Summary
The 2010 Census will be the most expensive census in our nation's history, even after adjusting for inflation. The Census Bureau (Bureau) estimates that the life cycle cost of the 2010 Census will be from $13.7 billion to $14.5 billion. GAO was asked to (1) assess the extent to which the Bureau's 2010 Census life cycle cost estimate adheres to characteristics defined for high-quality cost estimation, (2) report on the relationship between the estimate and the Bureau's budget, and (3) assess whether the Bureau's existing policies and resources are sufficient to conduct cost estimation. To assess the reliability of the Bureau's cost estimate, GAO analyzed the Bureau's methods and approaches to determine if the estimate is well-documented, comprehensive, accurate, and credible.
The Bureau's 2010 Census life cycle cost estimate is not reliable because it lacks adequate documentation and is not comprehensive, accurate, or credible. The Bureau could not provide detailed documentation on data sources, significant assumptions, or changes in assumptions for the cost estimate. The cost estimate is not comprehensive because the Bureau did not include the potential cost to fingerprint temporary workers or clearly define some of the cost elements in the model. The cost estimate is not accurate because it does not reflect updated information on address canvassing productivity that was identified during the dress rehearsal and that should result in a significant cost increase. Further, the Bureau does not maintain historical data in a centralized way that is easily accessible for analysis. The cost estimate is not credible because the Bureau did not perform sensitivity or uncertainty analyses, which would have helped quantify the risk and uncertainty associated with the cost model and provided a level of confidence for the estimate. The Bureau also did not validate the estimate with an independent cost estimate. The Bureau uses the life cycle cost estimate as the starting point for annual budget formulation and revises the life cycle cost estimate based on appropriations received and updated budget information. However, the Bureau does not update the cost estimate to reflect actual costs. Further, because the life cycle cost estimate is not reliable, annual budget requests based on that estimate are not fully informed. The Bureau has insufficient policies and procedures and inadequately trained staff for conducting high-quality cost estimation for the decennial census. The Bureau does not have established cost estimation guidance and procedures in place or staff certified in cost estimation techniques. While the Bureau is developing a new budget management tool called the Decennial Budget Integration Tool, which will support the cost estimation process, the Bureau will need to establish rigorous cost estimation policies and procedures and use skilled estimators to ensure that future cost estimates are reliable and of high quality. On April 3, 2008, the Secretary of Commerce announced a redesign of the 2010 Census plan that included significant cost increases of $2.2 billion to $3 billion. The details of this cost increase were not available at the time of this review; however, until the Bureau makes fundamental changes to its cost estimation process, uncertainties about the ultimate cost of the 2010 Census will remain. Without improvements to the cost estimation process, the Bureau's ability to effectively manage operations will be hampered and Congress's ability to oversee the 2010 Census will be constrained.
Recommendations
Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.
Director:
Team:
Phone:
Robert N. Goldenkoff
Government Accountability Office: Strategic Issues
(202) 512-6794
Recommendations for Executive Action
Recommendation: To improve the Bureau's life cycle cost estimates for the decennial census, improve the quality and transparency of the Bureau's 2010 Census life cycle cost estimate, assist the Bureau in managing costs during design revisions resulting from problems with the handheld computers, and help establish a sound basis for the 2020 Census cost estimate, the Secretary of Commerce should direct the U.S. Census Bureau to thoroughly document the 2010 Census life cycle cost estimate. Specifically, documentation should be maintained in a centralized standard format and specify all data sources, assumptions, calculation methods, and cost elements used to prepare the 2010 cost estimate.
Agency Affected: Department of Commerce
Status: Open
Comments: The Census Bureau (Bureau) plans to prepare detailed documentation of the basis of its FY 2010 budget request for the 2010 Census, including assumptions, sources of data, methods of calculation and detailed estimates at the project level for all operations, systems, and contracts. According to the Bureau, it will maintain this "baselined" information in a standardized format, which it will use for all future year budget formulation efforts and which will be available for analysis in planning the 2020 Census. (The Bureau stated that it plans to transition to the Decennial Budget Integration Tool (DBiT) system to store information on assumptions, data sources, and changes over time.) The Bureau does not plan to prepare detailed documentation of assumptions, data sources, etc... for prior years in the current 2010 Census cycle (2002-2009). According to the Bureau, it is not possible for the Bureau to do this, and funding levels for those years were tied mostly to the planning and research agenda for the 2010 Census. However, the Bureau does plan to document costs of major activities for prior years. According to the Bureau, cost estimates for early years of the 2020 Census life cycle cost estimate (LCCE) will be driven more by the early planning agenda and objectives.
