programs, Save Tax Dollars, and Enhance Revenue, [hyperlink, 
http://www.gao.gov/products/GAO-11-318SP] (Washington, D.C.: Mar. 1, 
2011). 

[End of section] 

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