GAO-16-375SP: General government: 20. Federally Leased Vehicles

General government > 20. Federally Leased Vehicles

The General Services Administration and selected agencies could potentially reduce costs by improving the processes for justifying the use of vehicles in the federal fleet and taking actions for any vehicles that may be underutilized.

Why This Area Is Important

In fiscal year 2014, federal agencies paid over $1 billion to lease over 186,000 vehicles from the General Services Administration (GSA) to carry out agencies’ missions. Ranging from busses to compact sedans, these vehicles transport personnel, haul equipment, and ferry clients to agency-provided service locations, among other activities. In recent years, Members of Congress and the President have raised questions about the size and cost of the federal fleet, and legislative proposals have been aimed at reducing its size and cost.

Each federal agency is responsible for managing its own vehicle fleet.  At agency request, GSA leases vehicles to each agency. GSA also provides guidance and advice to agencies on the management of their federal fleet. Additionally, the Federal Property Management Regulations (FPMR) require agencies to ensure that each vehicle within their fleets either meets an agency-wide utilization standard or is individually justified. The FPMR recommend—but do not require—that the annual mileage minimum be 12,000 miles for passenger vehicles and 10,000 miles for light trucks. For both utilization metrics and justification, agencies are allowed to define their own criteria for their vehicle fleets. For its January 2016 report, GAO reviewed the leased vehicle fleets at five agencies:  the Bureau of Indian Affairs (BIA), the National Aeronautics and Space Administration (NASA), the National Park Service (NPS), the U.S. Air Force (Air Force), and the Veterans Health Administration (VHA). BIA and NPS are within the Department of the Interior, and VHA is within the Department of Veterans Affairs. 

What GAO Found

While agencies are allowed to determine their criteria for keeping vehicles in their fleet, GAO found that some federal agencies kept vehicles that did not meet the agency’s utilization criteria and for which the agency could not readily provide a justification, including the following examples. 

  • Air Force officials could not readily provide the justifications for 413 vehicles that did not meet Air Force’s utilization criteria. The agency paid $1.5 million to GSA for these vehicles in fiscal year 2014. Air Force officials told GAO that the justifications for these vehicles are not stored in Air Force’s Fleet Management Information System because these vehicles are used by the Air National Guard, which has its own justification process. However, Air Force is administratively responsible for these vehicles, according to agency officials.
     
  • VHA was unable to locate justifications for 181 vehicles for which it had data indicating that the vehicle had not met VHA’s utilization criteria. VHA paid $0.6 million to GSA for these vehicles in fiscal year 2014. According to VHA officials, justifications are stored with local fleet managers and are not readily accessible to headquarters officials. Agency officials said the justification system was developed to assist local fleet managers and that previously, it was not necessary for headquarters to access these records.  

Agencies are allowed to individually justify vehicles that do not meet the agency’s utilization criteria, but the regulations do not specify how agencies should conduct this justification process or how the justifications should be documented. While the FPMR state that agencies may be required to provide written justification, the regulations do not require agencies to clearly document the justifications before a request to provide such documentation is made. Federal internal control standards state that all transactions and significant events need to be clearly documented and that the documentation should be readily available for examination.[1]Without readily available documentation, the agencies could not determine whether any of these vehicles should be eliminated from agency fleets.

In addition to the vehicles for which agencies could not locate justifications in a timely manner, three agencies kept vehicles that did not pass their justification process. While regulations do not require agencies to take any action for unjustified vehicles, federal internal control standards call for agencies to be accountable for stewardship of government resources.[2] All five selected agencies in GAO’s review have established approaches to address unjustified vehicles, which can include placing them in a shared pool, transferring them to a new mission, rotating them with higher-mileage vehicles, or eliminating them from their fleet. All five agencies took actions to reduce vehicles that did not meet utilization criteria or pass the justification process, but two agencies still cumulatively retained over 500 unjustified vehicles.[3]  

  • NPS retained 109 vehicles that did not meet the agency-defined utilization criteria and did not pass the agency’s justification process. The agency paid GSA $0.4 million for these vehicles in fiscal year 2014.
     
