Federal Aircraft:

Inaccurate Cost Data and Weaknesses in Fleet Management Planning Hamper Cost Effective Operations

GAO-04-645: Published: Jun 18, 2004. Publicly Released: Jul 12, 2004.

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Federal civilian agencies own and operate a fleet of aging aircraft, many of which may soon need to be replaced. Agencies manage their fleets with help from guidance and policies issued by the General Services Administration (GSA) and the Office of Management and Budget (OMB). Numerous audit reports have disclosed that agencies lacked accurate cost data and had acquired aircraft without adequate justification. GAO reviewed (1) the composition and costs of the federal aircraft fleet; (2) the systems and controls agencies use to ensure that they effectively and efficiently acquire and manage their aircraft fleets; and (3) the operations, maintenance, safety standards, and safety records for federal aircraft.

GAO could not accurately determine the number of government-owned aircraft and total costs of federal aircraft program operations, because it found that GSA's database was unreliable. Although the database showed federal agencies owned nearly 1,400 aircraft and that agencies reported spending over $700 million to operate and maintain federally-owned and contracted aircraft in fiscal year 2002, GAO found it understated the cost of federal aircraft operations by at least $568 million over the past 3 years. This is because some agencies did not report all the required information. GAO also found there was no requirement for the agencies to report other aircraft costs such as depreciation. The systems and controls GAO reviewed provide limited assurance that agencies are cost effectively acquiring and managing their aircraft fleets. All seven aircraft programs GAO examined failed to implement some key principles of fleet management planning, as outlined in GSA, OMB, and other federal guidance. GAO found that programs did not consistently prepare long-term fleet management plans to identify fleet requirements and aircraft that best meet those requirements. GAO also found that these programs rarely prepared OMB Circular A-76 studies to assess whether the private sector could provide aviation services at a lower cost, and often did not perform cost benefit analyses before acquiring aircraft. Finally, GAO found that programs did not use a full range of aviation metrics to measure and assess the effectiveness of their aircraft operations and rarely prepared OMB Circular A-126 studies to periodically assess the continuing need for their aircraft operations. GAO also found that OMB provides limited oversight over compliance with Circulars A-76 and A-126, leaving it up to each program to determine whether to complete the reviews. Although exempt from many federal safety requirements, federal aircraft programs GAO reviewed developed their own operations, maintenance, and safety standards to help ensure safe operations. However, the use of oversight to evaluate the safety of the programs and help identify potential issues before they become safety problems varied greatly. Two programs that GAO visited subjected themselves to reviews by Federal Aviation Administration inspectors and two others utilized GSA-sponsored safety teams to review their operations. Historically, these GSA-sponsored reviews have found that similar safety issues existed at several programs. These issues included having an insufficient number of instructors to conduct aviation training, lack of a formal general maintenance manual, lack of trained personnel to accomplish assigned missions, and flight crews not thoroughly planning flights. The remaining three programs relied on internal reviews of their operations. GAO also identified 183 accidents and incidents occurring in federally owned or contracted aircraft over the past 9 years that resulted in 91 fatalities. GAO found that most of these were caused by human factors such as pilot error and occurred in contracted aircraft.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: On November 17, 2006, GSA stated that it was in the process of releasing new guidance to federal agencies on how to oversee their aircraft operations. On, January 15, 2008, the GSA web site indicated that the "Gold Standard" program had been unveiled as guidance to help federal agencies improve and maintain the safety of the federal aircraft fleets.

    Recommendation: Given the wide variety of oversight provided these programs and the important role oversight can play in helping enhance safety, the Administrator of GSA should direct the Interagency Committee on Aviation Policy to examine the oversight being provided to federal aircraft programs and provide additional guidance, as necessary, on areas where enhanced oversight could improve the safety of federal aircraft operations.

    Agency Affected: General Services Administration

  2. Status: Closed - Implemented

    Comments: Based on GAO's recommendation, GSA is looking into a "gold standard" program for federal aircraft operators based on a similar program in the civil aviation sector.

    Recommendation: In order to ensure that federal aircraft programs have the capability to make sound fleet management decisions, the Administrator of GSA should direct the Interagency Committee on Aviation Policy to work with its members to develop a model fleet management planning process. At a minimum, this process should include guidance to help agencies strategically assess long-term fleet requirements, acquire the most cost-effective aircraft to meet those requirements, and continually assess fleet performance.

    Agency Affected: General Services Administration

  3. Status: Closed - Implemented

    Comments: In response to GAO's recommendation, GSA has implemented a specially designed computer program to test data "triggers," which ensure data integrity. It also is now performing manual checks to ensure that controls governing authority for users' access and data entry are working properly.

    Recommendation: In order to improve the completeness and accuracy of the FAIRS database so that it captures all aircraft program costs and is useful for conducting detailed analyses of the condition and performance of the federal aircraft fleet, the Administrator of GSA should conduct periodic testing of the FAIRS database to ensure that existing systems controls are working as designed and work with ICAP to identify, develop, and implement additional controls as necessary.

    Agency Affected: General Services Administration

  4. Status: Closed - Implemented

    Comments: GSA has agreed to look for options for reporting additional information on the costs involved in acquiring and keeping aircraft over time and will institute new mandatory reporting requirements or find other methods for obtaining the data.

    Recommendation: In order to improve the completeness and accuracy of the FAIRS database so that it captures all aircraft program costs and is useful for conducting detailed analyses of the condition and performance of the federal aircraft fleet, the Administrator of GSA should expand existing FAIRS guidance to require that programs report additional aviation costs associated with acquiring aircraft, not currently required, which would provide more complete and accurate data on the composition and cost of the federal aircraft fleet and, thus, enhance GSA's annual report on federal aircraft operations. At a minimum, agencies should be required to report acquisition, financing, and self-insurance costs.

    Agency Affected: General Services Administration

  5. Status: Closed - Implemented

    Comments: During fiscal year 2004, GSA revised reporting requirements and changed FAIRS to make it mandatory for agencies to report operating costs for crew, fuel, maintenance, and overhead. GSA also agreed to continue to encourage agencies to reinforce existing policy and revise reporting rules as necessary to support compliance with reporting requirements.

    Recommendation: In order to improve the completeness and accuracy of the Federal Aviation Interactive Reporting System (FAIRS) database so that it captures all aircraft program costs and is useful for conducting detailed analyses of the condition and performance of the federal aircraft fleet, the Administrator of GSA should clarify existing FAIRS guidance to agencies to identify those cost elements that all aircraft programs should report to the FAIRS system, make the reporting of those elements mandatory, and develop a mechanism to ensure that agencies comply with reporting requirements.

    Agency Affected: General Services Administration

  6. Status: Closed - Not Implemented

    Comments: In its oral comments on a draft of this report, OMB agreed with the recommendation. OMB has not indicated how it will respond to the report's recommendation. However, as of January 2008, no modifications have been made to Circulars A-76 or A-126, so we are closing the recommendations as not implemented. Also, OMB did not respond to numerous attempts to contact them about this recommendation.

    Recommendation: In order to help ensure that federal aircraft programs are being managed in the most cost effective manner, the Director, OMB should review current guidance relating to the acquisition and management of federal aircraft, including those associated with OMB Circulars A-76 and A-126, and develop additional guidance, as necessary, for agencies and OMB to achieve greater consistency in the management of federal aircraft programs.

    Agency Affected: Executive Office of the President: Office of Management and Budget


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