Recommendation: To improve the Bureau's life cycle cost estimates for the decennial census, and ensure that the life cycle cost estimate reflects current information, the Secretary of Commerce should direct the U.S. Census Bureau to update assumptions as appropriate, including updating productivity assumptions to reflect results from the address canvassing dress rehearsal. The Bureau should also document the basis for prior and future changes made to assumptions used in the life cycle cost estimate.
Agency Affected: Department of Commerce
Status: Open
Comments: The Census Bureau stated that it revised assumptions (including estimates of productivity)in its FY 2009 amended budget request for the 2010 Address Canvassing operation, based on results from the Dress Rehearsal Address Canvassing. According to the Bureau, future changes to assumptions will be reflected in budget submission and documentation. For 2020, the Bureau stated that it plans to use a change control process to manage all future changes to assumptions in the cost estimates. Further, the Bureau stated that it will conduct operational assessments for major 2010 operations, including documenting actual costs relative to modeled costs. For example, the Bureau plans to report actual productivity rates and use those actual rates as the basis for planning 2020 life cycle costs. The Bureau also plans to update assumptions for prior years in this decade's budget life cycle by 2012, in time to deliver a 2020 life cycle estimate based on actual costs incurred in the 2010 Census.
Recommendation: To improve the Bureau's life cycle cost estimates for the decennial census, and keep the life cycle cost estimate current and to document lessons learned for cost elements whose actual costs differ from the estimate, the Secretary of Commerce should direct the U.S. Census Bureau to update the estimate to reflect actual costs.
Agency Affected: Department of Commerce
Status: Open
Comments: The Census Bureau plans to capture actual costs for all Census operations through a combination of its 2010 Census Cost and Progress System (which collects production data during major 2010 Census operations) and the Commerce Business System (which provides the official cost record for each project). According to the Bureau, it plans to incorporate actual costs into the Decennial Budget Integration Tool (DBiT) system in time to form the basis of the initial life cycle cost estimates for the 2020 Census cycle and subsequently revised estimates.
Recommendation: To improve the Bureau's life cycle cost estimates for the decennial census, and to improve the quality of and provide a confidence level for the 2010 Census life cycle cost estimate, the Secretary of Commerce should direct the U.S. Census Bureau to perform sensitivity and uncertainty analyses on the estimate.
Agency Affected: Department of Commerce
Status: Open
Comments: According to the Bureau, it plans to purchase commercial software that will be able to perform sensitivity and uncertainty analyeses using data from the Decennial Budget Integration Tool (DBiT) system. The Bureau plans to consult with GAO and its DBiT contractor to develop and implement a plan to conduct sensitivity and uncertainty analysis on key budget assumptions. The Bureau stated that, given current levels of knowledge and staffing and available tools, it did not think it would be possible to complete sensitivity and uncertainty analyses by April 2009 in order to support the FY 2010 appropriation cycle. The Bureau plans to test the utility of conducting these analyses as a standard practice in its cost estimation approach. The Bureau stated that it intends to apply sensitivity and uncertainty analyses in the 2020 budget process.
Recommendation: To improve the Bureau's life cycle cost estimates for the decennial census, and to help ensure that the Bureau produces a reliable, high-quality life cycle cost estimate for the 2020 decennial census, the Secretary of COmmerce should direct the U.S. Census Bureau to establish guidance, policies, and procedures for conducting cost estimation that would meet best practices criteria and ensure that it has staff resources qualified in cost estimation.
Agency Affected: Department of Commerce
Status: Open
Comments: The Census Bureau stated that it plans to update its current budget guidance, policies and procedures for estimating costs of major cyclical programs like the census in light of best practices described in GAO's Cost Guide by June 30, 2009. It also plans to conduct a skills gap analysis by January 31, 2009 and complete training plans by April 30, 2009. We have requested the Bureau's skill gap analysis but have not received it yet.