  • VHA retained 393 vehicles that did not meet agency-defined utilization criteria and did not pass the agency’s justification process. The agency paid GSA $1.3 million for these vehicles in fiscal year 2014.  VHA policy does not require justification for all vehicles that do not meet utilization criteria. As a result, these 393 vehicles were never subject to a justification process, even though they did not meet utilization criteria.   

By not taking corrective action to eliminate or reassign vehicles that did not meet utilization criteria or pass a justification review, agencies could be spending federal tax dollars on vehicles that may not be needed.



[1]See GAO, Standards for Internal Control in the Federal Government, GAO/AIMD-00-21.3.1 (Washington, D.C.: November 1999).

[3]A third agency retained one vehicle.

Actions Needed

In its January 2016 report, GAO recommended the following actions:

  • The Secretaries of the Department of Defense and the Department of Veterans Affairs should modify their current processes to ensure that each leased vehicle in the agencies’ fleets meets the agencies’ utilization criteria or has readily available justification documentation. Such action could lead to these agencies identifying unneeded vehicles and reducing costs by eliminating vehicles from their fleets.
     
  • The Secretaries of the Department of the Interior and Veterans Affairs should take corrective action to address each leased vehicle that has not met the agencies’ utilization criteria or passed the justification process. This corrective action could include eliminating unneeded vehicles, which would reduce costs.
     
  • The Administrator of GSA should examine the FPMR to determine if these regulations should be amended to require that vehicle justifications are clearly documented and readily available, and adjust them accordingly. Such action could lead to agencies identifying unneeded vehicles and reducing costs by eliminating vehicles from their fleets.

GAO was not able to quantify the financial benefits of these actions because potential savings would depend on how many vehicles were eliminated from the federal fleet as a result. In fiscal year 2014, selected agencies paid about $8.7 million for leased vehicles that did not meet agency-set utilization criteria and did not have readily available individual justifications. Costs paid may not equal cost savings from eliminating vehicles because agencies may need to spend resources on other means to accomplish the work performed by these vehicles. However, without justifications and corrective actions, agencies could be spending taxpayer dollars on vehicles that may not be needed.

How GAO Conducted Its Work

The information contained in this analysis is based on findings from the product in the related GAO product section. GAO reviewed the leased vehicle fleets at five agencies: Air Force, BIA, NASA, NPS, and VHA.  GAO selected these five agencies to include a mix of (1) fleet sizes, but none smaller than 1,000 vehicles; (2) military and civilian fleets; (3) fleets with varying annual mileage compared to federal miles-traveled guidelines; and (4) agencies’ use of telematics, among other considerations. Telematics is a technology that sends, receives, and stores information related to remote objects, such as vehicles. Agencies that use telematics may have more opportunities to measure utilization than agencies that do not use such technology.

For each agency, GAO analyzed the agencies’ policies and other relevant documentation on their utilization review processes. GAO compared agency processes to standards for internal control in the federal government. GAO also obtained fiscal year 2014 data from GSA for each agency’s leased passenger vehicles and light trucks. GAO excluded certain vehicles, such as those that were leased by more than one agency during fiscal year 2014, emergency responder and law enforcement vehicles, and vehicles outside the continental United States.  GAO determined which vehicles did not meet the miles-traveled guidelines in the FPMR and sent a list of these vehicles to each agency.  GAO asked each agency to identify if the vehicles had justification documentation or had passed a justification review. GAO then analyzed the costs paid to GSA for any unjustified vehicles.

Agency Comments & GAO Contact

GAO provided a draft of its January 2016 report to GSA; the Departments of Defense, Interior and Veterans Affairs; and NASA. GSA and the Departments of Defense, Interior, and Veterans Affairs provided written comments in which they concurred with GAO’s recommendations. These agencies also provided technical comments, which were incorporated as appropriate. NASA provided no comments. GSA stated that it was developing a comprehensive plan to address the recommendations.  Interior stated that NPS and BIA both plan to develop processes to ensure that vehicle justifications are readily available. The Department of Veterans Affairs set a target date of January 2017 to implement both of GAO’s recommendations.

GAO provided a draft of this report section to GSA, the Departments of Defense, Interior, and Veterans Affairs, and to NASA for review and comment. The agencies did not provide comments on this report section.

For additional information about this area, contact Lori Rectanus at (202) 512-2834 or rectanusl@gao.gov.